investing in africa’s success€¦ · creates significant investment opportunities fdi: us$46...

INVESTING IN AFRICA’S SUCCESS:

EXPANDING OUR AFRICAN FOOTPRINT

A new era for Sasol 2

Forward-looking statements

Forward-looking statements: Sasol may, in this document, make certain statements that are not historical facts and relate

to analyses and other information which are based on forecasts of future results and estimates of amounts not yet

determinable. These statements may also relate to our future prospects, developments and business strategies.

Examples of such forward-looking statements include, but are not limited to, statements regarding exchange rate

fluctuations, volume growth, increases in market share, total shareholder return and cost reductions. Words such as

“believe”, “anticipate”, “expect”, “intend”, “seek”, “will”, “plan”, “could”, “may”, “endeavour” and “project” and similar

expressions are intended to identify such forward-looking statements, but are not the exclusive means of identifying such

statements. By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and

specific, and there are risks that the predictions, forecasts, projections and other forward-looking statements will not be

achieved. If one or more of these risks materialise, or should underlying assumptions prove incorrect, our actual results

may differ materially from those anticipated. You should understand that a number of important factors could cause actual

results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-

looking statements. These factors are discussed more fully in our most recent annual report under the Securities

Exchange Act of 1934 on Form 20-F filed on 09 October 2013 and in other filings with the United States Securities and

Exchange Commission. The list of factors discussed therein is not exhaustive; when relying on forward-looking

statements to make investment decisions, you should carefully consider both these factors and other uncertainties and

events. Forward-looking statements apply only as of the date on which they are made, and we do not undertake any

obligation to update or revise any of them, whether as a result of new information, future events or otherwise.


What you will hear today…

• Africa has become a key

focus for the global E &P

industry

• Sasol has a long-

established home base in

South Africa

• A significant position in

Southern Africa and an

emerging presence in

West Africa

• Sasol is well positioned

to leverage Africa’s

opportunities

Sasol Ethylene Purification Unit 5,

Sasolburg


Africa’s growing resource base

Indications are that there are still substantial yet to find oil and gas resources on the continent

Sources: Standard Bank, International

Business Times, and Ernst and Young

Nine of the 17 largest gas

discoveries in the last five

years were in Sub-Saharan

Africa, thereby potentially

leading to:• Transformation of the region’s

economies

• Billions of dollars in annual

investments.

East Africa is now seen as

the new promised land” or

the “next epicentre” for global

natural gas, the latest “new

frontier.

Algeria Libya Egypt

Sudan

Ethiopia

Madagascar

Mozambique

SouthAfrica

Mamibia

Angola

NigeriaGhana

DRCKenya

Uganda

Tanzania

2.2

4.5

1.5

5.3

Established gas production

New gas finds

Gas ambition

Shale gas potential

100

110

130

150

1601

00

120

130 150 190

0

200

400

2010 2015 2020 2025 2030

Natural gas production outlook.Africa, 2010–2030

Demand Net exports

Bill

ion c

ubic

mete

rs


Creates significant investment opportunities

FDI:

US$46 billion

in 2012

US$37 billion

in 2006

US$15 billion

in 2002

The continent grew on average 5.5% a year over the past decade and GDP is expected to

rise by an average of 6% in the next year, with foreign direct investment (FDI) increasing


The key drivers for unlocking growth are in place

• Collective efforts from

industry and governments

to develop skilled workers

to sustain the market

• Regional integration is

providing much needed

infrastructure

• Local content is playing a

key role in de-risking the

supply chain

• Potential for partnerships

to enable accelerated

growth

• New energy policies and

regulations aimed at

attracting FDI

Opportunities

Challenges

• Infrastructure not yet on

par with development

pace

• Human capacity requires

focused development

• Governance systems still

evolving


We are a global company with African roots

Sasol is an international integrated energy and chemicals company that

leverages the talent and expertise of our more than 33 000 people working

in 37 countries. We develop and commercialise technologies, and build

and operate world-scale facilities to produce a range of high-value product

streams, including liquid fuels, chemicals and low-carbon electricity.

Central Processing Facility, Mozambique


Our footprint in Africa

Sasol’s capital investments by region for 2014

Total US$ 438 million


South Africa is the cornerstone of our global operations

25%of South Africa’s

liquid fuels from

synthetic fuels

3,5 million tons of chemicals

annually

1 000 megawattsof electricity, cumulatively

generating up to 69% of our

total internal electricity

requirements in South Africa

Downstream:

Throughout, our 64 year history, Sasol has played an important role in both South Africa’s

and the broader region’s industrialisation, growth and socio-economic development

• Over the years, Sasol’s unique technologies have made us the world’s largest producer of

synthetic fuels and chemicals from coal and natural gas.

• Our expertise in commercialising technologies that beneficiate resources, including natural

gas, to produce much-needed liquid fuels, high-value chemicals and low carbon electricity,

serves to promote regional growth, development and stability.

• Sasol’s chemical business products are mainly sold within Southern Africa with increasing

exports into Western Africa.


