Sasol has welcomed recent policy announcements that bolster South Africa's transition to a low-carbon economy while enhancing economic growth and socio-economic development. A significant step forward is the agreement between the European Union (EU) and the South African government to initiate talks on establishing a 'Clean Trade and Investment Partnership.' This partnership aims to advance South Africa's energy transition by supporting sustainable aviation fuel development at Sasol's Secunda Operations, with the EU as a key export market.

This collaboration underscores the immense potential of Sasol’s South African assets to deliver sustainable energy and chemical products worldwide. The joint declaration emphasizes the urgency of advancing this partnership, stating: “This partnership must deliver short- and long-term solutions without delay to enable Sasol to export sustainable fuel, particularly aviation fuel, to the EU. This includes addressing compliance and regulatory issues. The EU further commits to supporting Sasol’s long-term decarbonisation efforts, especially at Secunda, thereby contributing to a Just Energy Transition.”

Sasol has also expressed optimism regarding South Africa's 2025 Budget Review, published by National Treasury on 12 March 2025. The budget outlines promising policy changes, particularly regarding the carbon tax framework, which aligns with South Africa's broader energy transition objectives. While these updates are subject to parliamentary approval, the adjustments indicate positive momentum for sustainable growth.

Key highlights of the carbon tax revisions include:

• Retaining the basic tax-free allowance at 60% until at least 2030. This change deviates from the previously planned annual reductions starting in 2026 outlined in the Phase 2 Carbon Tax discussion paper.
• Increasing the allowance for carbon offsets.
• Extending energy efficiency incentives under the 12L rebate until 2030.

Maintaining the basic tax-free allowance for hard-to-abate sectors offers crucial flexibility for businesses to invest in their energy transition efforts. The expanded credit for carbon offsets is also seen as a vital step to foster growth in this emerging market within South Africa. Together, these policy measures are designed to stimulate substantial investments in South Africa’s energy transition, ultimately strengthening energy security, economic growth, and job creation.

“While we continue advancing our strategic goals, I am encouraged by these recent policy developments from the South African government and the EU,” said Simon Baloyi, President and CEO of Sasol. “This progress highlights the strong relationship between the two regions and represents a significant milestone in securing South Africa's sustainable, low-carbon energy future. With Sasol’s Secunda Operations playing a pivotal role, the transition must align with market demands and technical feasibility.”