In the largest single investment made by a local industrial gas company in the past decade, gas provider Air Products South Africa on Tuesday celebrated the launch of its new R800-million air separation unit (ASU) at the company’s Vanderbijlpark facility, in Gauteng.

Construction of the ASU, dubbed the G-Plant, was driven by intensifying demand for industrial gases from energy group Sasol, and represented an expansion of Air Products’ existing long-term supply contract with the petrochemicals giant.

The new plant would supply the Sasol One Site Expansion Programme, in nearby Sasolburg, with pipeline gaseous oxygen and nitrogen in response to increased feedstock requirements, which would see the energy company receiving up to 80% of the plant’s production capacity of over 2 500 t/d.

Sasol’s R8.4-billion expansion programme would see it doubling the production of hard waxes and increasing the production of medium waxes, mostly used for the candle industry in South Africa, and liquid paraffin, used in a variety of industrial applications such as adhesives, bitumen used in road construction and printing ink.

While Sasol would remain the anchor customer of G-Plant in terms of a long-term “over-the-fence” supply contract, the balance of the gaseous and liquid product – comprising gaseous oxygen, nitrogen and argon – would service other markets, including Air Products’ other pipeline networks, as well as bulk and packaged gas customers.

G-Plant is the sixth ASU plant to be commissioned at the Vanderbijlpark site and the fifteenth to be commissioned nationally by the industrial gas provider.

“While the G-Plant was commissioned in support of Sasol’s expansion programme, we will be leveraging off it to boost our overall supply capacity for the merchant market, as well as our production capability for pure argon, which will consolidate our market leadership in this area,” Air Products on-sites GM Rob Richardson said at the launch of the facility on Tuesday.

Sasol Infrachem MD Louis Fourie added that the commissioning of the G-Plant not only provided the energy group with long-term security of supply, but also enabled it to diversify its sources to include both on-site and off-site sources of gas.

“Apart from the significant wax expansion project currently under construction at Sasolburg, our Sasol Sasolburg Expansion Programme includes the recent commissioning of an Ethylene Purification Unit and Sasol Gas Engine Power Plant. This agreement takes our existing valued relationship with Air Products to the next level, and points to mutual future sustainability for both companies,” he said.

Described by Air Products as a “significant addition” to what was already the largest dedicated industrial gas manufacturing facility in South Africa, the three-year construction of the unit formed part of an overall long-term capital investment pipeline by the company of just under R2-billion.

Air Products had commissioned eight ASUs in the past ten years, with two currently under construction, including its new plant in the Coega Industrial Development Zone – the first of its kind in the region.

“Our long-term capital investment strategy is the basis upon which we can build and develop our supply chain capacity, and therefore ensure the future sustainability of the company, and the industry as a whole,” noted Air Products South Africa MD Mike Hellyar.

Also speaking at the launch, Trade and Industry deputy director-general .

lauded the development, adding that Air Products would likely qualify for financial assistance for the development of its Coega-based ASU through the Department of Trade and Industry’s (DTI’s) various manufacturing incentive programmes.

“Subject to due process, the DTI will support this investment from within its suite of [industrial incentives] programmes.

“The investment by Air Products [into the industrial gas market] is significant, as it ticks so many boxes necessary for the development of a successful industry and a growing economy,” he commented.

He added that the country “must” overcome the trust deficit that had developed between government and business, particularly in the critical manufacturing sector.

“Countries that have successfully industrialised are characterised by a strong, mutually beneficial relationship between government and the private sector. As the DTI, we will continue to look at building capacities to work more closely with the private sector and ensure that the right regulatory policy is in place and is not a barrier,” he concluded.