Renergen has inked three take-or-pay conditional helium sales agreements with Linde, Messer and Helium24.
The domestic natural gas and helium producer today (4th August) announced the deals which relate to its planned Phase 2 plant in the Virginia Gas Project.
Linde and Messer have both signed a 15-year agreement and Helium24 has committed to a 10-year agreement.
Each agreement is conditional upon completion of a number of project development milestones at the Virginia Gas Project and either party may terminate due to delay in the commencement of production date.
Furthermore, should Renergen be unable to deliver at least 80% of annual take-or-pay quantities during any consecutive six-month period once the plant is operational, the parties may terminate the contract.
With the inked deals, Renergen has now completed sales agreements for approximately 65% of the five tonne per day Phase 2 helium production at the Virginia Gas Project.
“Adding these prestigious names to our customer list for Phase 2 production is an incredible achievement and a testament to what the team is building at Virginia,” said, Stefano Marani, CEO of Renergen.
“These sales agreements along with the iSi agreement in April accounts for a combine 220 containers per annum, which represents 65% of design capacity contemplated in the front-end engineering and design of the Phase 2 project.”
“Importantly, having long-term off-take agreement in place with tier-one customers provides a strong foundation for the company when we enter discussions with lenders to approve project funding, as it eliminates a significant component of market risk.”
“The company has worked hard this year at systematically addressing its remaining execution risks, from drilling to sales to construction, and we find ourselves in a significantly strong position now than ever before.”