Sasol Expands South African Specialty Chemicals Unit

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Researched by Industrialinfo.com (Industrial Information Resources Incorporated; Houston, Texas). Sasol (NYSE:SSL) (Johannesburg, South Africa) is increasing its Methyl Isobutylketone (MiBK) total production capacity to 60,000 tons per annum, which will give the company about 10% of the 300,000 tons plus annual global market for the product. MiBK is a solvent for resins used in the production of surface coatings. MiBK is also used extensively in rubber chemicals for the production of vehicle tires, as a solvent in the production of pharmaceuticals and adhesives and for specialized metallurgical extraction.

Sasol’s decision to double capacity for MiBK was motivated by growing global demand and the fact the product was one of the higher value added derivatives in the company’s chemical portfolio. It will improve Sasol’s ability to support their growing customer base worldwide.

The new 30,000 tons per year plant will be constructed at Sasolburg, South Africa and is scheduled to come on stream early in 2008. The project is now in the front-end engineering and design phase. In line with the policy of continuous improvement, the plant will incorporate important technical enhancements over the existing plant that started production in1995.

The company’s solvents division has a total annual production capacity of nearly two million tons per annum at four sites in South Africa (72%) and three in Germany (28%). The division sold 1.5 million tons of product worldwide in its 2005 fiscal year and experienced a 30% increase in sales to $1.33 billion up from $1 billion in 2004. The solvents division’s turnover represented about 12% of total group revenue of $10.9 billion for the year ending in June 2005. No investment total has been disclosed for the new plant, but in the past fiscal year, Sasol was the largest capital investor in South Africa with total expenditures estimated at $2 billion.

Meanwhile in Sasol’s other 'home town' of Secunda, South Africa, Technip (NYSE:TKP) (Paris, France) is working on an E+P+CM (engineering, procurement, construction and project management) services contract to complete the company’s new PP2 plant that will have a production capacity of 300,000 tons of polypropylene. The plant is based on BP’s innovative gas phase technology and is scheduled for commissioning in August 2006.

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