ANNUAL REPORT 2016 - ShareDataww Investment Case 2About this Report 3Our Vision, Mission and Values...

ANNUAL REPORT 2016

ww

Investment Case 2

About this Report 3

Our Vision, Mission and Values 4

Our Growth Strategy and Business Model 6

Renergen’s Business Model 8

Our Assets 9

Our Board 12

4HIGHLIGHTS AND INVESTMENT CASE

RENERGEN OVERVIEW

CONTENTS

Navigation

Read more

More information available at www.renergen.co.za

2

RENERGEN ANNUAL REPORT 2016

ww

14Chairman’s and CEO’S Report 14

Governance report 16

Application of King III 20

Risk Report 24

SWOT Analysis 27

Key Performance Indicators 29

Remuneration Report 30

Policies and Procedures 32

General Information 37

Director’s Responsibilities and Approval 38

Group Secretary’s Certification 39

Audit and Risk Committee Report 40

Independent Auditor’s Report 42

Directors’ Report 43

Consolidated Statement of Financial Position 46

Consolidated Statement of Profit or Loss and Other Comprehensive Income 47

Statement of Changes in Equity 48

Consolidated Statement of Cash Flows 49

Accounting Policies 50

Notes to the Financial Statements 57

LEADERSHIP AND GOVERNANCE

ANNUAL FINANCIAL STATEMENTS

SHAREHOLDER INFORMATION

Analysis of Ordinary Shareholders 77

Notice of AGM 80

Definitions 88

Form of Proxy 90

Corporate Information IBC

36 80

It is listed on the Alternative Exchange ("AltX") of the JSE Limited ("JSE") using the abbreviated name Renergen and share code REN.

Renergen is focused on the alternative and renewable energy sectors in South Africa and sub-Saharan Africa.

RENERGEN ANNUAL REPORT 2016 1

•Opportunity to capitalise on the considerable growth in the alternative and renewable energy sector

• Holder of South Africa’s first and only onshore petroleum production right

• Proven natural gas and helium reserves

• Strong, entrepreneurial leadership with geographic and sectoral experience

• Strong access to deal flow

• Focused investment strategy

• Limited competition

•Dollar-denominated revenue base with Rand-denominated expense base

•Management incentivised to focus on value of the investment and ability to generate long-term cash flow

• Listed on a well-regulated exchange, with associated credibility and transparency

INVESTMENT CASE

HIGHLIGHTS AND INVESTMENT CASE

Acquired Tetra4, a natural gas and helium business

First alternative energy company listed on JSE We just so happen to be listed on AltX

Tetra4 helium off-take agreement with Linde Group concluded

Tetra4 production and sale of natural gas commenced ahead of schedule

Tetra4 in early discussions on power production with industrial clients

Megabus’ compressed natural gas supply from Tetra4 commences in May 2016

Progressed studies on feasibility of hydro-electric project in Côte d’Ivoire through subsidiary Mega Power Renewables

CH₄

2 RENERGEN ANNUAL REPORT 2016

Key dataRenergen Limited (Registration number: 2014/195093/06)JSE share code: REN JSE ISIN: ZAE000202610Listing date: 9 June 2015

Renergen or “the company” or “the group” presents its first Integrated annual report since listing on the JSE’s AltX on 9 June 2015 as a SPAC. Our focus is the alternative and renewable energy sectors in emerging markets, with a strong leaning towards Africa.

The JSE Listings Requirements for a SPAC obligate the company to invest in viable assets in the first 24 months from listing. Renergen announced the acquisition of 90% of Molopo South Africa Exploration and Production Proprietary Limited (“Molopo”) from Windfall Proprietary Limited (“Windfall”), which was effective 2 December 2015. As a result of the acquisition Renergen is no longer classified as a SPAC and is the first renewable energy company to list on AltX. Following the acquisition Renergen changed Molopo’s name to Tetra4 Proprietary Limited (“Tetra4”). As part of the purchase of Tetra4 from Windfall, Renergen was given ownership of Mega Power Renewables.

Our annual report covers the financial performance of the group for the year from 1 March 2015 to 29 February 2016. The report is aimed primarily at our current and potential shareholders. As a newly listed company on the JSE this report aims to provide an understanding of our investments – Tetra4 and Mega Power Renewables – our growth strategy, our corporate governance framework and our financial performance for the year under review.

Corporate informationThe group’s executive directors are Stefano Marani (CEO), Nick Mitchell (COO), Fulu Ravele (CFO) and Eddie Cooke. They can be contacted at the registered office of the company (see IBC). Renergen’s 2016 Annual Report is available on the group’s website: www.renergen.co.za.

The company’s contact details are disclosed on the IBC.

Basis of preparationThis report has been prepared in terms of:

• International Financial Reporting Standards (IFRS)

• Companies Act, No 71 of 2008, of South Africa, as amended.

• King Report on Corporate Governance (King III)

• Broad-Based Black Economic Empowerment Code

• JSE Listings Requirements

AssuranceThe group’s external auditor, Grant Thornton, has provided assurance on the financial statements and expressed an unqualified audit opinion. The financial statements have been prepared under the supervision of Fulu Ravele the Chief Financial Officer of Renergen.

Forward-looking informationThe report contains some forward-looking information regarding the financial position of the group. Renergen believes this forward-looking information to be realistic at the time of the issue of the report. These statements include uncertainties, assumptions and risks about future events and circumstances, which may result in actual results differing from those anticipated. Forward-looking information has not been independently reviewed by the external auditors.

Board approvalThe board of directors of Renergen (“the board”) acknowledges its responsibility for ensuring the integrity of the annual report. The report has been prepared in line with best practice and the board confirms that it has approved the release of the 2016 annual report.

Brett Kimber Chairman Stefano Marani CEO Mbali Swana Chairman Audit Committee

ABOUT THIS REPORT


RENERGEN OVERVIEW

We intend capitalising on our strong acquisition pipeline to build a diversified portfolio of investments focused on the alternative and renewable energy sector. We target investments with significant potential to unlock profits across the value chain. Our strategy is to take investment opportunities from early stage to revenue production. Our executive team has extensive expertise in the sector and an entrepreneurial approach to maximising the profitability of our investee companies. We will deliver capital growth through creation of value.

RENERGEN IS AN INTEGRATED ALTERNATIVE ENERGY BUSINESS THAT INVESTS IN EARLY STAGE ALTERNATIVE ENERGY PROJECTS ACROSS AFRICA AND EMERGING MARKETS

TIMELINE

2014 2015 2016

SeptemberRenergen established

JuneListed on the JSE’s AltX exchange as first primary listed SPAC

NovemberAcquisition of Tetra4, a natural gas and helium business

JanuaryCommence construction of initial compression facilities for Tetra4

MayCompleted Construction of first compression facility for Tetra4

Tetra4 begins production, supplying compressed natural gas(“CNG”) to Megabus, a division of Unitrans Passenger Proprietary Limited

Helium off-take agreement with Linde Group concluded

OUR VISION, MISSION AND VALUESOur Vision

To capitalise on the unprecedented growth in the alternative energy sector by building and operating a diversified portfolio of alternative energy assets in Africa and emerging markets, with the aim of delivering superior and sustainable economic returns to shareholders.

Our Mission

To identify, acquire and develop early stage alternative energy assets that provide the opportunity of adding value through enhancing the resource, the business model and prospects to improve profitability and maximise shareholder returns. Renergen aims to increase access to clean reliable energy, which is essential to the continued economic growth and development of the African continent.

Our Values

• Ethical and responsible approach to business

• Entrepreneurialism

• Teamwork


South Africa

Côte d’Ivoire

AFRICA

Key features:• First and only onshore petroleum

production right in South Africa

• Acquired November 2015

• Production started May 2016

• Proven reserves of methane-rich natural gas – clean substitute for transport fuel, thermal fuel and power

• Production right issued by Department of Mineral Resources and valid for another 25 years

• Holds a licence from NERSA to store and trade in gas

• R2.2 billion current valuation based on single production right and access to markets

• Potential to generate returns across the beneficiation curve

• High client density and limited competition

• One of the richest sources of helium recorded globally

• Holds an additional three onshore petroleum exploration rights in South Africa

TETRA4

Key features:• Prefeasibility study complete and

highly prospective

• Feasibility study underway

• Potential for minimum of 25MW installed capacity

• Grid connection in close proximity

• 8.9% economic growth rate in Côte d’Ivoire in 2015

• Côte d’Ivoire has some of the longest-standing PPPs and IPPs in Africa

• Côte d’Ivoire has a stable business environment

• The framework is a build, operate and own model signed directly with the Ministry of Energy

• Off-take agreements are typically signed on a 35-year take or pay arrangement with the state-owned utility, CI-Energies

MEGA POWER RENEWABLES

OUR ASSETS

A HYDRO-ELECTRIC SCHEME IN THE FIRST STAGES OF DEVELOPMENT IN CÔTE D’IVOIRE

A NATURAL GAS AND LIQUEFIED HELIUM COMPANY

IN THE FREE STATE, SOUTH AFRICA


Long-term

• To become the pre-eminent listed African energy-focused investment vehicle

• Provide the flexibility of a private equity firm, with the advantages of a listed company:

– Eligible for investment by pension funds

– No non-dilutive management performance fee detracting from investor returns

– Flexibility to divest when the most value can be secured as there is no prescribed date for divestments

• To reach mid-cap ALSI by a combination of organic growth and raising capital for new projects

Our growth strategy

Our proposition to investors

Short-term

• Early-stage growth company

• Listed on AltX

• Developing early-stage projects to revenue production

• Deliver capital growth through creation of value

Medium-term

• Hold a portfolio of assets in diversified lifecycle stages

• Partially or fully exit revenue generative projects for attractive returns

• Capital from disposals redeployed to new early-stage projects

Funding base

• Equity by issuing new shares to investors

• Disposals of mature assets

• Debt funding for specific projects that qualify, to reduce dilution for existing shareholders

Strategic objectivesFinancial sustainability• Delivering superior returns through

the development of alternative energy projects

Early-stage development• Investing in projects and businesses

which are not yet mature enough to be considered a fit for mainstream investors

RENERGEN OVERVIEW (continued)

OUR GROWTH STRATEGY AND BUSINESS MODEL

Social responsibility• Developing viable projects that do

not have access to funding from traditional sources, contributing to Africa’s energy self-sufficiency

• All investments have a social component ensuring improvement either to the environment or to communities in which we operate

Access to power• Lead the way in bringing access

to power to Africans through investments

• The continent requires access to sustainable power in order to fuel growth and improve quality of life for millions of Africans


Demand drivers

Globally the use of renewable energy and alternative energy sources is growing rapidly. Renewable energy is increasingly contributing to the development of a low-carbon economy and the goal of keeping global temperature within the two degrees Celsius limit as agreed on at the UN Paris Climate Conference in December 2015. Although renewable energy is an integral part of addressing climate change, it also contributes to economic growth, job creation and energy security.

Africa is home to 13% of the world’s population but only 3% of energy consumption. Fifty percent of Africans will be living in cities by 2030, the fastest urbanising continent in the world. Sufficient cost-effective energy must be provided to meet the

annual urban growth rate. Economic growth on the continent continues to accelerate, with GDP growth expected to strengthen to 5% in 2016. (Sources: McKinsey and Company’s Powering, February 2015; Africa International Energy Agency, Africa Energy Outlook 2014). Africa has significant access to natural gas reserves, rivers conducive to the construction of hydro power stations and an abundance of solar energy. Tapping into alternative and renewable energy is vital to harness the power needed to continue to stimulate economic growth and development.

South Africa’s Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) is the fastest-growing renewable energy programme in the world and one of Africa’s biggest infrastructure

investments, according to the goverment’s paper, the State of Renewable Energy in South Africa, published in September 2015. The Integrated Resource Plan 2010 set a target of 17,800MW (equivalent to 42%) of new electricity generation capacity to be derived from renewables. The World Wildlife Fund calls South Africa’s renewable energy sector “a flagship public-private partnership model for SA and the rest of Africa”.

Resource extractionEight percent average annual growth in mineral resource extraction in sub-Saharan Africa is expected over the next decade, driving demand for affordable alternative and renewable energy, according to research by Oxford Economics, published in PWC’s Capital project and infrastructure spending Outlook to 2025.

Infrastructure developmentTen percent average annual growth in infrastructure spend in sub-Saharan Africa is expected over the next 10 years, with an anticipated spend of US$180 billion by 2025 according to PWC’s Building the Future of Africa March 2015. Development of new and replacement of aging infrastructure provides unique opportunities to incorporate alternative energy solutions.

Economic diversification of sub-Saharan economiesA substantial need for alternative and renewable energy is required to support the fast-growing manufacturing sector in the region.

Population growth and urbanisationThe growth and development of the middle class in sub-Saharan Africa accompanied by rapid urbanisation is expected to increase consumption of energy exponentially.

Demand for connectivityAs economic growth continues, so does the load on the telecommunication networks and the requisite energy resources to keep communications infrastructure operational.

Our operating context


Target asset classes:• Clean energy

– natural gas, biogas, etc.

• Renewable energy

• Traditional energy with enhanced emission reduction. May include fossil fuels, but with an objective to reduce carbon footprint from improved operations, for example

• Associated services – transmission lines, pipelines, energy logistics, etc.

Targets businesses:• Operate in the alternative energy

sector or offer the potential to improve carbon footprint and profitability of the operation by upgrading and modernising outdated infrastructure

• Market value less than intrinsic value or the potential to improve the business through Renergen’s expertise, influence and business relationships exists

• Managed by strong, experienced team or their potential to unlock value and maximise profits by leveraging underlying business opportunities, technology and asset profile

INVESTMENT MANDATE INVESTMENT CRITERIA

Assessment criteria:• Macro factors affecting target

• Business case and growth potential

• Due diligence – financial and legal

Other considerations:• Dividend yield

• Growth in sales

• Balance sheet

• Management team capabilities

• Earnings and cash flow

Does the target have a strong, experienced management team or can it be leveraged to create and unlock value and maximise assets?

Would investment lead to strategic cross-pollination opportunities in the future for Renergen?

Would investment enhance the business’ and Renergen’s growth potential?

Is the opportunity in a sector with long-term upside potential?

Is the target in the alternative energy space or could investment reduce emissions?

INVESTMENT STRATEGY

Is the target profitable or close to becoming so?

RENERGEN’S BUSINESS MODEL



TETRA4Tetra4 is a natural gas producer that provides sustainable, clean energy solutions to large-scale energy users in the Free State Goldfields region. It has 10 methane-rich natural gas and uniquely occurring helium wells. The natural gas is beneficiated, offering “Wellhead to Tank” Compressed Natural Gas (CNG) solutions for the transport, mining and industrial markets. The helium is pre-sold and will be separated, liquefied and transported by Afrox and Linde.

Tetra4’s CNG offering provides clean energy for power generation, thermal applications and as a fuel substitute. The onshore resource benefits from numerous large-scale energy users in close proximity, in an area of the country, which has traditionally been energy starved. Tetra4’s approach of “Wellhead to Tank” solutions makes a compelling proposal to potential clients in the area and ensures swift access to energy for our clients.

Geological ResourceTetra4 owns the production right which spans 187 000 hectares in the Free State near Virginia, Theunissen and Welkom and is surrounded by a further 98 000 hectares of exploration rights. The company owns a second exploration right of a 52 000 hectare field located in Evander, Mpumalanga as well as farm-in rights to two reserves near the towns of Kroonstad and Heilbron.

OUR ASSETSAs set out in the Independent Qualified Reserve Evaluator Report (incorporated in the circular to Renergen shareholders dated 28 October 2015, which is available on the company website, www.renergen.co.za) prepared by Venmyn Deloitte and dated 21 October 2015, the gas field has the following reserves:

• Proven: 25 billion cubic feet

• Probable: 88 billion cubic feet

• Possible: 245 billion cubic feet

The Free State field is an exceptional gas reserve as the gas originates from deep-seated bacteria and finds its way to the surface via various geological structures. Due to the nature of the origin of the gas, the lifespan of the producing wells is significantly longer than traditional wells, as regeneration occurs.

The gas also contains a very high concentration of helium. Almost all of the world’s helium is produced in the USA. Helium production is mainly as a result of radioactive decay, and owing to the high levels of uranium and thorium in the Wits Basin in the Free State, Tetra4 enjoys high concentrations of helium in its gas (up to 7% has been recorded across the reserve, with an average 2.5%).

The geology also makes for low-cost extraction as the gas flow has a very low pressure, further reducing the cost of drilling.

CNG MARKET

CNG has been used as a fuel substitute for decades in countries in Europe, South America, Asia and other African countries. In South Africa the gas economy is almost entirely dependent on local production of Liquefied Petroleum Gas (LPG) and natural gas imported from Mozambique. LPG is produced as a by-product of producing refined fuels and transported by road to customers. There are frequent constraints in supply. The Free State often has a limited supply as the larger markets of Gauteng and KwaZulu-Natal are give preference. Natural gas imported from Mozambique comes via Republic of Mozambique Pipeline Company (ROMPCO) pipeline to Johannesburg and is supplied mainly to users close to the pipeline. In addition, the ROMPCO pipeline has a deficit of gas. Although there are several smaller entrants that serve private retail markets they are also dependent on Sasol for natural gas.

The South African government is committed to developing the gas economy in South Africa. The Department of Trade and Industry’s 2015 Industrial Policy Action Plan indicates that a Transformative Gas Industrial Policy is on the horizon. McKinsey Global Institute’s 2015 research, “South Africa’s big five: bold priorities for inclusive growth”, says natural gas could unlock new industries in the country that would add R250 billion to the gross domestic product and create 300 000 jobs by 2030.

Wellhead to Tank Business ModelTetra4: Vertically Integrated Business Model

Upstream Midstream Downstream

Wellhead

Gas dryer + Compression +

LogisticsIndustrial burner Power generator Vehicle filling station


Tetra4 is located in a region with a very limited supply of energy and large mining companies. CNG may be used as a diesel substitute for vehicles and underground locomotives, as a replacement to power paraffin that could fire gold plants or provide comfort heating, and to generate electricity. The company’s vertically integrated business model will allow Tetra4 to capture revenues at every point along the way. The midstream and downstream opportunities will generate the bulk of the returns.

Tetra4 has adopted a phased business development approach. The company has commenced a full Environmental Impact Assessment (“EIA”) in relation to constructing the pipeline that is expected to be approved in early 2017. Prior to this, only limited production may take place. Tetra4 is planning its pipeline that will connect all the wells and terminate at a central processing plant where the natural gas will be compressed and helium separated and liquefied.

In May 2016, Tetra4 started supplying CNG to its first customer, Megabus. Tetra4 has installed a compressor at one well. Multiple mobile tube trailers are filled with CNG at the wellhead and deliver the gas to Megabus’ depot where the tankers are connected to a gas dispenser. Megabus has purchased 10 buses operating on CNG exclusively and has a fleet of over 250 buses in the region. The first project is seen as the pilot for the broader opportunity.

A new series of wells is planned with drilling having commenced in May 2016.

Helium marketSouth Africa currently uses an estimated 300–400kg per day of helium, mainly imported. Helium is used in the medical industry for MRI machines, fibre optics, electronics, telecommunications, superconductivity, underwater breathing, welding, nuclear power stations and party balloons.

The world’s largest consumer of helium is the European Organisation for Nuclear Research (CERN), the particle accelerator in Switzerland, which consumes 220 tons per annum.

Helium is very difficult to transport, requiring specialised tanks that hold it in a liquid form but only for 45 days. The time limitations in transporting helium naturally protect the local market. However, Tetra4’s production capacity and accessibility to Europe and the US in terms of shipping opens export prospects.

On 4 May 2016 Tetra4 and the Linde Group concluded a long-term take-or-pay agreement for the life of plant that includes Linde Group supplying the technology and export capability. The agreement is 80% of the production for the life of the plant, which is expected to be a minimum of 15 years.

Tetra4’s operationsTetra4 employs staff only across core day-to-day functions and outsources the remaining specialised activities such as construction, drilling, engineering, environmental, legal and geology to leading industry professionals. All equipment installed is proven technology. The company has implemented safety protocols that are in line with international standards. All operations comply with the required legislation including:

RENERGEN OVERVIEW OUR ASSETS (continued)

1

2

THE COMPANY’S VERTICALLY INTEGRATED BUSINESS MODEL WILL ALLOW TETRA4 TO CAPTURE REVENUES AT EVERY POINT ALONG THE WAY.

1. The first successful trial of a locomotive operating on CNG above ground at Sibanye Gold Limited’s operations in the Free State

2. Installation of the first compression station at site in the Free State


• Mine Health and Safety Act of 1996

• Occupational Health and Safety Act of 1993

• Hazardous Substances Act 1973

• Mineral and Petroleum Resources Development Act of 2002

• National Environmental Management Act of 1998

Social responsibilityTetra4 identified a local school, Stilte Primary School, as the beneficiary of its Social and Labour Programme. The school was dilapidated and, through the company’s patronage, since 2013 has been transformed, receiving the following:

• Solar Borehole Pump – supplied and will be installed when required

• Classroom – supplied and installed. Burglar proofing and security gate were added

• Classroom furniture – the above classroom equipped for 30 learners, together with a teacher’s desk and chair, green board and pin board

• Upgrading of play area – 70m2 of the grounds have been paved, as discussed with Mrs Dikgole, the headmistress of the School

• Sports ground preparation – ground was levelled, graded and rubble removed

• Sports field equipment – soccer goals and netball posts have been installed. Each scholar was supplied with either a netball or soccer ball

• Additional assistance – Robert Katzke Tetra4’s Operations Manager assisted the headmistress with tidying up the electrical pump connection and laying an underground pipe for water flow-off from the drinking fountain

MEGA POWER RENEWABLESLocated in Côte d’Ivoire in West Africa, the Missilou and Marabadiassa projects are prospective hydroelectric power schemes. The two sites are estimated to produce a minimum of 25MW. The grid connection is in relatively close proximity.

Renergen funded the prefeasibility study in return for 62% of the equity of the combined projects. The remaining equity is held by a local partner, Capital Holdings SA, and Megatron Proprietary Limited, the company that originated the scheme. The prefeasibility studies are positive and the final feasibility study is under way. It will be completed towards the end of 2016. The total estimated project cost is US$85 million.

Côte d’Ivoire’s economy is rapidly expanding, with GDP growth of over 8% for the last four consecutive years. French-speaking West Africa’s largest economy, it has seen a revival since the end of a decade-long period of civil wars in 2011. The country also has some of the longest-standing PPP and IPPs in Africa, dating back to the 1970s. James Wilson describes Côte d’Ivoire as having one of the most promising power sectors in Africa, in a recent article published in the Financial Times on 27 September 2015, citing coverage and the regulatory framework as being conducive to independent power producers developing projects.

3 4

5

3. Tetra4 at the Stilte Primary School

4. Children at the Stilte Primary School with their new sports equipment at the unveiling of the new class room

5. Preparations of the new class room prior to the unveiling


ONE Brett Kimber (55)

Independent non-executive chairmanQualifications: BSc Hons Mineral Economics, BSc Hons Geochemistry

Brett stepped down as managing director of African Oxygen Limited (Afrox) in January 2015 after a 25-year career in the broader Linde Group across Asia, the US and South Africa. He graduated with a BSc Hons Geochemistry in 1987 and joined Anglo American in 1988 as a senior research geologist before joining the then BOC Group (now Linde Group) in 1990 where he served in various capacities.

