No quick fix in the Gulf for Sasol/Qatar Petroleum Oryx GTL plant
After safety, Sasol is giving its Qatari Oryx gas-to-liquids plant highest priority within the group.
Author: Barry Sergeant
Posted: Thursday , 26 Jul 2007
mineweb.net
JOHANNESBURG -
Sasol (SOL.JSE, R269 a share; SSL.NYSE, $38.44), the South African energy and chemicals group with its major coal to liquids (CTL) plant in that country, has confirmed that there is going to be no quick fix to the problems it hit with fine material in the Oryx gas-to-liquids (GTL) plant being built in Qatar. In an investor newsletter published on Thursday, Sasol said it anticipated that the capital impact of the "symptom treatment" would be small compared to the overall capital cost of the facility.
Sasol confirmed that implementing its back-up solution is expected to take until the middle of 2008. This would delay the full commissioning of the $950m Oryx joint venture (JV) project until much the same time. The plant has been producing on a restricted basis for the past four months, and shipped first product to the market in April.
At full production Oryx is set to produce around 34,000 barrels a day of natural fuels, mainly an ultra-pure diesel, as clear as water. The world has been watching progress at Oryx as it moves to full production, with Oryx seen as a global prototype of big-scale GTL in action. There are plans to expand the initial nameplate capacity of the Oryx plant to as much as 100,000 barrels of liquids a day, and yet further plans to construct an integrated GTL plant with stand alone capacity of 130,000 barrels of liquids a day.
Oryx was ceremonially opened on June 7 last year, in Ras Laffan Industrial City. The Oryx JV, in which Qatar Petroleum owns 51% and Sasol 49%, was then expected to build up to full production in 12 months or so.
Oryx, the largest GTL plant in the world, has been hit by a succession of teething problems, of which production of fines material is the latest. On Thursday Sasol said that events at Oryx were not expected to have any impact on Sasol rolling out its GTL and CTL (coal-to-liquid) technology. It said that while its intention is to achieve full capacity at Oryx as quickly and safely as possible, "our experience is that starting up technically complex and first-of-kind facilities takes time and is inherently problematic".
Sasol reminded that over the past 50-plus years its has successfully developed, implemented and operated several generations of large-scale synthetic fuel plants. Based on this experience, Sasol was fully confident that the challenges at Oryx would be overcome. Meantime, however, Sasol reminded that "a prolonged ramp-up period can be expected".
Just last week Sasol traded at all time highs, changing hands at $42.73 a share on the New York Stock Exchange. |
