Shares in Renergen, the JSE-listed liquified natural gas production company, rose by 8.22% on the JSE on Friday, after the company said it was restarting its plant following the completion of scheduled maintenance procedures.
Renergen owns South Africa’s first onshore helium and liquid natural gas (LNG) production facility in Virginia in the Free State.
The company’s stock soared 8.22% by the close of Friday’s trade session to R10.80 per share, reversing its 14.29% and 31.21% monthly and year to date slump, respectively, on the JSE.
Earlier in the day, the company advised that “annual maintenance of the entire plant and the notified Eskom maintenance is now complete with the power now fully restored” to the facility. This had enabled the resumption of LNG production.
“The plant was started earlier this week, and we resumed LNG production as of 19 September,” it said.
Renergen was now starting its helium module, with processes set on bringing down its temperatures in order to recommence filling.
“The scheduled maintenance was completed within our scheduled timelines, and undertaken for the first time managed and supervised completely by our own engineering, operations and maintenance departments since having taken control of the process plant,” said Renergen CEO, Stefano Marani.
The company was now looking forward to “continued improvement and stability in the system” following resumption of production.
“We look forward to filling and delivering containers for customers again,” added Marani.
Renergen has been a favoured stock among many retail investors, but the company has also faced criticism from some, who railed against delays in reaching production and questioned whether the company was ever going to be financially viable.
On July 26, a helium specialist from the US had been on site with the project, providing guidance about plant performance optimisation, fine-tuning, production operation and control methodologies.
“His experience with several cryogenic helium plants has helped our team greatly shorten what is typically accepted as an iterative process to optimal performance. We intend to extend his service beyond this phase into ongoing support, and will also encompass LHe elements of our Phase 2 project,” the group said in a statement.
“Despite the challenges encountered in reaching this milestone, we are thrilled to have achieved this significant development and to commence LHe sales to our customers. Our team has unequivocally demonstrated its capability to manage and operate this facility effectively in the face of challenges and under extreme pressure,” Marani said previously.
Earlier this year, Renergen announced an investment boost from Italian firm Airsol, a wholly-owned subsidiary of SOL.
The SOL group has a significant presence in the industrial gases market, including helium, across the world. SOL had now subscribed for the remaining tranche of convertible debentures, bringing SOL’s total investment in Renergen to a value of $7 million (R131m).
The Italian firm had originally subscribed for convertible debentures in Renergen for an amount of $3m.
BUSINESS REPORT