TWO Mbali Swana (59)

Independent non-executive deputy chairman, chairman of the Audit and Risk CommitteeQualifications: Bas (UCT), BArch (UCT), Pr Arch (SA), MIAT (SA)

Mbali is the Chief Executive Officer of Prop5 Corporation Proprietary Limited (Prop5), a turnkey built environment infrastructure and engineered products developer which he founded in 1986. Mbali has significant experience in implementing large-scale projects across Africa, and is currently developing Prop5’s Africa-wide strategy for the development of infrastructure.

OUR BOARD

INDEPENDENT NON-EXECUTIVES

FOUR Luigi Matteucci (62)

Independent Non-executive Director, Member of the Audit CommitteeQualifications: CA(SA)

Luigi actively consults on strategic and business development initiatives in the mining and engineering field. He served in senior management positions and as Financial Director of Highveld Steel and Vanadium Corporation Limited for 18 years up to 2007 where he implemented successful cost reduction and efficiency strategies.


TWO

THREE Russell Broadhead (54)

Independent non-executive director, member of the Audit and Risk CommitteeQualifications: Higher National Diploma in Building Studies, Senior Management Development Programme.

Russell has over 25 years’ experience in engineering in the UK, Middle East and Africa. After a one-year project management role with Alstom in France, Russell was appointed as general manager of Alstom SA and held the position from 1999 to 2002. Since 2002 Russell has held the position of managing director of Grinaker-LTA Power and subsequently Edison Jehamo Power following a management buy-out. He continued in this position with Symbion-PNC following further restructuring. Russell has recently been appointed as the projects director of Megatron Federal operating business, a division of Ellies Proprietary Limited.

ONE

FOUR

THREE


FIVE Reginald Edmond Cooke (Eddie) (42)

Executive director, member of the Audit and Risk CommitteeQualifications: Mechanical Engineering National Diploma, International Training on Liquid Petroleum Gas and Compressed Natural Gas in the USA, Brazil, Argentina and Italy

Eddie started his career as a Mechanical Engineer and after obtaining five years’ work experience he started a Liquefied Petroleum Gas business. After natural gas was introduced into South Africa Eddie became involved with the conversion of vehicles to run on CNG. He has been involved in CNG and all its associated technology for over nine years. Eddie currently serves as director on the Southern African Gas Association (SAGA) and as vice chairman of the Southern African Biogas Industries Association (SABIA).

SIX Stefano Marani (38)

Chief Executive OfficerQualifications: BSc Actuarial Science, BSc Hons in Advanced Mathematics of Finance

Stefano was the Chief Executive Officer of Tetra4, the company acquired by Renergen in November 2015. The company was previously known as Molopo South Africa Exploration and Production Proprietary Limited. He was part of the team that acquired Molopo from its previous owners and has been involved with the company in a management role since April 2013. Stefano has significant experience in the areas of structured finance and advisory. After completing his formative training with Deutsche Bank, he was recruited by Morgan Stanley in London, where he was ultimately charged with building their sub-Saharan African fixed income capital markets business.

EXECUTIVES

SEVEN Nick Mitchell (37)

Chief Operating OfficerQualifications: Microsoft Certified Systems Engineer (MCSE) A+ Certified

Nick was instrumental in the acquisition of Tetra4, previously known as Molopo, from Molopo Energy Limited in October 2013. He subsequently developed and implemented Tetra4’s vertically integrated business plan. Nick has extensive experience in infrastructure projects across Africa supported by a network in territories including Côte d’Ivoire, the Democratic Republic of Congo and Mozambique.

EIGHT Fulufhedzani Ravele (Fulu) (29)

Chief Financial OfficerQualifications: B Comm Financial Accounting, Postgraduate Diploma in Accounting, CA(SA)

Fulu obtained her CA(SA) qualification with Deloitte South Africa in 2012. She has experience in financial accounting, internal and external audit. After qualifying as a CA(SA), she was seconded to Deloitte LLP Los Angeles office as an audit senior. Fulu was appointed as a management accountant at Barclays Capital South Africa in June 2013, were she focused on reporting financial results for Corporate and Investment Banking (CIB) South Africa and Rest of Africa. Fulu joined Molopo South Africa as financial director in July 2015.

SIX

FIVE

SEVEN

EIGHT


We listed as the first SPAC on the JSE and are now the first listed alternative energy company on the JSE’s AltX exchange. The energy sector offers significant opportunities and Renergen has a solid pipeline of potential acquisitions.

Introducing our first assetWithin a few months of listing we acquired Tetra4 from Windfall, which holds the only onshore petroleum production right in South Africa. Tetra4 started supplying CNG to its first customer in May 2016. Tetra4 is a good fit to Renergen’s investment strategy with proven reserves of natural gas and helium and offers upside for Renergen as the resource is further developed.

Renergen recently concluded an off-take agreement with Linde Group for Tetra4’s helium resource.

Access to Tetra4’s natural gas reserve and extensive local demand has created the perfect scenario to build a sustainable business model with quality off-take agreements. The Windfall team, which included our CEO, Stefano and COO, Nick, has helped develop a fully-integrated business model encompassing the entire value chain by harnessing the value across the full beneficiation curve. Our executives have been instrumental in bringing the asset from an exploration right to production and generating the first revenue from the resource. We will

IT IS A PLEASURE TO REPORT ON THE PROGRESS MADE BY RENERGEN SINCE LISTING IN JUNE 2015, PARTICULARLY AS WE HAVE ACHIEVED KEY MILESTONES IN OUR GROWTH STRATEGY

LEADERSHIPAND GOVERNANCE

CHAIRMAN’S AND CEO’S REPORT


continue to implement the business model, establishing the infrastructure and concluding a further number of off-take agreements that are already on the table.

In the medium- to long-term Renergen believes the key to creating shareholder value in Tetra4 will be increasing proven reserves and then introducing power generation directly to local customers. We have plans and initiatives in place that should achieve significant increases in reserves over the next three to five years. These include exploiting the exploration rights in the Free State and Mpumalanga and focusing on targeted drilling.

Introducing our second assetA second acquisition of Mega Power Renewables, a hydroelectric opportunity in Côte d’Ivoire that was being developed by Windfall, was purchased by Renergen as part of the Tetra4 acquisition.

The completed prefeasibility study indicates that this may be a promising prospect. As a result Renergen has continued to progress towards a bankable feasibility study. Once the feasibility study has been completed, Mega Power Renewables Africa and Compagnie Ivoirienne d’Electricité CI-Energies (a state-owned utility) will enter into negotiations on a power purchase agreement which typically takes the form of a 35-year take-or-pay arrangements.

Côte d’Ivoire is an attractive investment destination with a GDP growth of over 8%, a stable business environment and an established electricity sector that is governed by a well-established governance framework. The country has adopted the French legal system and has also signed up to the OHADA principles, a system of business laws in West Africa.

Governance and risk managementRenergen strives for the highest standards of corporate governance. We are implementing robust governance structures.

Although still a young business, Renergen’s board has been focused on ensuring that we understand, control and report on risks that govern or may impact on our business. To this end Renergen has established an Audit and Risk Committee to ensure the following areas are given specific priority:

• Financial and sustainability reporting

• Internal financial controls

• External audit process

• Internal audit process

• Corporate law

• Risk management

• Sustainability issues

• Information technology governance

It is a prerequisite that all members of the committee are suitably skilled

and experienced independent, non-executive directors. The members of the committee must collectively have sufficient qualifications and experience to fulfil their duties.

As announced on SENS on 3 May 2016 Renergen is pleased that Mr Luigi Matteuci has accepted an offer to join the board as an independent non-executive director and member of the the Audit and Risk Committee. Luigi is a qualified chartered accountant CA(SA) and comes with a vast amount of both mining and industrial experience. We look forward to his contributions at a board level.

Renergen has also established a Governance, Ethics, Transformation and Compensation Committee.

AppreciationWe would like to extend our appreciation to our fellow directors for the commitment and enthusiasm they have demonstrated. Our executive and non-executive directors have all worked tirelessly during the year and their contributions are much appreciated.

Brett Kimber Stefano MaraniChairman CEO

CH₄


Ethical leadershipRenergen is committed to upholding the highest standards of ethics, transparency and good governance while pursuing wealth and value creation. To this end the board is committed to implementing sound governance principles and practices in terms of relevant local and international best practice. Renergen has a newly constituted board and has recently assessed the application of the principles set out in the King Code.

The boardRenergen’s board comprises four executive, and four independent non-executives, including board chairman Brett Kimber. The responsibilities of the independent non-executive chairman and the CEO, and the remaining independent non-executive and executive directors, are strictly separated to ensure that no director can exercise unencumbered decision-making. The chairman provides independent board leadership and guidance and encourages suitable deliberation on all matters requiring the board’s attention. He further ensures the board operates efficiently and as a unit. The CEO and other executive directors are accountable for strategy implementation and making day-to-day operational decisions. Independent non-executive directors are not involved in the daily operations of the company.

The independent non-executive directors are high merit individuals who objectively contribute a wide range of industry skills, knowledge and experience to the board’s decision-making process. These directors are not involved in the daily operations of the company.

LEADERSHIP AND GOVERNANCE (continued)

GOVERNANCE REPORT

At any time all independent non-executive directors have unrestricted access to management and to the group’s external auditors. Further, all directors are entitled to seek independent professional advice on any matters pertaining to the group as they decide is necessary, and at the group’s expense.

The board meets quarterly with ad-hoc special meetings convened as necessary. Details of directors’ attendance at board and board committee meetings during the year are set out on pages 18 and 19.

A formal board charter that sets out its responsibilities and authority governs the board. The charter is in line with King III and is reviewed annually. It regulates the parameters within which the board operates and ensures the application of the principles of good corporate governance. It further sets out the roles and responsibilities of the board and its directors in line with sustainability practices.

The Audit and Risk and Governance, Ethics, Transformation and Compensation Committees assist the board in discharging its duties. The directors acknowledge that, notwithstanding this delegation, ultimate accountability and responsibility for the performance and affairs of the company and the group remains with the board.

Appointments to the board are made in a formal and transparent manner. The company does not have a nominations committee; our Memorandum of Incorporation allows for the board to elect a director, whose appointment is confirmed by shareholders at the Annual General Meeting. Procedures for appointment to the board include background and reference checks and individual interviews to ensure appointees are reputable and competent.

RENERGEN IS COMMITTED TO UPHOLDING THE HIGHEST STANDARDS OF ETHICS, TRANSPARENCY AND GOOD GOVERNANCE WHILE PURSUING WEALTH AND VALUE CREATION


Company secretaryAll directors have access to the company secretary. Renergen has appointed Acorim Proprietary Limited, which has extensive experience in the boardroom. The company secretary assists with the full range of services in order to ensure that the board and its directors have considered all aspects in terms of the ongoing good corporate governance of the company and addressed the items in the board and committee charters. A summary of service provided are listed below:

• Ensuring compliance with Companies Act, King III and JSE Listings Requirements

• Assistance with board pack compilation

• Drafting notices and agendas

• Attending meetings and advising structure and guidance

• Drafting annual work plans, charters and terms of reference (TOR)

• Recording and transcription of minutes within seven days

The board is of the opinion that the company secretary is suitably qualified and experienced to carry out their duties as stipulated under section 88 of the Companies Act. The board is satisfied that an arm’s length relationship exists.

The performance of the company secretary is assessed on an annual basis by the board. The board considered the following in reaching the assessment:

• Qualifications of Acorim’s representatives

• Acorim has the correct level of resources available to provide the required services

• Independence

Delegation of authority

Company structure

Operations

Governance, Ethics, Transformation

& Compensation Committee

Executive

Audit Committee

Renergen Board

Finance

Renergen Exco


THE BOARD

Responsibility The board is responsible and accountable for the performance and affairs of the group and has full control over all the underlying companies in the group. It aims to exercise sound judgement and leadership with integrity based on the King III principles.

ResponsibilitiesAcquisitions and disposalCorporate commutationsFixed assets >R10 millionProperty acquisitionsLitigationDebt >R10 millionBusiness plan

Members and meetings attendance

Executive directors Attendance/(Number of meetings)

Stefano Marani (CEO) 3 (3)

Nick Mitchell (COO) (appointed 25 November 2015) 1 (3)

Clive Angel (CFO) (resigned 25 November 2015) 2 (3)

Fulu Ravele (CFO) (appointed 25 November 2015) 1 (3)

Eddie Cooke (appointed 16 February 2016) (Changed from independent non-executive director to executive director as per announcement released on SENS on 3 May 2016)

3 (3)

Independent non-executive directorsBrett Kimber (chairperson) 3 (3)

Mbali Swana 3 (3)

Russell Broadhead 3 (3)

Luigi Matteuci (appointed 3 May 2016)

Number of independent non-executive directors 4/8

Achievements during the year

During the year the board:

• agreed and implemented an operating charter

• agreed on an annual work plan

• agreed and implemented a level and delegation of authority matrix

• concluded the acquisition of Tetra4

• established two board committees: Audit and Risk, and Governance, Ethics, Compensation and Transformation

• Appointed a suitably-qualified CA(SA) to the board and Audit and Risk Committee

LEADERSHIP AND GOVERNANCE GOVERNANCE REPORT (continued)

Board processesRenergen’s board, although relatively young in terms of its existence, has created an optimal efficiency for board processes that allows for greater contribution from directors, which is summarised as follows:

• The board has established ground rules for meeting behaviours

• The chair encourages directors to actively participate in meetings

• The meeting agenda is structured to ensure matters for decision are dealt with early in the meeting

• The meeting agenda allows adequate time for discussion at board meetings, as well as for information sharing

• The board pack is delivered at least seven days prior to board meetings

• A standard format is used

• The board regularly reviews the content and format of the board papers

• The minutes of board meetings provide an accurate account of the board’s decision-making which demonstrates the due care and diligence of the directors regarding the matters put before them

• The minutes are distributed to directors as soon as possible after a board meeting, to confirm their accuracy and assure that any mistakes are promptly identified and corrected

• The minutes describe and record all declared conflicts of interest

• All action items from board meetings followed up or completed

• The board has a comprehensive calendar setting out its annual activities

• The board’s committees have a charter or terms of reference that clearly sets out its roles and responsibilities


COMMITTEES

AUDIT AND RISK COMMITTEE (for the full report see page 30)

GOVERNANCE, ETHICS, TRANSFORMATION AND COMPENSATION COMMITTEE

Responsibility To assist the board with the monitoring of social and ethical matters including:

• Financial and sustainability reporting

• Internal financial controls

• External audit process

• Internal audit process

• Corporate law

• Risk management

• Sustainability issues

• Information technology governance

• The governance processes within the company

To assist the board with the monitoring of social and ethical matters including:

• Processes, policies and practices of remuneration board appointment

• Industrial relations

• Social and labour

• Regulatory matters

• Human resources

• Executive compensation

Members and meetings attendance

Independent non-executive directors

MembersMbali (Chair) (INED)

Russell (INED)

Luigi (appointed on 3 May 2016) (INED)

Nick (ED)

Invitees:Stefano(ED)

Fulu (ED)

Nick (ED)

Audit, Risk and IT committee held their first meeting in May 2016 after year end. Audit discussions are held separately from the Risk and IT discussions to ensure the correct balance of directors and separation of responsibilities is maintained in compliance with the King code of corporate governance.

Members Attendance/(Number of meetings)

Brett (Chair) (INED) 1 (1)

Eddie (ED) (changed from INED to ED as per the announcement made on 03 May 2016)

1 (1)

Luigi (appointed on 3 May 2016) (INED)

Nick (ED) 1 (1)

Invitees

Stefano (ED) 1 (1)

Fulu (ED) 1 (1)

Number of independent non-executive directors

3/3 2/6

Achievements during the year

Have not completed a full year of operation. The committee had its inaugural meeting on 9 May 2016.

Agreed and implemented a committee charter

During the reporting period, the combined Governance, Ethics, Transformation and Compensation committee was chaired by Brett Kimber, chairman of the board. In keeping with the principles set out in chapter 2 of the King Code which state, inter alia, that the Compensation Committee should not be chaired by the chairman of the board, Luigi Matteuci has been appointed as chairman of the Governance, Ethics, Transformation and Compensation committee with effect from 18 August 2016

*ED = executive director INED = Independent non-executive director

ComplianceRenergen complied unless otherwise noted (throughout the review period) with all the necessary legislation and recommendations throughout the review period:

• JSE Listings Requirements

• Companies Act

• King III Principles

In addition Renergen submits regular reports as required by the following regulators:

• PASA in respect of the exploration rights, production rights and social and labour report

• NERSA in relation to storage licence and trading license

Renergen is compliant with OSH Act and Mine, Health and Safety Act for legal appointments.

Application of King IIIChapter 2 of the company’s King III compliance checklist is set out on pages 20 to 23. The full King III compliance checklist can be found on the company website.


LEADERSHIP AND GOVERNANCE

APPLICATION OF KING III

PRINCIPLE APPLIEDPARTIALLY

APPLIEDUNDERREVIEW NOTES

Ethical Leadership and Corporate Citizenship

1 Effective leadership based on an ethical foundation

2 Responsible corporate citizen

3 Effective management of company’s ethics

Boards and Directors

4 The board should act as the focal point for and custodian of corporate governance

5 Strategy, risk, performance and sustainability are inseparable

6 Directors act in the best interests of the company

7 The Chairman of the Board is an independent non-executive director

8 The CEO should not also be the Chairman of the Board of directors

9 The board appoints the CEO

10 A framework for the delegation of authority has been established

11 Capacity of directors in relation to executive, non-executive and independent must be categorised and documented

12 A balance of power and authority exists at board level

13 Directors are appointed through a formal process

14 Formal induction and on-going training of directors is conducted

15 The board is assisted by a competent, suitably qualified and experienced Company Secretary

16 Regular performance evaluations of the board, its committees and the individual directors

In compliance with various regulatory frameworks (including the JSE Listings Requirements, the Companies Act and King III), the Renergen board and its Committees have contracted an external independent service provider to conduct a comprehensive evaluation of the board collectively, a review of individual directors’ performance and a review of the Chairman’s leadership. The board and Committee evaluation, conducted through questionnaires, will provide the board of directors with the opportunity to enhance performance and to better meet the needs of the company and its stakeholders.




17 Appointment of well-structured committees and oversight of key functions

18 An agreed governance framework between the group and its subsidiary boards

19 Directors and executives are fairly and responsibly remunerated

20 Remuneration of directors and senior executives is disclosed

21 The company’s remuneration policy is approved by its shareholders

22 The board should consider rescue proceedings or other turnaround mechanisms as soon as the company is financially distressed as defined in the Companies Act of South Africa

23 The board reports on the effectiveness of the company’s system of internal controls

The board has not yet served a full year. Evaluations using best practice methodologies will take place in November following the completion of one full year of operation.

Internal Audit

24 Effective risk-based internal audit No internal audit function. The board will ensure that an effective risk- based internal audit, overseen by the Audit and Risk Committee, is performed once operations commence.

25 Written assessment of the effectiveness of the company’s system of internal controls and risk management

No internal audit function. The board will ensure that an effective risk- based internal audit, overseen by the Audit and Risk Committee, is performed once operations commence.

26 Internal Audit is strategically positioned to achieve its objectives

No internal audit function. The board will ensure that an effective risk- based internal audit, overseen by the Audit and Risk Committee, is performed once operations commence.

Audit Committee

27 Effective and independent

28 Suitably skilled and experienced independent non-executive directors

29 Chaired by an independent non-executive director

30 Oversees integrated reporting

31 A combined assurance model is applied to improve efficiency in assurance activities

Work in progress as the company completes its first full year after conversion from being a SPAC. The Audit Committee is still developing the necessary model and system.




32 Satisfies itself of the expertise, resources and experience of the company’s finance function

33 Oversees Internal Audit Not applicable. The board will ensure that an effective risk-based internal audit, overseen by the Audit and Risk Committee, is performed once operations commence.

34 Integral to the risk management process

35 Oversees the External Audit process

36 Reports to the board and shareholders on how it has discharged its duties

Compliance with Laws, Codes, Rules and Standards

37 The board ensures that the company complies with relevant laws and considers adherence to non-binding rules, codes and standards

38 The board and directors have a working understanding of the relevance and implications of non-compliance

39 Compliance risk forms an integral part of the company’s risk management process

40 The board has delegated to management the implementation of an effective compliance framework and processes

Governing Stakeholder Relationships

41 Appreciation that stakeholders’ perceptions affect a company’s reputation

42 Management proactively deals with stakeholder relationships

43 Strive to achieve an appropriate balance between its various stakeholder groupings in the best interests of the company

44 Equitable treatment of shareholders

45 Transparent and effective communication to stakeholders

46 Disputes are resolved effectively and timeously

The Governance of Information Technology

47 The board is responsible for information technology (IT) governance

48 IT is aligned with the performance and sustainability objectives of the company

49 Management is responsible for the implementation of an IT governance framework

50 The board monitors and evaluates significant IT investments and expenditure

Work in progress as the company completes its first full year after conversion from being a SPAC. There were no significant IT investments and expenditure in the February 2016 year. The Governance, Ethics, Transformation and Compensation committee is still developing its policies and systems to manage this element.

LEADERSHIP AND GOVERNANCE APPLICATION OF KING III (continued)




51 IT is an integral part of the company’s risk management

Work in progress as the company completes its first full year after conversion from being a SPAC. The Governance, Ethics, Transformation and Compensation committee is still developing its policies and systems to manage this element.

52 IT assets are managed effectively

53 The Audit and Risk Committee assists the board in carrying out its IT responsibilities

The Governance of Risk

54 The board is responsible for the governance of risk and setting levels of risk tolerance

55 The Risk Committee assists the board in carrying out its risk management responsibilities

56 The board delegates the process of risk management to management

57 The board ensures that risk assessments are performed on a continual basis

58 Frameworks and methodologies are implemented to increase the probability of anticipating unpredictable risks

59 Management implements appropriate risk responses

60 The board ensures continual risk monitoring by management

61 The board receives assurance on the effectiveness of the risk management process

62 Sufficient risk disclosure to stakeholders

Integrated Reporting and Disclosure

63 Ensures the integrity of the company’s integrated report

64 Sustainability reporting and disclosure is integrated with the company’s financial reporting

Work in progress as the company completes its first full year after conversion from being a SPAC.

65 Sustainability reporting and disclosure is independently assured

Work in progress as the company completes its first full year after conversion from being a SPAC.


Risk control frameworkRenergen has a large appetite for risk given the investment focus. The Audit and Risk Committee is responsible for ensuring that the risks the company takes are those that the shareholders seek to gain exposure to, and to reduce the likelihood of unintended risks creeping into the system.

Renergen has built its risk control framework based on the ISO 31000: 2009 principles, adopting the approach that the success of risk management will depend on the effectiveness of the management framework providing the foundations and arrangements that will embed it throughout the group at all levels. The framework assists in managing risks effectively through the application of the risk management process at varying levels and within specific contexts of the

company. The framework ensures that information about risk derived from the risk management process is adequately reported and used as a basis for decision-making and accountability across the company. Key elements of the framework have been adopted below for the purpose of creating a robust framework within which Renergen’s Audit and Risk Committee will operate.


