EDITORIAL: Sasol shows government the way
The government could learn a thing or two from petrochemicals group Sasol, which has been embroiled in a Medupi-like mess of its own in Louisiana
As it grapples with the many-headed Eskom hydra, the government could learn a thing or two from petrochemicals group Sasol, which has been embroiled in a Medupi-like mess of its own in Louisiana.
The Lake Charles ethane cracker project is close in scale to Eskom’s vastly over-budget-and-time new power plant, which was intended as a symbol of homegrown magnificence but is now a monument to abysmal planning and crisis management.
Similarly, Lake Charles was supposed to be Sasol’s New Big Thing, lifting it to the status of international chemicals contender. Instead, the company has sunk about R188bn on a project that may never generate the expected returns. Now Sasol has taken its medicine, helped in no small part by an unforgiving market in which all shareholders have taken pain.
The upshot is that Sasol’s joint CEOs are gone, executives in charge of the project have been removed, the dividend has been cut and a competent insider with almost four decades of experience has been named to lead the company.
It took Sasol’s board five months to do this, which in capitalist time can feel like years. But Eskom is real years into a catastrophe and its board and its shareholder are nowhere close to ringing in much-needed change. That is the real crisis of our paralytic state.
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