Natural gas and helium producer Renergen has reached comprehensive settlement and coexistence agreements with Springbok Solar Power Plant, which ends all legal disputes between the companies.

The agreements pave the way for mutually beneficial operations in the Free State, following a period of protracted legal proceedings and a regulatory review.

The issue between the companies arose from overlapping land use rights governed by South African law, specifically under Section 53 of the Mineral and Petroleum Resources Development Act.

Renergen was the first to acquire a valid production right over the relevant area. Subsequently, Springbok Solar sought to build a solar energy plant on the same land, which would require Ministerial consent – which was initially granted and later set aside.

The settlement between the companies now provides clarity and avoids further litigation, as well as establishes a framework for both projects to progress constructively.

The agreements ensure the protection of Renergen subsidiary Tetra4, particularly its rights to natural gas extraction at the Virgina project, while also allowing the operation of the Springbok Solar project within its designated area, in accordance with South African laws.

The companies will continue to engage and consult on all applicable legislation and regulation on future development and expansion of both companies’ operations in the Free State. 

Both Renergen and Springbok Solar say they remain committed to supporting South Africa’s transition to a sustainable energy future.

“The coexistence agreement demonstrates that renewable energy and natural gas projects can coexist in harmony, provided that all regulatory processes are followed and stakeholders engage in good faith,” comments Renergen CEO Stefano Marani.

He adds that the agreement between the companies closes a difficult chapter for both parties and clears a path forward built on collaboration and mutual respect.

“We are pleased to have concluded constructive engagement and to have agreed on a resolution.

“With growing overlap between renewable energy and mineral and petroleum rights, we believe improved and ongoing consultation between all stakeholders (including rights holders, other developments and the regulatory authorities) is critical, including inter-departmental coordination in supporting strategic infrastructure developments,” Katerine Persson adds on behalf of Springbok Solar.

Meanwhile, Renergen expects to report a wider loss per share and headline loss per share for the six months ended August 31.

The company advises that its loss per share will increase by at least 9c, or 20%, compared with the loss per share of 46c reported by the company for the comparable six months of the prior financial year.

The wider loss is primarily owing to one-off transaction costs related to the merger of Renergen with ASP Isotopes, with ASP being in the process of buying out Renergen; increased depreciation expenses following commissioning of the Phase 1 plant at Virginia for helium and liquefied natural gas production; and increased interest expenses.

The company will release another trading statement once it is more certain of its expected interim earnings.