RISK REPORT

Mandate and commitment

Monitoring and review of the framework

Design of framework for managing risk

Understanding the group and its context

Establishing risk management policy

Accountability

Integration into organisational processes

Resources

Establishing internal communications and reporting mechanisms

Establishing external communications and reporting mechanisms

4.1

4.2

4.5

4.3

4.4

Continual improvement of the framework

Implementing risk management

Implementing the framework for managing risk

Implementing the risk management process

Framework construction process:


4.1 Mandate and commitmentThe introduction of risk management and ensuring its ongoing effectiveness require strong and sustained commitment by management of the group, as well as strategic and rigorous planning to achieve commitment at all levels. Management should:

• define and endorse the risk management policy;

• ensure that the group’s culture and risk management policy are aligned;

• determine risk management performance indicators that align with performance indicators of the group;

• align risk management objectives with the objectives and strategies of the group;

• ensure legal and regulatory compliance;

• assign accountabilities and responsibilities at appropriate levels within the group;

• ensure that the necessary resources are allocated to risk management;

• communicate the benefits of risk management to all stakeholders; and

• ensure that the framework for managing risk continues to remain appropriate.

4.2 Design of framework for managing risk4.2.1 Understanding of the group and its context

Before starting the design and implementation of the framework for managing risk, it is important to evaluate and understand both the external and internal context of the group, since these can significantly influence the design of the framework. Evaluating the group’s external context may include, but is not limited to:

(a) the social and cultural, political, legal, regulatory, financial, technological, economic, natural and competitive environment, whether international, national, regional or local;

(b) key drivers and trends having impact on the objectives of the group; and

(c) relationships with, and perceptions and values of, external stakeholders.

Evaluating the group’s internal context may include, but is not limited to:

• governance, organisational structure, roles and accountabilities;

• policies, objectives, and the strategies that are in place to achieve them;

• capabilities, understood in terms of resources and knowledge (e.g. capital, time, people, processes, systems and technologies);

• information systems, information flows and decision-making processes (both formal and informal);

• relationships with, and perceptions and values of, internal stakeholders;

• the group’s culture;

• standards, guidelines and models adopted by the group; and

• the form and extent of contractual relationships.

4.2.2 Establishing risk management policyThe risk management policy should clearly state the group’s objectives for, and commitment to, risk management and typically addresses the following:

• the group’s rationale for managing risk;

• links between the group’s objectives and policies and the risk management policy;

• accountabilities and responsibilities for managing risk;

• the way in which conflicting interests are dealt with;

• commitment to make the necessary resources available to assist those accountable and responsible for managing risk;

• the way in which risk management performance will be measured and reported; and

• commitment to review and improve the risk management policy and framework periodically and in response to an event or change in circumstances.

The risk management policy should be communicated appropriately.

4.2.3 AccountabilityThe group should ensure that there is accountability, authority and appropriate competence for managing risk, including implementing and maintaining the risk management process and ensuring the adequacy, effectiveness and efficiency of any controls. This can be facilitated by:

• identifying risk owners that have the accountability and authority to manage risks;

• identifying who is accountable for the development, implementation and maintenance of the framework for managing risk;

• identifying other responsibilities of people at all levels in the group for the risk management process;

• establishing performance measurement and external and/or internal reporting and escalation processes; and

• ensuring appropriate levels of recognition.



4.2.4 Integration into organisational processesRisk management should be embedded in all the group’s practices and processes in a way that it is relevant, effective and efficient. The risk management process should become part of, and not separate from, those organisational processes. In particular, risk management should be embedded into the policy development, business and strategic planning and review, and change management processes.

There should be an group-wide risk management plan to ensure that the risk management policy is implemented and that risk management is embedded in all of the group’s practices and processes. The risk management plan can be integrated into other organisational plans, such as a strategic plan.

4.2.5 ResourcesThe group should allocate appropriate resources for risk management. Consideration should be given to the following:

• People, skills, experience and competence

• Resources needed for each step of the risk management process

• The group’s processes, methods and tools to be used for managing risk

• Documented processes and procedures

• Information and knowledge management systems

• Training programmes

4.2.6 Establishing internal communication and reporting mechanismsThe group should establish internal communication and reporting mechanisms in order to support and encourage accountability and ownership of risk. These mechanisms should ensure that:

• key components of the risk management framework, and any subsequent modifications, are communicated appropriately;

• there is adequate internal reporting on the framework, its effectiveness and the outcomes;

• relevant information derived from the application of risk management is available at appropriate levels and times; and

• there are processes for consultation with internal stakeholders.

These mechanisms should, where appropriate, include processes to consolidate risk information from a variety of sources, and may need to consider the sensitivity of the information.

4.2.7 Establishing external communication and reporting mechanismsThe group should develop and implement a plan as to how it will communicate with external stakeholders. This should involve:

• engaging appropriate external stakeholders and ensuring an effective exchange of information;

• external reporting to comply with legal, regulatory, and governance requirements;

• providing feedback and reporting on communication and consultation;

• using communication to build confidence in the group; and

• communicating with stakeholders in the event of a crisis or contingency.

These mechanisms should, where appropriate, include processes to consolidate risk information from a variety of sources, and may need to consider the sensitivity of the information.

4.3 Implementing risk management4.3.1 Implementing the framework for managing risk

In implementing the group’s framework for managing risk, the group should:

• define the appropriate timing and strategy for implementing the framework;

• apply the risk management policy and process to the organisational processes;

• comply with legal and regulatory requirements;

• ensure that decision-making, including the development and setting of objectives, is aligned with the outcomes of risk management processes;

• hold information and training sessions; and

• communicate and consult with stakeholders to ensure that its risk management framework remains appropriate.

4.3.2 Implementing the risk management processRisk management should be implemented by ensuring that the risk management is applied through a risk management plan at all relevant levels and functions of the group as part of its practices and processes.


4.4 Monitoring and review of the frameworkIn order to ensure that risk management is effective and continues to support organisational performance, the group should:

• measure risk management performance against indicators, which are periodically reviewed for appropriateness;

• periodically measure progress against, and deviation from, the risk management plan;

• periodically review whether the risk management framework, policy and plan are still appropriate, given the organisations’ external and internal context;

• report on risk, progress with the risk management plan and how well the risk management policy is being followed; and

• review the effectiveness of the risk management framework.

4.5 Continual improvement of the frameworkBased on results of monitoring and reviews, decisions should be made on how the risk management framework, policy and plan can be improved. These decisions should lead to improvements in the group’s management of risk and its risk management culture.

Implementation strategyRenergen’s approach to risk starts at the parent level, and applies it uniformly throughout its investments. This ensures consistency and accountability throughout the company at all levels. The Audit and Risk committee will have a number of tools at its disposal, and will continue to evaluate and refine these tools based on the committee’s views on the company’s requirements in order to operate in a safe, professional and profitable manner.

SWOT ANALYSIS

Strengths• Dedicatedteamwithinthe

company

• Knowledgeofenergysector

• ThroughTetra4,holdsthefirstand only onshore petroleum production right in South Africa, creating first mover advantage for onshore petroleum production. Tetra4 in operation within six months of acquisition, ahead of schedule

• Goodrelationshipwithcurrentregulators in South Africa

• Expertsandspecialiststoprovide knowledge and skills available

• Investmentthresholdlesscompetitive (not competing with PE)

Opportunities• Significantshortageof

conventional energy supply in South Africa and rest of Africa

• Shiftinfocusofeconomies to alternative sources of energy

• Needtogroweconomyreliesheavily on increased energy supply

• Limitedcompetitioncurrently

• Increasedrequirementsfordecrease in carbon emissions

• Financialsupportavailable from the government

Weaknesses• Limitedcashforinvestments

• Smallstaffingcomplement,executive team stretched

• Notrackrecord

Threats• Highlyregulatedsector

• Energypricesarevolatile

• Politicalrisk

SWOT ANALYSIS


LEADERSHIP AND GOVERNANCE RISK CONTROL FRAMEWORK (continued)

Management and commitmentRenergen recognises that effective risk management is underpinned by strong and sustained commitment by management, as well as strategic and rigorous planning to achieve commitment at all levels. The board, through the Audit and Risk Committee, is ultimately responsible for the successful implementation and ongoing monitoring of the risk management framework.

Renergen’s risk management frameworkRenergen’s board has an extensive understanding of the external environment both sectorially and geographically. In establishing and subsequently listing the company the board has endeavoured to embed sound governance and regulatory frameworks, as well as clear delegation of authority and strategic investment policies. The board is in the process of establishing a risk management policy, which will clearly state the company’s objectives for, and commitment to, risk management.

Risk managementThe Audit and Risk Committee is an integral component of the risk management process. (see the committee’s report on page 29) With regard to risk the committee is responsible for:

• Overseeing the development and annual review of a policy and plan for risk management to recommend for approval to the board

• Monitoring implementation of the policy and plan for risk management

THE RISK CONTROL FRAMEWORK ASSISTS IN MANAGING RISKS EFFECTIVELY THROUGH THE APPLICATION OF THE RISK MANAGEMENT PROCESS.

taking place by means of risk management systems and processes

• Making recommendations to the board concerning the levels of tolerance and appetite and monitoring that risks are managed within the levels of tolerance and appetite as approved by the board

• Ensuring that the risk management plan is widely disseminated throughout the company and integrated in the day-to-day activities of the company

• Ensuring that risk management assessments are performed on a continuous basis

• Ensuring that frameworks and methodologies are implemented to increase the possibility of anticipating unpredictable risks

• Ensuring that management considers and implements appropriate risk responses

• Ensuring that continuous risk monitoring by management takes place

• Expressing the committee’s formal opinion to the board on the effectiveness of the system and process of risk management

• Reviewing reporting concerning risk management that is to be included in the integrated report for it being timely, comprehensive and relevant

• Focusing on financial risks such as financial reporting risks, internal financial controls, fraud risks as it relates to financial reporting and IT risks as it relates to financial reporting


INDICATORS PERFORMANCE MEASURE

Investment performance Asset earnings increaseONE

Investment in renewable projects

Increase number of projects

TWO

Renewable energy projects value

Progress in stage of completion and

bankable value (ZAR)THREE

Social labour plan Meeting all SLP obligations

FOUR

Internal cash flow generation to meeting

working capital requirements

Increase in cash generated from

operationsFIVE

Maintenance of high-quality safety standards

Zero incident levels on operations site

SIX

KEY PERFORMANCE INDICATORS



OUR REMUNERATION POLICY HAS BEEN DEVELOPED TO CONTINUE AND FOSTER THE COMPANIES ENTREPRENEURIAL CULTURE WITH THE AIM OF ACHIEVING SUSTAINABLE GROWTH WITHIN THE BUSINESS ASSETS.

Our policy embraces our employees and recognises their contributions in execution of the group strategy through fair and balanced remuneration practise. The Governance, Ethics, Transformation and Compensation committee is responsible for developing the remuneration policy, while the board is tasked with its specific implementation to ensure the policy aligns business strategy and objectives with the overall goal of creating and maximising shareholder value.

Key principles that shape our policy:

• a critical success factor for the company is its ability to attract, retain and motivate the talent required to achieve operational and strategic objectives.

• it is envisaged that once the company is delivering on its mandate, a portion of senior management’s reward will be variable and will be determined by the achievement of realistic company targets together with the individual’s personal contribution to the growth and development of the business. This

REMUNERATION REPORT

will be made possible through a combination of a long-term share incentive and a short-term bonus schemes.

• when warranted by exceptional circumstances, special bonuses may be considered as additional awards.

• long-term incentives align the objectives of management and shareholders for a sustained period.

Guaranteed salary policy Guaranteed salaries are reviewed annually. The Executive packages are baselined in arrears against the PWC Directors Remuneration Report using the AltX listed peers as the benchmark while other employees’ structures are typically aimed at the upper quartile when trying to attract the high calibre candidates into the group. The remuneration committee also takes into consideration; business performance, salary practices prevailing in the market, the individual’s performance, expertise and level of experience in the role when setting individual salaries. Packages are negotiated at market-related levels

and, as a general rule, above-average remuneration will be awarded to employees who demonstrate an above-average competency, and who are able to deliver results in keeping with this. Remuneration packages remain competitive to attract and retain the best talent required for the group.

Variable salary policy Currently the remuneration committee has not investigated or recommended a variable pay structure for any of the Executives or any employees.

Performance bonuses All full-time salaried executives, senior managers, employees are appraised annually. Their performance ratings at each year-end influence annual and merit increments or promotions in the following year. Currently executives and senior managers are not incentivised through any other short-term incentive structures. The appropriate structure and the relevant KPIs are currently in development.

Executive directors’ remuneration The remuneration of the executive directors within the group for the past financial year is shown in the table below:

29 February 2016

EmolumentsTravel

allowance Bonus Total

Stefano Marani 625 (4*) – – 625

Fulu Ravele 558 (7,6*) – – 558

Nick Mitchell 600 (4*) – – 600

Reginald Edmond Cooke

– – – –

1 783 – – 1 783

* relates to period of salaried employment within the group.


Special contractual arrangements Special contracts apply to the appointments of and the termination of employment of the executive directors, incorporating fixed-term contracts of employment to be fulfilled. They are summarised as follows:

Executive director Title Contract type Notice period

Stefano Marani CEO Permanent 3 months

Fulu Ravele CFO Permanent 3 months

Nick Mitchell COO Permanent 3 months

Non-executive directors’ remunerationThe appointment of non-executive directors is initially considered and resolved by the board, thereafter ratified by Shareholders at the next AGM. The remuneration is based on proposals from the board and duly approved. They do not receive short-term incentives and their term of office is governed by the Company’s Memorandum of Incorporation which provides that at least one-third of the directors will retire by rotation, but may, if eligible, offer themselves for re-election. The remuneration of non-executive directors is reviewed by the remuneration committee on an annual basis, and approved by the board. It is further presented and voted on by Shareholders at the next AGM.

Chairman’s remunerationIn the case of the Chairman, as with the non-executive directors, his remuneration is benchmarked annually by the committee and an appropriate fee recommended for approval by the board and by shareholders at the AGM.

The tariff of remuneration We have opted to offer a combination of fixed and variable structure for the Chairman and non-executive directors. The tariff of remuneration applicable to the members of the main board and its standing committees that was published in the shareholders’ circular in October 2015 was as follows:

Chair retainer

per annumMember retainer

per annum Fee per meeting

Board 160 000,00 80 000,00 20 000,00

Audit and Risk 80 000,00 40 000,00 20 000,00

Social, Ethics, Governance and Transformation 80 000,00 40 000,00 20 000,00

The following remuneration was paid to non-executive directors during FY2016:

Non-executive

Directors’ fees Committees fees Total

Brett Kimber 173 100 273

Mbali Swana 180 – 180

Russell Broadhead 180 – 180

Reginald Edmond Cooke 180 50 230

713 150 863

Non-executive directors’ fees have been accrued for based on the fees approved by the board in October and published in the shareholders’ circular in October 2015. These fees have not been paid out, pending approval by shareholders in the next annual general meeting.

Reginald Edmond Cooke’s status as a non-executive director has changed due to services he renders to Tetra4. Non-executive directors’ fees were earned before his status changed to executive director.

Luigi Matteucci was nominated as an independent non-executive director on 3 May 2016. He also serves on the audit as well as the social, ethics, governance and transformation committees.


LEADERSHIP AND GOVERNANCE REMUNERATION REPORT (continued)

1. Company organisational structure and responsibilities diagram

POLICIES AND PROCEDURES

Reporting lines

Finance oversight Operations oversight

Tetra4Executive

OperationsExplorations

Finance Operations

Financial Results

Investment management

SHAREHOLDERS

RENERGENBOARD

RENERGENEXCO

Stef MaraniExecutive

Nick MitchellOperations

Fulu RaveleFinance

Rob KatzkeArea manager


2. Delegation of authority

DESCRIPTION OF ACTIVITY MINIMUM LEVEL OF AUTHORITY

FINAL APPROVAL

1. Acquisitions/disposals or closure of business and investmentsEngage with acquisition targets/purchasers and conclude confidentiality agreements

CEO Board

Formal investigations, due diligence, term sheets, draft transaction agreements of potential acquisitions and disposals/closures

CEO Board

2. Corporate communicationCommunication with financial analysts, trade, local or national press which is not advertising and/or promoting in the normal course of business

CEO Board

3. Dealings in foreign exchangeSetting up or varying the foreign exchange policies or dealing facilities

FD MD

Dealing in foreign exchange where exposure exceeds R1 million but less than R10 million

FD MD

Dealing in foreign exchange where exposure exceeds R10 million CEO/CFO Board4. Employment and industrial relations

Board appointments and divisional board appointments Governance, Ethics, Transformation and Compensation Committee

Board

Employment of any person not budgeted for HR MDDismisal/retrenchment/early retirement of any senior management

CEO Governance, Ethics, Transformation and Compensation Committee

Employee salary increases HR MDGroup remuneration increases (not individuals) Compensation Committee BoardSenior management and all annual salary increases Compensation Committee BoardAppointment of an employee outside group standard terms HR MDEngagements and agreements with labour unions CEO Board

5. Fixed assetsCapital expenditure budget, spend and disposals less than R10 million

FD MD

Capital expenditure budget, spend and disposals greater than R10 million

CEO Board

Equipment leases/rentals Divisional director FD6. Lease of property

Less than 12 months Divisional director FDMore than 12 months FD MD

7. Acquisition or disposal of propertyAll property acquisitions and disposals MD Board

8. LitigationAll litigations, excluding debt collection CEO BoardDebt collection Divisional director FD

9. Overseas travelAll overseas travel Director

10. Queries from SARSLess than R2 million FD Audit and Risk

CommitteeMore than R2 million Audit Committee Board

11. Raising of financeOpening and closing of bank accounts FD CEOCommitments to finance facilities less than R10 million FD CEOCommitments to finance facilities greater than R10 million FD Board

12. Business planGroup budget CEO BoardGroup strategic plan CEO Board



3. Insurance• Access to company offices must

be secured with the approved insurance provider.

• Officers’ and directors’ insurance must be in force at all times.

• Insurance cover must be provided for injuries at work at the expense of the company.

• All company assets must be insured.

• The Audit and Risk Committee to be presented with a summary of insurance cover.

4. Procurement• When a need for an asset/service

is identified, a requisition is sent to the relevant department by email.

• An assessment is made by the head of the department on the need for the asset requested.

• The requisition is approved by email.

• Three quotations are sought from the approved list of suppliers.

• Should there be no suppliers on the current suppliers list providing the service/asset, a quotation is obtained from three different suppliers if the estimated purchase price exceeds R50 000.

• Supplier quotations are assessed and selected on the basis of merit.

• Purchase orders are placed using a standard order form if no form is provided by the supplier.

• Purchase orders are checked to the quotation or pro forma invoice and approved by at least two people, one of whom is a director.

• The completed purchase order is emailed to the supplier for the order to be officially placed.

• Professional services such as environmental and legal will not follow the procedure above, but instead will simply involve asking for quotes to our incumbent service providers for new work.

5. Payments• Suppliers are paid using

authorised banking details as they appear on the beneficiary list of the company bank account.

• New supplier details are captured on the beneficiary list based on details provided on the supplier’s invoice or confirmation of banking details letter from the supplier’s bank.

• Change to the suppliers’ banking details should be accompanied by a stamped letter from the bank stating the new details, communication from the supplier on the supplier’s letterhead. A phone call to the supplier must be made to confirm the change in bank accounts.

• All payments are made only on presentation of an invoice, contract or quotation with prepayment terms of service.

• Access to the company bank account is only done using a username and confidential password.

• Users should not share their banking passwords with any other individual.

• Payments are only made with authorisation by two people after verifying the details on the online payment requisition to the invoice details.

• Confirmation of payment is emailed to the supplier.

• Payment confirmation and invoices are filed together, an electronic version of invoices and confirmation of payment must be retained and saved on the company central server.

• Access to the online banking system is limited to certain employees.

• Employees with bank cards will not share the company’s bank card and PIN with any other individual.

• Company bank cards should be kept in a secure location at all times.

6. Financial reporting• Monthly transactions should be

recorded at the end of every month.

• Monthly management accounts should be reviewed by the executive and the board within 30 days after the month-end.

• Actuals to be compared to the budgets and variances investigated.

• Year-end audits must be performed annually by approved auditors.

• Independence of potential auditors must always be assessed before appointment of auditors.

• Always consult the designated advisor on JSE reporting requirements for both half-year reporting and year-end reporting to ensure compliance with the JSE Listings Requirements.

7. Human resources• Employment contracts must

be signed and employees familiarise themselves with the terms of employment prior to starting employment. Signing the contract is an indication of agreeing to the terms stipulated in the contract.

• Employees are expected to treat all company assets with due care.

• All qualifying employees must be registered for UIF (unemployment insurance).

• All employees are expected to act ethically and in the best interests of the company.

• Employees are expected to abide by the rules, regulations and laws that govern the country in which the company operates.

Leave• Annual leave can only be taken

once approved by the line manager.

• An employee must give the manager at least a week’s notice of the intention to take leave of absence.

• The line manager approves leave of absence at their discretion.

• Line managers must be notified of all absence from work.


Remuneration• Employees’ salaries are paid on

the 25th day of every month. If the 25th falls on a public holiday or weekend, payment will be made on the last business day of the week before the 25th of that month.

• Bonuses are paid at the discretion of the company.

• Salary increases are at the discretion of the board and increases will be communicated when they have been effected.

• All employees are entitled to payslips on a monthly basis.

• The company will support training initiatives by employees provided the training improves their skills in their line of work. Any other training outside the employee’s area of duties will be at the employee’s own expense.

8. Communication• All external emails must have the

approved company signature, with company name, telephone number, contact person, cell phone number and email address.

• Company emails must only be used for company-related communication, personal communication must be done on personal email accounts.

• Telephone calls must be answered in a professional manner.

• Employees who use their mobile phone for work-related communication must ensure that the mobile phone is secured by an unlocking PIN or password.

• Company letters must be on the most recent company letterhead; it is the duty of the author of the letter to ensure that letterhead contains the accurate company details.

9. IT infrastructure• All laptops, PCs and servers are

to be secured with passwords.

• Server infrastructure is hosted remotely and includes redundancy measures in case of hardware failure.

• Daily backups performed on servers.

• Daily backups will be implemented across laptops and PCs to avoid disruption in the event of theft, loss or hardware failure.

• Firewall and antivirus software deployed on all laptops, PCs and servers.

• Monthly reporting on hosted servers for threat detection, viruses, malware and patches that may need to be implemented.

10. Regulatory appointments• Renergen and/or its subsidiary

is compliant with the OSH Act in terms of legal appointments.

• Renergen and/or its subsidiary is compliant with the Mine, Health and Safety Act in terms of legal appointments.

11. Regulatory compliance• Renergen has adhered to

JSE Listings Requirements.

• Renergen and/or its subsidiary has adhered to the Companies Act requirements.

• Renergen and/or its subsidiary has attempted to implement King III principles where possible throughout the group and will keep a compliance register updated.

• Prepared and submitted monthly exploration reports for the Regulator (PASA) on the exploration rights.

• Prepared and submitted quarterly

exploration and production reports for the Regulator (PASA) on the exploration rights and production rights.

