Wrap Text
Renergen Quarterly Update
RENERGEN LIMITED
Incorporated in the Republic of South Africa
(Registration number: 2014/195093/06)
JSE Share code: REN
A2X Share code: REN
ISIN: ZAE000202610
LEI: 378900B1512179F35A69
Australian Business Number (ABN): 93 998 352 675
ASX Share code: RLT
("Renergen" or "the Company")
RENERGEN QUARTERLY UPDATE
Fiscal Q1 2025 Highlights:
• LNG production increased from 154 tons to 1344 tons in this reporting period
• Helium system integration in finalisation with the OEM focused on system and
operational enhancements
• Two new wells with strong gas flow and high helium
LNG production
As reported in our announcement on 15 February 2024, the planned and unplanned
maintenance of the plant was completed, resulting in LNG production for the reporting period
totalling 1344 tons, increasing from the 154 tons as reported in the previous quarter. The
company will continue to ramp up production as planned during the remaining FY2025 period.
Helium system integration continues
As per our last quarterly, the OEM arrived on site late February 2024, to complete the system
integration and final commissioning. These steps have included:
- Separation of Nitrogen and Helium from the tail stream gas
- Purification of the helium (99,95%)
- Achieving liquification and upgrading from 99.95% to 99.999% purity , which has been
verified by an independent 3rd party laboratory.
As more fully set out in the announcement released on 11 June 2024, helium liquefaction re-
commenced as of 4 June 2024. Prior to commencement of the Performance Test, the OEM
contractor must demonstrate that the entire plant is operating at desired temperature,
pressure, and production flow parameters. Helium being produced leading up to the
Performance Test is being stored for the customer, and in the meantime the OEM continues
to refine the system and operating procedures in preparation for the Performance Test, the
purpose of the refinements being to ensure long-term stability and continuous production
during operations.
Exploration
Based on data from the seismic interpretation, two new wells have been drilled, both of which
are above average blowers and expected to be completed in July 2024. Initial samples
indicate helium concentrations of over 3% in the wells, and flow rates in excess of 100,000
standard cubic feet per day each. Final flow rates will be completed pending completion of the
wells.
This positive development signals that the interpretation of the seismic has indeed identified
several gas bearing structures associated with gas anomalies at depth and will not only reduce
the error in drilling dry wells in future, but can be used to accurately identify target areas with
higher flow rates.
Licenses and Other Matters
There has been no change to the licences.
ASX Listing rule 5.4.3 –no rights were acquired or disposed, nor were any farm-in or farm-out
agreements entered into during the quarter. The Company has not entered into any farm-in or
farm-out agreements.
ASX Listing rule 5.4.5 -There were payments during the quarter to an associate of, or a related
party of Renergen or an associate of Renergen. These payments totalled ZAR5.486 million
and relate to remuneration paid to directors and prescribed officers.
Johannesburg
27 June 2024
Authorised by: Stefano Marani
Chief Executive Officer
Designated Advisor
PSG Capital
To readers reviewing this announcement on the Stock Exchange News Service (SENS), this
announcement may contain graphics and/or images which can be found in the PDF version
posted on the Company's website.
www.renergen.co.za
For all media relations, please contact:
Mandy Stuart
Head of Marketing & ESG Management
mandy@renergen.co.za
For all US investors and media relations, please contact:
Georg Venturatos– Gateway Group, (949) 574-3860
Ren@gateway-grp.com
Rule 5.5
Appendix 5B
Mining exploration entity or oil and gas exploration entity
quarterly cash flow report
Name of entity
RENERGEN LIMITED
ABN Quarter ended ("current quarter")
93998352675 31 May 2024
Current Year to date
quarter (3 months)
Consolidated statement of cash flows
ZAR'000 ZAR'000
1. Cash flows from operating activities
1.1 Receipts from customers 10 991 10 991
1.2 Payments for
(a) exploration & evaluation (4) (4)
(b) development - -
(c) production (10 740) (10 740)
(d) staff costs (8 825) (8 825)
(e) administration and corporate costs (38 682) (38 682)
1.3 Dividends received (see note 3) - -
1.4 Interest received 1 885 1 885
1.5 Interest and other costs of finance paid (220) (220)
1.6 Income taxes paid - -
1.7 Government grants and tax incentives - -
1.8 Other (provide details if material) –
- Restricted cash (2 640) (2 640)
1.9 Net cash used in operating activities (48 235) (48 235)
2. Cash flows from investing activities
2.1 Payments to acquire or for:
(a) entities - -
(b) tenements - -
(c) property, plant and equipment (49 340) (49 340)
(d) exploration & evaluation (12 083) (12 083)
(e) investments - -
(f) other non-current assets – other - -
intangible assets
ASX Listing Rules Appendix 5B (17/07/20) Page 1
+ See chapter 19 of the ASX Listing Rules for defined terms.
