Struggling petrochemicals producer Sasol has appointed advisers to sell its stakes in a power plant in Mozambique and a gas pipeline running from the country into South Africa, two sources familiar with the matter told Reuters.
Sasol, the world’s top producer of motor fuel from coal, is trying to shed assets to pay off its debt pile and avoid a rights issue of up to US$2B, but has not previously flagged the Mozambique assets as up for sale.
It has appointed South Africa’s Nedbank to manage the sale of its 50% stake in the Republic of Mozambique Pipeline Company (ROMPCO), the joint venture operating the pipeline that runs 865 kilometres from Mozambique into South Africa, the sources said.
“We do not comment on ongoing commercially sensitive and/or M&A processes and we do not react to market speculation,” a Sasol spokesman wrote in an email.
The sources said the company had also appointed Deloitte to sell its 49% stake in Central Termica de Ressano Garcia (CTRG), Mozambique’s first permanent large-scale gas power plant which, at a capacity of 175 megawatts, meets almost a quarter of the country’s energy demand, according to Sasol’s website.
Mozambique’s state-run National Hydrocarbon Company (ENH) and South Africa’s government-owned Central Energy Fund (CEF) each hold 25% stakes in ROMPCO.
ENH, CEF, and Deloitte did not immediately respond to requests for comment. Nedbank declined to comment.
The other 51% of CTRG is held by Mozambique’s state power utility EDM. EDM could not immediately be reached for comment.
As part of a business revamp, Sasol said last week it would cut jobs and exit West African oil operations.