• Prepared and submitted annual production right reports for the Regulator (PASA) on the production rights.

• Prepared and submitted an annual social and labour report for the Regulator (PASA) on the exploration and production rights.

• Prepared and submitted quarterly reports for the regulator NERSA in relation to storage licence.

• Prepared and submitted annual reports for the regulator NERSA in relation to trading licence.


ANNUALFINANCIAL STATEMENTSGeneral Information 37

Director’s Responsibilities and Approval 38

Group Secretary’s Certification 39

Audit and Risk Committee Report 40

Independent Auditors’ Report 42

Directors’ Report 43

Consolidated Statement of Financial Position 46

Consolidated Statement of Profit or Loss and Other Comprehensive Income 47

Consolidated Statement of Changes in Equity 48

Consolidated Statement of Cash Flows 49

Accounting Policies 50

Notes to the Financial Statements 57

Analysis of Ordinary Shareholders 77

Notice of AGM 80

Definitions 88

Form of Proxy 90

Corporate Information IBC


GENERAL INFORMATIONCountry of incorporation and domicile South Africa

Company registration number 2014/195093/06

JSE Share code REN

JSE ISIN ZAE000202610

Registered office First Floor

1 Bompas Road

Dunkeld West

2196

Nature of business and principal activities Energy company, focused on alternative and renewable energy sectors in South Africa and sub-Saharan Africa. The Company is listed on the JSE Alternative Exchange (“AltX”)

Directors Stefano Marani

Fulu Ravele

Nick Mitchell

Brett Kimber

Mbali Swana

Russell Broadhead

Reginald Edmond Cooke

Luigi Matteucci

Auditors Grant Thornton Johannesburg Partnership

Chartered Accountants (S.A.) Registered Auditors

A South African member of Grant Thornton International Limited

Company secretary Acorim Proprietary Limited

Transfer secretaries Computershare Investor Services Proprietary Limited

Designated adviser Merchantec Capital

Level of assurance These financial statements have been audited in compliance with the applicable requirements of the Companies Act 71 of 2008

Preparer The financial statements were prepared under the supervision of:

Fulu Ravele CA(SA)Chief Financial Officer


DIRECTOR’S RESPONSIBILITIES AND APPROVAL

The directors are required in terms of the Companies Act 71 of 2008 to maintain adequate accounting records and are responsible for the content and integrity of the financial statements and related financial information included in this report. It is their responsibility to ensure that the financial statements fairly present the state of affairs of the group as at the end of the financial period and the results of its operations and cash flows for the period then ended, in conformity with International Financial Reporting Standards. The external auditors are engaged to express an independent opinion on the financial statements.

The financial statements are prepared in accordance with International Financial Reporting Standards and are based upon appropriate accounting policies consistently applied and supported by reasonable and prudent judgements and estimates.

The directors acknowledge that they are ultimately responsible for the system of internal financial control established by the group and place considerable importance on maintaining a strong control environment. To enable the directors to meet these responsibilities, the board sets standards for internal control aimed at reducing the risk of error or loss in a cost-effective manner. The standards include the proper delegation of responsibilities within a clearly defined framework, effective accounting procedures and adequate segregation of duties to ensure an acceptable level of risk. These controls are monitored throughout the group and all employees are required to maintain the highest ethical standards in ensuring the group’s business is conducted in a manner that in all reasonable circumstances is above reproach. The focus of risk management in the group is on identifying, assessing, managing and monitoring all known forms of risk across the group. While operating

risk cannot be fully eliminated, the group endeavours to minimise it by ensuring that appropriate infrastructure, controls, systems and ethical behaviour are applied and managed within predetermined procedures and constraints.

The directors are of the opinion, based on the information and explanations given by management, that the system of internal control provides reasonable assurance that the financial records may be relied on for the preparation of the financial statements. However, any system of internal financial control can provide only reasonable, and not absolute, assurance against material misstatement or loss.

The directors have reviewed the group’s cash flow forecast for the period to 28 February 2017 and, in light of this review and the current financial position, they are satisfied that the group has or had access to adequate resources to continue in operational existence for the foreseeable future.

The external auditors are responsible for independently auditing and reporting on the group’s financial statements. The financial statements have been examined by the group’s external auditors and their report is presented on page 42.

The financial statements set out on pages 46 to 76, which have been prepared on the going concern basis and the directors’ report on pages 43 to 45, were approved by the board on 26 May 2016 and were signed on their behalf by:

Stefano Marani Fulufhedzani RaveleDirector Director(CEO) (CFO)


GROUP SECRETARY’S CERTIFICATIONIn our capacity as Company Secretary, we hereby confirm, in terms of section 88(2)(e) of the Companies Act, 2008 (Act No. 71 of 2008), as amended (“the Act”), that for the 14-month period ended 29 February 2016, the company has lodged with the Companies and Intellectual Property Commission all such returns as are required of a public company in terms of the Act and that all such returns are true, correct and up to date.

Acorim Proprietary LimitedCompany Secretary

23 August 2016

Acorim Proprietary Limited2nd Floor, North Wing, Hyde Park Corner Office SuitesCorner 6th Road and Jan Smuts AvenueHyde Park, 2196

Tel: +27 11 325 6363


AUDIT AND RISK COMMITTEE REPORT

The Audit and Risk Committee has adopted formal terms of reference which are updated on an annual basis. The Board is satisfied that the Audit Committee has complied with these terms, and with its legal and regulatory responsibilities as set out in the Company’s Act, King III and JSE Listing Requirements.

The Audit and Risk Committee consisted of three independent non-executive directors throughout the financial year. Members of the committee are listed below

NAME QUALIFICATION

Mbali Swana: Chairperson Bas (UCT), BArch (UCT), Pr Arch (SA), MIAT (SA)

Russell Broadhead Higher National Diploma in Building Studies, Senior Management Development Programme

Luigi Matteucci CA (SA)

The committee has had one meeting after year-end and all members were in attendance.

The Board believes that the members collectively possesses the knowledge and experience to supervise Renergen’s financial management, external auditors, the quality of Renergen’s financial controls, the preparation and evaluation of Renergen’s consolidated financial statements and Renergen’s financial reporting.

The Board has established and maintains internal controls and procedures, which are reviewed on a regular basis. These are designed to manage the risk of the business failures and to provide reasonable assurance against such failures. However, this is not a guarantee that such risks are eliminated.

It is the duty of the Audit Committee, inter alia, to monitor and review:• The effectiveness of the internal audit function; findings

and appointment of external auditors, reports of external auditors.

• Evaluation of the performance of the CFO.

• The governance of the information technology (IT) and effectiveness of the Group’s information systems.

• Interim and annual function and operating reports, the consolidated annual financial statements and all other widely distributed financial documents.

• Accounting policies of the group and proposed revisions.

• Compliance with applicable legislation, requirements of appropriate regulatory authorities and the Group’s code of ethics

• Determined the nature and extent of all non-audit services provided by the external auditor and approved the applicable non-audit services undertaken in terms of the audit charter;

• The integrity of the annual financial report and associated reports (by ensuring that its content is reliable and recommending it to the Board for approval) and

• Policies and procedures for preventing and detecting fraud

External auditors have unrestricted access to the Audit Committee, the Audit Committee chairman and the chairman of the Board, ensuring that the auditors are able to maintain their independence. External auditors report at Audit Committee meetings. The Audit Committee also meets with external auditors separately without other invitees being present. Management may attend the Audit Committee meetings by invitation.

The Audit Committee is also responsible for determining that the designated appointee has the necessary independence, experience qualification and skills and the audit and other fees are reviewed and approved.

Audit Committee has reviewed and assessed the independence of the external auditor, and has confirmed in writing that the criteria for independence, as set out in the rules of the Independent Regulatory Board of Auditors and international bodies, have been followed. The Audit Committee is satisfied that Grant Thornton and Jacques Barradas are independent to the Group as defined by the Companies Act 71 of 2008 and as per the standards stipulated by the auditing profession. Requisite assurance was sought and provided by the Companies Act 71 of 2008 that internal governance processes within the firm supports and demonstrate the claim to independence.

The Audit and Risk Committee, in consultation with the executive management, agreed to the terms of the engagement. The audit fee for external audit has been considered and approved taking into consideration such factors as the timing of the audit, the extent of the work required and the scope.

The Audit Committee approves the annual audit plan presented by the auditors and monitors progress against the plan. The audit plan provides the Audit Committee with the necessary assurance on risk management, internal control environment and IT governance. The Audit Committee recommends that Grant Thornton is reappointed for the 2017 financial year with Jacques Barradas as the Group audit engagement partner.

The Audit Committee has satisfied itself that both Grant Thornton and Jacques Barradas are accredited in terms of the JSE Listings Requirements.

The Audit Committee is responsible for IT governance on behalf of the Board and reviews the report of management at each meeting.

The Audit Committee evaluated the expertise and performance of the CFO during 2016. It is satisfied that she has the appropriate expertise and experience to carry out her duties as the CFO of the Group.


AUDIT COMMITTEE STATEMENT

Based on information from, and discussed with, management and external auditors, the Audit Committee has no reason to believe that there was any material breakdown in design and operating effectiveness of internal financial controls during the year and the financial records may be relied upon as the basis for preparation of consolidated financial statements.

The Audit Committee has considered and discussed this annual financial report and associated reports and both management and external auditors.

During this process the Audit Committee:• Evaluated significant judgements and reporting decisions;

• Determined that the going concern basis of reporting is appropriate;

• Evaluated the material factors and risks that impact the annual financial reports and associated reports;

• Evaluated the completeness of the financial and sustainability discussion and disclosure; and

• Discussed the treatment of significant and unusual transactions with management and the external auditors.

The Audit Committee considers that the annual financial report complies in all material respects with the statutory requirements of the various regulations governing disclosure and reporting of the consolidated annual financial statements and that the consolidated financial statements comply in all material respects with IFRS, the SAICA Financial Reporting Guides issued by the Accounting Practices Committee and Financial Reporting Pronouncements issued by the Financial Reporting Standards Council, as well as the requirements of the Companies Act and the JSE Listing Requirements. The Audit Committee has recommended to the Board that the consolidated annual financial statements be adopted and approved by the Board.

Mbali Swana Chairman: Audit and Risk Committee23 August 2016


INDEPENDENT AUDITORS’ REPORT

8

Independent Auditorʼs Report To the shareholders of Renergen Limited

Report on the Financial Statements

We have audited the consolidated and separate financial statements of Renergen Limited set out on pages 12 to 39, which comprise the consolidated and separate statements of financial position as at 29 February 2016, and the consolidated and separate statements of comprehensive income, consolidated and separate statements of changes in equity and consolidated and separate statements of cash flows for the year then ended, and the notes, comprising a summary of significant accounting policies and other explanatory information.

Directors' responsibility for the financial statements The company's directors are responsible for the preparation and fair presentation of these consolidated and separate financial statements in accordance with International Financial Reporting Standards and the requirements of the Companies Act of South Africa and for such internal control as the directors determine is necessary to enable the preparation of consolidated financial statements that are free from material misstatements, whether due to fraud or error.

Auditorʼs responsibility Our responsibility is to express an opinion on these consolidated and separate financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated and separate financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditorʼs judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entityʼs preparation and fair presentation of the consolidated and separate financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entityʼs internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion In our opinion, the consolidated and separate financial statements present fairly, in all material respects, the consolidated and separate financial position of Renergen Limited as at 29 February 2016, and its consolidated and separate financial performance and consolidated and separate cash flows for the year then ended in accordance with International Financial Reporting Standards, and the requirements of the Companies Act of South Africa.

Other reports required by the Companies Act As part of our audit of the consolidated financial statements for the year ended 29 February 2016, we have read the Directors' Report, Audit Committee's Report and Company Secretary's Certificate for the purpose of identifying whether there are material inconsistencies between these reports and the audited consolidated financial statements. These reports are the responsibility of the respective preparers. Based on reading these reports we have not identified material inconsistencies between these reports and the audited consolidated financial statements. However, we have not audited these reports and accordingly do not express an opinion on these reports.

Report on other legal and regulatory requirements In terms of the IRBA Rule published in Government Gazette 39475 dated 04 December 2015, we report that Grant Thornton Johannesburg Partnership has been the auditor of Renergen Limited for one year.

GRANT THORNTON JOHANNESBURG PARTNERSHIP Chartered Accountants (SA)Registered Auditors

J Barradas PartnerChartered Accountant (SA) Registered Auditor

26 May 2016 @Grant Thornton Wanderers Office Park 52 Corlett Drive Illovo, 2196.


DIRECTORS’ REPORT

The directors have pleasure in submitting their report on the financial statements of Renergen Limited and the group for the period ended 29 February 2016.

1 Nature of businessAn energy company, focused on alternative and renewable energy sectors in South Africa and sub-Saharan Africa. The Company is listed on the JSE Alternative Exchange (“AltX”).

2 Review of financial results and activitiesThe company and consolidated financial statements have been prepared in accordance with International Financial Reporting Standards and the requirements of the Companies Act 71 of 2008, as amended, the JSE Listings Requirements, the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and the financial reporting pronouncements as issued by the Financial Reporting Standards Council. The accounting policies have been applied consistently compared to the prior period.

Net loss of the group was R19 499 000 (2014: R3 080 000) after taxation of Rnil (2015: Rnil). Net loss of the company was R7 507 000 (2015: Rnil) after taxation of Rnil (2015: Rnil).

On 10 July 2015, Renergen Limited announced it was in negotiations to acquire a viable asset pursuant to the Listings Requirements of the JSE (the “Listings Requirements”) pertaining to SPACs.

On 18 August 2015, Renergen Limited announced an agreement to acquire 90% of the issued share capital and claims of Tetra4 Proprietary Limited (“Tetra4”) (previously named Molopo South Africa Exploration and Production Proprietary Limited) from Windfall Energy Proprietary Limited (“Windfall”) for a purchase consideration to be settled by the issue of 70 million ordinary Renergen Limited shares (“Renergen Shares”) for R9.28 and the cash payment of R5 million (“the Tetra4 Acquisition”), implying a deal value of approximately R650 million, based on Renergen’s Net Asset Value (“NAV”). Renergen shareholders approved the Tetra4 Acquisition by the requisite majority on 25 November 2015.

The salient features of the Tetra4 Acquisition are:

• First and only South African onshore petroleum production right enabling Renergen Limited first mover advantage in the local natural gas sector;

• Exploration assets developed to production status and now close to production;

• Anticipated first revenue to be generated from first half of 2017 financial year;

• Proven reserves of 25 billion cubic feet and value of R2.2 billion as indicated in the independent Form 1 Report dated 21 October 2015; and

• Significant attractive upside for Renergen Limited shareholders as the resource is further developed.

The Tetra4 Acquisition was concluded on 2 December 2015 at which time Renergen became an operating company on AltX of the JSE and was no longer classified as a SPAC.

The acquisition of Tetra4 Proprietary Limited constituted a reverse acquisition due to Renergen Limited being a special purpose acquisition company and not classified as a business. Tetra4 Proprietary Limited changed its year-end from June to December prior to the acquisition. A decision was made to align Tetra4 Proprietary Limited’s reporting period to it’s legal parent company, Renergen Limited’s reporting period. Tetra4 Proprietary Limited again changed it’s year-end from December to February. The comparatives presented in the financial results reflect Tetra4 Proprietary Limited’s prior year December 2014 six-month’s audited results. The current year results reflect 14 months ended 29 February 2016 for Tetra4 Proprietary Limited and 14 months ended February 2016 for Renergen Limited. Based on the guidance from IFRS3 on reverse acquisition, the group consolidated results are shown as a continuation of the legal subsidiary. Renergen Limited was thus reversed into Tetra4 Proprietary Limited.

Tetra4 Proprietary Limited is expected to start generating revenue in the first half of the 2017 financial year. On 4 May 2016, the Linde Group, a world-leading gases and engineering company, its African subsidiary, African Oxygen Limited (Afrox), Renergen Limited and Tetra4 Proprietary Limited, signed an historic agreement for the commercialisation of the Free State Helium and Natural Gas (NG) field.

3 Share capitalThe company increased its number of shares issued to 77 375 528 from 100 shares in prior year.

Refer to note 13 of the consolidated financial statements for details of the movement in authorised and issued share capital.

4 DividendsNo dividends were declared or paid to shareholders during the year.


5 DirectorateThe directors in office at the date of this report are as follows:

DIRECTORS OFFICE DESIGNATION CHANGES

Stefano Marani Chief Executive Officer Executive Appointed 20 November 2014

Fulu Ravele Chief Financial Officer Executive Appointed 25 November 2015

Nick Mitchell Chief Operating Officer Executive Appointed 25 November 2015

Brett Kimber Chairperson Non-executive independent Appointed 17 June 2015

Mbali Swana Deputy chairperson Non-executive independent Appointed 16 February 2015

Russell Broadhead Non-executive independent Appointed 20 November 2015

Reginald Edmond Cooke Executive Appointed 16 February 2015

Luigi Matteucci Non-executive independent Appointed 3 May 2016

Clive Angel Executive Resigned 25 November 2015

Mr Reginald Edmond Cooke’s status as an independent non-executive director changed with effect from 3 May 2016 to an executive director due to the consulting services he is rendering to Tetra4 over a prolonged, indefinite period. Mr Cooke will be receiving consulting fees for such services and will continue to earn directors fees for meetings of the board and its sub-committees.

6 Directors’ interests in sharesAs at 29 February 2016, the directors of the company held direct and indirect beneficial interests in 23% (2014: —%) of its issued ordinary shares, as set out below.

Interests in shares

DIRECTORSDIRECT 2016

%INDIRECT 2016

%DIRECT 2014

%INDIRECT 2014

%TOTAL

%

Executive directors

Stefano Marani 0.33 11.41 — — 11.74

Nick Mitchell — 11.41 — — 11.41

Non-exectutive directors

Russell Broadhead — 0.16 — — 0.16

0.33 22.98 — — 23.31

The register of interests of directors and others in shares of the company is available to the shareholders on request.

Stefano Marani disposed of 130 000 of his indirect shares for non consideration in June 2016. This resulted in his shareholding decreasing from 11.41% to 11.24%. This resulted in the overall directors’ indirect interest decreasing from 22.98% to 22.81%

7 Interests in subsidiaries, associates and joint arrangementsDetails of material interests in subsidiary companies are presented in the consolidated financial statements in note 6. The interest of the group in the profits and losses of its subsidiaries for the period ended 29 February 2016 is as follows:

SUBSIDIARIES 2016 2014

R’000 R’000

Tetra4 Proprietary Limited (10 474) —

8 Events after the reporting periodRenergen Limited, through its subsidiary Tetra4 Proprietary Limited and African Oxygen Limited (Afrox), a subsidiary of the Linde Group, a world-leading gases and engineering company, entered into an agreement to commercialise the Free State Helium and Natural Gas on 3 May 2016. Tetra4 Proprietary Limited has contracted the Helium under an off-take agreement with The Linde Group, via its Global Helium subsidiary, being assigned distribution rights for substantial reserves of helium. Afrox will operate the plant and market the helium.


Renergen Limited and Unitrans Passenger Proprietary Limited signed a contract through their respective subsidiaries, Tetra4 Proprietary Limited and Megabus Proprietary Limited (“Megabus”) on 19 May 2016, for the supply of compressed natural gas by Tetra4 Proprietary Limited to Megabus Proprietary Limited, to power 10 buses operating from the Megabus depot in the town of Virginia, Free State province, South Africa.

The directors are not aware of any other material event which occurred after the reporting date and up to the date of this report.

9 Going concernThe directors believe that the company and group have adequate financial resources to continue in operation for the foreseeable future and accordingly the company and consolidated financial statements have been prepared on a going concern basis. The directors have satisfied themselves that the company and group are in a sound financial position and that it has access to sufficient borrowing facilities to meet its foreseeable cash requirements. The directors are not aware of any new material changes that may adversely impact the company and group. The directors are also not aware of any material non-compliance with statutory or regulatory requirements or of any pending changes to legislation which may affect the company and group.

Renergen group is expected to start generating revenue in the first half of the 2017 financial period from Tetra4 Proprietary Limited’s sales of compressed natural gas. Management continues to monitor the cash flows to ensure that the group continues to be in a position to pay its debts when they become due. The capital expenditure forecast are approved by the board after considering the impact on solvency and liquidity.

10 AuditorsGrant Thornton Johannesburg Partnership will continue in office as auditors in accordance with section 90 of the Companies Act of South Africa.