Appendix 5B
Mining exploration entity or oil and gas exploration entity quarterly cash flow report
Current Year to date
quarter (3 months)
Consolidated statement of cash flows
ZAR'000 ZAR'000
2.2 Proceeds from the disposal of:
(a) entities - -
(b) tenements - -
(c) property, plant and equipment - -
(d) investments - -
(e) other non-current assets - -
2.3 Cash flows from loans to other entities - -
2.4 Dividends received (see note 3) - -
2.5 Other (provide details if material) - -
2.6 Net cash used in investing activities (61 423) (61 423)
3. Cash flows from financing activities
3.1 Proceeds from issues of equity securities
(excluding convertible debt securities) - -
3.2 Proceeds from issue of convertible debt - -
securities
3.3 Proceeds from exercise of options - -
3.4 Transaction costs related to issues of equity - -
securities or convertible debt securities
3.5 Proceeds from borrowings 74 640 74 640
3.6 Repayment of borrowings (374 641) (374 641)
3.7 Transaction costs related to loans and
borrowings - -
3.8 Dividends paid - -
3.9 Other – lease payments (884) (884)
3.10 Net cash used in financing activities (300 885) (300 885)
4. Net increase/(decrease) in cash and
cash equivalents for the period
4.1 Cash and cash equivalents at beginning of
period 471 075 471 075
4.2 Net cash used in operating activities
(item 1.9 above) (48 235) (48 235)
4.3 Net cash used in investing activities
(item 2.6 above) (61 423) (61 423)
4.4 Net cash used in financing activities
(item 3.10 above) (300 885) (300 885)
4.5 Effect of movement in exchange rates on
cash held (4) (4)
4.6 Cash and cash equivalents at end of
period 60 528 60 528
ASX Listing Rules Appendix 5B (17/07/20) Page 2
+ See chapter 19 of the ASX Listing Rules for defined terms.
Appendix 5B
Mining exploration entity or oil and gas exploration entity quarterly cash flow report
5. Reconciliation of cash and cash
equivalents Current Year to date
at the end of the quarter (as shown in the
quarter (3 months)
consolidated statement of cash flows) to the
ZAR'000 ZAR'000
related items in the accounts
5.1 Bank balances 12 309 12 309
5.2 Call deposits 48 219 48 219
5.3 Bank overdrafts - -
5.4 Other (provide details) - -
5.5 Cash and cash equivalents at end of
quarter (should equal item 4.6 above) 60 528 60 528
6. Payments to related parties of the entity and their associates Current
quarter
ZAR'000
6.1 Aggregate amount of payments to related parties and their
associates included in item 1 3 058
6.2 Aggregate amount of payments to related parties and their
associates included in item 2 2 428
Note: if any amounts are shown in items 6.1 or 6.2, your quarterly activity report must include a
description of, and an explanation for, such payments.
7. Financing facilities
Note: the term "facility' includes all forms of
financing arrangements available to the
Total facility Amount drawn
entity.
amount at quarter at quarter
Add notes as necessary for an end end
understanding of the sources of finance ZAR'000 ZAR'000
available to the entity.
7.1 Loan facilities 938 274 938 274
7.2 Credit standby arrangements - -
7.3 Other (please specify) - -
7.4 Total financing facilities 938 274 938 274
7.5 Unused financing facilities available at quarter end -
7.6 Include in the box below a description of each facility above, including the lender, interest
rate, maturity date and whether it is secured or unsecured. If any additional financing facilities
have been entered into or are proposed to be entered into after quarter end, include a note
providing details of those facilities as well.
ASX Listing Rules Appendix 5B (17/07/20) Page 3
+ See chapter 19 of the ASX Listing Rules for defined terms.
