https://www.engineeringnews.co.za
Africa|Construction|Contractor|Design|Engineering|EPCM|Export|Gas|LNG|Mining|Petroleum|PROJECT|Projects|Shell|System|Technology|Equipment|Drilling|Bearing|Operations
Africa|Construction|Contractor|Design|Engineering|EPCM|Export|Gas|LNG|Mining|Petroleum|PROJECT|Projects|Shell|System|Technology|Equipment|Drilling|Bearing|Operations
africa|construction|contractor|design|engineering|epcm|export|gas|lng|mining|petroleum|project|projects|shell|system|technology|equipment|drilling|bearing|operations

Virginia gas project, South Africa – update

14th May 2021

By: Sheila Barradas

Creamer Media Research Coordinator & Senior Deputy Editor

     

Font size: - +

Name of the Project
Virginia gas project.

Location
The project spans 187 000 ha of gasfields across Welkom, Virginia and Theunissen, in the Free State, South Africa.

Project Owner/s
Tetra4, a subsidiary of domestic natural gas and helium producer Renergen.

Project Description
The project entails the construction of 52 km of gas-gathering pipeline and cryogenic liquefaction processing facilities.

The aim is to produce all South Africa’s helium requirements and potentially export the balance of production, as well as produce the first liquefied natural gas (LNG) locally available for commercial consumption.

Phase 1 aims to produce 350 kg/d of helium. Output will be increased to up to 10 000 kg/d of helium across both stages of Phase 2, “arguably making it among the biggest helium projects on the planet", CEO Stefano Marani has said. This will deliver 0.7-billion cubic feet (bcf) of gas, which, over 19 years, amounts to 13.87 bcf, or 4%, of the 344 bcf prospective resource.

Renergen is also in the construction phase of South Africa’s first commercial LNG plant.

Phase 1 of the project will produce about 50 t/d of LNG, which is about 75 000 ℓ/d of diesel equivalent. Both stages of Phase 2 will potentially increase this to the LNG equivalent of about 600 000 ℓ/d of diesel, subject to what current studies show geologically.

Phase 2 allocations will likely result in the project’s transforming into a significant LNG production facility, placing the project more in line with global small-scale production capabilities.

Phase 2 is intended to have the first stage completed by late 2023 and the second stage by 2025, by which time more than 300 wells would have been added.

Potential Job Creation
Despite the project’s size relative to traditional mining operations, it will create an estimated 360 temporary jobs during development and construction, and an estimated 82 permanent jobs once all the clusters have been developed.

Capital Expenditure
The total projected capital expenditure to roll out the first phase of production is estimated at R750-million, which includes the cryogenic liquefiers.

Planned Start/End Date
Phase 1 of the Virginia project is expected to start producing LNG and liquid helium by 2021. Phase 2 is expected to complete construction of both stages in 2025 or 2026.

Latest Developments
Drilling at Renergen’s R2D2 well has progressed as expected, and drilling has been interpreted to be proximal to the target gas-bearing fracture system.

The company reports that logging operations are under way in preparation for casing the well and that it is applying for the requisite approvals to continue drilling in the Wits formation.

Given this casing, the logging and approval process is expected to take several weeks to complete. The company has elected to relocate the drilling rig to a new site, C3PO, where it will also drill to base Karoo pending the approvals to drill to final depth at the R2D2 well.

Further, gaseous odours were detected in the deeper section of R2D2, consistent with the experience of drilling the successful MDR1 well, Renergen has confirmed.

Renergen CEO Stefano Marani has described the presence of the odour as “really good news”, especially since the well is interpreted to be close to the target fractures in the Wits, and the company is drilling in the same type of geology encountered at the successful MDR1 well.

“We are through the most challenging part of the drilling on R2D2, with more precision than in our previous wells, so the learningsinsights? have not been in vain, and we expect our ability to hit targets will only improve as we go forward.

Key Contracts, Suppliers and Consultants
Phase 1:
Sproule, formerly MHA Petroleum (helium reserve independent expert report) and VGI (owner’s engineer with regard to the engineering and procurement phase of the project).

EPCM Bonisana (gas gathering work), a subsidiary of EPCM Holdings (engineering, procurement and construction contractor – Phase 1 gas gathering pipeline).

Western Shell Cryogenic Equipment (technology and equipment), and Bohrmeister Technik (Phase 1 – drilling contract).

Phase 2:
Saipem (front-end engineering design (FEED) contract for the development of the downstream LNG and liquid helium processing facilities, including the associated balance of the plant).

EPCM Holdings (FEED contract – Phase 2 gas gathering pipeline).

Sproule (evaluation and certification of reserves, based on the results of the additional data acquisition and the current drilling campaign. This will build on previous work carried out by MHA Petroleum Consultants, acquired by Sproule in 2019).

Contact Details for Project Information
Renergen, tel +27 10 045 6000, email info@renergen.co.za or investorrelations@renergen.co.za.

Edited by Creamer Media Reporter

Comments

Showroom

Booyco Electronics
Booyco Electronics

Booyco Electronics, South African pioneer of Proximity Detection Systems, offers safety solutions for underground and surface mining, quarrying,...

VISIT SHOWROOM 
GreaseMax
GreaseMax

GreaseMax is a chemically operated automatic lubricator.

VISIT SHOWROOM 

Latest Multimedia

sponsored by

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION







sq:0.101 0.174s - 167pq - 2rq
Subscribe Now