US-based cryptocurrency company BitNile Holdings has launched a subsidiary called Ault Energy to pursue oil and gas asset acquisitions.
Ault Energy will be a subsidiary of BitNile’s existing subsidiary Ault Alliance.
BitNile recently acquired $12m of the Series A convertible redeemable preferred stock of US-based diversified firm Ecoark Holdings.
A deal related to the acquisition had been signed between BitNile’s wholly owned subsidiary, Digital Power Lending (DPL), and Ecoark.
The deal gives Ault Energy, as DPL’s designee, the right to purchase up to 25% in drilling projects owned by White River Holdings, a wholly owned subsidiary of Ecoark.
Ault Energy and White River initially plan to undertake drilling activity for at least 100 wells over the next 60 months.
These wells are located on around 30,000 acres in Texas, Louisiana and Mississippi, which White River is currently leasing.
BitNile founder and executive chairman Milton ‘Todd’ Ault III said: “The formation of Ault Energy is the result of a long-term goal to partner with an experienced, competent team to extract oil in a location known for large oil reserves.
“We have confidence in the team at Ecoark and White River and believe this is a great opportunity to allocate capital towards oil and gas projects.”
White River currently owns a drilling rig, as well as three workover rigs for re-entry and completion procedures.
Ault Energy and White River plan to purchase up to two more drilling rigs this year to allow concurrent drilling projects, but there is no guarantee that these plans will materialise this year.
Ecoark chairman and CEO Randy May said: “The opportunity to partner with Ault Energy will allow White River to greatly scale its vertically integrated oil and gas exploration, production and drilling operations.
“We are looking forward to aggressively drilling out our leasehold over the coming months and years with Ault Energy.”