R/€ = 17.95
R/$ = 15.86
Au 1240.41 $/oz
Pt 959.00 $/oz
Mar 11, 2003
New R870m comonomer project for petrochem giantBack
© Reuse this South African petrochemicals giant Sasol is in the process of spending R870-million on another comonomer project, Engineering News Online can today exclusively report.
This comes against the backdrop of the chemical giant’s modest 4% increase in group earnings, announced gingerly by CEO Pieter Cox at Sasol’s interim financial results presentation yesterday, ahead of the company’s historic April 9 NYSE listing.
The comonomer project, a second 1-octene train, is expected to be commissioned by the third quarter of 2004, at a cost larger than the first 48 000 t/y plant, but with roughly the same capacity.
As a comonomer, 1-octene is used to manufacture different polyethylene products, providing mechanical strength to various types of plastics, including both high- and low-density polyethylene from which quality plastic products are made.
Sasol’s Hannes Botha revealed, in answer to a question, that the company’s board is also expected to approve an even bigger project soon.
This is the R10-billion to R12-billion, Project Turbo, the most significant part of Sasol’s renewal initiative, Project World Class, which will prepare Synfuels for new fuel specifications that are to come into effect in January 2006, the deadline for all South African refineries to supply lead-free petrol and low-sulphur diesel.
Engineering News Online can report that Project Turbo would require the largest portion of the estimated capital for Project World Class and is expected to have significant spin-offs for Sasol Chemical Industries, as it will supply the division with more feedstreams for further expansions. This is part of a R19-billion capex commitment.
Sasol Polymers will also benefit from increased levels of ethylene and propylene from Project Turbo's new processes.
The project consists of multiple phases, which, in turn, comprise several smaller projects.
In total, the project is estimated to require about 17 000 t of structural steel, and the employment of some 15 000 people.
Meanwhile, Sasol’s strong financial performances over the last three years have been followed by a mere 4% increase in operating profit, to R7,3-billion for the interim period to December 31, 2002.
The group’s earnings suffered a R2-billion blow, caused mainly by the strengthening of the rand.
Cox said the rand:dollar exchange rate weakened by 8% from an average of R9,29 in the previous reporting period to R10,03 in this reporting period. While the weaker rate had a beneficial effect on sales, the closing rate on December 31, of R8,57, was much stronger than the closing rate of preceding months and 28% stronger that the closing rate of R11,95 on December 31, 2001.
This resulted in net translation losses of R974-million being charged to the income statement, as a result of the revaluation of financial assets and liabilities on December 31 last year. This compares to net translation gains in the previous reporting period of R922-million and represents a swing of R1,9-billion.
Cox reported that attributable earnings were more or less equal to, and basic earnings per share of 751 cents were slightly above, those achieved in the previous reporting period.
Sasol’s financing costs rose by 23% to R529-million, mainly due to higher capital expenditure, which increased from R3,6-billion to R5,7-billion during the comparable periods.
Increased capital expenditure resulted primarily from the Mozambique Natural Gas project, the Qatari and Nigerian gas-to-liquid (GTL) projects and the n-butanol and acrylic acid projects in Sasolburg.
Top performing divisions during the period were Sasol Synfuels, which lifted profits by 36% – from R3,688-billion to R5,032-billion – and Sasol Mining, up by 10% to R708-million. National pipeline gas sales of Sasol Gas were about 12% higher.
Edited by: Martin Czernowalow© Reuse this
To subscribe email firstname.lastname@example.org or click here
To advertise email email@example.com or click here
Other Energy News
Updated 2 hours 58 minutes ago The South African Marine Research and Exploration Forum (Samref) was recently launched by Science and Technology Minister Naledi Pandor. The Forum is a joint initiative of the Department of Science and Technology (DST) and the Offshore Petroleum Association of South...
Updated 2 hours 58 minutes ago Having identified the lack of training opportunities as a rising concern in the oil industry, the biennial Cape Industries Showcase (CIS), scheduled to take place from July 13 to 15 at the Cape Town International Convention Centre, will focus on skills development...
Updated 6 hours ago President Jacob Zuma unveiled the skeletons of what he described as an economic “turnaround plan” in a State of the Nation Address dominated by the current plight of the South African economy, which was unlikely to grow by more than 1% in 2016 and would not nearly...
Recent Research Reports
Construction 2016: A review of South Africa's construction industry (PDF Report)
Creamer Media’s Construction 2016 Report examines South Africa’s construction industry over the past 12 months. The report provides insight into the business environment; key participants; local demand; geographic diversification; corporate activity; black economic...
Energy Roundup – February 2016 (PDF Report)
The February 2016 roundup covers activities across South Africa for December 2015 and January 2016 and includes details of a Government Gazette notice that confirms Cabinet’s decision to move ahead with the 9 600 MW nuclear procurement programme; State-owned power...
Energy Roundup - December 2015 (PDF Report)
The December 2015 roundup includes details of State-owned utility Eskom’s application to claw back R22.8-billion; South Africa’s ranking as an investment destination for renewable energy; and a nuclear expert’s thoughts on reactor designs for South Africa’s nuclear...
Water 2015: A review of South Africa's water sector (PDF Report)
Creamer Media’s Water 2015 Report considers the aforementioned issues, not only in the South African context but also in the African and global context in terms of supply and demand, water stress and insecurity, and access to water and sanitation, besides others.
Input Sector Review: Pumps 2015 (PDF Report)
Creamer Media’s 2015 Input Sector Review on Pumps provides an overview of South Africa’s pumps industry with particular focus on pump manufacture and supply, aftermarket services, marketing strategies, local and export demand, imports, sector support, investment...
Liquid Fuels 2015: A review of South Africa's liquid fuels sector (PDF Report)
Creamer Media’s Liquid Fuels 2015 Report examines these issues in the context of South Africa’s business environment; oil and gas exploration; fuel pricing; the development of the country’s biofuels industry; the logistics of transporting liquid fuels; and...
This Week's Magazine
Updated 3 hours ago Lifting, transporting, installing and ballasting solutions provider Ale has expanded its global fleet of trailers and invested in the latest range of widening trailers that can be mechanically widened from 3 m to the desired width for any project. Ale ordered 48 axle...
Updated 3 hours ago The market for the BMW 7 Series in South Africa differs quite significantly from the rest of the world. China, the US and the Middle East almost exclusively buy the long-wheel-base version, using the German manufacturer’s luxury high-end sedan as a chaffeur-driven...
Updated 3 hours ago January new-vehicle sales fell by 6.9%, to 48 615 units, compared with the same month last year. Statistics released by the Department of Trade and Industry show that the domestic new passenger-car market declined by 6.1%, to 34 936 units, compared with 12 months ago.
Updated 3 hours ago Information technology (IT) equipment and infrastructure multinational Dell is providing open infrastructure systems for clients so that they can use any systems, including innovative new systems, that suit their business needs, says Dell Europe, Middle East and...
Updated 3 hours ago South Africa’s State-owned defence industrial group, Denel, has set up another international partnership, based in Hong Kong. This new subsidiary is Denel Asia and it is a joint venture (JV) with South African private sector company VR Laser.