Sasol Lowers Earnings Forecast for Lake Charles Project
2019-08-27    []

Sasol said today that it has reduced its 2020 core earnings target for the Lake Charles Chemical Project (LCCP) and has revised the dates for the start-up of some of the downstream units following technical issues encountered with the steam cracker. Sasol has lowered its EBITDA guidance for LCCP for the 2020 financial year from between $300 to 350 million to $150 to $300 million. Sasol delayed the release of its annual financial results earlier this month due to possible “control weaknesses” at the project.

Sasol also says that a problem relating to a large heat exchanger at the ethane cracker which interrupted the start-up for several days has been resolved and start-up has resumed. “We are currently halfway through achieving our 72 hour beneficial operation production test run on the ethane cracker,” the company says.

It adds, however, that on 24 August 2019, it produced ethylene at the LCCP that meets the feedstock requirements of some of its downstream units, but the ethylene produced is marginally below polymer grade specification due to the acetylene reactor system that is not performing as expected. Efforts to upgrade ethylene to polymer grade specification are underway with the support of the catalyst supplier and the technology licensor. The cracker is currently operating at about 50% utilization rate.

The company today gave an update for the start-up of the downstream units within LCCP. It says the beneficial operation of its low- density polyethylene unit has been delayed from mid-October to November, its ethoxylates unit from December 2019 to January 2020 and the guerbet unit from February 2020 to March 2020.



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