Mathabo Le Roux
6 February 2008
Johannesburg — SASOL, along with the governments of SA and Mozambique, is to invest R1,1bn to build a gas compression station at Komatipoort to increase the supply of gas from Mozambique to SA 20% by the end of next year.
Sasol imports 120-million gigajoules of gas a year from the Temane and Pende gas fields, and the expansion would boost volumes to 147-million gigajoules, the company said.
Construction on the project would start in the second half of this year, and it would come on stream towards the end of next year.
Sasol originally invested $1,2bn to establish the natural gas venture in Mozambique's Inhambane province, in partnership with the Mozambican government in 2004. The South African government then took up an offer to become a partner in the venture. Mozambique's natural gas fields at Pende and Temane, in Inhambane, were discovered in 1962, but their commercial potential was explored when the Mozambican government and Sasol signed a contract for the fields' development in 2000.
South African government gas company iGas and the Mozambican government, through the state-owned Companhia de Mocambicana de Gasuduto, have stakes of 25% each in the company that owns the natural gas venture, Republic of Mozambique Pipeline Investment Company. Sasol Gas owns the rest.
The additional gas that will now feed to SA will be used in the first phase of an expansion project at Sasol's synfuels plant in Secunda to increase capacity 20% over the next eight years.
Sasol said yesterday that 75% of the eventual additional synfuels capacity would use environmentally more benign natural gas as feedstock while the rest of the feedstock for the expansion would come from fine-coal reserves.
The group previously estimated the use of natural gas could cut emission of the toxic gases sulphur dioxide and nitrogen oxide from its synfuels production about 35%. Sasol said two gas-turbine-driven compressor units and ancillary equipment would be used at Komatipoort to increase gas flow in the trans-border pipeline that transports natural gas 865km from Inhambane to Sasol's operations at Secunda and Sasolburg.
Foster Wheeler SA won the contract for the engineering, procurement and construction management on the expansion. Sasol said preference would be given to local suppliers for the sourcing of equipment and materials.
The project would provide temporary jobs for 450 people: 150 for skilled artisans and 300 local workers.
Sasol's share price barely changed yesterday at R349,50 with 3-million shares traded.
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