Renergen plans Nasdaq listing in next growth phase

Renergen, which is in early stages of commercialising its liquefied natural gas (LNG) and helium resources, plans to list on the Nasdaq exchange later this year to raise additional funding for the second phase of its Virginia Gas Project.

A week ago, the company announced the production of its first liquid helium as part of the first phase, placing SA on the map as one of just eight countries that produces the resource.

The helium, contained in the natural gas, is used in producing semiconductors, an essential element of cars, computers, medical devices, cellphones and other technology.

Renergen also became the first SA company to produce LNG in September last year. Commercial deliveries commenced in December.

Phase one of the Virgina project is essentially a pilot plant for the second.

Renergen, which is already listed on the Australian Stock Exchange and the JSE, said in a statement on Tuesday that it is preparing a circular for shareholders seeking approval to issue additional shares for cash.

The date of the potential listing is yet to be determined, as well as the number of ordinary shares to be issued and the listing price.

Headed by CEO Stefano Marani, the company regards the next growth phase as the potential game changer as it looks to produce large quantities of LNG and liquid helium.

Renergen has said that the global helium market remains constrained by limited output and increasing demand from magnetic resonance imaging (MRI) as well as rocketry.

Demand for LNG, a cleaner energy source than fossil fuels, is also expected to increase domestically, exceeding available production capacity. SA has no other source of LNG and negligible LNG import infrastructure, according to the company.

The company’s shares were up 1.85% to R27 in early afternoon trade on the JSE, giving it a market valuation of R3.7bn.

Marani has been outspoken about big money managers investing in the JSE’s top 40 stocks and ignoring the small-cap market, which he says offers the potential to boost economic growth.

Renergen, which is still in development and not making a profit, had debt of R870m at end-December, according to cash flow documents published on the Australian Stock Exchange.

The company experienced engineering problems with the commissioning of its helium plant in October that led to further delays and much negative attention on social media and Australian investor forum HotCopper. The share price ended 2021 about 30% lower year on year.

With Katharine Child

mahlangua@businesslive.co.za