Dual-fuel gensets come up on almost every behind-the-meter mining project, usually framed as insurance. Run on wellhead gas, fall back to diesel if the gas stops. It is a reasonable instinct, and it is worth understanding what the capability actually buys before paying for it.

What dual fuel means, and what it does not

The term covers two quite different things, and proposals do not always distinguish them.

A bi-fuel engine is fundamentally a diesel engine that substitutes gas for part of its fuel while running. It still needs diesel to ignite the charge, because the gas is compression-ignited by the diesel pilot rather than by a spark. Substitution rates vary with load and gas quality, and the engine cannot run on gas alone.

A dual-fuel installation in the looser sense is often two separate capabilities: a spark-ignited gas engine for normal running and a diesel unit for backup. These are two machines, not one, and the economics are completely different.

Asking a supplier which of these they are quoting is the first useful question, because the capital cost, the fuel logistics and the failure behaviour all diverge from that point.

The case for it on a wellhead site

Gas supply is not perfectly reliable. Wells are shut in for workovers. Compression goes down. Freeze-offs happen in cold climates, and gathering systems have their own outages. Every hour the fuel is unavailable is an hour the site earns nothing.

A fallback means those hours are not total losses. On a site with a meaningful hosting contract or a fleet that is expensive to idle, that can justify the cost on its own.

There is also a commissioning argument. A site that can run on diesel can be energised, tested and loaded before the gas infrastructure is finished, which pulls revenue forward and decouples two schedules that otherwise have to land together.

The case against, which is usually stronger than people expect

Diesel is expensive relative to stranded wellhead gas, and the gap is the entire premise of behind-the-meter mining. Running a mining load on diesel is frequently loss-making at any realistic hashprice. The fallback keeps the machines warm; it does not keep them profitable.

That changes the question. If diesel running is uneconomic, the fallback is not a revenue protection measure, it is an asset protection measure, and it should be sized and priced as one. You may only want enough capability to keep critical systems and controls alive, not the whole fleet.

Then there is the fuel logistics. Diesel on a remote pad means tanks, bunding, deliveries, fuel polishing and a tank that can be stolen from. Diesel also degrades in storage, so a tank kept for emergencies needs managing or it becomes an emergency of its own.

Finally, the engines themselves. A bi-fuel conversion adds complexity to a machine that already has a maintenance burden, and it changes the emissions picture, which may matter depending on where the site sits.

Where dual fuel genuinely earns its place

• Contracted hosting with uptime obligations. If a contract carries penalties, the cost of the fallback is measured against those penalties rather than against hashprice.
• Cold climates with freeze-off risk. Where gas interruption is seasonal and predictable, the exposure is quantifiable and the case is easier to make.
• Early-phase sites. Where gas infrastructure is being built, the ability to start on diesel and transition later has real schedule value.
• Critical load only. Keeping controls, monitoring, heat tracing and safety systems alive during an outage is cheap and sensible, and is a different proposition from running the whole fleet.

Questions to settle before ordering

• Is this bi-fuel on one engine, or two separate machines? What exactly is being quoted?
• If bi-fuel, what substitution rate is realistic at this site’s gas quality and load profile, not in the brochure?
• Is the fallback sized for the full fleet, or for critical load only, and which did the economics assume?
• What does diesel running cost per hour here, and at what hashprice does it stop making sense?
• Who manages fuel storage, deliveries and degradation over a multi-year term?
• Does the fallback start automatically, and has that transfer been tested under load rather than just energised?

The practical read

Dual fuel is not a default. On a site with reliable gas, no uptime penalties and a fleet that tolerates downtime, it is capital spent on a scenario that may never arrive. On a site with contractual exposure or seasonal supply risk, it can be the difference between an outage and a breach.

The decision turns on what an hour of downtime actually costs you, which is a number worth calculating before anyone quotes equipment. If that number is small, so is the case.

Rax Mining specifies fuel arrangements for natural gas modular data units against the site’s real supply profile rather than a default. If you are weighing a fallback and want the economics set out before equipment is ordered, talk to us.