Renergen Limited (ASX:RLT) has issued the market with an update on the progress of its liquid helium plant in South Africa – now well behind schedule.
The company’s announcement on Wednesday did, at times, sound like an apology.
“We would like to assure our stakeholders that everything is being done to conclude the commissioning timeously,” Renergen CEO Stefano Marani.
“We acknowledge it has taken longer than originally planned to reach this step, but ensuring the safe operation of the plant is our main priority right now.
“It is too easy to focus on the larger milestones and ignore smaller ones, but we should not lose sight that we will shortly own and operate one of approximately less than 20 liquid helium production facilities globally.”
A particularly indignant investor may feel such a comment to be patronising, but then again, it’s South Africa.
And if that was a widely held perception, it wasn’t evident in the first hour of trades on Wednesday. The reassurance from the company was enough to send shares 10% higher to 84cps around 10.30am AEST.
Regarding the delays for its plant, probably first and foremost of concern to Renergen – despite no real acknowledgement of actual factors causing delays on Wednesday – is the ongoing South African energy crisis.
For the entire 2020’s, SA’s main utility, Eksom – owned by the government – has been strategically shutting down power across the country where needed on an almost daily basis.
Aging plant infrastructure is the key reason blamed by Eksom and related parties for the power shortage. In short, the country is producing less power than it needs, despite having a capacity to produce more (on paper.)
Other parties – including the International Monetary Fund (IMF) – blame Eksom itself for underinvesting in its own hardware and assets. At any rate, the situation last year prompted the IMF to declare South Africa’s power problem was tanking its economy.
So, to be fair to Renergen, they’ve got that to worry about.
RLT last traded at 84cps.