Sasol

Nominated for its national and international lobbying campaign to promote Carbon Capture and Storage (CCS) as a clean solution to the dirty business of producing liquid fuels from coal and gas.

Background

Sasol is a South African company involved in mining, energy, chemicals and synthetic fuels (synfuels). It produces petrol from coal – known as coal to liquids (CTL), which is a dirty business that produces twice as many greenhouse gas emissions as the standard refining of petrol from crude oil.

Given that this is Sasol’s core business, it is not surprising that the company is one of the biggest emitters of carbon dioxide (CO2) on the African continent – Sasol’s Secunda plant in South Africa is the world’s single biggest emitter of CO2. The company knows that climate change could threaten its future and concedes in official documents that international efforts to counter climate change could have a “material adverse effect” on its business and “financial condition”.

In recent years, Sasol has been on a major public relations and lobbying drive to sell CTL technology to the world, using Carbon Capture and Storage (CCS) as the panacea for this dirty product. As Time magazine reported last year: “Imagine the public relations nightmare facing an oil company that uses technology responsible for powering Nazi Germany, that propped up apartheid for decades and that operates a plant with the dubious distinction of being the world's biggest single-point source of carbon dioxide.”

Despite its dirty product, the company’s CEO, Pat Davies told the magazine “We are an innovative company. We can be part of this solution too.”

Lobbying Activities

In order to convince politicians, the public and regulators that Sasol is part of the “solution”, it has embarked on an intensive domestic and international lobbying campaign. Sasol’s lobbying strategy is multi-pronged: it aims to promote the acceptability and use of CTL technology around the world, and create a wider market for its activities. Whilst at the same time it promotes CCS technology as a potential way of reducing emissions from its activities.

At home, the once state-owned company enjoys a close relationship with the government.

It has played an influential role in the development of South Africa’s Long Term Mitigation Scenario, the most recent key government document which sets out plans to reduce greenhouse gas emissions. South Africa has not ruled out future new plants for converting coal to liquid, despite the high levels of emissions generated. Sasol has also promoted CCS through its involvement in policy talks.

Active on the Intergovernmental Panel on Climate Change

As Sasol’s 2008 Sustainable Development Report says: “To advance our appreciation of the causes, Sasol plays a role on the international stage via the UN’s Global Compact and Intergovernmental Panel on Climate Change. In support of CCS solutions, we are on the South African delegation to the multinational Carbon Sequestration Leadership Forum.”

Sasol has also succeeded in having one of its scientists – Fred Goede - sit on the Intergovernmental Panel on Climate Change (IPCC) - the scientific body responsible for identifying the level and nature of the risk posed by climate change. Goede is not only a member of the IPCC, he also wrote a recent IPCC report on CCS – the technology promoted by Sasol.

But as WWF South Africa has pointed out, even if technological advances allow Sasol to reduce the emissions generated by producing synfuels, CCS will not reduce the level of emissions of the vehicles running on the resulting synfuels. Moreover at the present time, CCS remains an unproven commercial technology.

Carbon Sequestration Leadership Forum - Burying the problem internationally

Sasol is an active player in the Carbon Sequestration Leadership Forum (CSLF), an organisation through which it is successfully lobbying for CCS technologies.

In October 2009, the Forum, which comprises 23 governments as well as the European Commission, held its latest meeting in London to promote CCS technology “in an effort to stay ahead of the December climate summit in Copenhagen”.

At the conference, Christine Ramon, the chief financial officer of Sasol was on a panel discussion on “the priority and urgency of actions required for near-term deployment of CCS”. This would then be formulated as recommendations to be delivered to the Ministers attending the Forum.

Sasol got what they wanted. At the end of the Forum, the participating Energy and Environment Ministers from the member nations “endorsed CCS technologies as a key component of international plans to combat climate change.”

$100,000s spent lobbying Washington

Meanwhile in the US, Sasol is keen to expand its business and has been an active player in the Coals to Liquids coalition, lobbying Congress on bills promoting “alternative fuels” and securing support from former President George Bush and Senator Barack Obama prior to his election as President.

A 2008 report by GroundWork South Africa summarised the company’s lobbying effort, saying that Sasol “paid the Livingston Group $320,000 last year to lobby Congress to support building CTL plants in the United States. With congressional members and the White House promising to promote alternative fuels, a number of other alternative-fuel companies have joined Sasol in hiring firms to lobby for tax breaks and other incentives to ease their entrance into the market dominated by oil companies.”

In 2009, Sasol paid the lobbying consultancy, the Livingston Group a further $220,000 for lobbying purposes. Through the Livingston Group, Sasol has also sought support from the US military for coal to liquids fuel. With concerns about energy security high on the US agenda, and easy access to large supplies of coal, Sasol has pushed the case for using coal-to-liquid technology to ensure supplies of transport fuel.

Sasol was asked to comment on its nomination for the Angry Mermaid Award but did not respond.