Renergen promised investors that it would generate significant revenue from helium by 2019, but four years later, it has not sold any helium.
Renergen released its interim financial results for the six months ended 31 August 2023, revealing it generated R23.76 million in revenue with a net loss of R43.5 million.
Although revenue increased from the previous period, it was far below the expectations Renergen created with investors in the past.
Since it was listed on the AltX of the Johannesburg Stock Exchange (JSE) on 9 June 2015, Renergen consistently promised investors strong revenue from liquid helium (LHe) production.
In May 2016, Renergen announced that it signed a major helium deal with Afrox. It said this deal would enable Afrox to locally source and supply helium by 2018/19.
Renergen told investors in August 2019 that it would be producing 350 kg of liquid helium (LHe) per day by 2021.
These two deadlines came and went without Renergen producing a single drop of liquid helium.
In January 2023, Renergen finally stated that it had produced its first liquid helium. It said its helium module was in production and being optimised.
Investors reacted positively to the news of helium production, and the share price jumped more than 8% in two days.
This was primarily due to the expected increase in revenue as Renergen has lined up many helium sale agreements that it told investors about.
Based on information Renergen shared with investors, they expected around 350 kg of helium to be produced per day.
However, during its latest results announcement, CEO Stefano Marani revealed that they had not sold any helium to date.
He said, shortly after Renergen announced that it had started to produce helium, that they discovered a gas leak at the helium cold box.
The helium cold box had to be taken off-site for repairs and returned to the Renergen’s Virginia Gas Project site.
Marani said they are now recommissioning the helium module and will bring it back online soon.
He said although the plant is capable of producing liquid helium, they have not sold any liquid helium as they promised investors.
Marani admitted that they have dropped the ball and only expect to produce the promised 350 kg of liquid helium by the end of the 2024 financial year.