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Sasol provides R400m in financing for first South African-owned chemical tanker

October 11/2019

MOSCOW (MRC) -- Integrated chemicals and energy company Sasol has provided R400-million to finance the acquisition of the first South African-owned chemical tanker, the Bow Cecil, by empowered entity, Nduna Maritime, said Engineeringnews.

Speaking after the 37 000 dwt vessel, which is equipped with 47 tanks, docked in Durban Harbour on Wednesday, Sasol executive VP: advisory, assurance and supply chain Vuyo Kahla said this was the companys largest ever enterprise and supplier development (ESD) funding agreement through its Sasol Siyakha Trust.

Since 2007, Sasol has disbursed R426.7-million to 91 small, medium-sized and microenterprises (SMMEs) as part of its ESD programme. The deal, which was refused by large local and international financiers, took just three hours to conclude.

The Bow Cecil, which will transport chemicals to international markets, will also be the first chemical tanker to become part of the South African ship registry and fly the countrys flag. The South African ships registry currently only comprises four ships. The tanker was built in Norway in 1998 and was acquired by Nduna Maritime from Odfjell Chemical Tankers.

"We are particularly proud of this landmark agreement as it is a significant investment into localising and diversifying our supply chain. As a global producer of a number of chemical products, we supply numerous markets around the world. Through Nduna Maritime, we are extending our value chain participation through a wholly owned South African business," Kahla said.

Sasol spends about R1.8-billion a year on shipping costs. As the owner of the Bow Cecil, Nduna Maritime will leverage this asset to increase its capacity to ship more chemical products to markets concentrated in Asia.

Vusi Mazibuko, executive chairperson of the Mnambithi Group, which owns Nduna Maritime, said that the company would acquire more ships. It had also set itself a target of having an all-South African crew on the Bow Cecil by 2024.

We have plans to expand our fleet in both liquid bulk and dry bulk vessels, which will see us further deepen South African ownership of the maritime industry. The vessel currently handles outbound shipments of chemicals into South East Asia, the Middle East, and Europe for Sasol and other companies," he noted.

He said that about R160-billion of cargo passed through South African ports each year. Ninety-six per cent of this is handled by international companies. Just capturing 10% of that market would be a significant achievement for South African companies.

As MRC wrote previously, Sasol's world-scale US ethane cracker reached beneficial operation on 27 August 2019. Sasols new cracker, the heart of our Lake Charles Chemicals Project (LCCP), is the third and most significant of the seven LCCP facilities to come online and will provide feedstock to our six new derivative units at our Lake Charles multi-asset site.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,255,800 tonnes in the first seven months of 2019, up by 9% year on year. Shipments of all PE grades increased. At the same time, the estimated PP consumption in the Russian market was 796,120 tonnes in January-July 2019, up by 11% year on year. Shipments of PP block copolymer and homopolymer PP increased.

Sasol is an international integrated chemicals and energy company that leverages technologies and the expertise of our 31 270 people working in 32 countries. The company develops and commercialises technologies, and builds and operates world-scale facilities to produce a range of high-value product stream, including liquid fuels, petrochemicals and low-carbon electricity.
Author:Anna Larionova
Tags:petroleum products, crude oil, PP, PE, propylene, ethylene, petrochemistry, Sasol.
Category:General News
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