South Africa

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South Africa
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South African Companyfounded in 1950.

• World leader in commercial production of liquid
  fuels from coal crude oil.
  
• Manufactures over 200 fuel products.
• Exports to over 90 countries.
• Develops proprietary technologies for producing
  environmentally sound fuels.

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Awards Financial Reporting

• 2006-November Ernst Young Excellence in
  Sustainability Reporting
  
• 2004 2005 Ernst Young Excellence in
  Corporate Reporting
  
• 2003, 2005 2006 Best Chairmans Statement by
  Investment Analysts Society
  
• 2005 2006 Ranked 15 of 1300 in audit of Annual
  Reports by London-based Audit firm.

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Awards Financial Reporting

• Sasol dealt with all the issues relevant to
  their core business, communicating clearly to
  stakeholders in user-friendly, well structured
  report. The overall quality and usefulness of
  reports was high and the social, economic
  environmental impacts were clearly
  articulated. Jayne Mammatt of Ernst Young
• Much remains to be done to continuously improve
  our performance and image as a responsible
  corporate citizen. It is only by being
  transparent and responsive to our stakeholders
  interests that we will secure and maintain their
  trust. Pat Davies, CE of Sasol

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Sustainability Stewardship

• Sasol is committed to sustainable development as
  defined by the World Commission on Environment
  and Development.

• We aim to meet the needs of todays generation
  without compromising the ability of future
  generations to do the same.
  
• Our operations are conducted with sensitivity
  towards the economic, social and environmental
  needs of stakeholders. The business is a healthy
  mix of financial prosperity, balanced with
  environmental stewardship and social
  responsibility.

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Research DevelopmentSasols Hallmark

• Fischer-Tropsch process patented in 1957.
• Large, sustainable, commercial conversion of coal
  into liquid fuels and chemicals.
  
• Sasols GTL diesels have been proven to be the
  cleanest-burning diesels on market in Europe and
  the USA.
  
• Sasol GTL diesel is high-quality low emission.
• Virtually sulphur free (less than 50 ppm)
• High octane (70)
• Low aromatics (
• Use in existing proposed engines.

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Qatar
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Qatarthe native pronunciation falls between
cutter and gutter, but not like guitar
Ruled by the al-Thani family since the mid-1800s,
Qatar transformed itself from a poor British
protectorate noted mainly for pearling into an
independent state with significant

• oil and natural gas revenues. During the late
  1980s and early 1990s, the Qatari economy was
  crippled by a continuous siphoning off of
  petroleum revenues by the amir, who had ruled the
  country since 1972. His son, the current Amir
  HAMAD bin Khalifa al-Thani, overthrew him in a
  bloodless coup in 1995. In 2001, Qatar resolved
  its longstanding border disputes with both
  Bahrain and Saudi Arabia. Oil and natural gas
  revenues enable Qatar to have one of the highest
  per capita incomes in the world.

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Gas to Liquid GTL Diesel

• 1999 Sasol and Chevron form Sasol Chevron to
  pursue Gas to Liquids (GTL)
  
• 2001 Qatar Petroleum and Sasol sign joint venture
  for GLT Plant in Qatar called ORYX GTL
  
• 2002 GTL plant in Nigeria
• 2004 Sasol Chevron and Qatar Petroleum GTL
  project receives 6 Billion project plan
  
• 2005 Production at Qatar plant jumps from 34,000
  to 100,000 barrels per day

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Sasol
5 year graph of Sasol compared to SP 500
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Sasol
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Sasol
Reasons for Stock Price Fluctuation

• Stock prices have fallen since June 06 when crude
  oil was at record highs of 60/barrel.
  
• First delivery of clean-burning diesel from Oryx
  GTL plant in Qatar in December 2006. First
  tanker-full is sold.

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Sasol
Recent Stock History (Yahoo Finance)
Beta 1.77 52-Week Change3 -6.48 SP50
0 52-Week Change3 10.71 52-Week High (11-May-06
)3 46.31 52-Week Low (25-Sep-06)3 29.54 50-Day
Moving Average3 33.58 200-Day Moving Average3
35.95
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Sasol
Dividends (Yahoo Finance) No Stock Splits

• Forward Annual Dividend Rate5 1.13
• Forward Annual Dividend Yield5 3.40
• Trailing Annual Dividend Rate3 1.04
• Trailing Annual Dividend Yield3 3.10
• 5 Year Average Dividend Yield5 3.80
• Dividend Date3 26-Oct-06

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Sasol
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SWOT Analysis

• Strengths
• PEG .5, environmentally friendly fuels, patent
  on GTL technology.
  
• Weakness
• -Oil prices, refining margins, chemical prices,
  and rand/dollar exchange rate
  
• Opportunities
• -Expanding business within company segments.
  Sasol Mining, Sasol Synthfuels, Sasol Oils, Sasol
  Gas, Sasol Petroleum International, and Sasol
  Synfuels International
• Threats
• -Competitors, Monsanto Exxon Mobil
• -Unexpected drop in Oil prices, and
  strengthening of Rand.

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Sasol
Crude Oil Prices

• Price of crude oil on New York Mercantile
  Exchange (NYMEX) was under 25/barrel in
  September 2003
  
• By August 11, 2005 it had risen to over
  60/barrel and tapped out at a record price of
  78.40/barrel on July 13, 2006
  
• Seasonal differencesdifference in demand
• Volatile!

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Sasol
Supply of Crude Oil and Causes for Decrease

• Decrease in supply (Iraq, Iran, Saudi Arabia)
• These are short term
• Even if not reducedsweet crude oil almost
  exhausted and more expensive sources of fuel will
  be needed, especially alternatives
  
• Causes Peak Oil? (Hubberts peak oil theory)
• Third Worlds demand more
• Easy wells tapped, new drilling is expensive

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Sasol
Speculators True Price Drivers

• See a long term increase in demand, decrease in
  supply, or both. (www.wikipedia.com)
  
• Price Bubble?
• Speculators view of the oil market, (hurricanes,
  supply of oil, etc.) drive the market up or down
  
• Argument Sasol and Oil stock (Chevron) seem to
  be positively correlated for demand for energy.
  Although Sasol is much less expensive than oil
  stock, and demand has a strong urge to rise for
  alternative fuel in the future

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Sasol
Recommendations of Vanguard Emerging Markets ETF
Fund Investors who are

• Seeking to diversify from US securities
• Seeking Long term Capital Growth
• Long-term (5-year) investment horizon
• Willing to accept share price fluctuations

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