15-12-05 Sasol, whose first international gas-to-liquid (GTL) plant would be commissioned in Qatar next year, was actively seeking markets in Europe to sell GTL diesel, the petrochemicals group said.
Synthetic diesel extracted from gas has lower levels of sulphur than diesel produced from crude oil, and is thus attractive to regions such as Europe, which have strict fuel and emissions laws.

Sasol's Qatari project, known as Oryx, will produce 34,000 bpd when it comes on stream next year. Sasol, which has a GTL joint venture with US oil multinational Chevron, said this year it planned to have 540,000 bpd of GTL capacity by 2014.
Although Chevron does not have an equity stake in Oryx, GTL diesel and GTL naphtha produced at the plant will be branded directly by Sasol Chevron.

Mark Schnell, the general manager of global marketing of Sasol Chevron, said that Europe was probably "the most fertile market" for GTL diesel.
Sasol Chevron was engaged in commercial discussions with major refiners and marketers in the region, Schnell said. It would establish term contracts for most of the initial volumes of GTL diesel, which would be integrated as blend stock into refinery operations -- either by blending into the final product or by feeding into the refining process upstream.

He said they were looking for longer-term relationships with companies.
"This offers a degree of security of supply that will be important, particularly, for example, where a customer chooses to reformulate a premium diesel product around GTL diesel. There may be some spot business, but this would be the exception rather than the rule," Schnell said.

Figures cited by Sasol showed that diesel-fuelled cars accounted for less than 15 % of sales of new passenger cars in Western Europe in 1990. The figure exceeded 50 % by this year. Similar trends were starting to occur in other major fuel consuming regions outside of the US, Sasol said. The company listed Australia, South Africa and South America as examples.
Sasol's GTL diesel contains sulphur of less than 5 parts per mm. In terms of South Africa's switch to cleaner fuels in January, sulphur content in diesel sold locally must be reduced from 3,000 parts per mm (ppm) to 500 ppm. Diesel with 50 ppm will become available for the first time.

On the development of naphtha markets, Sasol said Japan and South Korea were "obvious homes" but there were other potential markets in Asia-Pacific.
"Certainly, Oryx GTL naphtha is most likely to move eastwards rather than westwards."
Sasol hoped to sell naphtha to a few potential customers on a trial basis, thereafter offering a term arrangement where it saw the best value.
In other matters, Sasol said it expected the competition tribunal to make a decision in January on the proposed merger of its liquid fuel business with Engen.