Sasol weighs sale of assets in Papua New Guinea

PORT MORESBY - Sasol, the world’s largest maker of petroleum from coal, is exploring the sale of its gas assets in Papua New Guinea.

"Sasol is considering divesting from Papua New Guinea," said spokesman Alex Anderson said. "We are currently engaging interested parties."

The company — which started exploring for natural gas in Papua New Guinea during 2008 — is also in discussions to sell its 50% stake in Iranian unit Arya Sasol Polymer, which it co-owns with Pars Petrochemical of Iran, a unit of National Petrochemical.

In its interim results for December, Sasol Petroleum International said it had disposed of 10% of its equity interest in an exploration asset in Papua New Guinea for a total consideration of R60m.

In addition, in 2010, Sasol had entered into negotiations with buyers interested in acquiring its exploration assets in Nigeria, which were concluded last year for a total consideration of R36m.

Sasol wrote down the unit’s value by R1.97bn ($215m) for the six months to December.

The company spent R14.4bn on capital investments in the first six months of its fiscal year, according to company filings.

Cash from operating activities decreased to R21.4bn in the half year from R22.7bn a year earlier.

"Sasol is in the process of running many megaprojects, especially in the US, where the expected cost and implementation thereof remain uncertain," Absa Asset Management Private Clients portfolio manager Jacques Theron said.

Sasol also reported that its projects in the US had progressed to the front-end engineering and design phase. The rapid growth in the gas market in the region presented exciting opportunities for Sasol’s gas-to-liquids projects, which CEO David Constable said supported its aspirations in the US.

Sasol had earlier reported a 2% rise in headline earnings per share to R24.01 for the six months ended December, from R23.50 a year ago. Diluted headline earnings per share edges up to R23.89 from R23.34.

Turnover rose to R85.44bn from R83.03bn, while operating profit fell to R18.93bn from R20.48bn.

Operating profit was up by 9%, excluding the effect of one-off charges amounting to R3.6bn relating to the partial impairments of Arya Sasol Polymer Company.

Sasol Synfuels delivered production for the period of 3.7-million tons. It said the overall production rate of Synfuels continued to improve, after a significant rise in the second half of the 2012 financial year. [Bloomberg]
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