Johannesburg, South Africa – The unprecedented set of combined challenges driven by COVID-19 and the significant decline in the oil price have come at a time when Sasol is in a peak gearing phase as the Company completes LCCP. 

Sasol is confident that its foundation business is capable of positive cash flow from operations in a low oil price environment. At the prevailing Rand oil price of approximately R580/bbl, Sasol will be within the current covenant levels at 30 June 2020. In anticipation of a lower-for-longer Rand per barrel oil price, a comprehensive package of actions is being finalised to deliver this and sustainably strengthen the balance sheet. It is important to note the current liquidity position: 

• Sasol has current cash and available facilities of approximately US$2,5bn; and
• Sasol has no significant debt maturities before May 2021.

Sasol is prioritising the following actions, details of which will be announced to the market on Tuesday:

• Business optimisation to reduce costs;  
• Working capital optimisation;
• Re-scheduling some capital expenditure; 
• Expanding the scope of, and accelerating, the asset disposal programme to realise proceeds in excess of the current US$2 billion target; 
• Engaging our lending groups. Thus far, engagements have been constructive; and
• Assessing alternatives to manage Sasol’s near-term debt covenant constraints, including a potential equity issue.

Sasol will update the market on the conference call at 15:00 SA on Tuesday, 17 March, with detail on the comprehensive package of actions. 

Shareholders are accordingly advised to exercise caution when dealing in the Company’s securities until a further announcement is made.

Fleetwood Grobler commented “The disruption in the global oil market, coupled with the ongoing impact of COVID-19 has significantly changed the outlook in just a few weeks. It is critical that we keep matters within our control by acting quickly and decisively so that stakeholders don’t lose sight of the significant underlying value in this business. We are therefore working towards a package of measures to ensure that the business is profitable even at low oil prices and that we continue to have a strong balance sheet to support it.” 

If you have any questions, please email: investor.relations@sasol.com or contact Feroza Syed at +27 10 344 9280.