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South Africa: Sasol Shifts Finish Date for Nigerian Plant
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Business Day (Johannesburg)
14 May 2008
Posted to the web 14 May 2008
Siseko Njobeni
Johannesburg
PETROCHEMICALS group Sasol yesterday admitted that the completion of the Escravos, Nigeria, gas-to-liquids plant would be delayed until 2011.
The announcement contradicts comments made by SasolChevron spokesman Malcolm Wells last month that though the project was experiencing problems, it would be completed by the end of the decade.
Initial estimates were that the plant would be set for commissioning at the end of next year.
The project has experienced increases in capital costs and its schedule has been under pressure. Sasol, which has a 37,5% interest in the project, said recent estimates indicated capital costs would rise to $6bn.
Sasol said that it expected attributable earnings per share for the year to June to rise 40%-50% . The group said it expected headline earnings per share to rise 50%- 60%.
The group attributed the increase to weakening of the rand against the dollar, an increase in crude oil and product prices and "an improvement in the overall production rate". It said synfuels were expected to be lower than forecast , but were still expected to be higher than the previous corresponding period.
Sasol said the earnings statement did not take into account noncash charges relating to the Inzalo empowerment deal. "Due to the closing date for public invitations being extended to July 5 , a large portion of the noncash charges will affect Sasol earnings next year," it said.
The R26bn empowerment deal will be presented to shareholders at a meeting on Friday.
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Also likely to affect the earnings forecast was a looming fine on subsidiary Sasol Wax, which, with other European wax industry members, faces charges of anticompetitive behaviour.
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