Sasol Divests Mozambican Gas-to-Power Plant

South African state oil company Sasol has struck a deal to sell its 49% stake in Central Termica de Ressano Garcia, Mozambique's first permanent large-scale gas-fired power plant, it announced on December 21.

The 175-MW power station in Ressano Garcia is set to be bought by Azura Power for $175mn, pending regulatory approval and other conditions being met, Sasol said. State-owned Electricidade de Mocambique (EDM) must first waive its pre-emptive rights to the stake. 

Sasol is struggling with high levels of debt as a result of lower oil and chemicals prices, made worse by delays and cost overruns at its Lake Charles Chemicals Project in the US. Its total debt came to rand 189.7bn ($12.8bn) at the end of June, versus rand 130.9bn a year earlier.

The company is looking to shore up its financial position with billions of dollars of divestments. It closed the sale of a 50% stake in three plants at its Louisiana petrochemicals complex to LyondellBasell in early December. The company also agreed on the sale of a minority share in a gas-to-liquids plant in Nigeria to Chevron in July, and is seeking buyers for its 50% position at a pipeline that supplies South Africa with gas from Mozambique.