South Africa’s Central Energy Fund (CEF) has completed its due diligence on its R1-billion investment in emerging integrated energy producer Renergen’s Virginia gas project.
Marking a major step towards finalising the agreement between Renergen and the CEF, both parties have now started engaging with their respective stakeholders to obtain final approvals to complete the transaction.
Renergen CEO Stefano Marani says the successful conclusion of the due diligence “signifies the strategic nature of the Virginia gas project and further marks another significant step forward in closing out the capital required for Phase 2 operations at Virginia”.
He adds that the CEF’s involvement in the project brings with it “a wealth of experience” in upstream oil and gas exploration, midstream natural gas to liquids processing and large-scale pipeline operations and maintenance experience.
“This will all assist in bringing a new and critical source of energy online, at a time where South Africa is suffering a significant energy crisis,” Marani notes.
Commenting on the commissioning progress of Virginia ahead of the start of Phase 1 operations, Marani says that turning the plant for Phase 1 operations on is “a function of coordinating all the sites to turn on simultaneously, and importantly, the relevant teams are ensuring that all aspects of the operation will run according to design”.
“We have no intention of rushing the process at this late stage and introducing risk. Since starting construction at Virginia prior to Covid, the total delays experienced in the context of several global macro events of the past two years could have been significantly worse had we not implemented several mitigations to reduce the overall impact on the project,” he adds, referencing the project’s delays over the past few years.