SA’s gas sector is set for a seismic shift after the Pretoria high court ruled the Gas Act does not apply to any production and incidental activities related to upstream petroleum activities — effectively placing helium and other natural gas outside the reach of the industry regulator.
The judgment includes the requirement for licensing of trading, construction and operation of liquefaction facilities outside the piped-gas industry.
Instead, the court said these activities are regulated by the Mineral & Petroleum Resources Development Act of 2002.
That means companies in the sector operating outside the national pipeline grid do not need licences from the National Energy Regulator of SA (Nersa).
The matter was brought to court by Tetra4, a subsidiary of liquefied helium and liquefied natural gas (LNG) producer Renergen, which welcomed the decision.
“The judgment is a win for Tetra4 and a positive development for the broader upstream gas sector in SA,” said CEO Stefano Marani. “It provides long-needed clarity on the legislative framework, affirming that upstream gas production and associated infrastructure like liquefaction plants are not subject to Nersa’s licensing regime when activities are conducted outside the piped gas industry.
“This outcome reduces regulatory duplication, lowers barriers to entry, and sets a clearer path for future development and investment in the sector,” Marani added.
In March Tetra4 made the long-awaited first commercial sales of liquid helium from its Virginia gas project, sending Renergen shares soaring.
Helium has became a sought-after commodity. A 2024 report by market research firm IDTechEx indicates global demand is expected to almost double in 10 years.
Though criticised by environmental activists, LNG is an important energy source in the global transition away from coal.
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