11 Company secretaryThe company secretary is Acorim Proprietary Limited.

Business address:

2nd Floor, North Block Hyde Park Office Tower Cnr 6th Road and Jan Smuts Hyde Park 2196

DIRECTORS’ REPORT (continued)


as at 29 February 2016

GROUP COMPANY

Figures in Rand thousand Notes29 February

201631 December

201429 February

201628 February

2015

Assets

Non-current assets

Property, plant and equipment 4 7 145 181 4 —

Intangible assets 5 61 504 56 942 — —

Investments in subsidiaries 6 — — 594 414 —

68 649 57 123 594 418 —

Current assets

Investment in joint venture 7 6 503 — 6 503 —

Loans to group companies 8 — — 69 964 —

Other financial assets 9 — — 5 500 —

Trade and other receivables 11 4 134 56 1 1

Cash and cash equivalents 12 41 721 618 40 842 —

52 358 674 122 810 1

Total assets 121 007 57 797 717 228 1

Equity and liabilities

Equity

Share capital 13 124 158 — 722 557 1

Accumulated loss (25 330) (13 756) (7 507) —

Equity attributable to equity holders of parent 98 828 (13 756) 715 050 1

Non-controlling interest (7 923) — — —

Total equity 90 905 (13 756) 715 050 1

Liabilities

Non-current liabilities

Loans from shareholders 14 — 47 614 — —

Other financial liabilities 15 23 857 20 911 — —

Provisions 16 2 755 2 755 — —

26 612 71 280 — —

Current liabilities

Trade and other payables 18 3 490 273 2 178 —

Total liabilities 30 102 71 555 2 178 —

Total equity and liabilities 121 007 57 797 717 228 1

Net asset value per share (cents) 117.48 (13 756 198)

Tangible net asset value per share (cents) 38.00 (70 698 236)

CONSOLIDATED STATEMENT OFFINANCIAL POSITION


CONSOLIDATED STATEMENT OF PROFIT OR LOSSAND OTHER COMPREHENSIVE INCOME

GROUP COMPANY

Figures in Rand thousand Notes

14 monthsended

29 February2016

6 monthsended

31 December2014

29 February2016

28 February2015

Other income 61 — 74 —

Operating expenses (18 038) (1 956) (9 081) —

Share-based payment (1 518) — (1 518) —

Operating loss 19 (19 495) (1 956) (10 525) —

Investment revenue 20 3 023 — 3 018 —

Fair value adjustments 21 (2 946) (1 122) — —

Finance costs 22 (81) — — —

Loss and other comprehensive loss for the period (19 499) (3 078) (7 507) —

Loss attributable to:

Owners of the parent (18 452) (3 078) (7 507) —


(19 499) (3 078) (7 507) —

Total comprehensive loss attributable to:

Owners of the parent (18 452) (3 078) (7 507) —


(19 499) (3 078) (7 507) —

Loss per sharePer share informationBasic and diluted loss per share (c) 25 (36.53) 3 078 (7 507) —


CONSOLIDATED STATEMENTOF CHANGES IN EQUITY

Figures in Rand thousand SHARE CAPITALACCUMULATED

LOSS

TOTALATTRIBUTABLE

TO EQUITYHOLDERS OFTHE GROUP/

COMPANY

NON-CONTROLLING

INTEREST TOTAL EQUITY

GroupBalance at 1 June 2014 — (10 678) (10 678) — (10 678)

Loss and other comprehensive loss for the period

— (3 078) (3 078) — (3 078)

Balance at 1 January 2015 — (13 756) (13 756) — (13 756)

Issue of shares 124 158 — 124 158 — 124 158

Retained earnings at acquisition date — 5 502 5 502 — 5 502

Loan from minority shareholder — — — (5 500) (5 500)

Non-controlling interest at acquisition — 1 376 1 376 (1 376) —

Loss for the period — (18 452) (18 452) (1 047) (19 499)

Balance at 29 February 2016 124 158 (25 330) 98 828 (7 923) 90 905

Note 13

Company

Issue of shares 1 — 1 — 1

Balance at 1 March 2015 1 — 1 — 1

Loss and other comprehensive loss for the period

— (7 507) (7 507) — (7 507)

Issue of shares 722 556 — 722 556 — 722 556

Balance at 29 February 2016 722 557 (7 507) 715 050 — 715 050

Notes 13


CONSOLIDATED STATEMENTOF CASH FLOWS

GROUP COMPANY

Figures in Rand thousand Notes

14 monthsended

29 February2016

6 monthsended

31 December2014

29 February2016

31 December2015

Cash flows from operating activities

Cash used in operations 26 (24 123) (2 169) (8 348) (1)

Interest income 3 024 — 3 018 —

Finance costs (81) — — —

Net cash outflow from operating activities (21 180) (2 169) (5 330) (1)

Cash flows from investing activities

Purchase of property, plant and equipment 4 (7 054) — (4) —

Purchase of other intangible assets 5 (4 562) (252) — —

Business combinations 27 69 184 — — —

Business combination transaction costs (306) — — —

Net movements in loans with group companies — — (15 278) —

Purchase of financial assets (5 000) — (5 000) —

Investment in joint venture (2 750) — (6 503) —

Net cash inflow/(outflow) from investing activities 49 512 (252) (26 785) —

Cash flows from financing activities

Net proceeds on share issue 13 72 957 — 72 957 1

Proceeds from shareholders loan — 2 445 — —

Repayment of shareholders loan (60 186) — — —

Net cash inflow from financing activities 12 771 2 445 72 957 1

Total cash movement for the period 41 102 24 40 842 —

Cash at the beginning of the period 618 594 — —

Total cash at end of the period 12 41 721 618 40 842 —


ACCOUNTINGPOLICIES

1 Presentation of financial statementsThe financial statements have been prepared in accordance with International Financial Reporting Standards, and the Companies Act 71 of 2008, as amended, the JSE Listings Requirements, the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and the financial reporting pronouncements as issued by the Financial Reporting Standards Council. The financial statements have been prepared on the historical cost basis, and incorporate the principal accounting policies set out below. They are presented in South African Rands.

These accounting policies are consistent with the previous period.

1.1 Consolidation

Basis of consolidationThe consolidated financial statements incorporate the financial statements of the group and all investees which are controlled by the group.

The group has control of an investee when it has power over the investee; it is exposed to or has rights to variable returns from involvement with the investee; and it has the ability to use its power over the investee to affect the amount of the investor’s returns.

The results of subsidiaries are included in the consolidated financial statements from the effective date of acquisition to the effective date of disposal.

All intra-group transactions, balances, income and expenses are eliminated in full-on consolidation.

Non-controlling interests in the net assets of consolidated subsidiaries are identified and recognised separately from the group’s interest therein, and are recognised within equity. Losses of subsidiaries attributable to non-controlling interests are allocated to the non-controlling interest even if this results in a debit balance being recognised for non-controlling interest.

Transactions which result in changes in ownership levels, where the group has control of the subsidiary both before and after the transaction are regarded as equity transaction and are recognised directly in the statement of changes in equity.

Business combinationsThe group accounts for business combinations using the acquisition method of accounting. The cost of the business combination is measured as the aggregate of the fair values of assets given, liabilities incurred or assumed and equity instruments issued. Costs directly attributable to the business combination are expensed as incurred, except the costs to issue debt which are amortised as part of the effective interest and costs to issue equity which are included in equity.

To apply IFRS 3, the standard on business combination, the assets acquired and the liabilities assumed must constitute a business, otherwise reporting entity accounts for the transaction or event as an asset acquisition. Appendix A of IFRS 3 defines a business as an integrated set of activities and assets that is capable of being conducted and managed for the purpose of providing a return in the form of dividends, lower costs or other economic benefits directly to investors or other owners, members or participants. Paragraph B7 of IFRS 3 explains that a business consists of inputs and processes applied to those inputs that have the ability to create outputs. Renergen Limited, listed as a Special Purpose Acquisition Company, was not a business prior to the acquisition of Tetra4 Proprietary Limited, but simply a cash shell. The acquisition of Tetra4 Proprietary Limited, therefore, does not constitute a business combination.

Due to the transaction not being a business combination by definition of IFRS 3, it is a share-based payment transaction. The difference in fair value of the shares deemed to have been issued by the accounting acquirer and the fair value of the accounting acquiree’s identifiable net assets represents a service received by the accounting acquirer, the entire difference should be considered to be payment of a stock exchange listing of its shares and no amount is considered cost of raising capital.


1 Presentation of financial statements (continued)

1.1 Consolidation (continued)

Renergen Limited (listed entity) issued 70 million shares to Tetra4 Proprietary Limited’s (non-listed entity) former shareholder (Windfall Energy Proprietary Limited) in exchange for 90% shareholding in Tetra4 Proprietary Limited. This resulted in Windfall Energy Proprietary Limited effectively holding a controlling stake of 90% in Renergen Limited. The former shareholders of the legal subsidiary obtained control of the legal parent. It is appropriate to apply by analogy in accordance with paragraph 10-12 of IAS8, guidance in paragraph B19-B27 of IFRS3 for reverse acquisitions. This results in the non-listed operating entity being identified as the accounting acquirer and listed as the accounting acquiree. The accounting acquirer (Tetra4 Proprietary Limited) is deemed to have issued shares to obtain control of the acquiree (Renergen Limited).

The consolidated financial statements have been prepared as the continuation of Tetra4 Proprietary Limited. Renergen Limited was thus reversed into Tetra4 Proprietary Limited, with Tetra4 Proprietary Limited prior year results presented as comparatives.

Joint venturesAn interest in a joint venture is accounted for using the equity method, except when the investment is classified as held-for-sale in accordance with IFRS 5 Non-current assets held-for-sale and discontinued operations. Under the equity method, interests in joint ventures are carried in the consolidated statement of financial position at cost adjusted for post-acquisition changes in the company’s share of net assets of the joint venture, less any impairment losses. Profits or losses on transactions between the company and a joint venture are eliminated to the extent of the company’s interest therein.

When the company loses joint control, the group proportionately reclassifies the related items which were previously accumulated in equity through other comprehensive income to profit or loss as a reclassification adjustment. In such cases, if an investment remains, that investment is measured to fair value, with the fair value adjustment being recognised in profit or loss as part of the gain or loss on disposal.

1.2 Property, plant and equipmentProperty, plant and equipment is carried at cost less accumulated depreciation and accumulated impairment losses.

Property, plant and equipment is initially measured at cost. Cost includes all of the expenditure which is directly attributable to the acquisition or construction of the asset, including the capitalisation of borrowing costs on qualifying assets and adjustments in respect of hedge accounting, where appropriate.

Expenditure incurred subsequently for major services, additions to or replacements of parts of property, plant and equipment are capitalised if it is probable that future economic benefits associated with the expenditure will flow to the company and group and the cost can be measured reliably. Day-to-day servicing costs are included in profit or loss in the period in which they are incurred.

Property, plant and equipment is subsequently stated at cost less accumulated depreciation and any accumulated impairment losses, except for land which is stated at cost less any accumulated impairment losses.

Depreciation is charged to write off the asset’s carrying amount over its estimated useful life to its estimated residual value, using a method that best reflects the pattern in which the asset’s economic benefits are consumed by the company and group. Leased assets are depreciated in a consistent manner over the shorter of their expected useful lives and the lease term.

ACCOUNTINGPOLICIES (continued)



1.2 Property, plant and equipment (continued)

The useful lives of items of property, plant and equipment have been assessed as follows:

ITEM DEPRECIATION METHOD AVERAGE USEFUL LIFE

Computer software Straight line Five years

Furniture and fittings Straight line Six years

IT equipment Straight line Three years

Motor vehicles Straight line Five years

Office equipment Straight line Six years

Plant and machinery Straight line Five years

The residual value, useful life and depreciation method of each asset are reviewed at the end of each reporting period. If the expectations differ from previous estimates, the change is accounted for prospectively as a change in accounting estimate.

Each part of an item of property, plant and equipment with a cost that is significant in relation to the total cost of the item is depreciated separately.

The depreciation charge for each period is recognised in profit or loss unless it is included in the carrying amount of another asset.

Impairment tests are performed on property, plant and equipment when there is an indicator that they may be impaired. When the carrying amount of an item of property, plant and equipment is assessed to be higher than the estimated recoverable amount, an impairment loss is recognised immediately in profit or loss to bring the carrying amount in line with the recoverable amount.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its continued use or disposal. Any gain or loss arising from the derecognition of an item of property, plant and equipment is included in profit or loss when the item is derecognised. The gain or loss arising from the derecognition of an item of property, plant and equipment is determined as the difference between the net disposal proceeds, if any, and the carrying amount of the item.

1.3 Site restoration and dismantling costThe company has an obligation to dismantle, remove and restore items of property, plant and equipment. Such obligations are referred to as “decommissioning, restoration and similar liabilities”. The cost of an item of property, plant and equipment includes the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, the obligation for which an entity incurs, either when the item is acquired or as a consequence of having used the item during a particular period for purposes other than to produce inventories during that period.

If the related asset is measured using the cost model:

• changes in the liability are added to, or deducted from, the cost of the related asset in the current period;• if a decrease in the liability exceeds the carrying amount of the asset, the excess is recognised immediately in profit

or loss;• if the adjustment results in an addition to the cost of an asset, the entity considers whether this is an indication that

the new carrying amount of the asset may not be fully recoverable. If it is such an indication, the asset is tested for impairment by estimating its recoverable amount, and any impairment loss is recognised in profit or loss.



1.4 Significant judgements and sources of estimation uncertaintyIn preparing the financial statements, management is required to make estimates and assumptions that affect the amounts represented in the financial statements and related disclosures. Use of available information and the application of judgement is inherent in the formation of estimates. Actual results in the future could differ from these estimates which may be material to the financial statements. Significant judgements include:

Loans and receivablesThe company and group assess its loans and receivables for impairment at the end of each reporting period. In determining whether an impairment loss should be recorded in profit or loss, the company and group make judgements as to whether there is observable data indicating a measurable decrease in the estimated future cash flows from a financial asset.

The impairment for loans and receivables is calculated on a portfolio basis, based on historical loss ratios, adjusted for national and industry-specific economic conditions and other indicators present at the reporting date that correlate with defaults on the portfolio. These annual loss ratios are applied to loan balances in the portfolio and scaled to the estimated loss emergence period.

Impairment testingThe recoverable amounts of cash-generating units and individual assets have been determined based on the higher of value-in-use calculations and fair values less costs to sell. These calculations require the use of estimates and assumptions. It is reasonably possible that the assumption may change, which may then impact our estimations and may then require a material adjustment to the carrying value of goodwill and tangible assets.

The company and group review and test the carrying value of assets when events or changes in circumstances suggest that the carrying amount may not be recoverable. In addition, goodwill is tested on an annual basis for impairment. Assets are grouped at the lowest level for which identifiable cash flows are largely independent of cash flows of other assets and liabilities. If there are indications that impairment may have occurred, estimates are prepared of expected future cash flows for each group of assets. Expected future cash flows used to determine the value in use of goodwill and tangible assets are inherently uncertain and could materially change over time.

TaxationJudgement is required in determining the provision for income taxes due to the complexity of legislation. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The company and group recognise liabilities for anticipated tax audit issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made.

The company and group recognise the net future tax benefit related to deferred income tax assets to the extent that it is probable that the deductible temporary differences will reverse in the foreseeable future. Assessing the recoverability of deferred income tax assets requires the company and group to make significant estimates related to expectations of future taxable income. Estimates of future taxable income are based on forecast cash flows from operations and the application of existing tax laws in each jurisdiction. To the extent that future cash flows and taxable income differ significantly from estimates, the ability of the company and group to realise the net deferred tax assets recorded at the end of the reporting period could be impacted.

Useful lives of depreciable assetsManagement reviews its estimate of the useful lives of depreciable assets at each reporting date, based on the expected utility of the assets. Uncertainties in these estimates relate to technical obsolescence that may change the utility of certain assets.




1.5 Intangible assetsIntangible assets are initially recognised at cost.

Expenditure on research (or on the research phase of an internal project) is recognised as an expense when it is incurred. An intangible asset arising from development (or from the development phase of an internal project) is recognised when:

• It is technically feasible to complete the asset so that it will be available for use or sale.• There is an intention to complete and use or sell it.• There is an ability to use or sell it.• It will generate probable future economic benefits.• There are available technical, financial and other resources to complete the development and to use or sell the asset.• The expenditure attributable to the asset during its development can be measured reliably.

Intangible assets are carried at cost less any accumulated amortisation and any impairment losses.

The amortisation period and the amortisation method for intangible assets are reviewed every period-end.

Reassessing the useful life of an intangible asset with a finite useful life after it was classified as indefinite is an indicator that the asset may be impaired. As a result the asset is tested for impairment and the remaining carrying amount is amortised over its useful life.

ITEM USEFUL LIFE

Exploration rights Two years

Production right Thirty years

1.6 Financial instruments

Initial recognition and measurementFinancial instruments are recognised initially when the company and group becomes a party to the contractual provisions of the instruments. The company and group classifies financial instruments, or their component parts, on initial recognition as a financial asset, a financial liability or an equity instrument in accordance with the substance of the contractual arrangement.

Financial instruments are measured initially at fair value, except for equity investments for which a fair value is not determinable, which are measured at cost and are classified as available-for-sale financial assets.

For financial instruments which are not at fair value through profit or loss, transaction costs are included in the initial measurement of the instrument.

Subsequent measurementLoans and receivables are subsequently measured at amortised cost, using the effective interest method, less accumulated impairment losses.

Fair value determinationThe fair values of quoted investments are based on current bid prices. If the market for a financial asset is not active (and for unlisted securities), the company and group establish fair value by using valuation techniques. These include the use of recent arm’s length transactions, reference to other instruments that are substantially the same, discounted cash flow analysis, and option pricing models making maximum use of market inputs and relying as little as possible on entity-specific inputs.



1.6 Financial instruments (continued)

Trade and other receivablesTrade receivables are measured at initial recognition at fair value, and are subsequently measured at amortised cost using the effective interest rate method. Appropriate allowances for estimated irrecoverable amounts are recognised in profit or loss when there is objective evidence that the asset is impaired. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments (more than 30 days overdue) are considered indicators that the trade receivable is impaired. The allowance recognised is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the effective interest rate computed at initial recognition.

The carrying amount of the asset is reduced through the use of an allowance account, and the amount of the loss is recognised in profit or loss within operating expenses. When a trade receivable is uncollectable, it is written off against the allowance account for trade receivables. Subsequent recoveries of amounts previously written off are credited against operating expenses in profit or loss.

Trade and other receivables are classified as loans and receivables.

Trade and other payablesTrade payables are initially measured at fair value, and are subsequently measured at amortised cost, using the effective interest rate method.

1.7 Tax

Current tax assets and liabilitiesCurrent tax for current and prior periods is, to the extent unpaid, recognised as a liability. If the amount already paid in respect of current and prior periods exceeds the amount due for those periods, the excess is recognised as an asset.

Current tax liabilities (assets) for the current and prior periods are measured at the amount expected to be paid to (recovered from) the tax authorities, using the tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.

Deferred tax assets and liabilitiesA deferred tax liability is recognised for all taxable temporary differences, except to the extent that the deferred tax liability arises from the initial recognition of an asset or liability in a transaction which at the time of the transaction, affects neither accounting profit nor taxable profit (tax loss).

A deferred tax asset is recognised for all deductible temporary differences to the extent that it is probable that taxable profit will be available against which the deductible temporary difference can be utilised. A deferred tax asset is not recognised when it arises from the initial recognition of an asset or liability in a transaction at the time of the transaction, affects neither accounting profit nor taxable profit (tax loss).

A deferred tax asset is recognised for the carry forward of unused tax losses and unused STC credits to the extent that it is probable that future taxable profit will be available against which the unused tax losses and unused STC credits can be utilised.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.




1.7 Tax (continued)

Tax expensesCurrent and deferred taxes are recognised as income or an expense and included in profit or loss for the period, except to the extent that the tax arises from:

• a transaction or event which is recognised, in the same or a different period, to other comprehensive income; or• a business combination.

Current tax and deferred taxes are charged or credited to other comprehensive income if the tax relates to items that are credited or charged, in the same or a different period, to other comprehensive income.

Current tax and deferred taxes are charged or credited directly to equity if the tax relates to items that are credited or charged, in the same or a different period, directly in equity.

1.8 LeasesA lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership. A lease is classified as an operating lease if it does not transfer substantially all the risks and rewards incidental to ownership.

Operating leases – lesseeOperating lease payments are recognised as an expense on a straight-line basis over the lease term. The difference between the amounts recognised as an expense and the contractual payments are recognised as an operating lease asset. This liability is not discounted.

Any contingent rents are expensed in the period they are incurred.

1.9 Share capital and equityOrdinary shares are classified as equity. Mandatorily redeemable preference shares are classified as liabilities.

If the company and group reacquire their own equity instruments, the consideration paid, including any directly attributable incremental costs (net of income taxes) on those instruments are deducted from equity until the shares are cancelled or reissued. No gain or loss is recognised in profit or loss on the purchase, sale, issue or cancellation of the company and group’s own equity instruments. Consideration paid or received shall be recognised directly in equity.

Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.

1.10 Provisions and contingenciesProvisions are recognised when:

• the company and group have a present obligation as a result of a past event;• it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation;

and• a reliable estimate can be made of the obligation.

The amount of a provision is the present value of the expenditure expected to be required to settle the obligation.

Where some or all of the expenditure required to settle a provision is expected to be reimbursed by another party, the reimbursement shall be recognised when, and only when, it is virtually certain that reimbursement will be received if the entity settles the obligation. The reimbursement shall be treated as a separate asset. The amount recognised for the reimbursement shall not exceed the amount of the provision.

Provisions are not recognised for future operating losses.

If an entity has a contract that is onerous, the present obligation under the contract shall be recognised and measured as a provision.

After their initial recognition contingent liabilities recognised in business combinations that are recognised separately are subsequently measured at the higher of:

• the amount that would be recognised as a provision; and• the amount initially recognised less cumulative amortisation.


2 Segmental informationNo operating segments have been disclosed as the company and group does not trade.

3 New standards and interpretations

3.1 Standards and interpretations effective and adopted in the current periodIn the current period, the company and group has adopted the following standards and interpretations that are effective for the current financial period and that are relevant to its operations:

Amendment to IFRS 13: Fair Value Measurement: Annual improvements projectThe amendment clarifies that references to financial assets and financial liabilities in paragraphs 48–51 and 53–56 should be read as applying to all contracts within the scope of, and accounted for in accordance with, IAS 39 or IFRS 9, regardless of whether they meet the definitions of financial assets or financial liabilities in IAS 32 Financial Instruments: Presentation.

The effective date of the amendment is for years beginning on or after 1 July 2014.

The group has adopted the amendment for the first time in the 2016 financial statements. The impact of the amendment is not material.

Amendment to IAS 38: Intangible Assets: Annual improvements projectThe amendment adjusts the option to proportionately restate accumulated amortisation when an intangible asset is revalued. Instead, the gross carrying amount is to be adjusted in a manner consistent with the revaluation of the carrying amount. The accumulated amortisation is then adjusted as the difference between the gross and net carrying amount.


The group has adopted the amendment for the first time in the 2016 financial statements.

The impact of the amendment is not material.

Amendment to IAS 16: Property, Plant and Equipment: Annual improvements projectThe amendment adjusts the option to proportionately restate accumulated depreciation when an item of property, plant and equipment is revalued. Instead, the gross carrying amount is to be adjusted in a manner consistent with the revaluation of the carrying amount. The accumulated depreciation is then adjusted as the difference between the gross and net carrying amount.


The group has adopted the amendment for the first time in the 2016 financial statements.

The impact of the amendment is not material.

3 New standards and interpretations (continued)

3.2 Standards and interpretations not yet effectiveThe company and group has chosen not to early adopt the following standards and interpretations, which have been published and are mandatory for the company and group’s accounting periods beginning on or after 1 March 2016 or later periods:

IFRS 9 Financial InstrumentsIFRS 9 issued in November 2009 introduced new requirements for the classification and measurements of financial assets. IFRS 9 was subsequently amended in October 2010 to include requirements for the classification and measurement of financial liabilities and for derecognition, and in November 2013 to include the new requirements for general hedge accounting. Another revised version of IFRS 9 was issued in July 2014 mainly to include a) impairment requirements for financial assets and b) limited amendments to the classification and measurement requirements by introducing a “fair value through other comprehensive income” (FVTOCI) measurement category for certain simple debt instruments.

NOTES TO THEFINANCIAL STATEMENTS


Key requirements of IFRS 9:

• All recognised financial assets that are within the scope of IAS 39 Financial Instruments: Recognition and Measurement are required to be subsequently measured at amortised cost or fair value. Specifically, debt investments that are held within a business model whose objective is to collect the contractual cash flows, and that have contractual cash flows that are solely payments of principal and interest on the outstanding principal are generally measured at amortised cost at the end of subsequent reporting periods. Debt instruments that are held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets, and that have contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on outstanding principal, are measured at FVTOCI. All other debt and equity investments are measured at fair value at the end of subsequent reporting periods. In addition, under IFRS 9, entities may make an irrevocable election to present subsequent changes in the fair value of an equity investment (that is not held for trading) in other comprehensive income with only dividend income generally recognised in profit or loss.

• With regard to the measurement of financial liabilities designated as at fair value through profit or loss, IFRS 9 requires that the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of the liability is presented in other comprehensive income, unless the recognition of the effect of the changes of the liability’s credit risk in other comprehensive income would create or enlarge an accounting mismatch in profit or loss. Under IAS 39, the entire amount of the change in fair value of a financial liability designated as at fair value through profit or loss is presented in profit or loss.

• In relation to the impairment of financial assets, IFRS 9 requires an expected credit loss model, as opposed to an incurred credit loss model under IAS 39. The expected credit loss model requires an entity to account for expected credit losses and changes in those expected credit losses at each reporting date to reflect changes in credit risk since initial recognition. It is therefore no longer necessary for a credit event to have occurred before credit losses are recognised.

