Amid South Africa’s energy boom, a groundbreaking project promises to breathe new life into the neglected mining town of Virginia in the Free State. Once famous for its thriving gold industry, Virginia was left behind in poverty, neglect and desolation after a tragic mining disaster in 1994 claimed the lives of 17 people, turning the town into a ‘ghost town’.
However, a liquid gas and helium project is now raising hopes of a renaissance for Virginia as the province seeks to become the country’s energy security hub. Hailed as a game changer for the local economy, the Renergen Tetra4 Virginia Gas Project has grown to a massive scale, with investments reaching R20 billion. It is the first of its kind in South Africa and is among the top 15 liquid helium producers in the world.
Helium is a key element in renewable energy technologies, including solar panels and wind turbines. It also has applications in many other areas, such as scientific research, medical technology, high-tech manufacturing, space exploration, national defense, deep-sea diving, welding and particle accelerators.
Nick Mitchell, operations director at Renergen Ltd, explains that liquid helium is part of the natural gas distillation process. The company extracts the hydrocarbons by drilling to depths of 400 to 700 meters underground to bring the natural gas to the surface.
Mxolisi Dukwana, then Premier of the Free State, highlighted the importance of the Renergen gas and helium project at an Energy Security Indaba hosted by the provincial government in Bloemfontein in November 2023. “We are committed to positioning the Free State as the energy security hub of the country. The geographical centrality of our province makes it an ideal location to facilitate trade and provide easy and convenient access to markets across the country,” he said.
While the Renergen project could compete on the international stage with its large reserves of helium and natural gas, several other gas projects are underway in other provinces such as Mpumalanga, the Eastern Cape and Gauteng. Mpumalanga, in particular, has more than four known liquid natural gas (LNG) projects under development.
However, gas exploration in South Africa faces challenges including environmental risks, limited long-term benefits, and concerns about economic viability and helium quality..
Despite the potential benefits of natural gas and helium, environmental concerns remain. A recent report in the Journal of the Green Economy highlights that gas is a fossil fuel and a major contributor to the climate crisis. It warns that new gas infrastructure could hamper the transition to renewables and that gas, due to its high methane content, can be as bad for the climate as coal.
Nick Mitchell, however, points out that the Virginia gas and helium project could help solve the country’s energy problems. He says the gas from the Free State project will be used locally and will replace more traditional fossil fuels such as coal, heavy fuel oil, diesel, LPG and kerosene in the industrial, logistics and power sectors.
He points out that, since natural gas is the cleanest fossil fuel, their product will facilitate the transition to cleaner energy and provide crucial options for businesses that currently rely on these more polluting energies.
In this way, the Renergen Tetra4 Virginia Gas Project symbolizes more than just an economic development opportunity for a once-declining city. It also embodies the country’s changing energy needs and the challenge of reconciling development and respect for the environment in an era marked by climate emergency.