Sasol declares force majeure on exports as flood fallout takes its toll

Sasol has declared force majeure on the export of certain chemical products following the heavy rainfall and floods in KwaZulu-Natal.

The petro-chemicals producer said on Monday it is assessing the effect of the floods on its business.

Force majeure refers to unforeseeable circumstances and it frees contracting parties from liability or obligation when an extraordinary event occurs. 

Sasol warned that its quarterly volume outlook could also be affected by the floods, but this is subject to the extent of infrastructure damage and the timing of the recovery and restoration of key infrastructure and utilities. 

Operations were suspended at the Port of Durban after the deadly floods but have slowly restarted, Public Enterprises Minister Pravin Gordhan said last week

More than 448 people died in KwaZulu-Natal and about 40 000 people were displaced as a result of the heavy rains and flooding. 

Last week, Sasol donated R7.5-million to support emergency relief efforts in the province. 

Several of its employees in KwaZulu-Natal have suffered bereavements and damage to property. 

On Monday, Sasol released a production update for the nine months ended in March, in which it said its financial performance for the period was underpinned by a favourable macroeconomic environment, with a higher crude oil price, refining margins and chemicals prices against a backdrop of heightened geopolitical tensions. 

But Sasol said the outlook is not so bright because of Russia’s war in Ukraine and resulting energy price volatility, rising inflation and the Covid-19 lockdowns in China, which pose a risk to sales volumes and margins during the last quarter. 

Anathi Madubela is an Adamela Trust business reporter at the M&G.

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Anathi Madubela
Anathi Madubela is a business journalist with a keen interest in the retail sector.

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