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Remeasurement items affecting operating profit (Tables) | 12 Months Ended
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Jun. 30, 2021
Remeasurement items affecting operating profit |
Schedule of remeasurement items affecting operating profit | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | 2021 | ​ | 2020 | ​ | 2019 |
for the year ended 30 June |  | Note |  |  | Rm |  | Rm |  | Rm |
Impairment of |  | ​ |  | ​ | 34 200 |  | 112 736 |  | 19 868 | ​
property, plant and equipment |  | 20 |  | ​ | 33 973 |  | 108 575 |  | 19 850 | ​
right of use assets |  | 18 |  | ​ | 35 |  | 3 322 |  | — | ​
other intangible assets |  | ​ |  | ​ | 80 |  | 839 |  | 11 | ​
equity accounted investment | ​ | ​ | ​ | ​ | 112 | ​ | — | ​ | — | ​
other assets |  | ​ |  | ​ | — |  | — |  | 7 | ​
Reversal of impairment of |  | ​ |  | ​ | (5 468) |  | — |  | (949) | ​
property, plant and equipment |  | 20 |  | ​ | (5 440) |  | — |  | (949) | ​
right of use assets | ​ | 18 | ​ | ​ | (2) | ​ | — | ​ | — | ​
other intangible assets | ​ | ​ | ​ | ​ | (26) | ​ | — | ​ | — | ​
(Profit)/loss on |  | 11 |  | ​ | (5 520) |  | (715) |  | 1 109 | ​
disposal of property, plant and equipment |  | ​ |  | ​ | (96) |  | 25 |  | (32) | ​
disposal of other intangible assets |  | ​ |  | ​ | (130) |  | — |  | — | ​
disposal of other assets |  | ​ |  | ​ | 52 |  | 148 |  | — | ​
disposal of businesses |  | ​ |  | ​ | (5 615) |  | (1 684) |  | (267) | ​
disposal and scrapping of property, plant and equipment |  | ​ |  | ​ | 269 |  | 796 |  | 1 408 | ​
Write-off of unsuccessful exploration wells |  | 20 |  | ​ | 6 |  | (43) |  | 34 | ​
Remeasurement items per income statement |  | ​ |  | ​ | 23 218 |  | 111 978 |  | 20 062 | ​
Tax effect |  | ​ |  | ​ | (7 771) |  | (26 399) |  | (4 409) | ​
Non-controlling interest effect |  | ​ |  | ​ | 1 |  | (931) |  | (5) | ​
Total remeasurement items for subsidiaries and joint operations, net of tax |  | ​ |  | ​ | 15 448 |  | 84 648 |  | 15 648 | ​
Effect of remeasurement items for equity accounted investments |  | ​ |  | ​ | 23 |  | — |  | 15 | ​
Total remeasurement items for the group, net of tax |  | ​ |  | ​ | 15 471 |  | 84 648 |  | 15 663 | ​
Schedule of main assumptions used for impairment calculations | Main assumptions used for impairment calculations
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | ​ |  | 2021 |  | 2020 |  | 2019
Long-term average crude oil price (Brent) (nominal)* | ​ | US$/bbl | ​ | 70,09 | ​ | 59,69 | ​ | 71,17
Long-term average ethane price (nominal)* |  | US$c/gal |  | 37,18 |  | 32,79 |  | 39,04
Long-term average ammonia price* |  | Rand/ton |  | 5 297,00 |  | 4 664,32 |  | 4 258,54
Long-term average Southern African gas purchase price (real)* |  | US$c/Gj |  | 8,41 |  | 7,10 |  | 4,86
Long-term average refining margin (nominal)* |  | US$/bbl |  | 9,67 |  | 9,43 |  | 10,16
Long-term average exchange rate* |  | Rand/US$ |  | 14,57 |  | 15,20 |  | 14,29
| * | Assumptions are provided on a long-term average basis. Oil and ammonia prices and exchange rate assumptions are calculated based on a five year period, while the ethane price is based on a ten year period. The refining margin is calculated until 2034, linked to the Sasolburg refinery's useful life. The Southern African gas purchase price is calculated until 2050, linked to the South African integrated value chain's useful life.
