https://www.miningweekly.com

Sasol outlines dual Southern Africa, North America growth plans

Sasol CEO David Constable outlines to Engineering News Online’s Martin Creamer the company’s regional growth strategies. Photographs: Duane Daws. Video: Nicholas Boyd. Video Editing: Lionel da Silva

8th March 2016

By: Martin Creamer

Creamer Media Editor

  

Font size: - +

Despite the lower-for-much-longer oil price outlook, integrated chemicals and energy company Sasol is remaining focused on executing growth projects in Southern Africa and North America as part of a dual regional strategy.

In presenting 63%-lower earnings attributable to shareholders in the six months to December 31, outgoing Sasol CEO David Constable gave details of Sasol’s expansion in neighbouring Mozambique, where it had obtained Council of Ministers’ approval for a field development plan that would monetise more hydrocarbon resources in support of Southern Africa’s growth objectives. (Also watch attached Creamer Media video).

“The Mozambican gas industry is playing an increasingly important role in the regional energy landscape,” Constable said at the company’s latest presentation of financial results, attended by Creamer Media’s Engineering News Online.

The production agreement’s $1.4-billion first phase involved an integrated oil, liquefied petroleum gas and gas project next to the company’s existing production agreement area.

Against that background, R2.7-billion was being invested in the Loop Line 2 natural gas pipeline project to increase the capacity of the Mozambique-to-South Africa gas pipeline to 191-billion cubic feet a year from the second half of this year.

In South Africa, beneficial operation was expected at the Shondoni coal project in Mpumalanga in the first half of this year and at the R13.6-billion second-phase Sasolburg wax expansion in the first half of 2017.

In the United States, $3.7-billion had been invested to date in the ethane cracker and downstream derivatives complex at Lake Charles, where detailed engineering was advanced and underground civil work was nearing completion.

To support the company’s response plan to the lower oil price, the decision had been taken to pace the execution of the cracker project, with the proposed schedule extension expected to optimise field efficiency still further and limit the spend rate.

A phased commissioning of the cracker was expected in 2018 and full beneficial operation of the smaller derivatives units in 2019.

“By optimising cash flows, we’re managing our gearing and credit rating, ensuring continued balance sheet strength, protecting our dividend policy and driving resilient earnings,” said Constable – who will be succeeded by joint CEOs Bongani Nqwababa and Stephen Cornell on July 1.

The dual strategy was designed to augment Sasol’s other business activities in Eurasia, Middle East and the rest of Africa.

Overall, the company was going all out to ensure that its balance sheet and earnings remained resilient at an oil price of $30/bl.

Edited by Creamer Media Reporter

Comments

Showroom

Flameblock
Flameblock

FlameBlock is a proudly South African company that engineers, manufactures and supplies fire intumescent and retardant products to the fire...

VISIT SHOWROOM 
Condra Cranes
Condra Cranes

ISO-certified Condra manufactures overhead cranes, portal cranes, cantilever cranes and crane components: hoists, drives, end-carriages, brakes and...

VISIT SHOWROOM 

Latest Multimedia

sponsored by

Hyphen, Eva mine, ferrochrome price make headlines
Hyphen, Eva mine, ferrochrome price make headlines
27th March 2024
Resources Watch
Resources Watch
27th March 2024

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION







sq:0.135 0.171s - 90pq - 2rq
Subscribe Now