The effective date of the standard is for years beginning on or after 1 January 2018.

The company and group expects to adopt the standard for the first time in the 2019 financial statements.

It is unlikely that the standard will have a material impact on the group’s financial statements.

IFRS 15 Revenue from Contracts with Customers

IFRS 15 supersedes IAS 11 Construction Contracts; IAS 18 Revenue; IFRIC 13 Customer Loyalty Programmes; IFRIC 15 Agreements for the Construction of Real Estate; IFRIC 18 Transfers of Assets from Customers and SIC 31 Revenue – Barter Transactions Involving Advertising Services.

The core principle of IFRS 15 is that an entity recognises revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. An entity recognises revenue in accordance with that core principle by applying the following steps:• Identify the contract(s) with a customer• Identify the performance obligations in the contract• Determine the transaction price• Allocate the transaction price to the performance obligations in the contract• Recognise revenue when (or as) the entity satisfies a performance obligation.

IFRS 15 also includes extensive new disclosure requirements. The effective date of the standard is for years beginning on or after 1 January 2018. The group expects to adopt the standard for the first time in the 2019 annual financial statements. It is unlikely that the standard will have a material impact on the group’s annual financial statements.

Amendments to IAS 16 and IAS 38: Clarification of Acceptable Methods of Depreciation and AmortisationThe amendment clarifies that a depreciation or amortisation method that is based on revenue that is generated by an activity that includes the use of the asset is not an appropriate method. This requirement can be rebutted for intangible assets in very specific circumstances as set out in the amendments to IAS 38.

The effective date of the amendment is for years beginning on or after 1 January 2016.

The company and group expects to adopt the amendment for the first time in the 2017 financial statements.

It is unlikely that the amendment will have a material impact on the company and group’s financial statements.


4 Property, plant and equipment

GROUP 2016 2014

Figures in Rand thousand CostAccumulateddepreciation Carrying value Cost

Accumulateddepreciation Carrying value

Computer software 94 (80) 14 78 (78) —

Furniture and fixtures 27 (18) 9 19 (15) 4

IT equipment 77 (9) 68 3 (1) 2

Land 1 238 — 1 238 — — —

Motor vehicles 1 252 (455) 797 451 (451) —

Office equipment 209 (169) 40 210 (139) 71

Plant and machinery 5 308 (329) 4 979 390 (286) 104

Total 8 205 (1 060) 7 145 1 151 (970) 181

COMPANY 2016 2015

CostAccumulateddepreciation Carrying value Cost

Accumulateddepreciation Carrying value

Computer software 4 — 4 — — —

Reconciliation of property, plant and equipment: Group – 2016

OPENINGBALANCE ADDITIONS TRANSFERS DEPRECIATION TOTAL

Computer software — 16 — (2) 14

Furniture and fixtures 4 8 — (3) 9

IT equipment 2 71 1 (6) 68

Land — 1 238 — — 1 238

Motor vehicles — 800 — (3) 797

Office equipment 71 1 (1) (31) 40

Plant and machinery 104 4 920 — (43) 4 979

181 7 054 — (88) 7 145

Reconciliation of property, plant and equipment: Group – 2014

OPENINGBALANCE DEPRECIATION TOTAL

Computer software 1 (1) —

Furniture and fixtures 6 (2) 4

IT equipment 2 — 2

Office equipment 89 (18) 71

Plant and machinery 110 (6) 104

207 (27) 181

NOTES TO THEFINANCIAL STATEMENTS (continued)


4 Property, plant and equipment (continued)

Reconciliation of property, plant and equipment: Company – 2016

Figures in Rand thousandOPENINGBALANCE ADDITIONS TOTAL

Computer software — 4 4

— 4 4

5 Intangible assets

GROUP 2016 2014

COSTACCUMULATEDAMORTISATION

CARRYINGVALUE COST

ACCUMULATEDAMORTISATION

CARRYINGVALUE

Exploration and Development costs

5 270 — 5 270 708 — 708

Molopo Project Mineral Rights

56 234 — 56 234 56 234 — 56 234

Total 61 504 — 61 504 56 942 — 56 942

Reconciliation of intangible assets

GROUP 2016 2014

OPENINGBALANCE ADDITIONS TOTAL

OPENINGBALANCE ADDITIONS TOTAL

Exploration and Development costs

708 4 562 5 270 456 252 708

Molopo Project Mineral Rights

56 234 — 56 234 56 234 — 56 234

56 942 4 562 61 504 56 690 252 56 942

The company has production and rights, bearing reference 12/4/07 over land in the magisterial districts of Ventersburg, Welkom and Odendaalrus in the province of the Free State.

The company has had to provide R2 755 408 as part of its Environmental Management Programme associated with the production activities for the rehabilitation and management of negative environmental impacts associated with the production activities.

The recoverable amount of the assets, Exploration and Development costs and Molopo Project Mineral Rights, will be recovered through value-in-use, as determined through the units of production and life of the mine. The amortisation will commence upon start of production.

There was no amortisation or impairment charges in the current period.

The fair value as determined by Venmyn Deloitte is R2.2 billion at 31 May 2015.


6 Investments in subsidiariesThe following table lists the entities which are controlled by the group, either directly or indirectly through subsidiaries.

Company

Figures in Rand thousand

NAME OF COMPANY% HOLDING

2016% HOLDING

2015

CARRYINGAMOUNT

2016

CARRYINGAMOUNT

2015

Tetra4 Proprietary Limited 90.00% —% 594 414 —

Windfall Resources Limited 100.00% —% — —

594 414 —

Subsidiaries with material non-controlling interests

Summarised consolidated statement of financial position

TETRA4 PROPRIETARY LIMITED

29 February2016

31 December2014

Assets

Non-current assets 68 646 57 123

Current assets 5 012 674

Total assets 73 658 57 797

Liabilities

Non-current liabilities 96 576 71 280

Current liabilities 1 312 273

Total liabilities 97 888 71 553

Total net liabilities (24 230) (13 756)

Carrying amount of non-controlling interest (7 923) —

Summarised statement of profit or loss and other comprehensive income


29 February2016

31 December2014

Other income and expenses (10 474) (3 078)

Loss before tax (10 474) (3 078)

Loss after tax (10 474) (3 078)

Total loss and other comprehensive income (10 474) (3 078)

Loss allocated to non-controlling interest (1 047) —



6 Investments in subsidiaries (continued)

Summarised statement of cash flows


2016 2014

Cash outflows from operating activities (10 478) (2 168)

Cash outflows from investing activities (11 613) (252)

Cash inflows from financing activities 22 351 2 445

Net increase in cash and cash equivalents 260 25

7 Investment in joint ventureThe following table lists all of the joint ventures in the group:

Group

NAME OF COMPANY

% OWNERSHIPINTEREST

2016

% OWNERSHIPINTEREST

2014

CARRYINGAMOUNT

2016

CARRYINGAMOUNT

2014

Ivory Coast Hydro Project 62.00 % — % 6 503 —

Investment in Ivory Coast Hydro is a hydroelectric scheme that Renergen Limited entered into jointly with two other parties in Côte d’Ivoire (in the west of the African continent). The Ivory Coast Hydro project has been accounted for in accordance with IAS28. R6 502 546 was invested in the current year. This forms part of Renergen’s capital contribution into the project. Renergen Limited jointly controls the project with 62% holding and 38% is shared between the two other parties. No income, expenses or liabilities were accrued for in the current year.

There is no group’s share of profit or loss from this equity accounted investment as the investment is nearing completion of feasibility stage.

8 Loans to group company

SUBSIDIARIES

Tetra4 Proprietary Limited — — 15 278 —

Tetra4 Proprietary Limited – acquired — — 54 686 —

— — 69 964 —

It was resolved by the board of Renergen Limited to finance Tetra4 Proprietary Limited for all its operations. The loan is unsecured, bears no interest and will not be repaid within the next 12 months.

An amount of R54 685 764 was ceded to Renergen Limited from Windfall Energy Proprietary Limited, which is the previous holding company. The amount ceded is unsecured, bears no interest and will not be repaid within the next 12 months.

GROUP COMPANY

Figures in Rand thousandFebruary

2016December

2014February

2016February

2015



GROUP COMPANY


2016December

2014February

2016February

2015

9 Other financial assets

Loans and receivables

C Sjoberg — — 5 500 —

Loan ceded to Renergen Limited by Windfall Energy Propri-etary Limited on acquisition of Tetra4 Proprietary Limited’s 90% shareholding. R5.5million loan was issued to C Sjoberg to finance the purchase on 10% shareholding in Tetra4 Propri-etary Limited in June 2014 with a pledge and session of the shares as security. No interest is charged on the loan. The loan is repayable on demand or over 10 years by means of any of the following: payments of dividends from shares to the lender; payment of the principal by the borrower or raising capital in Tetra4 Proprietary Limited by virtue of C Sjoberg’s business relationships to the value of at least R10 000 000 on favourable terms as accepted by Tetra4 Proprietary Limited.

Current assets

Loans and receivables — — 5 500 —

10 Financial assets by categoryThe accounting policies for financial instruments have been applied to the line items below:

Group – 2016

LOANS ANDRECEIVABLES TOTAL

Cash and cash equivalents 41 721 41 721

Deposits & other receivables 683 683

42 404 42 404

Group – 2014


Cash and cash equivalents 618 618

Deposits & other receivables 22 22

640 640


GROUP COMPANY


2016December

2014February

2016February

2015

10 Financial assets by category (continued)

Company – 2016


Cash and cash equivalents 40 842 40 842

Loans to group companies 69 964 69 964

Trade and other receivables 1 1

110 807 110 807

Company – 2015


Trade and other receivables 1 1

110 807 110 807

11 Trade and other receivables

Deposits 71 21 — —

Other receivable 612 1 1 1

Prepayments 2 105 — — —

Value Added Taxation receivable 1 346 34 — —

4 134 56 1 1

12 Cash and cash equivalents

Cash and cash equivalents consist of:

Bank balances 41 172 76 40 842 —

Environmental Rehabilitation Guarantee – Exploration rights 549 542 — —

41 721 618 40 842 —

Environmental Guarantee

The company has exploration rights over land in Evander (Mpumalanga) and in Virginia (Free State). The company has had to provide R502 850 as part of its Environmental Management Programme associated with the exploration activities for the rehabilitation and management of negative environmental impacts associated with the exploration activities. The funds are currently invested with an Absa call account with interest earned being capitalised into the account.


13 Share capital

Authorised

100 000 000 no par value shares 100 000 — 100 000 1

Reconciliation of number of shares issued:

Opening number of shares in issue — — 1 1

Share buy-back — — (1) —

Shares issued 7 376 — 7 376 —

Shares issued at Tetra4 Proprietary Limited acquisition 70 000 — 70 000 —

77 376 — 77 376 1

Reconciliation of shares issue:

1 000 Ordinary no par value shares of R1 each — — 1 1

1 000 Ordinary no par value shares repurchased at R1 each and cancelled

— — (1) —

7 375 528 Ordinary no par value shares of R10 each — — 73 755 —

Share issue cost — — (798) —

Shares issued at Tetra4 Proprietary Limited acquisition — — 649 600 —

Net asset value of shares at acquisition 68 972 — — —

Loans exchanged for acquisition of shares 60 186 — — —

Cash consideration transferred for share issue (5 000) — — —

124 158 — 722 556 1

Issued

Ordinary 124 158 — 722 557 1

14 Loans from shareholders

Windfall Energy Proprietary Limited — (47 614) — —

This loan was settled in the current period.

15 Other financial liabilities

Held at amortised cost

Molopo Energy Limited 23 857 20 911 — —

The loan agreement is for the period from inception of the loan on 1 May 2013 until 31 December 2022. During this period the loan is unsecured and interest free. The loan can only be repaid when Molopo South Africa declares a dividend and 36% of distributable profits must be repaid before a dividend is declared.

The loan has been discounted to present value for the period that it is interest free at a discount rate which is equal to the prime lending rate plus 2 basis points which at year-end was 10.25%.

GROUP COMPANY


2016December

2014February

2016February

2015



15 Other financial liabilities (continued)

In the event that by 31 December 2022 the loan is not repaid, the loan shall bear interest at prime overdraft plus 2 basis points and will have no repayment terms. Shareholders’ loans can only be repaid after the loans from Molopo Energy Limited has been settled.

Non-current liabilities

At fair value through profit and loss 23 857 20 911 — —

16 Provisions

Reconciliation of provisions: Group – 2016

OPENINGBALANCE TOTAL

Environmental rehabilitation 2 755 2 755

The company has production and rights, bearing reference 12/4/07 over land in the magisterial districts of Ventersburg, Welkom and Odendaalrus in the province of the Free State.

The company has had to provide R2 755 408 as part of its Environmental Management Programme associated with the exploration activities for the rehabilitation and management of negative environmental impacts associated with the production activities.

The rehabilitation requirements are reviewed annually by Petroleum Agency of South Africa “PASA”. The date of the latest review is 15 December 2015.

The company has guarantees in place to the value of R2 755 408 in place with PASA. The amount is allocated for:• the rehabilitation of 4 new planned sites;• final rehabilitation of 16 well sites;• removal and rehabilitation of approximately 18 382m of pipeline routes;• monitoring and maintenance of such rehabilitated pipeline routes;• remediation of contaminated soil; and• scarification of compacted soil;

as set out in paragraph 2.2.5 of the Record of Decision for the approval of the Environmental Management Programme, dated June 2011.

GROUP COMPANY


2016December

2014February

2016February

2015


17 Financial liabilities by categoryThe accounting policies for financial instruments have been applied to the line items below:

Group – 2016

FINANCIALLIABILITIES AT

AMORTISEDCOST TOTAL

Other financial liabilities 23 857 23 857

Trade and other payables 3 490 3 490

27 347 27 347

Group – 2014


AMORTISEDCOST TOTAL

Other financial liabilities 20 911 20 911

Trade and other payables 276 276

21 187 21 187

Company – 2016


AMORTISEDCOST TOTAL

Trade and other payables 2 178 2 178

18 Trade and other payables

Trade payables 1 807 151 1 073 —

Accrued expenses 864 94 863 —

Accrued leave pay 42 28 (57) —

Loans payable 777 — 299 —

3 490 273 2 178 —


GROUP COMPANY


2016December

2014February

2016February

2015


19 Operating lossOperating loss for the year is stated after accounting for the following:

Operating lease charges

Premises

• Contractual amounts 302 100 103 —

Depreciation on property, plant and equipment 88 27 — —

Employee costs 5 250 595 1 204 —

Impairment loss 31 825 — — —

20 Investment revenue

Interest received

Bank 3 023 — 3 018 —

21 Fair value adjustments

Other financial liabilities (2 946) (1 122) — —

22 Finance costs

Finance costs 81 — — —

23 TaxationNo provision has been made for 2016 tax as the group has no taxable income. The estimated tax loss available for set-off against future taxable income for the group is R49 076 407 (2015: R42 778 937); company R2 089 120 (2015: R Nil).

24 Auditors’ remuneration

Fees 441 — 441 —

GROUP COMPANY


2016December

2014February

2016February

2015


25 Loss per share

Basic loss per share

Basic loss per share is determined by dividing loss attributable to the ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during the period.

Basic loss per share

From continuing operations (cents per share) (36.53) (3 078) — —

Basic loss per share was based on loss for the group of R(19 499 326) (2014: Rnil); company of R(7 507 000) (2015: Rnil) and a group weighted average number of ordinary shares of 53 382 652 (2014: nil).

Reconciliation of loss for the year to basic earnings

Loss for the year attributable to equity holders of the parent (19 499) (3 078) (7 507) —

Diluted earnings per share

In the determination of diluted loss there were no dilutive instruments in issue.

Diluted loss per share

From continuing operations (cents per share) (36.53) — — —

Diluted loss per share was based on loss for the group of R(19 499 326) (2014: R(3 077 851)); company of R(7 507 000) (2014: Rnil) and a group weighted average number of ordinary shares of 53 382 652 (2014: nil).

Reconciliation of basic loss to loss used to determine diluted loss per share

Basic loss (19 499) — (7 507) —

Headline loss and diluted headline loss per share

Headline loss per share and diluted headline loss per share are determined by dividing headline loss and diluted headline loss by the weighted average number of ordinary share outstanding during a period.

Headline loss per share (cents) (36.53) — — —

Basic and diluted loss (19 499) (3 078) (7 507) —

There has been no difference in basic and diluted loss in the current financial period


GROUP COMPANY


2016December

2014February

2016February

2015


26 Cash used in operations

Loss before taxation (19 499) (3 078) (7 507) —

Adjustments for:

Depreciation 88 27 — —

Interest received (3 024) — (3 018) —

Finance costs 81 — — —

Fair value adjustments 2 946 1 122 — —

Share-based payment expense 1 518 — — —

Impairment of VAT asset 32 — — —

Changes in working capital:

Trade and other receivables* (5 702) 10 — (1)

Trade and other payables* (564) (250) 2 177 —

(24 123) (2 169) (8 348) (1)

* Trade & other receivables and Trade and other payables include at acquisition balances of Renergen Limited company.

27 Reverse acquisition

Tetra4 Proprietary Limited

On 25 November 2015, Renergen shareholders approved the Tetra4 Acquisition which was Renergen’s first viable asset acquisition as a SPAC, thus converting Renergen to a business.

The purchase consideration of the Tetra4 Proprietary Limited Acquisition was partly settled in cash and partly settled in Renergen Limited shares to apply IFRS 3, the standard on business combination. The assets acquired and the liabilities assumed must constitute a business, otherwise the reporting entity accounts for the transaction or event as an asset acquisition. Renergen Limited listed as a SPAC and was not a business prior to the acquisition of Tetra4 Proprietary Limited but simply a cash shell. The Tetra4 Proprietary Limited Acquisition, therefore, does not constitute a business combination. Due to the transaction not being a business combination by definition of IFRS 3, it is a share-based payment transaction as per IFRS 2.

Renergen Limited (listed entity) issued 70 million shares to Tetra4 Proprietary Limited’s (non-listed entity) former shareholder (Windfall Energy Proprietary Limited) in exchange for a 90% shareholding in Tetra4 Proprietary Limited. This resulted in Windfall Energy effectively holding a controlling stake of 90% in Renergen Limited. The former shareholders of the legal subsidiary obtained control of the legal parent. It is appropriate to apply by analogy in accordance with paragraph 10-12 of IAS8, guidance in paragraph B19-B27 of IFRS3 for reverse acquisitions. This results in the non-listed operating entity being identified as the accounting acquirer and the listed entity as the accounting acquiree. The accounting acquirer (Tetra4 Proprietary Limited) is deemed to have issued shares to obtain control of the acquiree (Renergen Limited).


GROUP COMPANY


2016December

2014February

2016February

2015


27 Reverse acquisition (continued)

Fair value of assets acquired and liabilities assumed

Current asset held for sale 3 753 — — —

Loans 3 — — —

Trade and other receivables (1 491) — — —

Cash and cash equivalents 69 184 — — —

Other loans payable (4 052) — — —

Trade and other payables 57 — — —

67 454 — — —

Acquisition date fair valueNAV of Renergen Limited at acquisition (67 454) — —

Consideration paid

The purchase of shareholding was partly settled in cash of R5 000 000 and partly settled in Renergen share issue of 70 000 000 shares issued at R9.28. Total consideration paid is thus R124 157 487. The share-based payment expense has been consolidated into the financial statements and is included in the statement of profit or loss.

Net identifiable assets

Renergen Limited’s net assets at acquisition date were R67 454 207. Claims of R60 185 764 were transferred to Renergen Limited at acquisition date. The transaction cost incurred was R305 820, included in operating expenses.

Non-controlling interest

At the date of acquisition, the 10% non-controlling interest is valued at R6 875 610 based on the value of the underlying business at Tetra4 Proprietary Limited.

Share-based payment

At acquisition date, Renergen Limited had 7 375 528 shares in issue at R10 per share. An additional 70 million shares were issued at R9.28 for the Tetra4 Proprietary Limited Acquisition, bringing the total number of shares in issue to 77 375 528 and the total share capital to R723.4 million. Renergen Limited shareholders therefore effectively hold 9.47% of the total issued shares of 77 375 528. The shareholding acquired by Tetra4 Proprietary Limited shareholders on the 70 000 000 share issue is effectively 90.47% (70 000 000 of the 77 375 528 shares in issue) in exchange for 90% of issued shares in Tetra4 Proprietary Limited. The fair value of the remaining 9.53% of Renergen shares is R68 971 723 (effective consideration paid for Tetra4).

The share based payment expense arising from the transaction amounted to R1 517 516, being the difference between the effective consideration and Renergen Limited’s net asset value at acquisition of R67 454 207.

Tetra4 Proprietary Limited contribution to group results


Tetra4 Proprietary Limited contributed R24 229 990 retained income in the current year to the group’s total retained income.


GROUP COMPANY


2016December

2014February

2016February

2015


27 Reverse acquisition (continued)

The contribution is comprised as follows:

Revenue 90

Expenses (10 564)

Total loss and other comprehensive income (10 474)

December 2014 retained earnings (13 756)

Total contribution (24 330)

Windfall Resources Limited Acquisition

On 29 February 2016, Renergen acquired 100% of Windfall Resources Limited for R100. Windfall Resources’s net asset value was R100 at acquisition date. The subsidiary did not trade for the period 25 November to 29 February 2019.

28 Commitments

Operating leases – as lessee (expense)

Minimum lease payments due

Within one year 301 — — —

Operating lease payments represent rentals payable by the group for certain of its office properties. Leases are negotiated for an average term of seven years and rentals are fixed for an average of three years. No contingent rent is payable.

29 ContingenciesThere are no commitments and contingent liabilities in the current year. Contingent liabilities raised in prior year of R554 649 have been recognised in the current period after the successful listing of Renergen on JSE AltX on 9 June 2015.

Non-executive directors’ fees have been accrued for, in the current year, based on directors’ fee rates approved by the board on and published in the shareholders’ circular in October 2015. Renergen Limited’s MOI states that directors will be entitled to a remuneration package once the company is successful on its acquisition of a viable asset. Fees of R863 333 were accrued for, but not yet paid, pending approval by shareholder in the coming annual general meeting.

30 Related parties

Relationships

Subsidiaries Tetra4 Proprietary Limited

Windfall Resources Proprietary Limited

Shareholder with significant influence Taryn Investment Holdings Proprietary Limited

Mazi Capital Investments

Companies controlled by directors Windfall Energy Proprietary Limited

CRT Proprietary Limited

MATC Investment Holdings Proprietary Limited

GROUP COMPANY


2016December

2014February

2016February

2015


30 Related parties (continued)

Related party balances

Loan accounts – owing (to)/by related parties

Tetra4 Proprietary Limited — — 15 278 —

Tetra4 Proprietary Limited – acquired from Windfall Proprietary Limited on acquisition

— — 54 686 —

Windfall Energy Proprietary Limited (477) (47 613) — —

(477) (47 613) 69 964 —

Related party transactions

Rent paid to related parties

Tetra4 Proprietary Limited — — 40 —

Administration fees received from related parties

Tetra4 Proprietary Limited — — (57) —

The group and company have no key management or prescribed officers as those functions are performed by the executive directors.

