JSE-listed petrochemicals company Sasol has signed a negotiation agreement with industrial gas company Air Liquide for the sale of Sasol South Africa’s 16 air separation units (ASUs), in Secunda.
The ASUs, with a 42 000 t/d capacity, provide oxygen for Sasol’s fuels and chemical production processes in Secunda, as well as supply various other gases that are used on site.
Air Liquide will supply the gases to Sasol’s operations under a long-term gas supply agreement.
Air Liquide, which built the ASUs, also plans to start a multiyear plan to modernise the facilities.
In addition to the benefits this will bring about in terms of safety, reliability and efficiency, the solution provided by Air Liquide is expected to, in coordination with Sasol, result in a 30% to 40% reduction in carbon dioxide (CO2) emissions from oxygen production by 2030.
"In line with our strategy and our know-how, this operation illustrates our intent to act in favour of the climate and local ecosystems. It will allow both Air Liquide and Sasol to focus on their core business, combining operational efficiency and a reduction of CO2 emissions.
"Climate action is at the heart of Air Liquide’s growth strategy and our Climate Objectives are the most ambitious of our sector. Our capacity for intervention is wide and goes from renewable energy-based hydrogen or oxygen production to energy efficiency programmes on existing sites. Solutions exist and we will continue to champion these worldwide. Now is the time to act," comments Air Liquide chairperson and CEO Benoît Potier.
It is also expected that with Air Liquide owning and operating the full ASU fleet, it will provide optimisation and management of the assets, as well as energy efficiency benefits.
Air Liquide has been present on the Secunda site since 1979 and already owns and operates one ASU, which was commissioned in January 2018.
Sasol expects to negotiate final agreements by mid-August and for the transaction to close before June 2021.
The sale forms part of Sasol’s accelerated asset disposal programme, which, in turn, forms part of the company’s response plan to Covid-19, announced on March 17.
The response plan was designed to mitigate the impact of lower oil prices and Covid-19. It includes a cash conservation programme, an accelerated asset disposal programme and a potential rights issue of up to $2-billion, which remains subject to the progress of other initiatives.
“We have embarked on a journey to reposition the Sasol of the future as a more resilient and sustainable enterprise. In the short term, a number of measures has been developed and one of these measures is the acceleration of our asset divestment programme to streamline our portfolio by focusing on core assets.
"This transaction has important commercial benefits that are very clear – one of the most significant being the pursuit of decarbonisation not only for the ASU operations but for the whole of Sasol’s Secunda operation," comments Sasol president and CEO Fleetwood Grobler.
Air Liquide South Africa acting CEO Taki Nkhumeleni says the project illustrates the company's commitment to South Africa.