Stimulated broader contributions to South Africa

We make ongoing investments:

2014: US$2.1 billion in capital

expenditure;

• We are a top contributor to the

national fiscus: 2014: US$3.2

billion in direct and indirect

taxes; US$8.6 billion over the

last 3 years

• We enable skills and socio-

economic development: 2014:

US$128 million; US$274 million

over the last 3 years

US1 = ZAR10.95

Sasol Fuels Technology Research,

Sasolburg


Actively pursuing upstream opportunities in South Africa and the region

• Southern Africa, like most other emerging markets, is entering the most

energy intensive phase of its economic development.

• To support the region’s energy requirements, we are actively pursuing new

hydrocarbon resources, with a particular focus on natural gas.

50% partner with

PetroSA in TCP: Block 3A/4A

in the offshore Orange basin

60% partner with Eni in

ER 236 offshore Durban and

Zululand basins

Upstream:


Extending our investments into Mozambique, our heartland

• Developed stranded gas fields through strong partnerships and technological

expertise

• Contributed to creation of favourable and safe investment climate and

established Exploration and Production sector in the country

• Gas development with our partners has been a catalyst for socio-economic

growth through:

− Revenue generated from equity investment in the natural gas project

− Tax revenue (one of the largest tax payers in the country) significantly higher

when investment paid off

− Capital investments and spin-offs from secondary industries



Continuing to grow our existing operations

Investing in growing capacity beyond

197 MGJ/a on our 183 MGJ/a current

capacity.

Looking for opportunities for additional

production from our existing producing

licence

Low and high pressure compression,

and electrical expansion projects

aimed at enhancing reservoir

deliverability

Additional capacity due to

debottlenecking of the plant to

197 MGJ/a and 5th train addition that

will take us to 240 MGJ/a



ROMPCO – an enabling partnership

Equity in pipeline company (ROMPCO): Sasol

Gas 50% (Operator), CMG (25%), iGAS (25%)


Over $200 million Loopline

investment to increase pipeline

capacity to support market

development

BO: 2015

US$140m ROMPCO compressor

on pipeline completed in 2010

Further capital projects to

enhance reservoir deliverability


Enabling regional markets

Sasol Gas Engine Power Plant

Central Termica Ressano

Garcia (CTRG) Gas Engine

Power Plant

• To date, gas taken in kind has

grown by 33% (Compound

annual growth rate) driven by

significant growth in the

domestic market

• First permanent gas-to-power

plant in South Africa

• 175 MW capacity

• First permanent gas-to-

power plant in Mozambique

• Joint venture with EDM

(51%) and Sasol (49%)

• Meeting 23% of in-country

demand

• 175 MW capacity

Enabling energy security, reducing GHG emissions

Royalty gas

1.3

1.4

1.8

2.9

3.2

3.4

3.8

3.5

3.8

3.5

3.4

3.5

3.6

2.4

2.1

2.9

2.6

3.9

4.5

FY05

FY06

FY07

FY08

FY09

FY10

FY11

FY12

FY13

FY14

GJ (millions)Natural gas in kind Natural gas in cash

5% gas royalty entitlement analysis - GJ


Diversifying energy sources

Sasol and its partners are

developing 20 000 tpa LPG facility

which will:

• Improve balance of payments

• Reduce LPG imports

• Stimulate growth amongst distributors

and retailers

• LPG is a portable, clean and efficient

energy source

• Enable accessibility and affordability to

communities

• Reduce pressure on forests – charcoal

currently a primary energy source

Enabling access to clean energy

Gas reticulation systems

• Sasol partnered with ENH on

installation of gas reticulation systems

in Vilanculos, Inhassoro & Govuro in

Inhambane province

• Advancing the use of gas as a source

of household electricity

• Over 300 families have benefited over

the last three years

Household using natural gas for cooking


Advancing in-country gas monetisation: Mozambique basin: PSA opportunities

• An EWT was conducted on

the Inhassoro oil rim –

produced over 236 000 bbls

of light oil until the end of

March 2013 as part of the

appraisal programme

• Notice of commerciality

declared in early 2013 for both

natural gas and oil

The PSA licence is adjacent to

the current producing PPA area:

− Separated from the initial

commercial discoveries to

enable initial development of

the 120 MGJ/a project

− Field development plan in

progress – on track for

submission in February 2015

Subject to approval by authorities, the PSA provides

significant value adding opportunities:

