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AfrOil INVESTMENT AfrOil
CEF completes due diligence on purchase of stake in Renergen’s Virginia gas project
SOUTH AFRICA
SOUTH Africa’s state-owned Central Energy Fund (CEF) has completed due diligence on its ZAR1bn ($61.5mn) plan to acquire a stake in emerging integrated energy producer Ren- ergen’s Virginia gas project, Mining Weekly reports.
In a SENS statement issued on August 10, Renergen said that CEF intended to buy 10% of equity in the Virginia gas project, which targets several onshore natural gas fields in Free State.
This follows JSE-listed Renergen’s recent announcement that the project, which will pro- vide feedstock for a plant that will produce both liquid helium and LNG, was in its final commis- sioning phase.
In the SENS statement, Renergen’s CEO Ste- fano Marani said CEF’s successful conclusion of due diligence “signifies the strategic nature of the Virginia gas project and further marks another significant step forward in closing out the capital required for Phase 2 operations at Virginia.”
Commenting on CEF’s involvement in the project, Marani added that the fund would bring “a wealth of experience in upstream oil and gas exploration, midstream natural gas to liquids processing and large-scale pipeline operations and maintenance experience.”
According to Marani, the deal will also help make a new and critical source of energy avail- able at a time when South Africa is suffering a significant energy crisis.
Acknowledging that the project had expe- rienced delays as a result of the coronavirus (COVID-19) pandemic, Marani said Rener- gen had no intention of rushing the process and introducing additional risks at this stage. He also stated that the company’s plant in Free
State would produce its first liquid helium “in due course,” facilitating Renergen’s move from being a developer to a producer.
Renergen is developing the Welkom, Vir- ginia and Theunissen fields in Free State. It was using gas from these fields to produce CNG but will be shifting to LNG with the commission- ing of the first phase of its gas liquefaction plant. The company will deliver some Phase One LNG production to industrial consumers and some to a local subsidiary of TotalEnergies (France) for use as long-haul trucking fuel.
The LNG plant is then slated to bring its sec- ond stage on stream in early 2025. Phase Two will include a helium unit, as the Victoria fields contain unusually high volumes of helium. Sproule, an international energy consulting firm, estimates that these sites may hold as much as 9.74bn cubic metres (bcm) of helium, or more than the entire total proven reserves of North America. ™
Renergen is developing three onshore gas fields in Free State (Image: Edison Group)
PERFORMANCE
NESG: Nigerian economy suffering from Abuja’s failure to benefit from high oil price
NIGERIA THE Nigeria Economic Summit Group (NESG), a Lagos-based think tank and pol- icy advocacy organisation, said in a statement issued on August 10 that the country’s economy is suffering because the government has failed
to take full advantage of an upswing in crude oil prices.
In the statement, NESG attributed Abuja’s shortcomings on this front to oil theft, pipeline vandalism and sagging production.
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