Dual-listed resource explorer Renergen has discovered helium at its Evander field in Mpumalanga, where it holds natural exploration rights. This is the latest discovery by the group after its wildcat well, called P007 in Virginia in the Free State, found a powerful gas resource.
The well was drilled to inform the group about possible resources for phase two of its Virginia Gas Project in the Free State, SA’s only onshore petroleum development and which contains one of the richest helium concentrations recorded globally.
Helium, which is in high global demand, is important for the medical industry and is used for cooling in magnetic resonance imaging (MRI) machines. It is also needed for the manufacture of fibreoptic cables, cooling during the production of nuclear power and the propulsion of rockets into space. It is a key input for the defence industry and for balloons. It is also used as a cooling medium in a variety of industries, including detecting leaks in car air conditioning systems.
Renergen in April announced that it had signed its first direct helium supply deal with Austria-based airbags company ISI Automotive.
Evander is about 120km from the main industrial hub of Johannesburg and close to the main gas pipeline.
“Evander is a very interesting prospect, with the discovery solidifying our intent to attempt to convert these exploration rights into a production right,” CEO Stefano Marani said in a statement.
“Importantly and a major advantage for Renergen is having an onshore energy asset so close to Johannesburg, as it opens up some very interesting opportunities,” said Marani.
The company also announced that the pipeline for the Virginia gas project has now been performance tested and fared better than expected, with almost 7% increase in flow relative to the original design characteristics, along with more than 30% reduction in power consumption from what had originally been estimated.
The share price rose 1.89% to close at R20.65 valuing Renergen at R2.4bn.
Renergen was thrust into the spotlight in recent months when it developed a device known as cryo-vacc which will simplify the logistics of moving Covid-19 vaccines at temperatures of between -70°C and -150°C for periods of up to 30 days without a need for any power supply.
In 2020 it reached a deal with Total SA to jointly market and distribute liquefied natural gas (LNG) through Total SA filling stations.
The customer base for the LNG will predominantly be logistics companies operating trucks along the main routes across SA, with a portion of the initial production already allocated to customers.
The LNG displaces diesel usage, reducing operating costs and helping customers meet their sustainability targets due to the significantly lower greenhouse gas emissions from natural gas.
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