Sasol Limited Integrated Report 2021 - Book - Page 11
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President and Chief Executive Officer’s statement
Sasol 2.0 is our pathway
to Future Sasol. Together
with our people and FischerTropsch technology, we are
positioned to win.
Against this backdrop, we are exploring the possible
repurposing of assets to produce green hydrogen,
partnering to co-create hydrogen ecosystems and
launching projects to catalyse developments. Sasol is
uniquely positioned to play a leading role in the country’s
hydrogen economy.
The aviation sector is a material contributor to GHG emissions
globally and is under significant pressure to decarbonise.
Sustainable Aviation Fuel (SAF) is seen as one of the viable
large-scale carbon reduction solutions for the sector. While
only a marginal part of demand today, SAF could represent up
to 50% of aviation fuels by 2050.
Fleetwood Grobler
President and Chief Executive Officer
SAF consists of a basket of fuel technologies, one of which
is sustainable synthetic fuels (PtX). We are distinctly placed
to enable the production of PtX, which is expected to benefit
from declining renewable electricity and green hydrogen
production costs.
Dear stakeholders
Over the year we have made significant progress in alleviating our immediate challenges. Our short-term Response Plan has allowed us to successfully navigate through this trying period with
the Sasol 2.0 transformation programme already unlocking value. We are on track to deliver on our FY25 targets.
FY21 marked our 70th anniversary, a significant milestone in Sasol’s history. Reflecting on our journey and appreciating the road ahead, we themed the anniversary campaign, ‘Our Journey,
because of you’. This pays homage to our investors, customers, suppliers, business partners, employees, communities and other stakeholders.
The impact of COVID-19 across the globe has been devastating with many countries experiencing additional waves of the mutating virus. Some countries have been harder hit than others
and the difficult task of rebuilding has commenced while people everywhere accept the need to remain vigilant. Businesses had to change their ways of conducting business and Sasol was
no exception.
As the pandemic spread, it led to the tragic loss of life and I convey sincere sympathies to those who have lost family, friends, colleagues and loved ones to this highly infectious disease.
In addition, we express our deepest condolences to the family and friends of two colleagues who tragically passed away in work-related incidents – one before financial year end, the other after.
We have defined our Purpose, ‘Innovating for a better world’ which is indicative of Future Sasol and the role we see for ourselves globally. We also refreshed our values to: be Safe, be Caring, be
Inclusive, be Accountable and be Resilient.
We see a future for our Fischer-Tropsch (FT) technology which we believe will play an important role in delivering a sustainable future. We recognise that partnerships will be increasingly
important, as we seek to enhance our competitive position and accelerate our transition through collaboration with both the public and private sectors.
In addition, Sasol seeks to unlock more value from our Chemicals Business as we grow our specialty chemicals and ramp-up the Lake Charles Chemicals Project (LCCP) to reach its full potential.
Success of our Response Plan and Sasol 2.0
transformation programme
The Response Plan was initiated to address our
immediate challenges, whereas Sasol 2.0 is a complete
end-to-end transformation programme. The latter was
designed to drive the broad change required to reach
a new and sustainable Future Sasol. As part of this,
it was critical that we deliver the financial targets to
strengthen our balance sheet to enable a successful
Future Sasol.
Due to the focused efforts of our teams, excellent progress
was made in meeting our short-term financial targets:
• we exceeded our cash conservation target for FY21;
• we significantly surpassed our net asset value target
of US$2,5 billion. We have now contracted for total
divestments of US$3,8 billion subject to normal closing
conditions; and
• the good progress we made overall enabled us to avert
a rights issue, as announced in February this year.
Similarly, Sasol 2.0 is already unlocking value and we
have successfully transitioned to a more customer-facing
operating model, making each of our Business Units more
independent and agile. In exceeding our financial targets,
we have significantly improved our cost-competitive
position, laying the foundation for Future Sasol. We are well
on our way to building a sustainable business based on our
FT technology. This business will be highly cash generative,
yielding value to all our shareholders.
We were once pioneers and with a successful Sasol 2.0
implementation we can once again occupy this position.
Our advantaged Fischer-Tropsch technology
unlocking the future
Our proven FT processes have served us well for more
than 70 years. The processes are fully compatible with
green feedstocks and can produce sustainable products;
very much sought after in a low-carbon world.
Along with our catalyst technologies, FT is uniquely placed
to enable the production of sustainable synthetic fuels
and chemicals.
The potential of green hydrogen is a very exciting area as it
could enable Sasol to achieve significant decarbonisation in
the future. Our inherent capabilities and strengths translate
into numerous potential roles that Sasol can play in a green
hydrogen economy, which include:
• being a producer of hydrogen;
• an anchor customer in order to decarbonise our
operations; and
• fulfilling a market-maker role, to bridge the supply
and demand gap both domestically and through
exports.
For us, the potential is clear. To unlock green hydrogen
opportunities, we are pursuing various demonstration
projects and partnerships with the intent of enabling
and taking advantage of technology developments
and breakthroughs. We have partnered with the
LEN** consortium on cleaner aviation fuels, the
Industrial Development Corporation (IDC) to collaborate
in developing South Africa’s hydrogen economy and a local
partner on eco mobility.
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Linde PLC, ENERTRAG AG and Navitas Holdings (Pty) Ltd.
Sasol Integrated Report 2021
We believe that this opportunity can be realised: key will be
collaboratively creating a commercial model that will make
it work for all parties. We are therefore setting up a separate
Business Unit, Sasol ecoFT, to lead this work independently
from our current businesses – and with enough latitude to
be entrepreneurial and grow with the market.
Fischer-Tropsch technology remains at the core
A technology
for a sustainable
future
High greening
potential with
Green H2
Carbon sourcing
flexibility, potential
for unlimited
sustainable
feedstock with direct
air capture
Wide range of
applications: aviation,
transport fuels,
sustainable chemicals
Sasol the
undisputed
leader
Largest installation
of Sasol’s unique
FT technology
More than 70 years
of innovation and
operations expertise
Advantaged
technology
and catalysts (higher
yields, lower costs)
Partnering with
industry leaders
(eg HaldorTopsøe,
Technip Energy)
Fischer-Tropsch technology is key for
decarbonising our existing assets and
developing new sustainable businesses