Appendix 5B
Mining exploration entity or oil and gas exploration entity quarterly cash flow report
The US Dollar (US$) denominated loan and debentures included in the amount disclosed
above were translated at a rate of R18.7562/US$1 on 31 May 2024.
DFC Loan
Tetra4 entered into a US$40.0 million finance agreement with the US International
Development Finance Corporation ("DFC") on 20 August 2019 ("Facility Agreement"). The
first draw down of US$20.0 million took place in September 2019, the second draw down of
US$12.5 million in June 2020 and the final drawdown of US$7.5 million on 28 September
2021. Tetra4 shall repay the loan in equal quarterly instalments of US$1.08 million (R20.3
million using the rate at 31 May 2024) on each payment date which began on 1 August 2022
and will end on 15 August 2031. The loan is secured by a pledge of Tetra4's assets under
construction, land and the Debt Service Reserve Account.
The first drawdown of $20.0 million attracts interest of 2.11% per annum. Interest on the
second and final drawdowns is 1.49% and 1.24% per annum, respectively. Interest is payable
by Tetra4 to the DFC quarterly on 15 February, 15 May, 15 August and 15 November of each
year ("Repayment Dates") for the duration of the loan. Qualifying interest attributable to assets
under construction, within property, plant and equipment, is capitalised in line with the Group
policy. Interest paid during the quarter totalled US$0.14 million (R2.7 million).
A guarantee fee of 4% per annum is payable by Tetra4 to the DFC on any outstanding loan
balance. The guarantee fee is payable quarterly on the Repayment Dates. Tetra4 paid
guarantee fees totalling US$0.32 million (R6.1 million) during the quarter.
A commitment fee of 0.5% per annum was payable by Tetra4 to the DFC on any undisbursed
amounts under the Facility Agreement. Commitment fees were payable quarterly on the
Repayment Dates. Tetra4 did not pay any commitment fees during the quarter as there were
no undrawn amounts during the period.
An annual maintenance fee of US$0.04 million is payable by Tetra4 to the DFC for the
duration of the loan term and is payable on 15 November of each year, and commenced on
15 November 2020. The maintenance fee covers administrative costs relating to the loan.
There was no maintenance fee due during the quarter.
The DFC loan outstanding on 31 May 2024 amounted to US$31.35 million (R588.0 million).
ASX Listing Rules Appendix 5B (17/07/20) Page 4
+ See chapter 19 of the ASX Listing Rules for defined terms.
Appendix 5B
Mining exploration entity or oil and gas exploration entity quarterly cash flow report
IDC Loan
Tetra4 entered into a R160.7 million loan agreement with the Industrial Development
Corporation ("IDC") on 17 December 2021. An amount of R158.8 million was drawn down on
22 December 2021 and is repayable in 102 equal monthly payments which commenced in
June 2023. The loan terms included a 12-month interest capitalisation and an 18-month
capital repayment moratorium. The loan accrues interest at the prime lending rate plus 3.5%
(15.25% on 31 May 2024) and is secured by a pledge of Tetra4's assets under construction,
land and the Debt Service Reserve Account. The IDC loan outstanding on 31 May 2024
amounted to R170.5 million and interest accrued during the quarter amounted to R6.7 million.
Qualifying interest attributable to assets under construction, within property, plant and
equipment, is capitalised in line with the policy of the Group.
Debt covenants
The following debt covenants apply to the DFC loan:
a) Tetra4 is required to maintain at all times i) a ratio of all interest-bearing Debt to EBITDA
of not more than 3.0 to 1; (ii) a ratio of Current Assets to Current Liabilities of not less
than 1 to 1; and (iii) a Reserve Tail Ratio of not less than 25%.
(b) Tetra4 is required to maintain at all times (i) a ratio of Cash Flow for the most recently
completed four (4) consecutive full fiscal quarters, taken as a single accounting period, to
Debt Service for the most recently completed four (4) consecutive full fiscal quarters,
taken as a single accounting period, of not less than 1.30 to 1; and (ii) a ratio of Cash
Flow for the most recently completed four (4) consecutive full fiscal quarters, taken as a
single accounting period, to Debt Service for the next succeeding four (4) consecutive full
fiscal quarters of not less than 1.3 to 1.
(c) Tetra4 is required to ensure that the Debt Service Reserve Account is funded in the
aggregate of all amounts due to the DFC within the next 6 months.
