Company behind data centre collapses
THE future of a controversial data centre near Clyde is uncertain following the collapse of the United Kingdombased company behind the project, Lake Parime Ltd, due to a ‘‘crypto winter’’.
Contact Energy did not answer questioning by the Otago Daily
yesterday on whether it would partner cryptocurrency companies in future, but said all local contractors had been paid.
The data centre at the foot of the Clyde Dam was to have been operated by Lake Parime under a lease agreement with Contact Energy.
The 0.65ha site at 46 Fruitgrowers Rd, Earnscleugh, was due to open soon, having overshot the endofyear estimate for completion given by Contact Energy last September.
The agreement signed with Lake Parime was for Contact to supply 10MW of renewable electricity to operate the planned lowemissions data centre.
That roughly equates to the power used by 10,000 homes.
Among the infrastructure already in place at the site are eight containers that had been set to hold 368 servers each.
Lake Parime went into liquidation on Tuesday, following the appointment of Interpath Advisory’s Ed Boyle and Will Wright as joint administrators last Friday.
Lake Parime had previously said it worked with renewable energy operators to provide sustainable computing infrastructure for things such as machine learning, modelling, data visualisations, blockchain and cryptocurrency mining.
An Interpath Advisory statement said Lake Parime operated in the cryptocurrency sector, facilitating Bitcoin mining.
Mr Boyle said the price of Bitcoin fell by more than 60% over the course of 2022, which impacted Lake Parime’s ability to raise finance.
‘‘The current ‘crypto winter’ has posed challenges for many companies operating across the crypto spectrum,’’ he said.
Following their appointment, the administrators sold the business and its assets to Statar Mining Ltd, a move which was described as enabling the business to continue to trade.
A Contact Energy spokeswoman said the company had sent a termination of contract notice to the administrators of Lake Parime.
‘‘No local contractor will be out of pocket because Lake Parime Ltd has collapsed. All local contractors have been paid,’’ the spokeswoman said.
University of Otago bachelor of entrepreneurship director Dr John Williams said the collapse showed the risk in partnering with blockchain currency businesses.
Although he owned some crypto currency, it held ‘‘almost zero value’’ for mainstream businesses, a situation he did not believe was likely to change.