Renergen, an emerging natural gas and helium producer, has contracted with three companies to complete the feasibility studies for the second phase of its Virginia gas project.
The contracts relate to engineering studies and will culminate in the completion of the feasibility studies for the gas project’s phase 2 development.
Renergen said these are expected to be completed in or by the second quarter of the year, after which a financial investment decision is expected to be taken by the board.
The Virginia gas project contains one of the richest helium concentrations recorded globally, with readings of up to 12%.
The project is located at the Tetra4 site in the Free State and is the only holder of a valid onshore oil and gas production licence in SA.
Phase 1 of production is expected to come into operation later in 2021, with initial volumes of about 350kg of helium and 2,500GJ of liquefied natural gas (LNG) per day.
Phase 2 would see significantly larger quantities of LNG and liquid helium production. The LNG would be used in the domestic market and the helium would be exported to the international market.
The three contracted companies are multinational oilfield services company Saipem; global engineering, procurement and construction company EPCM Holdings; and independent energy consulting and advisory firm Sproule.
“This is a significant step forward in the planning of phase 2, as it not only defines the total capital expenditure required but will clearly help define the project’s financial parameters,” said Renergen CEO Stefano Marani.
“Working with organisations such as Saipem, EPCM and Sproule brings a wealth of knowledge, experience and technical capability to the overall project, which we believe will be of great benefit to our stakeholders and the long-term value of the Virginia gas project.”
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