Sasol Confirms Continued Disruption at Key South African Refinery

Sasol Ltd confirmed Tuesday the unplanned shutdown of a Natref unit in mid-August, which coincided with the planned shutdown of another unit, would continue to reduce supply from South Africa's only active inland traditional refinery.

"Natref has implemented measures to ensure the affected unit remains operational until end-September, improve refinery continuity and support more stable jet fuel supply availability to the market", Sasol said in an online statement. "This provides additional flexibility to continue supplying jet fuel to key customers, including customers at OR Tambo International Airport.

"Sasol is working with key industry stakeholders to ensure continuity of product supply to customers".

In a report Friday the South African Government News Agency said the unplanned shutdown had been caused by a "steam boiler failure, which damaged key refinery units".

Natref, commissioned 1971 in Sasolburg, is South Africa's only inland crude oil refinery, according to Sasol. It has a declared capacity of 108,500 barrels per day.

Sasol has temporarily gained additional capacity from its co-venturer, according to a Sasol statement October 23, 2025. Its co-venturer, Prax Group, is completing a rescue plan after entering administration in the United Kingdom in 2025.

Sasol said in its financial report published separately on Tuesday that Natref production rose eight percent quarter-on-quarter to 7.7 million barrels in the three months ended June, "supported by the mitigating actions to ensure uninterrupted crude oil purchases".

"FY26 [12 months to June 2026] production was 76 percent higher [at 25.8 million barrels] than the prior year, benefiting from improved operational reliability and Sasol's utilization of Prax SA's shareholding capacity during the ongoing business rescue process", Sasol added.

Fuel sales from across Sasol's portfolio including the Secunda coal-to-liquids refinery totaled 14.3 million barrels in FY 2026 Q4, down seven percent sequentially. Annual fuel sales increased 13 percent to 57.5 million barrels.

"Sales were supported by increased production from both SO [Secunda Operations] and Natref and increased demand in the higher margin Mobility and Commercial channels together with increased spot sales in the Wholesale channel", Sasol said.

"External purchases decreased by 42 percent compared to the previous quarter, as Q3 FY26 included Sasol's purchase and resale of Prax SA inventories at Natref as part of the agreed Prax SA business rescue process. FY26 external purchases were 51 percent lower than the prior year due to stronger production performance at both SO and Natref".

Sasol, whose production also includes natural gas and chemicals, reported ZAR 61 billion (around $3.78 billion) in adjusted earnings before interest, tax, depreciation and amortization for the financial year, up 17 percent from the prior financial year. It attributed the increase to "a four percent increase in sales volumes associated with improved production, a seven percent increase in the average U.S. dollar per barrel Brent crude oil price and a more than 100 percent increase in refining margins following improved fuel differentials".

"These benefits were partially offset by a seven percent stronger average rand-to-U.S.-dollar exchange rate and the non-recurrence of the ZAR 5.5 billion Transnet SOC Ltd settlement received in the prior year", Sasol added.

Annual earnings before interest and tax rose 37 percent to ZAR 25.7 billion. "The result included non-cash remeasurement items, comprising impairments of ZAR 16.8 billion compared with ZAR 20.7 billion in the prior year, as well as unrealized losses of ZAR 1.1 billion relating to the translation of monetary assets and liabilities and the valuation of financial instruments and derivative contracts".

Basic earnings per share increased 79 percent to ZAR 18.99 for FY2026.

Operations generated ZAR 56.7 billion in cash for FY2026. Free cash flow fell five percent to ZAR 11.9 billion. "Excluding the prior-year Transnet SOC Ltd net cash settlement after tax, free cash flow improved by 26 percent", Sasol said.

Net debt declined 11 percent year-on-year to $3.3 billion. "Liquidity remained strong at $5 billion", Sasol said.

To contact the author, email jov.onsat@rigzone.com