Slide 1: Sasol US Mega Projects Investor Presentation
Sasol US Mega Projects Investor Presentation 19 September 2013 better together … we deliver
Slide 2: Forward-looking statements
forward-looking statements Forward-looking statements: Sasol may, in this document, make certain statements that are not historical facts and relate to analyses and other information which are based on forecasts of future results and estimates of amounts not yet determinable. These statements may al
Slide 3: What will we cover today
what will we cover today ● Overview of the Sasol Group ● North American Operations ● Our North American projects – Competitive advantage – Execution plan ● Closing remarks strictly confidential - not for further dissemination better together … we deliver 3
Slide 4: Sasol at a glance
Sasol at a glance ● An integrated energy and chemicals company ● The world’s largest producer of synthetic fuels ● South Africa’s leading energy and chemicals company ● Turnover ($20.5bn in FY13) ● Pioneer in gas-to-liquids (GTL) and coal-to-liquids (CTL) technologies ● Operating profit ($4.6 bn in
Slide 5: Expanding globally
expanding globally our vision is to grow profitable sustainably and inclusively, while delivering value to shareholders through technology and the talent of our people in the energy and chemical markets in Southern Africa and worldwide Sasol has exploration, development, production, marketing and sa
Slide 6: Sasol North America Lake Charles Chemical Complex
Sasol North America Lake Charles Chemical Complex strictly confidential - not for further dissemination better together … we deliver 6
Slide 7: Sasol North America – our history
Sasol North America – our history ● Originated in 1961 as the Petrochemical Division of Conoco, later renamed Conoco Chemicals ● Acquired by Du Pont in 1982 ● MBO formed Vista Chemical in 1984 ● Acquired by RWE-DEA in 1991 ● PVC Business Sold to Georgia Gulf in 1999 ● Acquired by Sasol in 2001 stric
Slide 8: An advantaged site with access to major highway, rail and port infrastructure
an advantaged site with access to major highway, rail and port infrastructure Sasol North America strictly confidential - not for further dissemination better together … we deliver 8
Slide 9: A thriving downstream and petrochemicals hub
a thriving downstream and petrochemicals hub Entergy NISCO Sasol Georgia Gulf City of Westlake North America MG Industries Air Products Phillips 66 EXCEL Refinery Paralubes ARCH BioLab City of Sulphur City of Lake Charles PPG Basell Certainteed Louisiana Pigment Firestone Air Liquide Westlake Citgo
Slide 10: North American operations – our priorities
north american operations – our priorities ● Safety and Environmental Excellence ● Reliability and Plant Operations ● Cost/Profitability Improvement Focus strictly confidential - not for further dissemination better together … we deliver 10
Slide 11: Striving for zero harm
striving for zero harm Recordable Case Rate* 4th Quartile 3rd Quartile 2nd Quartile 1st Quartile -- * 12 month rolling average strictly confidential - not for further dissemination better together … we deliver 11
Slide 12: Continuous improvement – proven track record
continuous improvement – proven track record 20 % reduction Fiscal Year 3% Inflation Base strictly confidential - not for further dissemination better together … we deliver 12
Slide 13: Achieving operational excellence in North America
achieving operational excellence in North America Global Economic Hurricane Downturn Rita Annual production FY 93/94 FY 95/96 FY 97/98 FY 99/00 FY 01/02 FY 03/04 FY 05/06 FY 07/08 FY 09/10 FY 11/12 FY13/14B steadily higher volumes and revenues without a major debottleneck strictly confidential - not
Slide 14: The opportunity for Sasol
the opportunity for Sasol strictly confidential - not for further dissemination better together … we deliver 15
Slide 15: One of the largest foreign direct investment manufacturing projects in the US
one of the largest foreign direct investment manufacturing projects in the US ● Approval for front-end engineering and design (FEED) for our world-scale ethane cracker complex and GTL project in December 2012 ● GTL FID 18-24 months after LCCP FID ● Estimated total project capital investment: $16 to
Slide 16: Gas-to-liquids in a nutshell
gas-to-liquids in a nutshell a commercially proven technology Product work-up GTL products Diesel: 75% Naphtha: 20% Natural gas Reforming GTL synthesis LPG: 5% as feedstock 10 mcf 1 barrel of product 1 bcf/d 100 000 bbl/day 1 tcf reserve 100 million bbl of products Over 30 years strictly confidentia
