Transitioning SA's Petrochemical Value Chain

The chemicals sector is identified as one of the ‘hard to abate’ sectors given the nature of its technical processes but also economic factors such as low profit margins, capital intensity, trade exposure and long asset life which limit ability to make dramatic and rapid investments in new production processes and products. Opportunities for decarbonisation of the chemicals sector can be broadly considered to include:

• Increasing the resource efficiency and reducing the greenhouse gas intensity of existing chemicals production through process efficiencies and modifications including use of digital tools, energy management tools and changing production routes;
• Changing to feedstocks that are less emissions intensive to produce or give rise to lower levels of emissions during transformation processes, including bio-based feedstocks, such as plant or animal fats, sugar, lignin, hemi- cellulose, starch, corn or algae;
• Substituting chemicals products with those that give rise to lower levels of emissions either during production or use; and
• Avoiding production of certain products like polymers, rubbers, plastics, packaging etc through re-use, recycling and substitution.

As discussed in the section on decarbonisation of Secunda and Sasolburg’s processes, Sasol is already considering opportunities for process efficiencies and modifications to reduce the GHG emissions from production, such as turn-down of coal boilers and energy optimisation. In terms of the second and third bullets, part of their shorter-term strategy is to increase gas utilisation as a replacement for some of the coal input, due to its lower GHG footprint. Looking further afield, they are exploring a transition to green chemicals production, which depends on the availability of affordable green hydrogen for both organic and inorganic chemicals. Organic chemicals production further depends on availability of sufficient and affordable sustainable carbon as a feedstock. Other chemicals companies around the world are all faced with the challenge of decarbonisation, requiring them to seek out similar opportunities which are suited to their production outputs and processes.

For Sasol specifically, their existing expertise and Fischer-Tropsch and Haber-Bosch technological know-how makes it well placed to make green chemicals derived from hydrogen, and to switch from fossil fuel feedstocks to sustainable carbon sources. However, as discussed throughout this section, there are risks in terms of the economics of green hydrogen supply, sourcing a technologically and economically feasible sustainable carbon supply, and then process risks to making the switch at various volumetric levels.

The complexity of Secunda and Sasolburg’s processes also raise the question of combined economic and technical viability of the greening product slate at each stage of the transition.  Factors that will need to be considered include:

• The ratio of organic and inorganic chemicals;
• Market demand, including both international and domestic, which is in turn linked to logistics considerations,
• Pace of transition in the feedstock (upstream) markets;
• Ratio of chemicals to liquid fuels (and market demand), and ultimately, the viability of a fully green product slate (green chemicals plus Sustainable Aviation Fuel).