Sasol’s plan to bounce back
Sasol shareholders have taken significant hits over the past year but changes at the fuel and chemical maker could bring some relief.
In a trading update released on Thursday morning, Sasol outlined the pain it took in the past few months – and its plans to turn this around.
Civil unrest in Mozambique affected the company’s Central Processing Facility (CPF) – the country’s only inland crude refinery – leading to reduced production rates in December 2024.
In addition, on 4 January 2025, a fire occurred at its Natref refinery that caused damage to supporting piping and infrastructure around the Crude Distillation Unit.
This fire led to serious concerns over the jet fuel supply to OR Tambo International Airport.
Bloomberg reported that this fire also highlighted the country’s growing reliance on fuel imports
Sasol has yet to confirm an exact date for restarting the plant but said on Thursday that repairs are anticipated to be completed before the end of February 2025.
“Plans are being implemented, including product purchases to address supply shortfalls, where possible,” the company said.
Sasol also outlined an ongoing operational challenge it is experiencing at its Secunda Operations, largely related to coal quality complications and the consequent impact on gasifier and equipment availability.
However, the company explained that it decided in December 2024 on a destoning solution to enhance the coal quality it supplies to Secunda Operations.
It said the solution’s beneficial operation is expected in the first half of its 2026 financial year, which runs from July this year through December.
The company expects the implementation of destoning and ongoing equipment reliability improvement initiatives to improve production levels going forward.
Sasol also provided an update on its financial performance for the first half of its 2025 financial year.
The company said its International Chemicals revenue improved compared to the first half of its 2024 financial year.
However, it adjusted its sales volume guidance for this segment downward to 4% to 8% lower than 2024, driven by weaker-than-expected demand and unplanned operational outages.
“The financial impact has been mitigated through effective cost management initiatives and improved margins compared to the prior period,” the company said.
It also noted that the overall business environment remains challenging.
It explained that the company’s sales volumes in the quarter continued to be negatively impacted by the East Cracker outage in the US. However, the unit started up successfully in November 2024.
“Overall profitability has improved due to proactive management initiatives,” the company said.

Sasol said its previous guidance for both Mining and Gas remains unchanged, with the annual volume outlook for its Secunda Operations and Natref revised downward.
“Consequently, we expect sales volumes for Fuels and Chemicals Africa to be largely in line with FY24,” the company said.
“Despite the operational challenges faced during the quarter, we remain committed to executing key self-help initiatives aimed at improving performance and mitigating the challenges we face.”
Sasol’s ORYX production volume guidance was revised upwards.
This update also comes after Sasol CEO Simon Baloyi announced he is exploring new ways for the company to meet emissions targets after increasing its reliance on coal for its fuel and chemicals production.
Baloyi said the company, which is South Africa’s second-largest polluter, plans to expand its use of renewable energy to offset its dependence on coal.
Sasol has faced mounting pressure to reduce greenhouse gases (GHG), particularly at its Secunda plant, the world’s largest single-site emitter.
After struggling to transition to natural gas and green hydrogen, Sasol is revisiting coal, with Baloyi stating the company must “transition at a pace that works for the country”.
Shutting operations to meet climate goals, he said, “does not make any logical sense”.
Sasol pledged in 2021 to cut emissions by 30% by 2030 by replacing coal with gas from Mozambique, but limited gas supply has derailed that plan.
“That GHG strategy was predominantly based on lots of gas coming in, and where are we today? We know there’s no gas in Mozambique,” Baloyi said.
The revised strategy focuses on energy efficiency and increasing renewable energy capacity beyond the 750 MW already sourced.
“If we need to double up on renewable energy from one gigawatt to two, we’ll do that,” Baloyi said.
Bloomberg reported that there will be more to offset if Sasol follows through with its plans to improve the supply and quality of coal it mines to feed its operations and revive fuel and chemical production from Secunda.
Plans to improve coal quality and remove impurities could also boost production, potentially raising output above the current 7 million tons annually.
Sasol’s net-zero goal by 2050, introduced by former CEO Fleetwood Grobler, included producing green hydrogen.
While the company explored a project at Boegoebaai for hydrogen exports and domestic use, high costs have dampened demand.
Baloyi questioned early adoption, saying, “Why do you want to be like a guinea pig of technology?”
In October last year, Anchor Capital’s Deryck Van Rensburg told BusinessDayTV that Sasol is not the best-run business and has endured a “precarious and tricky environment from a management perspective”.
Regardless of this, Van Rensburg made Sasol his stock pick but warned that it is a speculative punt rather than a long-term hold.
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