Natural Gas Assets

At the beginning of 2011, Sasol purchased a $2 billion, 50 per cent working interest in Talisman Energy’s natural gas assets in one of the most prolific shale gas plays in North America: the Montney shale basin located in northeast British Columbia. The assets include 112,000 total net acres of land in the Montney basin with approximately 20 trillion cubic feet of  resource.

In November 2013, natural gas exploration and production company Progress Energy made an offer to acquire Talisman’s interest in the partnership. In March 2014, Industry Canada approved the sale, making Progress Sasol’s partner and the principal operator of the assets

The partnership will allow for the development of the Farrell Creek and Cypress A assets within the Montney formation and involves a spending commitment of at least $1.1 billion during the development period from 2015-2024, subject to the economic viability of the play.

Regardless of Sasol’s plans to build a gas-to-liquids facility in Louisiana and eventually a second facility in Alberta, Sasol’s investment in the Montney shale is of strategic importance to the company. The Montney offers a large asset base with long-life production. The field is also located with access to the B.C. west coast where liquefied natural gas (LNG) terminals are in various stages of development. Between Sasol’s own GTL technology and the potential for exporting gas through LNG terminals, the long-term markets for Montney gas production are promising.

Responsible operations

Progress Energy is the operator of the Montney natural gas assets.

The practice of fracking is strictly regulated by the Canadian authorities and Progress has a solid record of complying with all the required regulations and procedures. Sasol supports Progress Energy’s responsible environmental stewardship practices.

Progress Energy employs technological advances and industry best practices to ensure the most efficient water use. Progress Energy safeguards the quality and quantity of regional surface and groundwater resources through sound wellbore construction practices, by sourcing alternatives to fresh water as appropriate, and recycling water as much as practical.

Progress Energy also discloses publicly all the fluids it uses for hydraulic fracturing in every well. That information is available here.

Sasol is a Global Producer

In addition to Sasol’s Canadian natural gas interests, the company explores, appraises, develops and produces several natural gas and oil assets around the world.

  • Mozambique – Sasol operates a central processing facility that currently produces approximately 300 million cubic feet of natural gas per day. Sasol also has exploration interests in two offshore licenses as well as one onshore license in Mozambique.
  • Gabon – Sasol has a 27.75% interest in the Etame Marin permit, which produces about 20,000 barrels of sweet crude oil per day.
  • Nigeria – Sasol holds an interest in two exploration licences and participated in the drilling of two exploration wells in the non-operated block OPL214. This yielded two minor oil and gas discoveries, which may be tied in to the main Uge field development.
  • Australia – Sasol and its partners Shell and Finder Exploration are completing prospect maturation studies to enable drilling in the AC/P 52 licence in the Browse Basin offshore Western Australia.
  • Botswana – Sasol has a joint-venture agreement with Origin Energy of Australia to explore for coal-bed methane. The joint venture, Kubu Energy Resources, acquired three prospecting licences covering an area of 2 970 km2 in the Central Province. Sasol is planning a number of exploration activities over the next two years to determine the quantity of natural gas available and the feasibility of commercial development.
  • South Africa – Sasol has signed an Exploration Right permit with the Petroleum Agency South Africa (PASA) to explore for hydrocarbons on Durban and Zululand basins, offshore Kwazulu-Natal province in an area covering 83 000 km2.

Other Canadian Opportunities

North America has been identified as a core focus area for Sasol. We continue to target and evaluate new natural gas prospects as well as value-added downstream opportunities.