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To: Dennis Roth who wrote (864)	5/23/2007 10:10:11 AM
From: Dennis Roth	Respond to of 1740

Sasol’s woes could ‘tarnish reputation as global leader’ Mathabo le Roux Trade and Industry Correspondent Posted to the web on: 23 May 2007 businessday.co.za SASOL shares fell more than 5% yesterday after the petrochemical group said its flagship gas-to-liquids technology Oryx plant was not performing optimally due to operational problems. Now an analyst has warned that the hiccups could point to grave problems with Sasol’s technology. If so, the group’s reputation as a developer of alternative energy sources could be tarnished. Sasol, in a cautiously worded statement to the JSE’s news service, said the output of its Oryx gas-to-liquids plant in Qatar, which has been operational for more than three months, was lower than planned, with increased production inhibited by the higher than expected output of fine material resulting from the break-up of the catalyst. The fine material then had to be handled downstream. The fine material was constraining the overall throughput of the downstream units, the company said. A Bloomberg report quoted Sasol GM Lean Strauss as saying the plant was operating at a third of its capacity of 34000 barrels per day (bpd) and that the group would likely need to spend tens of millions of dollars to install new equipment. Trying to brush off concerns about deeper problems, the Sasol statement said the challenges were limited to individual items of equipment and while the problems would prolong the ramp-up period, the group was “fully confident that the challenges will be overcome”. But analysts are sceptical about Sasol’s optimism and the market gave the group a clear no-confidence vote with shares losing R15 in their biggest one-day drop in eight months, to close at R261,01, from a high of R276 at the start of trade yesterday. Vunani Securities analyst Campbell Parry said the prognosis could be more serious than Sasol was suggesting. “The problems in Qatar go further than a fairly marginal financial impact. “Although management did not actually admit it, we believe catalyst hydration — leading to break-up — may be the cause. This is a serious problem for which there is no meaningful solution beyond running the plant at lower rates, shutting down frequently and literally digging the clogged filters out,” he said. PetroSA experienced the same problems with its 11000bpd gas-to-liquids plant in Mossel Bay. It took the state company two years to reconstruct the catalyst chemistry to prevent such hydration and break-up. Parry expected the Oryx plant to run at 30% of capacity until 2009. While the financial impact on the firm would not be that significant, he said Sasol’s entire reputation in gas-to-liquids could be at stake in a worst-case scenario. Sasol is hailed globally as a leader in the field of developing alternative liquid energy from coal and gas. However, the delays with Oryx, its first attempt at rolling out the technology commercially, would give competitors time to catch up. It could invalidate Sasol’s pre-eminent position in the gas-to-liquids world. “If its reputation is tarnished, it could have severe implications,” said Parry.

To: Dennis Roth who wrote (864)	5/23/2007 10:13:15 AM
From: Dennis Roth	Read Replies (2) \| Respond to of 1740

The Bottom Line: Qatar hiccup puts Sasol investors on their guard Posted to the web on: 23 May 2007 businessday.co.za IN SASOL’s worst single day since the national treasury mooted the prospect of a windfall tax a year ago, the company’s shares plummeted 5,9% on the JSE yesterday, wiping R9,5bn off its total market value. The inspiration for the bloodletting was a carefully worded warning from Sasol that suggested all was not quite what it should have been in its landmark gas-to-liquids plant in Qatar. This came after Sasol warned that its expected output from its Oryx gas-to-liquids plant in Qatar was “lower than expected” during the first quarter. This is another disappointment in Qatar, following the original delays in getting production going at the plant last year. Despite the roaring oil price — which touched $70 a barrel on Monday — Sasol’s shares fell from R276,10 to R261 on the JSE. This means that the recent upward march of Sasol’s share price, from about R220 in March to the R276 level, has been halted, and it suggests a note of caution for investors. As you would expect, Sasol sought to limit the damage yesterday, explaining that these were run-of-the-mill “start-up operational challenges, most of these limited to individual pieces of equipment”. But Sasol said it was looking to “eliminate” or remedy the biggest problem “over the coming months” — and the question is, how much larger are these problems than initially expected? For some time, cynics have been questioning whether the Sasol story of gas-to-liquids and coal-to-liquid has been overhyped, and whether it is all a lot more difficult than initially thought. For the cynics, yesterday’s announcement will come as some sort of vindication, and keep alive the questions over the sustainability of Sasol’s long-term plans. Whether this hiccup is any indicator of future trends remains to be seen, but it is notable that while not a unanimous recommendation, Sasol is still rated as a “buy” from most of the analysts who cover the stock. But what is certain is that after yesterday’s warning, investors will have their eyes keenly peeled for any further signs that the Sasol story isn’t quite as sweet as they had initially believed. Viwe Tlaleane edits The Bottom Line. E-mail to: bottomline@ bdfm.co.za

