Methods & Concepts

Given the different assumptions and modelling frameworks used by  each study considered, and the general complexity of the modelling endeavour, it is difficult to associate specific details to each of the stylized decarbonization routes.  However, some broad observations can be made.

Under Route 1, the closure of Sasol’s Secunda facility would result in a drop in both domestic liquid fuels and chemicals supply. This will also contribute to a reduction in South Africa’s greenhouse gas emissions by around 45 Mt per annum, or just under 10% of the current national total.  Under Routes 2 and 3, Secunda operates to 2050 and beyond, with a transition to complete decarbonisation of the facility and its products. 

From the modelling it is clear that the rate at which Secunda and Sasolburg’s decarbonization transition occurs will depend on various factors. The later the transition starts, the more rapid it will need to be to remain aligned with an overall carbon budget allocation.  A higher budget for the petrochemicals value chain means a reduced budget being available for other sectors. 

Route 2, which sees synfuel production being decarbonised via gas as a transition feedstock, requires significant new gas supplies to be secured, potentially from the early 2030s onwards. Under this route, coal consumption could be as much as halved at Secunda by the mid-2030s and completely phased out by the late 2040s, with green feedstock ramping up from the mid-2040s. Towards 2050, gas feedstock would need to ramp down to zero. Route 3, which sees conversion straight to green carbon feedstocks, requires unlocking of green hydrogen and sustainable carbon sources at scale in the early 2030s,

with the phase out of coal feedstock and its complete removal by the latest 2040.  

Given that Secunda provides various raw materials to Sasolburg’s operations, changes at Secunda will have significant impacts on the production and outputs from Sasolburg. 

• Under Route 1, some ongoing chemicals production is assumed in the economy to 2050, likely from reduced production at Sasolburg (although this is not specified) due to there being no further inputs from Secunda from the mid-2030s.
• In Routes 2 and 3, production at Sasolburg would be less affected given that inputs from Secunda would remain, and the facility could remain operational at full capacity. As Secunda decarbonizes, inputs to Sasolburg will too.
• Ultimately the use of gas at Sasolburg will need to be phased out through substitution with green hydrogen and sustainable carbon.

UPSTREAM:

Coal and gas industrial feedstocks: 

• Across all Routes, there is a reduction in the demand for coal and gas as feedstocks for petrochemical and chemical processes, which are replaced by green hydrogen and sustainable carbon. This feedstock switch varies in scale and timing across each route, with  corresponding mining, exploration, infrastructure, and other transitional implications for the coal and gas sectors. 

Sustainable carbon: 

• It is unclear how and to what extent the sustainable carbon requirements for each Route have been incorporated into each study’s overall modelling framework. It is likely that there are complex cross-economy interlinkages which are difficult to investigate given available information. 

Green Hydrogen:

• Across all Routes, broad trends in the green hydrogen market can be observed. Green hydrogen supply starts to ramp up in the near-term, stimulated initially by demand for green-hydrogen related exports from South Africa including green iron, steel and ammonia. 
• In the 2030s, local demand for green hydrogen gains momentum, driven by applications in heavy-industry (including petrochemicals) and heavy-duty mobility.
• There is a wide range of hydrogen market growth projections contained in the modelling, with estimates of local production in 2050 from 2.5-9.5 Mtpa (of which 40%-50% is for export, the remainder for domestic use). 
• End use sectors include petrochemicals & chemicals production (ammonia and green fuels), green iron & steel manufacturing in the 2030s, and heavy-duty transport and power generation (power generation only in the case of the NBI study, not the ESRG modelling) in the mid-to-late 2040s.

DOWNSTREAM:

Liquid fuels:

• Across all Routes, production of and demand for liquid fuels declines substantially to 2050.
• Domestic production ramps down faster than domestic demand, with all crude refineries except Natref assumed closed by 2030. Residual demand is met by imports (in addition to Secunda’s production).
• Demand for petrol is the first to decline due to the anticipated ramp up in EVs, with diesel only seeing substantive declines in the 2040s – due to its ongoing use in heavy transport and other hard-to-electrify applications.
• By 2050 there is more than a 90% reduction in demand for fossil-based liquid fuels and no more domestic production remaining.

Transport:

• The transport sector sees a rapid uptake of EVs from the early 2030s onwards, with a range of ~55-90% of the ICE vehicle fleet replaced by EVs by 2040.
• Modal shifts from private passenger to public passenger transport (minibus taxis, buses, etc), as well as from road to rail for both passenger and freight transport are also observed.
• Freight transport sees a similar decline in ICE vehicles, and an uptake in EVs from the late 2030s and hydrogen-fueled vehicles in the 2040s.

Chemicals:

• The chemicals value chain implications do not appear to be explicitly elaborated in the models. A significant ramp up in ammonia production for export is observed in some of the ESRG modelled scenarios. The model is agnostic as to whether this is produced at Sasolburg / Secunda or elsewhere.