Transitioning SA's Petrochemical Value Chain

Financing Secunda and Sasolburg’s transition

The techno-economic discussion suggests that Secunda and Sasolburg may have a role producing Sustainable Aviation Fuel (SAF) and green chemicals (organic and inorganic) in a net zero future economy.  However, the path to achieve this transition involves input, process and product market changes that may challenge the ongoing viability of the facilities.  At any point in the decarbonisation transition, therefore, Secunda and Sasolburg could theoretically become financially or economically stranded. There are three ways in which stranding could come about:

  1. The facilities do not make sufficient return to cover a risk adjusted cost of capital over a particular length of life.
  2. The facilities make enough cash to cover operating costs, but not to service financing costs.
  3. The facilities do not cover their operating costs.

Secunda and Sasolburg are wholly owned and therefore financed by Sasol, an international corporation listed on the Johannesburg (1979) and New York (2003) stock exchanges. Sasol may therefore choose to tolerate operating at a loss for particular period of time if it sees the potential for cashflows from the facilities in the future.  Sasol views its business activities as a portfolio, and may be able to generate value and cash in other areas to support Secunda and Sasolburg through tricky patches of the transition, but again, only if the company and its shareholders see a viable future for the facilities.

Whether Sasol as a company will be able to attract finance for the operation of Secunda and Sasolburg during the transition ultimately depends on whether its transition plans are deemed credible and implementable by investors (Asset Management Engagement).


Institutional investors own 60% of shares. The two largest Sasol shareholders are the Government Employee Pension Fund (13.5%), managed by the Public Investment Corporation (PIC), and the South African government-owned Industrial Development Corporation (IDC) at 8.5%. Sasol stocks are also widely held by all major South African investment platforms.