The covenants in a) and b) will apply from 15 August 2025. Tetra4 has complied with the
covenant under c) above for the quarter and believes that it will be able to comply with the
covenants throughout the tenure of the loan.
The following debt covenants apply to the IDC loan:
a) Tetra4 is required to maintain the same financial and reserve tail ratios, and a Debt
Service Reserve Account as mentioned under the DFC loan.
b) In addition, Tetra4 shall not make any shareholder dividend distribution, repay any
shareholders' loans and/or pay any interest on shareholders' loans or make any payments
whatsoever to its shareholders without the IDC's prior written consent, if:
- Tetra4 is in breach of any term of the loan agreement; or
- the making of such payment would result in a breach of any one or more of the
financial ratios above.
The covenants in a) will apply from 15 August 2025. Tetra4 has complied with the covenant
under b) above for the quarter and believes that it will be able to comply with the covenants
throughout the tenure of the loan. Tetra4 also maintains a Debt Service Reserve Account with
respect to the IDC loan.
"Reserve Tail Ratio" means for any calculation date, the quotient obtained by dividing (a) all
of the Borrower's remaining Proved Reserves as of such calculation date by (b) all of the
Borrower's Proved Reserves as of the date of the Facility Agreement.
ASX Listing Rules Appendix 5B (17/07/20) Page 5
+ See chapter 19 of the ASX Listing Rules for defined terms.
Appendix 5B
Mining exploration entity or oil and gas exploration entity quarterly cash flow report
Molopo loan
Tetra4 entered into a R50.0 million loan agreement with Molopo on 11 May 2014. The loan
term is for a period of 10 financial years and 6 months which commenced on 1 July 2014
(repayable on 31 August 2024). During this period, the loan is unsecured and interest free.
From the period commencing 1 September 2024, to the extent that the loan has not been
repaid, it will accrue interest at the prime lending rate plus 2% and will still be unsecured. The
loan can only be repaid when Tetra4 declares a dividend and utilising a maximum of 36% of
the distributable profits in order to pay the dividend. It is not expected that the loan will be
repaid in the next 12 months given the unavailability of distributable profits based on Tetra4's
most recent forecasts. As such, the loan is classified as long term. The loan is recognised at
its present value and interest which represents the unwinding of the discount recognised on
initial recognition of the loan is included in profit and loss and amounted to R1.5 million for
the quarter (at an average rate of 13.25%). The Molopo loan outstanding on 31 May 2024
amounted to R48.5 million.
Unsecured Convertible Debentures
Renergen entered into a US$7.0 million unsecured convertible debenture subscription
agreement ("Subscription Agreement") with AIRSOL SRL ("AIRSOL"), an Italian wholly-
owned subsidiary of SOL S.p.A, on 30 August 2023 for the subscription by AIRSOL in
Renergen debentures in two tranches of US$3.0 million ("Tranche 1") and US$4.0 million
("Tranche 2"). Tranche 1 proceeds were received on 30 August 2023 and on 18 March 2024
AIRSOL subscribed for Tranche 2 debentures and Renergen received US$4.0 million. This
transaction is linked to the Nasdaq IPO.
The debentures have a maturity date of 28 February 2025 and accrue interest at a rate of
13% per annum, calculated and compounded semi-annually on the outstanding principal
amount. Interest is payable on 28 February and 31 August of each year during the term of
the debentures.
On maturity, the debentures can be settled in cash or converted to shares in Renergen at a
conversion rate to be determined by dividing the outstanding principal amount by the
conversion price. The conversion price has been agreed as follows:
• If the Nasdaq IPO has not been completed before the maturity date of the debentures,
the conversion price will be 90% of the 30-day volume weighted average traded price of
Renergen shares on the Johannesburg Stock Exchange.
• If the Nasdaq IPO has occurred before the maturity date of the debentures, and the
shares to be issued are Renergen shares admitted to trading on the JSE, the conversion
price with be 90% of the Rand equivalent of the deemed US$ price per share applicable
in the IPO.
• If the Nasdaq IPO has occurred before the maturity date of the debentures, and the
shares to be issued are Renergen American Depositary Shares ("ADSs"), the conversion
price with be 90% of the Rand equivalent of the US$ issue price per ADS.
Debentures outstanding on 31 May 2024 amounted to US$7.0 million (R131.3 million).