31 Directors’ emoluments

Executive

29 February 2016

EMOLUMENTSTRAVEL

ALLOWANCE BONUS TOTAL

Stefano Marani 625 — — 625

Fulu Ravele 558 — — 558

Nick Mitchell 600 — — 600

Reginald Edmond Cooke — — — —

1 783 — — 1 783

31 December 2014

EMOLUMENTSTRAVEL

ALLOWANCE BONUS

Stefano Marani — — —

Nick Mitchell — — —

No emoluments were paid to the directors or any individuals holding a prescribed office during the year.


GROUP COMPANY


2016December

2014February

2016February

2015


31 Directors’ emoluments (continued)

Non-executive

29 February 2016

DIRECTORS’FEES

COMMITTEESFEES TOTAL

Brett Kimber 173 100 273

Mbali Swana 180 — 180

Russell Broadhead 180 — 180

Reginald Edmond Cooke 180 50 230

Luigi Matteucci — — —

713 150 863

Non-executive directors’ fees have been accrued for based on the fees approved by the board in October and published in the shareholders circular in October 2015. These fees have not been paid out, pending approval by shareholders in the next annual general meeting.

Reginald Edmond Cooke’s status as a non-executive director has changed due to services he renders to Tetra4 Proprietary Limited. Non-executive directors’ fees were earned before his status changed to executive director.

31 December 2014No emoluments were paid to the directors or any individuals holding a prescribed office during the year.

32 Risk management

Capital risk managementThe company and group’s objectives when managing capital are to safeguard the company and group’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

The capital structure of the company and group consists of debt, which includes the borrowings (excluding derivative financial liabilities) disclosed in notes 8, 14 & 15, cash and cash equivalents, disclosed in note 12, and equity as disclosed in the consolidated statement of financial position.

There are no externally imposed capital requirements.

Financial risk managementThe company and group are exposed to a variety of financial risks: market risk (including currency risk, fair value interest rate risk and cash flow interest rate risk), credit risk and liquidity risk. The group’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the company and group’s financial performance. The principles for financial management are included in the company and group’s treasury policy and cover specific areas, such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial instruments and non-derivative financial instruments, and investment of excess liquidity.

Liquidity riskManagement manages cash flow on a group basis through an ongoing review of future commitments and credit facilities. Cash flow forecasts are prepared and spending is monitored for compliance with internal targets.


32 Risk management (continued)

Liquidity risk (continued)

Group

AT 29 FEBRUARY 2016LESS THAN

1 YEARBETWEEN 1

AND 2 YEARSBETWEEN 2

AND 5 YEARS OVER 5 YEARS

Other financial liabilities — — — 23 857

Provisions — — — 2 755

Trade and other payables 3 490 — — —

AT 31 DECEMBER 2014LESS THAN

1 YEARBETWEEN 1



Loan from shareholder — — — 47 613

Other financial liabilities — — — 2 911

Provisions — — — 2 755

Trade and other payables 273 — — —

Company

AT 29 FEBRUARY 2016LESS THAN

1 YEARBETWEEN 1



Trade and other payables 2 178 — — —

Interest rate risk

The company and group’s operating cash flows are independent of changes in market interest rates. The company and group’s interest rate risk arises from long-term debt. Debt issued at variable rates exposes the company and group to cash flow interest rate risk. The debt with variable interest rate is not repayable until December 2022. Refer to note 15. Interest-bearing debt comprise 26% of the total equity, therefore deemed to be low risk.

Credit risk

Credit risk is managed on a company and group basis as well as individual company basis. Credit risk consists mainly of cash deposits, cash equivalents, trade debtors and related party loans. The company and group only deposit cash with major banks with high-quality credit standing and limits exposure to any one counterparty. Trade receivables comprise a prepaid expense from regular suppliers of the company and group. Risk control assesses the credit quality of the supplier by taking into account its financial position, past experience and other factors. The maximum credit risk the company and group are exposed to is the receivable balance on the trade receivables and related party loans as disclosed in note 12 and 26 respectively.

Foreign exchange risk

The company and group procure some operating equipment and machinery internationally and is exposed to foreign exchange risk arising primarily with respect to ZAR, EUR and USD. Foreign exchange risk arises from future commercial transactions, liabilities and net investments in foreign operations. Management is of the view that only the ZAR poses a significant foreign exchange risk given its volatility against the USD. The company and group review its foreign currency exposure, including commitments on an ongoing basis.



33 Going concernThe financial statements have been prepared on the basis of accounting policies applicable to a going concern. This basis presumes that funds will be available to finance future operations and that the realisation of assets and settlement of liabilities, contingent obligations and commitments will occur in the ordinary course of business.

Renergen group is expected to start generating revenue in the first half of the 2017 financial period from Tetra4 Proprietary Limited’s sales of compressed natural gas. Management has continued to monitor the cash flows to ensure that the group continues to be in a position to pay it’s debts when they become due. The capital expenditure forecast are approved by the board after considering the impact on solvency and liquidity.

34 Events after the reporting periodRenergen Limited, through its subsidiary Tetra4 Proprietary Limited and African Oxygen Limited (Afrox), a subsidiary of the Linde Group, a world-leading gases and engineering company, entered into an agreement to commercialise Free State Helium and Natural Gas on 4 May 2016. Tetra4 Proprietary Limited has contracted Helium under an off-take agreement with The Linde Group, via its Global Helium subsidiary, being assigned distribution rights for substantial reserves of helium. Afrox will operate the plant and market the helium.

Renergen Limited and Unitrans Passenger Proprietary Limited signed a contract through their respective subsidiaries, Tetra4 Proprietary Limited and Megabus Proprietary Limited (“Megabus”) on 19 May 2016, for the supply of compressed natural gas by Tetra4 Proprietary Limited to Megabus Proprietary Limited, to power 10 buses operating from the Megabus depot in the town of Virginia, Free State province, South Africa.

The directors are not aware of any other material event which occurred after the reporting date and up to the date of this report.


ANALYSIS OFORDINARY SHAREHOLDERSas at 29 February 2016

SHAREHOLDER SPREADNUMBER OF

SHAREHOLDINGS% OF TOTAL

SHAREHOLDINGSNUMBER OF

SHARES% OF ISSUED

CAPITAL

1 – 1 000 284 70,82 45 966 0,06

1 001 – 10 000 49 12,22 223 747 0,29

10 001 – 100 000 39 9,73 1 647 053 2,13

100 001 – 1 000 000 18 4,49 5 328 029 6,89

Over 1 000 000 11 2,74 70 130 733 90,64

Total 401 100,00 77 375 528 100,00

DISTRIBUTION OF SHAREHOLDERSNUMBER OF



SHARES% OF ISSUED

CAPITAL

Private Companies 16 3,99 61 486 867 79,47

Retail Shareholders 338 84,29 5 426 029 7,01

Retirement Benefit Funds 8 2,00 3 947 148 5,10

Organs of State 2 0,50 2 679 445 3,46

Collective Investment Schemes 6 1,50 1 190 976 1,54

Assurance Companies 2 0,50 653 757 0,84

Medical Aid Funds 2 0,50 540 779 0,70

Stockbrokers & Nominees 4 1,00 439 139 0,57

Hedge Funds 2 0,50 403 075 0,52

Managed Funds 4 1,00 303 365 0,39

Trusts 8 2,00 152 467 0,20

Close Corporations 5 1,25 127 000 0,16

Foundations & Charitable Funds 1 0,25 23 369 0,03

Investment Partnerships 2 0,50 2 100 0,00

Public Companies 1 0,25 12 0,00

Total 401 100,00 77 375 528 100,00


SHAREHOLDER TYPENUMBER OF



SHARES% OF ISSUED

CAPITAL

Non-Public Shareholders 7 1,75 61 462 945 79,43

Directors and Associates

Directors and Associates (Direct Holding) 3 0,75 17 913 078 23,15

Directors and Associates (Indirect Holding) 1 0,25 125 000 0,16

Major Shareholders > 10% of the shares in issue (excluding directors)

Tamryn Investment Holdings (Pty) Ltd 3 0,75 43 424 867 56,12

Public Shareholders 394 98,25 15 912 583 20,57

Total 401 77 375 528

FUND MANAGERS WITH A HOLDING GREATER THAN 3% OF THE ISSUED SHARESNUMBER OF

SHARES% OF ISSUED

CAPITAL

Trillian Asset Management 19 128 427 24,72

Mazi Capital 6 469 521 8,36

Total 25 597 948 33,08

BENEFICIAL SHAREHOLDERS WITH A HOLDING GREATER THAN 3% OF THE ISSUED SHARES

NUMBER OFSHARES

% OF ISSUEDCAPITAL

Tamryn Investment Holdings (Pty) Ltd 43 424 867 56,12

CRT Investment Holding (Pty) Ltd 8 827 139 11,41

MATC Investment (Pty) Ltd 8 827 139 11,41

Government Employees Pension Fund 2 440 706 3,15

Total 63 519 851 82,09

Total number of shareholders 401

Total number of shares in issue 77 375 528


SHARE PRICE PERFORMANCE

Opening Price 9 June 2015 R17,00

Closing Price 29 February 2016 R14,00

Closing High for period R17,90

Closing low for period R12,50

Number of shares in issue 77 375 528

Volume traded during period 4 430 008

Ratio of volume traded to shares issued (%) 5,73%

Rand value traded during the period 62 521 960

Price/earnings ratio as at 29 February 2016 (2,47)

Earnings yield as at 29 February 2016(%) (40,44)

DIRECTORS OF THE COMPANY OR ANY OF ITS SUBSIDIARIES SHARES

MATC (S Marani) 8 827 139

CRT (N Mitchell) 8 827 139

S Marani 258 800

G3 Family Trust (R Broadhead) Indirect holding 125 000

18 038 078

BENEFICIAL HOLDERS > 10% COUNT HOLDING %

Tamryn Investment Holdings Proprietary Limited

Tamryn Investment Holdings Proprietary Limited 1 35 351 790 45,69



3 43 424 867 56,12

ANALYSIS OFORDINARY SHAREHOLDERS (continued)


NOTICE OFANNUAL GENERAL MEETING

RENERGEN LIMITED

Incorporated in the Republic of South Africa(formerly Dominica Trade Proprietary Limited)(Registration number: 2014/195093/06)Share code: REN ISIN: ZAE000202610(“Renergen” or “the Company” or “the Group”)

If you are in any doubt as to what action you should take in respect of the following resolutions, please consult your Central Securities Depository Participant (“CSDP”), broker, banker, attorney, accountant or other professional adviser immediately.

Notice is hereby given that the first Annual General Meeting (“Annual General Meeting”) of shareholders of Renergen will be held at 10:00 on Friday, 30 September 2016 at First Floor, 1 Bompas Road, Dunkeld West, 2196, for the purpose of considering, and, if deemed fit, passing, with or without modification, the resolutions set out hereafter.

The board of directors of the Company (“the Board”) has determined that, in terms of section 62(3)(a), as read with section 59 of the Companies Act, 2008 (Act 71 of 2008), as amended, the record date for the purposes of determining which shareholders of the Company are entitled to receive the notice of annual general meeting is Friday, 12 August 2016 and the record date for the purposes of determining which shareholders of the Company are entitled to participate in and vote at the Annual General Meeting is Friday, 23 September 2016. Accordingly, the last day to trade Renergen shares in order to be recorded in the Register to be entitled to vote will be Wednesday, 20 September 2016.

AGENDA

(i) Presentation of the audited annual financial statements of the Company as required by Article 6.6 of the Company’s Memorandum of Incorporation, including the reports of the directors, the report of the external auditors and the Audit and Risk Committee report for the year ended 29 February 2016 as set out in the Company’s Annual Report 2016, of which this notice forms part. The Annual Report 2016, containing the complete audited annual financial statements, is available at www.renergen.co.za or can be obtained from the Company’s registered office on request.

(ii) To consider and deemed fit, to pass, with and without modification, the following ordinary resolutions.

The minimum percentage of voting rights required for each of the ordinary resolutions (save for ordinary resolution number 12, which in terms of the JSE Listings Requirements prescribes a 75% (seventy five percent) majority vote) is more than 50% (fifty percent) of the voting rights exercised on each of the resolutions by shareholders present or represented by proxy at the Annual General Meeting.

The minimum percentage of voting rights required for each of the special resolutions is more than 75% (seventy five percent) of the voting rights exercised on each of the resolutions by shareholders present or represented by proxy at the Annual General Meeting

ORDINARY RESOLUTIONS

1 Ordinary resolution 1

Confirmation of appointment of new director: Ms Fulu RaveleTo confirm the appointment of Ms Fulu Ravele as an executive director of the Company.


Confirmation of appointment of new director: Mr Nick MitchellTo confirm the appointment of Mr Nick Mitchell as an executive director of the Company.


Confirmation of appointment of new director: Mr Brett KimberTo confirm the appointment of Mr Brett Kimber as an independent non-executive director of the Company and Chairman of the Board.


NOTICE OFANNUAL GENERAL MEETING (continued)


Confirmation of appointment of new director: Mr Luigi MatteucciTo confirm the appointment of Mr Luigi Matteucci as an independent non-executive director of the Company.


Re-election of Director: Mr Mbali SwanaTo appoint, Mr Mbali Swana who, in terms of Article 5.1 of the Company’s Memorandum of Incorporation, retires by rotation at this Annual General Meeting but, being eligible to do so, offers himself for re-election.


Re-election of Director: Mr Russell BroadheadTo re-elect, Mr Russell Broadhead who, in terms of Article 5.1 of the Company’s Memorandum of Incorporation, retires by rotation at this Annual General Meeting but, being eligible to do so, offers himself for re-election.

An abbreviated curriculum vitae in respect of each of the aforementioned directors appears on page 12 and page 13 of the annual report to which this notice is attached.


Appointment of Mr Mbali Swana to the Audit, Risk and Information Technology CommitteeTo appoint Mr Mbali Swana as a member and Chairman of the Company’s Audit, Risk and Information Technology Committee.


Appointment of Mr Luigi Matteucci to the Audit, Risk and Information Technology CommitteeTo appoint Mr Luigi Matteucci as a member of the Company’s Audit, Risk and Information Technology Committee.


Appointment of Mr Russell Broadhead to the Audit, Risk and Information Technology CommitteeTo appoint Mr Russell Broadhead as a member of the Company’s Audit, Risk and Information Technology Committee.

An abbreviated curriculum vitae in respect of each member of the Audit, Risk and Information Technology Committee appears on page 12 and page 13 of the annual report to which this notice is attached.


Reappointment of auditors and confirmation of their feesTo confirm the appointment of Grant Thornton as independent auditors of the Company with Mr Jacques Barradas, being the individual registered auditor who has undertaken the audit of the Company for the ensuing financial year, and to authorise the directors to determine the auditors’ fees.

11 Ordinary resolution number 11

Approval of remuneration policy“Resolved that the remuneration policy of the directors of Renergen Limited (“the Company”), as set out on page 33 of the annual report to which this notice is attached, be and is hereby approved as a non-binding advisory vote of shareholders of the Company in terms of the King III Report on Corporate Governance.”

Ordinary resolutions to be adopted at this Annual General Meeting require approval from a simple majority, which is more than 50% of the votes exercised on such resolutions by shareholders present or represented by proxy at the meeting.



Approval to issue ordinary shares, and to sell treasury shares, for cash“Resolved that the directors of Renergen Limited (“the Company”) and/or any of its subsidiaries from time to time be and are hereby authorised, by way of a general authority, to:

• allot and issue, or to issue any options in respect of, all or any of the authorised but unissued ordinary shares in the capital of the Company; and/or

• sell or otherwise dispose of or transfer, or issue any options in respect of, ordinary shares in the capital of the Company purchased by subsidiaries of the Company,

for cash, to such person/s on such terms and conditions and at such times as the directors may from time to time in their discretion deem fit, subject to the Companies Act, 2008 (Act 71 of 2008), as amended, the Memorandum of Incorporation of the Company and its subsidiaries and the Listings Requirements of JSE Limited (“the JSE Listings Requirements”) from time to time.

The JSE Listings Requirements currently provide, inter alia, that:

• this general authority will be valid until the earlier of the Company’s next Annual General Meeting or the expiry of a period of 15 (fifteen) months from the date that this authority is given;

• the securities which are the subject of the issue for cash must be of a class already in issue, or where this is not the case, must be limited to such securities or rights that are convertible into a class already in issue;

• any such issue may only be made to “public shareholders” as defined in the JSE Listings Requirements and not to related parties;

• the securities which are the subject of a general issue for cash may not exceed 50% (fifty percent of the number of listed securities, excluding treasury shares, as at the date of this notice, being 38 687 764 securities. Any securities issued under this authorisation during the period of 15 (fifteen) months from the date that this authorisation will be deducted from the aforementioned 38 687 764 listed securities. In the event of a sub-division or a consolidation during the period contemplated above the authority will be adjusted to represent the same allocation ratio;

• in determining the price at which securities may be issued in terms of this authority, the maximum discount permitted will be 10% (ten percent) of the weighted average traded price of such securities measured over the 30 (thirty) business days prior to the date that the price of the issue is agreed in writing between the issuer and the party/ies subscribing for the securities;

• an announcement giving full details, including the number of securities issued, the average discount to the weighted average traded price of the securities over 30 (thirty) business days prior to the date that the issue is agreed in writing between the issuer and the parties subscribing for the securities and an explanation including supporting information (if any), of the intended use of the funds will be published when the Company has issued securities representing, on a cumulative basis within the earlier of the Company’s next Annual General Meeting or the expiry of a period of 15 (fifteen) months from the date that this authority is given, 5% (five percent) or more of the number of securities in issue prior to the issue; and

• whenever the Company wishes to use repurchased shares, held as treasury stock by a subsidiary of the Company, such use must comply with the JSE Listings Requirements as if such use was a fresh issue of ordinary shares.

Under the JSE Listings Requirements, ordinary resolution number 12 must be passed by a 75% (seventy five percent) majority of the votes cast in favour of the resolution by all members present or represented by proxy at the Annual General Meeting.


Signature of documents“Resolved that each director of the Company be and is hereby individually authorised to sign all such documents and do all such things as may be necessary for or incidental to the implementation of those resolutions to be proposed at the Annual General Meeting convened to consider the resolutions which are passed, in the case of ordinary resolutions, or are passed and registered where necessary by the Companies and Intellectual Property Commission, in the case of special resolutions.”



SPECIAL RESOLUTIONS

14 Special resolution number 1

Non-executive Directors’ remuneration

FEES FOR THEYEAR ENDED

29 FEBRUARY 2016

FEES FOR THEYEAR ENDING28 FEBRUARY

2017TYPE OF FEE R R

Annual RetainerBoardChairperson 160 000 160 000Member 80 000 80 000

CommitteesChairperson 80 000 80 000Member 40 000 40 000

Per Meeting FeesBoardChairperson 20 000 20 000Member 20 000 20 000

CommitteeChairperson 20 000 20 000Member 20 000 20 000

“Resolved that, in terms of the provisions of sections 66(9) of the Companies Act, 2008 (Act 71 of 2008), as amended, the annual remuneration payable to the non-executive directors of Renergen Limited (“the Company”) for their services as directors of the Company for the financial years ended 29 February 2016 and ending 28 February 2017, be and is hereby approved.”

Explanatory noteIn terms of section 66(9) of the Companies Act, a company is required to pre-approve the payment of remuneration to non-executive directors for their services as directors for the ensuing financial year by means of a special resolution passed by shareholders of the Company within the previous two years.

Special resolutions to be adopted at this Annual General Meeting require approval from at least 75% (seventy five percent) of the votes exercised on such resolutions by shareholders present or represented by proxy at the meeting.



General approval to acquire shares“Resolved, by way of a general approval that Renergen Limited (“the Company”) and/or any of its subsidiaries from time to time be and are hereby authorised to acquire ordinary shares in the Company in terms of sections 46 and 48 of the Companies Act, 2008 (Act 71 of 2008), as amended, the Memorandum of Incorporation of the Company and its subsidiaries and the Listings Requirements of JSE Limited (“the JSE”), as amended from time to time.

The JSE Listings Requirements currently provide, inter alia, that:

• the acquisition of the ordinary shares must be effected through the order book operated by the JSE trading system and done without any prior understanding or arrangement between the Company and the counter party;

• this general authority shall only be valid until the earlier of the Company’s next Annual General Meeting or the expiry of a period of 15 (fifteen) months from the date of passing of this special resolution;

• in determining the price at which the Company’s ordinary shares are acquired in terms of this general authority, the maximum premium at which such ordinary shares may be acquired will be 10% (ten percent) of the weighted average of the market value at which such ordinary shares are traded on the JSE, as determined over the 5 (five) business days immediately preceding the date on which the transaction is effected;

• at any point in time, the Company may only appoint one agent to effect any acquisition/s on its behalf; • the acquisitions of ordinary shares in the aggregate in any one financial year may not exceed 20% (twenty percent) of the

Company’s issued ordinary share capital;• the Company may only effect the repurchase once a resolution has been passed by the board of directors of the

Company (“the Board”) confirming that the Board has authorised the repurchase, that the Company has passed the solvency and liquidity test (“test”) and that since the test was done there have been no material changes to the financial position of the Group;

• the Company or its subsidiaries may not acquire ordinary shares during a prohibited period as defined in paragraph 3.67 of the JSE Listings Requirements;

• an announcement will be published once the Company has cumulatively repurchased 3% (three percent) of the number of the ordinary shares in issue at the time this general authority is granted (“initial number”), and for each 3% (three percent) in aggregate of the initial number acquired thereafter.”

Explanatory noteThe purpose of this special resolution number 2 is to obtain an authority for, and to authorise, the Company and the Company’s subsidiaries, by way of a general authority, to acquire the Company’s issued ordinary shares.

It is the intention of the directors of the Company to use such authority should prevailing circumstances (including tax dispensations and market conditions) in their opinion warrant it.

15.1 Other disclosure in terms of Section 11.26 of the JSE Listings Requirements The JSE Listings Requirements require the following disclosures, which are contained in the annual report to which this notice is attached:

• major shareholders of the Company – page 78; and• share capital of the Company – page 66.

15.2 Material change There have been no material changes in the affairs or financial position of the Company and its subsidiaries since the Company’s financial year end and the date of this notice.

15.3 Directors’ responsibility statement The directors, whose names are given on pages 12 and 13 of the annual report to which this notice is attached, collectively and individually accept full responsibility for the accuracy of the information pertaining to special resolution number 2 and certify that to the best of their knowledge and belief there are no facts in relation to special resolution number 2 that have been omitted which would make any statement in relation to special resolution number 2 false or misleading, and that all reasonable enquiries to ascertain such facts have been made and that special resolution number 2 together with this notice contains all information required by law and the JSE Listings Requirements in relation to special resolution number 2.



15.4 Adequacy of working capital At the time that the contemplated repurchase is to take place, the directors of the Company will ensure that, after considering the effect of the maximum repurchase and for a period of twelve months thereafter:

• the Company and its subsidiaries will be able to pay their debts as they become due in the ordinary course of business;

• the consolidated assets of the Company and its subsidiaries, fairly valued in accordance with International Financial Reporting Standards, will be in excess of the consolidated liabilities of the Company and its subsidiaries;

• the issued share capital and reserves of the Company and its subsidiaries will be adequate for the purpose of the ordinary business of the Company and its subsidiaries; and

• the working capital available to the Company and its subsidiaries will be sufficient for the Group’s requirements.


