Sasol Limited Integrated Report 2021 - Book - Page 45
1
2
3
4
5
6
Performance overview – Chief Financial Officer’s review
Our refined approach to deliver sustainable
shareholder value over time
KEY MESSAGES
▪ Strong financial results delivered
▪ Significant progress in resetting the balance sheet
▪ Competitive cost basis established
▪ Maintaining focus on the factors within our control
• Deleverage balance
sheet
Hedging activity
More specifically:
Following the recent rise in the oil price, Sasol has been able to restructure
24 million barrels of put options to zero cost collars thereby increasing the
gross average floor level. The crude oil hedge cover ratio for FY22 has also
been increased by hedging an additional 18 million barrels using swaps.
For 2022, Sasol executed 100% of the hedging programme, which equates
to 42 million barrels per annum (90% of total Synfuels synthetic crude
oil production, 90% of Sasol’s share of ORYX production and equivalent
commodity chemicals volumes where there is a strong correlation to oil
price using a combination of zero cost collars and swaps).
• First order capital will be allocated to:
– maintaining our existing asset base, our compliance obligations,
decarbonising our existing businesses to deliver on our GHG reduction
targets and protecting returns (R20 – R25bn/a);
– selective growth/improve capital for smaller high return,
short payback projects and new sustainability initiatives;
– deleveraging and maintaining a robust balance sheet
(