• Diversification of Mozambique’s energy portfolio and

advancement of in-country monetisation options

• Enablement of extensive skills development and

local content opportunities

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35°30'0"E

35°30'0"E

35°15'0"E

35°15'0"E

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35°0'0"E

34°45'0"E

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21

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! ! ! Pipelines

Roads

Towns_CPF

PSA

PPA

0 10 20 30 40 505

Kilometers

N

Inhassoro

Vilanculos

CPF

Pande G-10

Temane G-8

Temane East

Inhassoro G-6

Temane Main

G-6 Oil Rim

Inhassoro G-10

Inhassoro G-10

Tafula

Corvo

Pande Main


We have proven, global expertise in monetisation

Uzbekistan GTL

~38,000 bbl/d

FEED phase

Escravos GTL

~33,200 bbl/d

Ramping up to full capacity

Lake Charles GTL

~96,000 bbl/d

FEED phase

Canada GTL

~48,000 bbl/d

Feasibility Phase

Mozambique: Conducting a

pre-feasibility study with ENH

and Eni for a GTL plant using

gas from the Rovuma basin

ORYX GTL ~32,400 bbl/d

Consistently operating above

design capacity since 2007

Secunda CTL

~160 000 bbl/d

Fully operational


Ongoing exploration

Grudja G-6

• Area A: entered Second Licence

Period to drill Grudja amplitude

supported anomaly in a

relatively unexplored part of the

Mozambique basin

• Concluding a farm out of 40%

interest

• Looking at upcoming bid

round blocks with interest


Driving targeted skills development in Mozambique

Bursary

programme,

in

partnership

with MIREM,

aimed at

developing

students in

the fields of

geology,

petroleum,

drilling and

reservoir

engineering

Over the next five years we forecast spend of

over US$12,4 million for:

Designed

to ensure

industry

knowledge

and develop

life skills to

prepare the

bursars for

life beyond

university

Sasol’s

learnership

programme is

fast tracking the

development

of sought

after artisans,

in the fields

of electrical,

instrumentation,

mechanical

fitting and

production

Programme

started in

2011, the

first learners

completed

their training

and have

been

appointed as

artisans at

the CPF in

2014

Leveraging

Sasol’s university

collaboration

approach to

build the

necessary

value adding

capabilities

within

Mozambican

universities

Development

of downstream

Masters

programme

with UEM in

support of the

Mozambique

Gas Master

plan


Enhancing our employee value proposition in Mozambique

Local content procurement:

Only companies registered

in Mozambique were eligible

for the construction work

Labour:

75% of construction labour for

the projects is Mozambican

Employee Value Proposition

(EVP)

Onsite clinic:

to provide primary healthcare

for staff and broader community

Education facilities:

to provide access to accredited,

comprehensive private education

97 Employee houses, with

supporting infrastructure

• Management buildings

• Access and internal roads

• Sewerage treatment system

• Utilities infrastructure

• Water management system

• Recreational facilities

Entrance to admin building GuardhouseOne of the houses

Housing project


Driving local development in Mozambique to promote industry growth

• Local content policy stipulates

local ownership, but also local

employment and purchase of

local materials

• Preferential procurement:

giving preference to

Mozambican businesses

wherever possible without

compromising on safety and

quality standards

• Supplier development: fast

tracking and assisting small- to

medium-sized businesses in-

country to build capacity so they

can compete with international

companies Clara José, student at Mabote

Technical and Vocational

School, Mozambique


Sustaining oil production in Gabon

Oil production underpins Gabon’s economy,

accounting for 65% of government revenue

and 75% of export revenue

27,75%economic interest in the offshore

Etame Marin Permitoperated by VAALCO Energy

Gross oil production of sweet

crude oil of about

14 500 to 15 000 bopd from the Etame, Ebouri

and Avouma oil fields

Production from all three fields is

routed to a floating

production, storage and

offloading (FPSO) facility

One of the oil platforms


Maintaining and boosting production in the region

Further growth

opportunities are being

evaluated and preliminary results

to date appear encouraging

Avouma, Etame and Ebouri fields

source: Gamba Sandstone, an

excellent quality reservoir

sandstone yielding high

recoveries

Together with our partners, we are progressing the Etame Expansion project

and South East Etame and North Tchibala project. - First oil from the new

Etame platform is on track for December 2014

Value add opportunities are currently being

evaluated to extend asset life


Sasol’s GTL technology - contributing to a key government driver in Nigeria

In addition, producing

33 200 bbl/day of

valuable products, mainly

clean burning diesel and

Naphtha.

A Nigerian National

Petroleum Corporation

and Chevron Nigeria

Limited project utilising

Sasol’s GTL technology in which

Sasol has a 10% indirect

interest

Adding value to ~3 tcf of natural gas over

the life of the project that would otherwise have

been flared

Escravos Gas-to-liquids (EGTL) project achieved

Beneficial Operation in June 2014Escravos GTL,

Nigeria


Sasol Exploration and Production’s growth

Production and Exploration

Offices

Canada

South Africa

Mozambique

London

Gabon

0

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150

200

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uit

y p

rod

ucti

on

(000 b

oe/d

)

SEPI production profile

Canada gas

Mozambique gas - PPA/PSA

Liquids (Mozambique, West Africa and Canada)

Nigeria

Australia


Stimulating

mutual growth

Africa rising is a reality

Our aim: maintain and enhance our existing asset base and explore

targeted growth opportunities

● Ever expanding resource

base, underpinned by

sound investments

● Infrastructure can be

enabled through regional

integration and cross

border partnerships

● Drive to ensure localisation,

local content and effective

state participation

● Sasol has built a replicable

integrated business in South Africa

and we are growing our asset base

in Mozambique

● We will continue to enable regional

markets and gas monetisation

across the continent

● Our focus is on finding and

developing feedstock to meet our

growth aspirations

Investing in Africa’s

success

Expanding our footprint

in Africa

Secunda integrated facility

investing in africa’s success€¦ · creates significant investment opportunities fdi: us$46...

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