Integrated energy and chemical company Sasol announced its plans to look beyond the near-term measures and position its business for sustained profitability in a low oil price environment.
As such, the Group’s new strategy is to focus on core portfolios of chemicals and energy. This decision is part of Sasol’s response to address the impacts of the oil price volatility and the COVID-19 pandemic.
“A focused and robust review of the business, and the associated workforce structures, is underway and a detailed update will be provided to stakeholders alongside the full-year results,” the company said in a statement.
A key decision as a result of this includes the discontinuation of all oil growth activities in West Africa.
“The reset of the strategy necessitates a revised operating model, which is still under development and will be announced in the second quarter of the financial year 2021,” read part of the statement.
Future business model affects workforce structure
Sasol explained that revision of the Group’s strategy aims to have a greater focus on enhanced cash generation, value realisation for shareholders and business sustainability.
While the chemicals business will focus on its activities in speciality chemicals, where it has differentiated capabilities and strong market positions which can be expanded over time.
The energy business will comprise the Southern African value chain and associated assets and will pursue greenhouse gas emission reduction (GHG) through a focus on gas as a key feedstock and renewables as a secondary energy source.
This will be a key enabler to achieve the 2030 and longer-term aspirations to shift to a lower-carbon economy.
In conclusion, Sasol revealed that: “The redesign of the organisation to enable our sustainability at lower oil prices will have an impact on our workforce structure. We have accordingly issued a notice to our representative trade unions in South Africa in terms of section 189 of the Labour Relations Act number 66 of 1995, inviting them to enter into consultation with Sasol. A similar process will be followed with the relevant recognised bodies in our other jurisdictions.”