While energy and chemicals major Sasol has somewhat shifted its focus from energy to chemicals in the near term, the company continues to drive its growth programmes in the US, Sasol outgoing president and CEO David Constable says.
Speaking during the group’s 2015 results presentation, Constable emphasised that the company’s business performance enhancement programme and its response plan are key enablers, allowing the company to deliver on its strategic aspirations.
Highlighting its key US mega- projects, Constable reiterated that the company’s “strategic agenda reinforces the importance of a diversified portfolio which ensures resilience”.
Sasol’s US project focus currently includes its ethane cracker and derivatives complex in Louisiana and its high-density polyethylene (HDPE) facility in Texas.
Subsequent to Sasol’s final investment decision to proceed with the $8.9-billion ethane cracker and derivatives complex, significant progress has been made in detailed engineering and infrastructure work, Constable further noted.
He added that the cumulative expenditure to the end of the 2015 financial year was $1.8-billion, with contracted commitments equal to $4.9-billion.
“Construction activities are proceeding as planned, with site preparation work for major units nearing completion. We are still on track for staged completion of all units . . . in 2018,” Constable said.
Project Scope The Louisiana megaproject proposes the development of a world-scale 1.5-million-ton-a-year ethane cracker and derivatives complex near Lake Charles.
Ethane cracking is the process of converting molecules of ethane extracted from natural gas to create ethylene.
About 90% of the cracker’s ethylene output will be converted into a diverse range of commodity and high-margin speciality chemicals and derivatives.
High-value derivatives are used in everyday products, such as synthetic fibres, detergents, fragrances, paints, film and packaging.
Once commissioned, the petrochemicals complex, which will also include six chemical manufacturing plants, will almost triple Sasol’s chemical production capacity in the US.
Engineering News in February reported that Sasol has “stress tested” the $8.9-billion ethane cracker and derivatives complex against several parameters and that the project’s economics remain “robust, even under extreme scenarios”.
In March, Sasol broke ground on the ethane cracker and derivatives project, marking the start of construction.
Sasol executive VP of international operations Steve Cornell noted at the ground-breaking event that, during the project, the company “[will] create more than 5 000 construction jobs and more than 500 full-time positions, 100 of which have already been filled”.
Early works activities, site preparation and civil construction work have been under way since 2014, according to Sasol North America’s website.
The website also notes is that site aboveground work and heavy equipment deliveries are expected to start this year, while mechanical, electrical and instrumentation work is expected to start in 2016 and 2017.
Constable, meanwhile, noted that construction of the HDPE facility has started in Texas, with plant start-up planned towards the end of the 2016 calendar year.
During August 2014, Sasol and its partner, chemicals manufacturer Ineos Olefins & Polymers, successfully concluded a toll manufacturing joint venture, known as Gemini HDPE.
The Gemini HDPE project will involve the construction of a new HDPE facility at Ineos’s battleground manufacturing complex, in La Porte, and is designed to produce 470 000 t of high-value, bimodal HDPE a year. The new facility will also use Innovene S process technology, which is licensed from Ineos Technologies.
The new facility will include upgrades to existing utilities and infrastructure, as well as new polymerisation, pelletisation and railcar load-out facilities.