Fulu is most proud of Renergen's increase in assets that came with its new Virginia Gas Project.
Renergen has announced a 178 percent increase in assets for its 2019 financial year end.
“It was a challenging year,” says Renergen CFO Fulu Ravele. Renergen was in a capital raising phase to fund the construction of its Virginia Gas Project.
“Sourcing suppliers for the construction of the Virginia project has been a challenge as there are a few local companies with experience in liquefied natural gas and liquefied helium [plant construction],” Fulu says. “Obtaining funding was the biggest opportunity as this allowed us to break ground on Virginia, not because the project is difficult, but rather because we became the first listed helium asset globally.”
“Negotiations for funding were concluded at the start of 2020 and cash injection into the company meant that it could commence with the Virginia Gas Project” says Fulu.
Cybersecurity also continues to be a challenge for Renergen. “We continue to educate ourselves as management and employees on this evolving risk.”
According to Fulu, the major milestones Renergen achieved include:
- Significant increase in our methane and helium reserve estimates
- Renergen listing on the Australian Securities Exchange in June 2019 and raising A$10 million at IPO
- Renergen, through its subsidiary, executed a debt facility agreement with DFC of $40 million in August and drew $20 million of that to commence construction work on the Virginia gas project
- Commissioning a new truck gas filling station in Johannesburg
- Drilling and striking a new gas well with 12 percent helium concentration
- Consolidation of 100 percent of the Virginia Gas Project
- Headline loss per share remained relatively consistent with prior year as more spending related to investment in assets under construction
- We commenced a project to implement an ERP system, this will automate a lot of our processes and increasing efficiency
- While a lot of companies were retrenching in FY2019/2020, due to the shrinking South African economy, Renergen went on a recruitment drive and doubled in employee complement without
“We are proudest of the increase in assets due to construction of the liquefied natural gas and liquefied helium plant, as well as the increase in intangible assets,” Fulu says. “Management has taken time to provide the concept of the use of natural gas through the pilot compressed natural gas plant in Virginia, and the country is now ready for its first South African onshore produced LNG and LHe.”
Covid-19
The lockdown was announced just after Renergen’s year end, by which stage most of the audit fieldwork was done. Renergen implemented the work-from-home policy on 18 March before the President declared the countrywide lockdown. “The agility of Renergen to adapt to the new lockdown norm was impressive,” Fulu says. “Makes me proud to work with a team that truly adapts to change. We still met all our reporting deadlines.”
She adds that quantifying the impact of Covid-19 hasn’t been easy and Renergen continues to monitor its impact on the business, especially with daily changes in regulations.
“This time has forced everyone to embrace technology and explore different ways of working. Having daily and weekly virtual meetings with the team assisted a great deal in keeping communication on the progress of financial reports and audit.”
Fulu says the only challenge with this was the instability of the internet and electricity outage everyone experiences in their own area of residence at different times.
“Although we are concerned about the impact of Covid on financial performance and business activities, this is also the time that our HR management is most vital. Employees’ wellbeing is extremely important in sustaining business activities as they adapt to the new normal. These are unchartered territories for all of us.”
