Sasol Form 20-F for the year ended 30 June 2021 - Book - Page 60
and pipelines to the CPF. The design capacity of the
CPF is 491 million standard cubic feet per day sales gas
together with small amounts of associated condensate.
Activities
Present activities in the Pande-Temane PPA
asset include projects for infill drilling and well
workovers to repair some existing Pande & Temane
producers. Phase three low pressure compression at the
CPF, necessary to maintain production as the reservoirs
deplete and in accordance with the approved FDP, was
brought into operation in October 2019
At 30 June 2021, there were 18 productive
wells in the Pande-Temane PPA asset. Well integrity
risks were identified and certain affected wells were
shut-in with plans for remediation during 2022, as these
plans were not executed in 2021. This was due to the
travel restrictions imposed in the face of the COVID-19
pandemic.
In terms of the PSA, following approval of the
FDP amendment in September 2020 and FID in
February 2021, work to deliver the field development
scope (oil and gas wells and gathering system and
integrated gas, oil and LPG processing facilities) has
commenced. The acquisition of 3D seismic over the
Pande and Inhassoro fields has commenced and is
expected to be completed in calendar year 2021.
Drilling and workover activities commenced on 7
August 2021 using the rig contracted for an integrated
drilling campaign, servicing the PPA, PT5-C and PSA
licences. Engineering, Procurement and Construction
management (EPCm) contracts for the surface facilities,
i.e. well pad surface facilities, oil and gas gathering
system and oil, gas and LPG processing facilities, are
planned to be awarded in the second half of calendar
year 2021.
Delivery commitments
Gas produced from the Pande-Temane PPA
asset, other than royalty gas provided to the
Mozambican government, is supplied in accordance
with long-term gas sales agreements (GSAs). The gas
produced in accordance with GSA1, signed on
27 December 2002 (25-year contract term from 1
April 2004), and GSA2, signed on 10 December 2008
(20-year contract term from 1 January 2010), is sold
internally for use as part of the feedstock for our
chemical and synthetic fuel operations and to the
external market in South Africa, with a maximum daily
quantity equivalent to 132 PJ/a (119,75 bscf/a) and
27 PJ/a (24,49 bscf/a) for GSA1 and GSA2
respectively. There are four offtakers under the GSA3,
which are 20-year contracts that supply gas to the
Mozambique market. These satisfy a licence condition
that a portion of gas produced is utilised in-country.
The contracts are with Matola Gas Company S.A from
1 July 2014 for 8 PJ/a (7,26 bscf/a), ENH-Kogas from
1 March 2013 for 6 PJ/a (5,44 bscf/a), Central Termica
de Ressano Garcia S.A. from end-February 2015 for
11 PJ/a (9,98 bscf/a) and ENH effective from
1 June 2015 for 2PJ/a (1,81 bscf/a).
The development of the PSA Pande field has
been incorporated in the revised FDP.
Capitalised exploratory well costs
At 30 June 2021, there were no exploratory
well costs capitalised in the Pande-Temane PPA asset
or in the A5-A and PT5-C licences.
In the PSA Pande area, exploratory well costs
continue to be capitalised for a period greater than
one year after the completion of drilling, amounting to
R192,4 million net to Sasol; these costs relate to the
exploration drilling activities conducted and completed
in 2008, and the follow-up activities which continued
from 2017.
Infill drilling projects which will convert
proved undeveloped reserves into proved developed
reserves in order to meet near-term delivery
commitments are underway. Production is expected to
commence declining in 2024, when it will no longer be
possible to fully supply at currently contracted rates.
Technical and commercial options are currently being
considered to address this issue.
Facilities and productive wells
PPA condensate is currently sold to Petróleos
de Moçambique, S.A. (Petromoc), which transports the
condensate by truck from the CPF for export. The
commercial agreement was effective from 1 July 2019
for a two-year period. Subsequently, a 12-month
extension until 30 June 2022 has been agreed.
Natural gas and condensate is produced from
the Pande-Temane PPA asset facilities, at the CPF on a
site of approximately 400 000 square metres, located
some 700 kilometres north of Maputo, the capital of
Mozambique. Production from the Temane and Pande
fields, which are managed as a single operational field,
is routed from production wells via in-field flowlines
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