Sasol to splurge on capital projects in face of weak oil prices
SASOL, the international energy and chemicals group, will spend R135bn over the next two years on capital projects in Southern Africa and the US despite weak oil prices. The company’s management is also confident it can maintain its expansion programme, while paying a dividend. It spent R70bn in capex in the year to June. Sasol is building a chemicals complex at Lake Charles, US. It recently warned shareholders costs had risen about $2bn above the previous forecast, to $11bn. It has budgeted $1.4bn to drill for oil and gas in the production-sharing area in southern Mozambique over the next two years. Several other capital projects are reaching completion: the $299m Gemini joint venture with Ineos to manufacture high-density polyethylene in Texas, US; the R2.7bn loop line 2 project to expand capacity on the existing gas supply line between Mozambique and SA; the second phase of the Fischer-Tropsch wax expansion project at Sasolburg, with a total cost of R13.6bn; and the Shandoni coll...
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