High Court ruling clarifies Renergen's operations in South Africa's gas sector

JSE-listed Renergen has won a "legal victory" that frees its onshore helium and natura gas production from operating under National Energy Regulator of South Africa (NERSA) regulations, and the ruling adds regulatory clarity to South Africa's petroleum sector.

The High Court of South Africa, Gauteng Division, did, on May 2, 2025, rule in favour of Renergen’s owned subsidiary Tetra4's request for a declarator that the Gas Act of 2001 does not apply to production and incidental activities related to upstream petroleum activities, including a requirement for licensing of trading, construction, and operation of liquefaction facilities outside the piped gas industry.

"This judgment is a landmark win for Tetra4 and the entire upstream gas industry. It affirms that upstream gas production and related activities, including on-site liquefaction, are outside the scope of the Gas Act and NERSA's licensing regime, provided they do not supply the regulated piped gas industry,” Renergen CEO Stefano Marani said.

In December 2021, Tetra4 initiated High Court motion proceedings to seek clarification on the jurisdiction of NERSA regarding certain operational activities.

“This order shows these activities fall under the regulatory purview of the Production Right granted in accordance with the Mineral and Petroleum Resources Development Act 28 of 2002 and resolves ambiguity and potential contradictions arising from disparate sets of legislation affecting Tetra4,” said Marani.

Notably, the court found Tetra4 did not require a NERSA license for trading in gas (such as methane and helium) when such trading occurs outside the piped gas industry, and not involving the national pipeline grid or downstream market regulated by NERSA.

The judgment also clarified that the Gas Act regulates only hydrocarbon gases transported by pipeline and does not cover noble gases like helium. Thus, helium production and trading were outside NERSA's regulatory reach.

Marani said the clarity derived from the legal ruling reduced regulatory duplication, lowered barriers to entry, and created a more enabling environment for upstream gas development in South Africa.

Renergen's share price fell 1.32% to R6.71 on Tuesday afternoon on the JSE, this after rising sharply from R3.43 in just over two months.

The legal judgement is Renergen's second legal win in a month, It recently successfully appealed a MDPRA (Mineral and Petroleum Resources Development Act) approval that had been granted to another company, Springbok Solar Power Plant (RF). This followed a dispute that had arisen between Renergen's Tetra4 and RF regarding their solar development encroaching upon Tetra4's production right in Virginia, in the Free State.

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