ASX Listing Rules Appendix 5B (17/07/20) Page 6
+ See chapter 19 of the ASX Listing Rules for defined terms.
Appendix 5B
Mining exploration entity or oil and gas exploration entity quarterly cash flow report
8. Estimated cash available for future operating activities ZAR'000
8.1 Net cash generated from operating activities (item 1.9) (48 235)
8.2 Payments for exploration and evaluation classified as investing
(12 083)
activities) (item 2.1(d))
8.3 Total relevant outgoings (item 8.1 + item 8.2) (60 318)
8.4 Cash and cash equivalents at quarter end (item 4.6) 60 528
8.5 Unused finance facilities available at quarter end (item 7.5) -
8.6 Total available funding (item 8.4 + item 8.5) 60 528
8.7 Estimated quarters of funding available (item 8.6 divided by
1.00
item 8.3)
Note: if the entity has reported positive relevant outgoings (ie a net cash inflow) in item 8.3,
answer item 8.7 as "N/A". Otherwise, a figure for the estimated quarters of funding available
must be included in item 8.7.
8.8 If item 8.7 is less than 2 quarters, please provide answers to the following questions:
8.8.1 Does the entity expect that it will continue to have the current level of net operating
cash flows for the time being and, if not, why not?
Answer: No, operating cash flows are expected to improve post the completion of the
Performance Test of the Helium facility and subsequent commercial production of
liquid helium. With the helium facility coming into production, it is expected that
revenues will increase from previous reporting periods. It is anticipated that this
new revenue stream and increased production will improve operating cash flows.
8.8.2 Has the entity taken any steps, or does it propose to take any steps, to raise further
cash to fund its operations and, if so, what are those steps and how likely does it
believe that they will be successful?
Answer: The combination of increased revenue from helium turn on, combined with funding
initiatives in advanced stages is expected to see the company through to nameplate
capacity with positive cash flow generation.
8.8.3 Does the entity expect to be able to continue its operations and to meet its business
objectives and, if so, on what basis?
Answer: The Company is continuing operations as outlined under 8.8.1 and 8.8.2.
Note: where item 8.7 is less than 2 quarters, all of questions 8.8.1, 8.8.2 and 8.8.3 above
must be answered.
Compliance statement
1 This statement has been prepared in accordance with accounting standards and policies which
comply with Listing Rule 19.11A.
2 This statement gives a true and fair view of the matters disclosed.
Date: 27 June 2024
Authorised by: By the Board
(Name of body or officer authorising release – see note 4)
ASX Listing Rules Appendix 5B (17/07/20) Page 7
+ See chapter 19 of the ASX Listing Rules for defined terms.
Appendix 5B
Mining exploration entity or oil and gas exploration entity quarterly cash flow report
Notes
1. This quarterly cash flow report and the accompanying activity report provide a basis for informing the market about the
entity's activities for the past quarter, how they have been financed and the effect this has had on its cash position. An
entity that wishes to disclose additional information over and above the minimum required under the Listing Rules is
encouraged to do so.
2. If this quarterly cash flow report has been prepared in accordance with Australian Accounting Standards, the definitions
in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash
Flows apply to this report. If this quarterly cash flow report has been prepared in accordance with other accounting
standards agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent standards apply to this report.
3. Dividends received may be classified either as cash flows from operating activities or cash flows from investing activities,
depending on the accounting policy of the entity.
4. If this report has been authorised for release to the market by your board of directors, you can insert here: "By the board".
If it has been authorised for release to the market by a committee of your board of directors, you can insert here: "By the
[name of board committee – eg Audit and Risk Committee]". If it has been authorised for release to the market by a
disclosure committee, you can insert here: "By the Disclosure Committee".
5. If this report has been authorised for release to the market by your board of directors and you wish to hold yourself out as
complying with recommendation 4.2 of the ASX Corporate Governance Council's Corporate Governance Principles and
Recommendations, the board should have received a declaration from its CEO and CFO that, in their opinion, the financial
records of the entity have been properly maintained, that this report complies with the appropriate accounting standards
and gives a true and fair view of the cash flows of the entity, and that their opinion has been formed on the basis of a
sound system of risk management and internal control which is operating effectively.
ASX Listing Rules Appendix 5B (17/07/20) Page 8
+ See chapter 19 of the ASX Listing Rules for defined terms.
Date: 27-06-2024 03:00:00
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