Financial assistance for subscription of securities “Resolved that, as a special resolution, in terms of section 44 of the Companies Act, 2008 (Act 71 of 2008), as amended, (“Companies Act”), the shareholders of Renergen Limited (“the Company”) hereby approve of the Company providing, at any time and from time to time during the period of two years commencing on the date of this special resolution number 3, financial assistance by way of a loan, guarantee, the provision of security or otherwise, as contemplated in section 44 of the Companies Act, to any person for the purpose of, or in connection with, the subscription for any option, or any securities, issued or to be issued by the Company or a related or inter-related company, or for the purchase of any securities of the Company or a related or inter-related company, provided that:

(a) the board of directors of the Company (“the Board”), from time to time, determines (i) the specific recipient, or general category of potential recipients of such financial assistance; (ii) the form, nature and extent of such financial assistance; (iii) the terms and conditions under which such financial assistance is provided; and

(b) the Board may not authorise the Company to provide any financial assistance pursuant to this special resolution number 3 unless the Board meets all those requirements of section 44 of the Companies Act which it is required to meet in order to authorise the Company to provide such financial assistance.”

Explanatory noteThe purpose of this special resolution number 3 is to grant the Board the authority to authorise the Company to provide financial assistance to any person for the purpose of, or in connection with, the subscription for any option or securities issued or to be issued by the Company or a related or inter-related company.


Loans or other financial assistance to directors “Resolved that, as a special resolution, in terms of section 45(3)(a)(ii) of the Companies Act, 2008 (Act 71 of 2008), as amended, (“Companies Act”), the shareholders of Renergen Limited (“the Company”) hereby approve of the Company providing, at any time and from time to time during the period of two years commencing on the date of this special resolution number 4, any direct or indirect financial assistance (which includes lending money, guaranteeing a loan or other obligation, and securing any debt or obligation) as contemplated in section 45(1) of the Companies Act to a director or prescribed officer of the Company, or to a related or inter-related company or corporation or to a member of any such related or inter-related corporation or to a person related to any such company, corporation, director, prescribed officer or member provided that:

(a) the board of directors of the Company (“the Board”), from time to time, determines (i) the specific recipient or general category of potential recipients of such financial assistance; (ii) the form, nature and extent of such financial assistance; (iii) the terms and conditions under which such financial assistance is provided, and

(b) the Board may not authorise the Company to provide any financial assistance pursuant to this special resolution number 4 unless the Board meets all those requirements of section 45 of the Companies Act which it is required to meet in order to authorise the Company to provide such financial assistance.”

Explanatory noteThe purpose of this special resolution number 4 is to grant the Board the authority to authorise the Company to provide financial assistance as contemplated in section 45 of the Companies Act to a director or prescribed officer of the Company, or to a related or inter-related company or corporation, or to a member of a related or inter-related corporation, or to a person related to any such company, corporation, director, prescribed officer or member.


Special resolutions to be adopted at this Annual General Meeting require approval from at least 75% (seventy five percent) of the votes exercised on such resolutions by shareholders present or represented by proxy at the meeting.

Notice given to shareholders of the Company in terms of section 45(5) of the Companies Act of a resolution adopted by the Board authorising the Company to provide such direct or indirect financial assistance in respect of special resolution number 4:

(a) By the time that this notice of Annual General Meeting is delivered to shareholders of the Company, the Board will have adopted a resolution (“Section 45 Board Resolution”) authorising the Company to provide, at any time and from time to time during the period of two years commencing on the date on which special resolution number 4 is adopted, any direct or indirect financial assistance as contemplated in section 45 of the Companies Act (which includes lending money, guaranteeing a loan or other obligation, and securing any debt or obligation) to a director or prescribed officer of the Company or of a related or inter-related company, or to a related or inter-related company or corporation, or to a member of any such related or inter-related corporation, or to a person related to any such company, corporation, director, prescribed officer or a member;

(b) the Section 45 Board Resolution will be effective only if and to the extent that special resolution number 4 is adopted by the shareholders of the Company, and the provision of any such direct or indirect financial assistance by the Company, pursuant to such resolution, will always be subject to the Board being satisfied that (i) immediately after providing such financial assistance, the Company will satisfy the solvency and liquidity test as referred to in section 45(3)(b)(i) of the Companies Act, and (ii) the terms under which such financial assistance is to be given are fair and reasonable to the Company as referred to in section 45(3)(b)(ii) of the Companies Act; and

(c) in as much as the Section 45 Board Resolution contemplates that such financial assistance will in the aggregate exceed one-tenth of one percent of the Company’s net worth at the date of adoption of such resolution, the Company hereby provides notice of the Section 45 Board Resolution to shareholders of the Company. Such notice will also be provided to any trade union representing any employees of the Company.


Amendments to the Memorandum of Incorporation of the Company“Resolved that, the Memorandum of Incorporation (“MOI”) of the Company be and is hereby amended by deleting the words:

• from clause 2.5(2), ‘Should fractions arise, these will be rounded down to the nearest whole number if they are less than 0.5 and will be rounded up to the nearest whole number if they are equal to or greater than 0.5 resulting in allocations of whole Securities and no fractional entitlements. No fraction of an ordinary Share shall be allotted.’,

and replacing same with the following:

“(2) In respect of fractional entitlements that arise, all such fractional entitlements shall be dealt with in accordance with the JSE Listings Requirements.”

and;

• from clause 2.20(1), ‘rounding off of entitlements to avoid fractions and/or odd-lots of Shares’,

and replacing same with the words ‘fractional entitlements that may arise being dealt with in accordance with the provisions of the JSE Listings Requirements in respect thereof’ so that clause 2.20(1) reads as follows:

“(1) Unless issued for the acquisition of assets, unissued ordinary Shares shall, first be offered to existing Shareholders pro-rata to their shareholding, subject to any fractional entitlements that may arise being dealt with in accordance with the provisions of the JSE Listings Requirements in respect thereof, the possible issue of any Shares which are not taken up to applicants for Shares in excess of their entitlements, the possible exclusion of any persons who are prohibited, by any law of any country to whose jurisdiction they are subject, from participation in a rights offer, unless such Securities are to be issued for an acquisition of assets.””

Explanatory noteThe purpose of this Special Resolution Number 5 is to bring the Company’s Memorandum of Incorporation in line with the recent amendments made by the JSE to the Listings Requirements with regard to the treatment of fractional entitlements. Currently, the Listings Requirements provides that “In respect of fractional entitlements that arise, all allocations of securities will be rounded down to the nearest whole number resulting in allocations of whole securities and a cash payment for the fraction. The weighted average traded price for LDT + 1 less 10% must be used as the cash value. An applicant issuer must release an announcement on LDT +2 in respect of the cash value determined.”


19 Other businessTo transact such other business as may be transacted at the Annual General Meeting of the Company.

VOTING AND PROXIES

Special resolutions to be adopted at this Annual General Meeting require approval from at least 75% (seventy five percent) of the votes exercised on such resolutions by shareholders present or represented by proxy at the meeting. Ordinary resolutions to be adopted at this Annual General Meeting, unless stated otherwise require approval from a simple majority, which is more than 50% of the votes exercised on such resolutions by shareholders present or represented by proxy at the meeting.

A shareholder entitled to attend and vote at the Annual General Meeting is entitled to appoint a proxy or proxies to attend and act in his/her stead. A proxy need not be a member of the Company. For the convenience of registered members of the Company, a form of proxy is attached hereto.

The attached form of proxy is only to be completed by those ordinary shareholders who:

• hold ordinary shares in certificated form; or• are recorded on the sub-register in “own name” dematerialised form.

Ordinary shareholders who have dematerialised their ordinary shares through a CSDP or broker without “own name” registration and who wish to attend the Annual General Meeting, must instruct their CSDP or broker to provide them with the relevant Letter of Representation to attend the meeting in person or by proxy and vote. If they do not wish to attend in person or by proxy, they must provide the CSDP or broker with their voting instructions in terms of the relevant custody agreement entered into between them and the CSDP or broker.

Proxy forms should be forwarded to reach the transfer secretaries, Computershare Investor Services Proprietary Limited, at least 48 (forty-eight) hours, excluding Saturdays, Sundays and public holidays, before the time of the meeting.

Kindly note that meeting participants, which includes proxies, are required to provide reasonably satisfactory identification before being entitled to attend or participate in a shareholders’ meeting. Forms of identification include valid identity documents, driver’s licenses and passports.

By order of the Board

Acorim Proprietary LimitedCompany Secretary

23 August 2016Johannesburg



“AltX” Alternative Exchange of the JSE Limited, on which Renergen listed in June 2015

“the Board” The board of directors of Renergen Limited

“CEO” Chief Executive Officer, Stehano Marani

“CFO” Chief Financial Officer, Fulu Ravele

“COO” Chief Operating Officer, Nick Mitchell

“the Companies Act” South African Companies Act 71 of 2008, as amended

“the current year” The year ending 29 February 2016

“IFRS” International Financial Reporting Standards

“IPP” Independent Power Producer

“JSE” Johannesburg Securities Exchange, part of JSE Limited and the main bourse in South Africa

“JSE Listings the Listings Requirements of the JSE, as amended from time to timeRequirements”

“King III Report” King Report on Corporate Governance in South Africa 2009

“Molopo” Molopo South Africa Exploration and Production Proprietary Limited (renamed Tetra4 Proprietary Limited

“NERSA” the National Energy Regulator of South Africa

“PASA” Petroleum Agency South Africa

“PPP” Public–private partnership, a government service or private business venture which is funded and operated through a partnership of government and private sector companies

“REIPPPP” the Renewable Energy Independent Power Producers Procurement Programme currently managed by the Department of Energy of the Republic of South Africa

“SENS” The JSE’s real-time news dissemination service

“SPAC” Special Purposes Acquisitions Company

“the year” or The year ended 29 February 2016“the year under review”

“Windfall” Windfall Energy Proprietary Limited

DEFINITIONS


FORM OF PROXY

Renergen Limited Incorporated in the Republic of South Africa(formerly Dominica Trade Proprietary Limited)(Registration number: 2014/195093/06)Share code: REN ISIN: ZAE000202610(“Renergen” or “the Company” or “the Group”)

For use only by ordinary shareholders who:

• hold ordinary shares in certificated form (“certificated ordinary shareholders”); or• have dematerialised their ordinary shares (“dematerialised ordinary shareholders”) and are registered with “own-name” registration,

at the first Annual General Meeting of shareholders of the Company to be held at First Floor, 1 Bompas Road, Dunkeld West 2196, at 10:00 on Friday, 30 September 2016 and any adjournment thereof.

Dematerialised ordinary shareholders holding ordinary shares other than with “own-name” registration who wish to attend the Annual General Meeting must inform their Central Securities Depository Participant (“CSDP”) or broker of their intention to attend the Annual General Meeting and request their CSDP or broker to issue them with the relevant Letter of Representation to attend the Annual General Meeting in person or by proxy and vote. If they do not wish to attend the Annual General Meeting in person or by proxy, they must provide their CSDP or broker with their voting instructions in terms of the relevant custody agreement entered into between them and the CSDP or broker. These ordinary shareholders must not use this form of proxy.

Name of beneficial shareholder

Name of registered shareholder

Address

Telephone work ( ) Telephone home ( ) Cell: Email:

being the holder/custodian of ordinary shares in the Company, hereby appoint (see note):

1. or failing him/her,

2. or failing him/her,

3. the Chairperson of the meeting,

as my/our proxy to attend and act for me/us on my/our behalf at the Annual General Meeting of the company convened for purpose of considering and, if deemed fit, passing, with or without modification, the special and ordinary resolutions to be proposed thereat (“resolutions”) and at each postponement or adjournment thereof and to vote for and/or against such resolutions, and/or abstain from voting, in respect of the ordinary shares in the issued share capital of the Company registered in my/our name/s in accordance with the following instructions:

Number of ordinary shares

For Against Abstain

1. Ordinary resolution 1 To confirm the appointment of Ms Fulu Ravele as executive director of the Company

2. Ordinary resolution 2 To confirm the appointment of Mr Nick Mitchell as executive director of the Company

3. Ordinary resolution 3 To confirm the appointment of Mr Brett Kimber as independent non-executive director

4. Ordinary resolution 4 To confirm the appointment of Mr Luigi Matteucci as independent non-executive director

5. Ordinary resolution 5 To approve the re-election as director of Mr Mbali Swana who retires by rotation 6. Ordinary resolution 6 To approve the re-election as director of Mr Russell Broadhead who retires by rotation

7. Ordinary resolution 7 To approve the appointment of Mr Mbali Swana as member and Chairman of the Audit, Risk and Information Technology Committee

8. Ordinary resolution 8 To approve the appointment of Mr Luigi Matteucci as member of the Audit, Risk and Information Technology Committee

9. Ordinary resolution 9 To approve the appointment of Mr Russell Broadhead as member of the Audit, Risk and Information Technology Committee

10. Ordinary resolution 10 To confirm the appointment of Grant Thornton as auditors of the Company, together with Mr Jacques Barradas, for the ensuing financial year

11. Ordinary resolution number 11 Approval of the remuneration policy

12. Ordinary resolution number 12 Approval to issue ordinary shares, and to sell treasury shares, for cash

13. Ordinary resolution number 13 Signature of documents

14. Special resolution number 1 Approval of the non-executive directors’ remuneration

15. Special resolution number 2 General approval to acquire shares

16. Special resolution number 3 Financial assistance for subscription of securities

17. Special resolution number 4 Loans or other financial assistance to directors

18. Special resolution number 5 Amendments to the Memorandum of Incorporation of the Company

Please indicate instructions to proxy in the space provided above by the insertion therein of the relevant number of votes exercisable.A member entitled to attend and vote at the Annual General Meeting may appoint one or more proxies to attend and act in his stead. A proxy so appointed need not be a member of the Company.

Signed at on 2016

Signature

Assisted by (if applicable)

NOTES TO THE FORM OF PROXY

1. Summary of Rights Contained in section 58 of the Companies Act, 2008 (Act 71 of 2008), as amended (“Companies Act”)

In terms of section 58 of the Companies Act:• a shareholder may, at any time and in accordance with the provisions

of section 58 of the Companies Act, appoint any individual (including an individual who is not a shareholder) as a proxy to participate in, and speak and vote at, a shareholders’ meeting on behalf of such shareholder;

• a proxy may delegate his or her authority to act on behalf of a shareholder to another person, subject to any restriction set out in the instrument appointing such proxy;

• irrespective of the form of instrument used to appoint a proxy, the appointment of a proxy is suspended at any time and to the extent that the relevant shareholder chooses to act directly and in person in the exercise of any of such shareholder’s rights as a shareholder;

• irrespective of the form of instrument used to appoint a proxy, any appointment by a shareholder of a proxy is revocable, unless the form of instrument used to appoint such proxy states otherwise;

• if an appointment of a proxy is revocable, a shareholder may revoke the proxy appointment by: (i) cancelling it in writing, or making a later inconsistent appointment of a proxy and (ii) delivering a copy of the revocation instrument to the proxy and to the company; and

• a proxy appointed by a shareholder is entitled to exercise, or abstain from exercising, any voting right of such shareholder without direction, except to the extent that the relevant company’s memorandum of incorporation, or the instrument appointing the proxy, provides otherwise (see note 7).

2. The form of proxy must only be completed by shareholders who hold shares in certificated form or who are recorded on the sub-register in electronic form in “own name”.

3. Shareholders who have dematerialised their shares through a CSDP or broker without “own name” registration and wish to attend the Annual General Meeting must instruct their CSDP or broker to provide them with the relevant Letter of Representation to attend the Annual General Meeting in person or by proxy. If they do not wish to attend in person or by proxy, they must provide the CSDP or broker with their voting instructions in terms of the relevant custody agreement entered into between them and the CSDP or broker. Should the CSDP or broker not have provided the Company with the details of the beneficial shareholding at the specific request by the Company, such shares may be disallowed to vote at the Annual General Meeting.

4. A shareholder entitled to attend and vote at the Annual General Meeting may insert the name of a proxy or the names of two alternate proxies (none of whom need be a shareholder of the company) of the shareholder’s choice in the space provided, with or without deleting “the Chairperson of the meeting”. The person whose name stands first on this form of proxy and who is present at the Annual General Meeting will be entitled to act as proxy to the exclusion of those proxy(ies) whose names follow. Should this space be left blank, the proxy will be exercised by the Chairperson of the meeting.

5. A shareholder is entitled to one vote on a show of hands and, on a poll, one vote in respect of each ordinary share held. A shareholder’s instructions to the proxy must be indicated by the insertion of the relevant number of votes exercisable by that shareholder in the appropriate space provided. If an “X” has been inserted in one of the blocks to a particular resolution, it will indicate the voting of all the shares held by the shareholder concerned. Failure to comply with this will be deemed to authorise the proxy to vote or to abstain from voting at the Annual General Meeting as he/she deems fit in respect of all the shareholder’s votes exercisable thereat. A shareholder or the proxy is not obliged to use all the votes exercisable by the shareholders or by the proxy, but the total of the votes cast and in respect of which abstention is recorded may not exceed the total of the votes exercisable by the shareholder or the proxy.

6. A vote given in terms of an instrument of proxy shall be valid in relation to the Annual General Meeting notwithstanding the death, insanity or other legal disability of the person granting it, or the revocation of the proxy, or the transfer of the ordinary shares in respect of which the proxy is given, unless notice as to any of the aforementioned matters shall have been received by the transfer secretaries not less than 48 (forty eight) hours before the commencement of the Annual General Meeting.

7. If a shareholder does not indicate on this form that his/her proxy is to vote in favour of or against any resolution or to abstain from voting, or gives contradictory instructions, or should any further resolution(s) or any amendment(s) which may properly be put before the Annual General Meeting be proposed, such proxy shall be entitled to vote as he/she thinks fit.

8. The Chairperson of the Annual General Meeting may reject or accept any form of proxy which is completed and/or received other than in compliance with these notes.

9. A shareholder’s authorisation to the proxy including the Chairperson of the Annual General Meeting, to vote on such shareholder’s behalf, shall be deemed to include the authority to vote on procedural matters at the Annual General Meeting.

10. The completion and lodging of this form of proxy will not preclude the relevant shareholder from attending the Annual General Meeting and speaking and voting in person thereat to the exclusion of any proxy appointed in terms hereof.

11. Documentary evidence establishing the authority of a person signing the form of proxy in a representative capacity must be attached to this form of proxy, unless previously recorded by the Company’s transfer secretaries or waived by the Chairperson of the Annual General Meeting.

12. A minor or any other person under legal incapacity must be assisted by his/her parent or guardian, as applicable, unless the relevant documents establishing his/her capacity are produced or have been registered by the transfer secretaries of the Company.

13. Where there are joint holders of ordinary shares:• anyoneholdermaysigntheformofproxy;• the vote(s) of the senior ordinary shareholders (for that purpose

seniority will be determined by the order in which the names of ordinary shareholders appear in the Company’s register of ordinary shareholders) who tenders a vote (whether in person or by proxy) will be accepted to the exclusion of the vote(s) of the other joint shareholder(s).

14. Forms of proxy should be lodged with or mailed to Computershare Investor Services Proprietary Limited:Hand deliveries to: Postal deliveries to:Computershare Investor Services Proprietary Limited

Computershare Investor Services Proprietary Limited

70 Marshall Street, Johannesburg, 2001

PO Box 61051, Marshalltown, 2107

to be received by no later than 9:00 on Wednesday, 28 September 2016 (or 48 (forty-eight) hours before any adjournment of the Annual General Meeting which date, if necessary, will be notified on SENS).

15. A deletion of any printed matter and the completion of any blank space need not be signed or initialled. Any alteration or correction must be signed and not merely initialled.

Summary of the rights of a shareholder to be represented by proxy, as set out in section 58 of the Companies Act:A proxy appointment must be in writing, dated and signed by the shareholder appointing a proxy, and, subject to the rights of a shareholder to revoke such appointment (as set out below), remains valid only until the end of the relevant shareholders’ meeting.A proxy may delegate the proxy’s authority to act on behalf of a shareholder to another person, subject to any restrictions set out in the instrument appointing the proxy.The appointment of a proxy is suspended at any time and to the extent that the shareholder who appointed such proxy chooses to act directly and in person in the exercise of any rights as a shareholder.The appointment of a proxy is revocable by the shareholder in question cancelling it in writing, or making a later inconsistent appointment of a proxy, and delivering a copy of the revocation instrument to the proxy and to the Company. The revocation of a proxy appointment constitutes a complete and final cancellation of the proxy’s authority to act on behalf of the shareholder as of the later of (a) the date stated in the revocation instrument, if any; and (b) the date on which the revocation instrument is delivered to the Company as required in the first sentence of this paragraph.If the instrument appointing the proxy or proxies has been delivered to the Company, as long as that appointment remains in effect, any notice that is required by the Companies Act or the Company’s Memorandum of Incorporation to be delivered by the Company to the shareholder, must be delivered by the Company to (a) the shareholder, or (b) the proxy or proxies, if the shareholder has (i) directed the Company to do so in writing; and (ii) paid any reasonable fee charged by the Company for doing so.Attention is also drawn to the “Notes to proxy”.The completion of a form of proxy does not preclude any shareholder from attending the Annual General Meeting.

CORPORATE INFORMATION

Renergen Limited Date of incorporation: 30 September 2014 Place of incorporation: South Africa

Company Secretary and registered address of Renergen Acorim Proprietary Limited (Registration number 2014/195093/06) 21, 7th Avenue Parktown North, 2193 (PO Box 464, Parklands, 2121)

Joint Corporate Adviser and Designated Adviser Merchantec Proprietary Limited (Registration number 2008/027362/07) 2nd Floor, North Block Hyde Park Office Towers Corner 6th Road and Jan Smuts Avenue Hyde Park, 2196 (PO Box 41480, Craighall, 2024)

Joint Corporate Adviser and Joint Lead Arranger Integrated Capital Management Proprietary Limited (Registration number 2005/019761/07) Unit 2, Ground Floor 3 Melrose Boulevard Melrose Arch Johannesburg, 2196 (PO Box 333, Melrose Arch, 2076)

Auditors Grant Thornton (Practice number 903 485) 42 Wierda Road West Wierda Valley Sandton, 2196 (Private Bag X28, Benmore, 2010)

Attorneys Webber Wentzel 10 Fricker Road Illovo Boulevard Illovo, 2196 (PO Box 61771, Marshalltown, 2107)

Joint Lead Arranger Trillian Asset Management Proprietary Limited (Registration number 2008/023108/07) Block D, Hobart Square 23 Hobart Road Bryanston, 2021 (Postnet Suite 488, Private Bag X1 Melrose Arch, Johannesburg, 2076)

Transfer Secretaries Computershare Investor Services Proprietary Limited (Registration number 2004/003647/07) Ground Floor, 70 Marshall Street Johannesburg, 2001 (PO Box 61051, Marshalltown, 2107)


NOTES


www.renergen.co.za

ANNUAL REPORT 2016 - ShareDataww Investment Case 2About this Report 3Our Vision, Mission and Values...

Documents

Transcript of ANNUAL REPORT 2016 - ShareDataww Investment Case 2About this Report 3Our Vision, Mission and Values...