Renergen launches South Africa’s first LNG auction

South African domestic natural gas and helium producer Renergen kicked off the country’s first-ever liquefied natural gas (LNG) auction.

Renergen launches South Africa's first LNG auction
Courtesy of Renergen

Interested parties are invited to apply to bid for the allocation of LNG, which will be produced from the company’s Virginia Gas project, located in the Free State, approximately 250 km southwest of Johannesburg.

Renergen holds the first and only onshore petroleum production right in South Africa.

The company noted LNG is the ideal substitute for liquid fuels, which will burn cleaner and release fewer emissions.

Importantly consumption of LNG does not require significant changes to the infrastructure required for liquid petroleum gas (LPG), making the switch efficient and cost-effective, the company said.

Renergen is the first South African-based company to supply LNG, and from the domestic supply as opposed to other imported sources.

By 2021, the company aims to complete its Phase 1 expansion plans of the Virginia Gas project and will be producing LNG and helium.

This major milestone will see Renergen become the first distributor of LNG at filling stations (in partnership with Total) in the country and the only domestic producer of helium.

Renergen anticipates that Phase 2 of the Virginia Gas project will be available by 2023. The company expects demand for LNG to increase significantly across South Africa.

Phase 2 production at the Virginia Gas Project will bolster the 2021 Phase 1 production, providing availability of LNG across all major highways in South Africa, with surplus volume to be made available to the market.