To: Dennis Roth who wrote (864)	5/25/2007 8:07:14 AM
From: Dennis Roth	Read Replies (11) \| Respond to of 1740

Oryx plant problems bedevil Sasol May 24, 2007 busrep.co.za By Justin Brown Johannesburg - The cause of technical problems bedevilling Sasol's first gas-to-liquids (GTL) plant in Qatar had baffled Sasol's scientists, admitted chief executive Pat Davies. "We thought by now that we would have resolved this issue," Davies said this week. "It is taking longer to find the root cause and we don't know what the problem is," he said in a teleconference to investment analysts. The group is planning to install extra equipment as a back-up solution for increasing plant throughput. Lean Strauss, a Sasol executive who overseas the group's synthetic fuel efforts, said the extra equipment, which would cost tens of millions of dollars, would be implemented from the middle of next year. "The equipment will address the symptoms [of the problems]," he said. Sasol is building a second GTL plant in Nigeria and is looking at the viability of a similar venture in Australia. The group is considering building two coal-to-liquids (CTL) plants in China at a total cost of $14 billion (R98 billion), and is investigating in CTL opportunities in India and the US. Davies said the difficulties in Qatar would not compromise Sasol's other projects. The key challenges were using the right catalysts at the Oryx facility and ensuring that Sasol's version of the Fischer-Tropsch (FT) process that was used at the Oryx plant was working, he added. Oryx is Sasol's first step in the internationalisation of its FT process, which converts gas and coal into fuel. The catalytic part of the conversion had generated too high a level of impurities. Sasol was confident it would resolve the difficulties at Oryx within a reasonable time frame, as it could draw on 50 years of experience with CTL in South Africa, Davies said. The company also had significant problems with its first CTL plant in South Africa, he added. The first plant was built at Sasolburg in the Free State in the 1950s. Sasol was started by the apartheid government and used technology developed by the Nazis. The Oryx refinery will generate a marginally positive cash flow. However, analysts suggested that, including depreciation, the plant would generate an operating loss. Oryx was still on course to ramp up to full production within 12 to 24 months following the start of commissioning in late March - after a 15-month delay, Davies added. The plan is for the Oryx plant to produce 34 000 barrels of fuel and other product a day. Strauss said that as long as Oryx's problems persisted, the development of the plant would be "constrained". Davies said daily production from Oryx for the year to June would be less than 7 000 barrels a day. Strauss said Oryx's operating expenditure per barrel, excluding gas, was not expected to be more than between $7 and $10 a barrel. These costs are a fraction of the oil price. Late yesterday the spot price of Brent crude was quoted at $70.45 a barrel, close to a nine-month high and within striking distance of the record high of $78 a barrel reached last July. The Oryx project remained "very robust", Strauss said. On Tuesday, Sasol's shares on the JSE shed 6 percent to an intraday low of R260.02. Yesterday the stock gained just less than 1 percent to close at R263.

To: Dennis Roth who wrote (864)	11/10/2007 3:47:10 AM
From: Dennis Roth	Respond to of 1740

Qatar Min: Oryx GTL To Produce 27,000 B/D By End '07 -Report Dow Jones - November 8, 2007 5:04AM EST LONDON (Dow Jones)--Production at the Oryx gas-to-liquids plant in Qatar should reach 27,000 barrels a day by the end of 2007, Qatar's Minister of Energy Abdullah al-Attiyah said in an interview in World Gas Intelligence Thursday. "Now they will start to run both trains at the same time for the first time," he said in an interview at last week's Oil and Money conference in London. Oryx is a joint venture between South Africa's Sasol Ltd . (SSL) and state-owned Qatar Petroleum. The plant was supposed to be producing at 34,000 barrels a day, but problems with catalysts at the plant have delayed the ramp up for production after the startup earlier this year. "Sasol is doing a good job, and I think Sasol will solve all the catalyst problems," al-Attiyah said. He also said Royal Dutch Shell PLC's (RDSB.LN) 140,000 barrels a day gas-to-liquids project, called Pearl, is on schedule for startup in 2009. News service Web site: energyintel.com -London Bureau, Dow Jones Newswires; +44 (0)20 7842 9317; james.herron@dowjones.com (END) Dow Jones Newswires 11-08-07 0503ET Copyright (c) 2007 Dow Jones & Company, Inc.