Sasol battens down the hatches

Sasol’s Lake Charles facility in the US. Photo credit: Wikimedia Commons

Sasol battens down the hatches as Hurricane Laura strikes

Plant in Louisiana is closed due to the extreme weather conditions. No flood damage has been reported so far.

Sasol battens down the hatches

Sasol’s Lake Charles facility in the US. Photo credit: Wikimedia Commons

Management at struggling petrochemical giant Sasol is watching with bated breath as Hurricane Laura batters the area around its vital Lake Charles facility in the US.

The expansion project in the state of Louisiana has long been a problem child due to delays, mismanagement and massive cost-overruns. It was also badly hit by heavy rainfall from Tropical Storm Harvey in 2017.

Cost overruns in the billions of dollars

Any significant damage due to the current hurricane would surely make it seem like a perennial bad-luck charm for the group.

Approved for expansion in 2014 at an estimated cost of $8.1-billion, Lake Charles has encountered various setbacks which have increased the price to $12.9-billion.

Sasol has been forced to review its entire business model as it struggles with high debt levels, falling oil and chemical prices, volatile fuel prices and lower demand for its products due to the pandemic.

No power and all manufacturing halted

In a statement released on Friday, Sasol said Lake Charles is without power and all manufacturing facilities are shut down. Ride-out crews (volunteer skeleton crews) who had sheltered in hurricane-approved buildings at the plant are safe and accounted for.

“There was no flooding on site as a result of the storm surge,” Sasol said. “When it is safe to do so, operations recovery crews will complete an initial assessment of the facility for any damage or remaining hazards.”

Recently the company announced a major restructure of its struggling organisation that will see it split into two core businesses, one focusing on Chemicals and the other on Energy. As part of this process there will be job losses and oil operations in West Africa are to be ended.