Slide 17: Shale gas and shale ethane have changed North American markets
not only shale gas, but also shale ethane has changed North American energy and chemical markets estimates vary from 40-100 years of supply History 2009 Projections US dry gas (trillion cubic feet per year) 30 1% 25 Net imports 11% 20 Shale gas 45% 14% 15 20% Non-associated onshore 8% 9% Non-associa
Slide 18: The US GTL opportunity is advantaged by favorable oil/gas price ratios
the US GTL opportunity is advantaged by favorable oil/gas price ratios Crude oil (Brent) prices expressed as a multiple of natural gas prices (Henry Hub) 40 ● More than 400 tcf of gas in the US can be commercially produced at <$6/mmbtu 30 ● All reputable long-term energy consultants forecast Henry H
Slide 19: GTL value addition
GTL value addition a Sasol wholly owned facility with a nameplate capacity of 4 million tons per annum wax products debottleneck in reactor wax wax Hamburg, LPG Germany oxygen extraction phase 1 fuels natural gas syngas sasol LTFT product naphtha four new natural reforming process work -up gas emuls
Slide 20: Ethane associated with gas leads to global leadership position for US crackers
ethane associated with gas leads to global leadership position for US crackers Source: CMAI Long term defensible position - bottom 30% of supply curve on a cash cost basis strictly confidential - not for further dissemination better together … we deliver 21
Slide 21: LCCP: world scale cracker and derivatives plants
LCCP: world scale cracker and derivatives plants backward-integrated growth for Sasol into a well-established and uniquely diversified market To HDPE (with INEOS) strictly confidential - not for further dissemination better together … we deliver 22
Slide 22: Execution is critical
execution is critical strictly confidential - not for further dissemination better together … we deliver 23
Slide 23: Proactive actions to address execution challenges
proactive actions to address execution challenges Mitigation ● Utilization of Recent mega-project ● Integrated project management team standard experience in the Gulf ● Leverage local mega-project expertise and designs where Coast execution possible ● Disciplined stage-gate discipline to ● Well-defi
Slide 24: Actively recruiting local, experienced people for mega project experience
mitigating execution risks and applying best practices mega project experience ● Actively recruiting local, experienced people for Sasol North America ● Experienced IPMT* – Experienced international Sasol and Sasol North America employees – Hire experienced local people – Experts from WorleyParsons
Slide 25: Hands-on management structure for basic development of LCCP packages
hands-on management structure for basic development of LCCP packages Integrated Project Management Team (IPMT) Sasol + Worley Parsons + others Main FEED Contractor - Fluor Manages all Engineering Contractors (ECs), develops Basic Engineering Packages (BEPs) for its scope and integrates all BEPs into
Slide 26: Using world-class technology and engineering partners
using world-class technology and engineering partners Facility Licensor Engineering Partner Ethane Cracker LLDPE LDPE EO / MEG HDPE (through JV) strictly confidential - not for further dissemination better together … we deliver 27
Slide 27: Modularization mitigates shortage of skills
modularization mitigates shortage of skills ethane cracker project modularization study (feasibility) strictly confidential - not for further dissemination better together … we deliver 28
Slide 28: Favorable location enables modularization
favorable location enables modularization Potential MATERIALS Module LABOR Laydown HEAVY HAUL EVERGREEN RD Area RAILROAD MATERIAL OFF-LOADING FACILITY SULPHUR ROAD I-10 strictly confidential - not for further dissemination better together … we deliver 29
Slide 29: Revisiting our investment considerations
revisiting our investment considerations robust project economics remain cornerstone of our investment decisions ● Prioritised portfolio Financing ● Maintaining gearing target ● Good market appetite for Sasol debt robust project ● Abundant low-cost feedstock supply economics Feedstock ● Volume and p
Slide 30: Strong investment case
strong investment case sustainable value creation strictly confidential - not for further dissemination better together … we deliver 31