The dispute between Hut 8 Mining (TSX: HUT), and its power provider at its North Bay, Ontario bitcoin mining facility has evidently reached an impasse. The firm this morning indicated that it has filed a Statement of Claim in the Superior Court of Justice of Ontario.
The claim has been filed against Validus Power Corp, and its related subsidiary, Bay Power Corp, whom was a third-party supplier of energy to the firms facility. A dispute with Validus has been ongoing since early November, when the company first revealed it had issued a notice of default.
The default notice was reportedly for Validus failing to hit certain operational milestones, while at the same time Hut 8 claimed that they were being charged for power at higher than agreed to rates. Later that month, Validus suspended providing power to the facility entirely, while delivering its own notice of default for Hut 8’s failure to pay outstanding invoices – which Hut 8 denied, despite previously revealing its dispute on pricing.
The two firms, whom initially began working together in late 2021, initially agreed on Validus providing up to 100MW of power to the facility, with 35MW of that capacity to come online by the end of Q4 2021. At the time of production halting, Hut 8 had installed a total of 0.84 EH/s of bitcoin mining capacity, with over 8,800 AISC miners installed. Before operations halted, it accounted for 27.4% of the firms total production capacity for Bitcoin.
In announcing the court filing this morning, Hut 8 stated that the statement of claim was related to Validus’ “failure to meet its contract obligations in the power purchase agreement.” Relief sought reportedly includes enforcement of certain provisions of that agreement, and related monetary damages.
Hut 8 has previously indicated that it is looking to source an alternate energy provider for the facility, although it does not yet appear that it has managed to source a new provider.
Hut 8 Mining last traded at $2.50 on the TSX.
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As the founder of The Deep Dive, Jay is focused on all aspects of the firm. This includes operations, as well as acting as the primary writer for The Deep Dive’s stock analysis. In addition to The Deep Dive, Jay performs freelance writing for a number of firms and has been published on Stockhouse.com and CannaInvestor Magazine among others.