Sasol Natref
Photo by: Creamer Media
The national Covid-19 lockdown has resulted in an unprecedented decline in fuel demand in South Africa.
Chemicals company Sasol and Total South Africa have, therefore, decided to suspend production of fuel at the Natref refinery from April 9, until further notice.
Further, Sasol has also resolved to decrease the daily production rates at its Secunda Synfuels Operations by about 25% to meet the current market demand, while maintaining optimal inventory levels.
Sasol on April 8 said it would maintain these production rates until further notice, while carefully monitoring the supply and demand balance.
It also noted that a further reduction in production rates may be required, depending on further developments in the fuels market.
Given these developments and the decline in demand, Natref's liquid fuels sales volumes for the current financial year are expected to be about 50-million to 51-million barrels, against the previously guided 57-million to 58-million barrels.
Sasol's synfuels production volumes will be about 7.3-million t to 7.4-million tons, against the previously guided range of 7.7-million t to 7.8-million tons.
All Sasol’s mines are continuing to operate notwithstanding the lower internal demand, resulting in the external coal purchases being significantly minimised.
At this stage, a similar chemicals demand remains good and Sasol is prioritising the supply of chemicals within South Africa, as well as the export market.
RESPONSE STRATEGY PROGRESS
Further to the progress alluded to earlier in terms of cash conservation, Sasol’s management team is in the process of proactively identifying further measures to provide an additional buffer against short-term volatility caused by Covid-19 and global macroeconomic factors.
These additional measures will be communicated to the market once agreed with the various stakeholders.
“Safeguarding the health and wellbeing of employees and providing essential products to customers and stakeholders remains the company’s priority,” said Sasol.