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | ​ |  | ​ |  | United |  | ​ | ​ | ​
​ | ​ | ​ | ​ | South | ​ | States of | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Africa | ​ | America | ​ | Europe
​ | ​ | ​ | ​ | % | ​ | % | ​ | %
Growth rate — long-term Producer Price Index |  | 2021 |  | 5,50 |  | 2,00 |  | ​ | ​ | 2,00
Weighted average cost of capital* |  | 2021 |  | 14,03 |  | 7,70 |  | 7,70 | – | 9,05
Growth rate — long-term Producer Price Index |  | 2020 |  | 5,50 |  | 2,00 |  | ​ | ​ | 2,00
Weighted average cost of capital* |  | 2020 |  | 14,22 |  | 7,66 |  | 7,66 | – | 9,79
Growth rate — long-term Producer Price Index |  | 2019 |  | 5,50 |  | 2,00 |  | ​ | ​ | 2,00
Weighted average cost of capital* |  | 2019 |  | 13,12 |  | 7,18 |  | 7,18 | – | 9,48
| * | Calculated using spot market factors on 30 June.
Summary of significant impairment/(reversal of impairment) of assets | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Property, | ​ | ​ | ​ | Other | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | plant and | ​ | Right of | ​ | intangible | ​ | ​ | ​ | ​ | ​ | Recoverable
​ | ​ | equipment | ​ | use assets | ​ | assets | ​ | Other | ​ | Total | ​ | amount*
​ | ​ | 2021 | ​ | 2021 | ​ | 2021 | ​ | 2021 | ​ | 2021 | ​ | 2021
Segment and Cash-generating unit (CGU) | ​ | Rm | ​ | Rm | ​ | Rm | ​ | Rm | ​ | Rm | ​ | Rm
Fuels Segment | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Secunda liquid fuels refinery | ​ | 24 456 |  | — |  | — |  | — | ​ | 24 456 | ​ | 23 232
Chemicals Africa segment | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Southern Africa Wax value chain | ​ | 7 863 |  | — |  | — |  | — | ​ | 7 863 | ​ | 2 748
Chlor Alkali and PVC | ​ | 1 094 | ​ | — | ​ | — | ​ | — | ​ | 1 094 | ​ | 393
Chemicals America segment | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
US Phenolics assets | ​ | 351 | ​ | 30 | ​ | 79 | ​ | — | ​ | 460 | ​ | —
Ethylene Oxide/Ethylene Glycol (EO/EG) | ​ | (4 906) | ​ | (2) | ​ | (26) | ​ | — | ​ | (4 934) | ​ | 110 113
Gas segment | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Sasol Canada - Shale gas assets | ​ | (521) | ​ | — | ​ | — | ​ | — | ​ | (521) | ​ | 357
Other | ​ | 196 |  | 5 |  | 1 |  | 112 | ​ | 314 | ​ | —
​ | ​ | 28 533 |  | 33 |  | 54 |  | 112 | ​ | 28 732 | ​ | ​
| * | The recoverable amounts reflect the CGU's contribution to the integrated value chain and have been determined as described in the accounting policies below.
Significant impairment of assets in prior periods
​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | 2020
Segment and Cash-generating unit (CGU) | ​ | Description | ​ | Rm
Fuels segment | ​ | ​ | ​ | ​
Sasolburg liquid fuels refinery |  | The impairment is mainly due to lower refining margins over the long-term and an increase in the WACC rate. |  | 8 594
Secunda liquid fuels refinery |  | The impairment is mainly due to lower crude oil prices, an increase in the WACC rate and a higher cost to procure gas in the longer term. |  | 3 834
Chemicals America | ​ | ​ | ​ | ​
LLDPE & LDPE | ​ | At 30 June 2020, assets and liabilities relating to a combination of assets within Sasol Chemicals USA have been classified as held for sale. An impairment was recognised to reduce the carrying value of the disposal group down to its fair value less cost to sell, including any portion that Sasol might retain in the disposal group. | ​ | 72 558
Chemicals Africa |  |  |  |
Ammonia value chain* |  | The impairment is mainly due to lower international ammonia selling prices and a decrease in volumes based on reduced market demand and a reduction in gas allocated to the value chain. |  | 2 736
Acrylates & Butanol value chain |  | The impairment is mainly due to significantly lower selling prices coupled with a long expected recovery period as operating rates are only expected to recover to pre-COVID-19 levels by 2027. The CGU was also impacted by an increase in the WACC rate and a higher cost to procure gas in the longer term. |  | 6 766
Polyethylene value chain* |  | The impairment is mainly due to depressed selling prices caused by polyethylene overcapacity, worsened by the impact of COVID-19, and higher feedstock costs. |  | 5 814
Chlor Vinyls value chain* |  | The impairment is mainly due to significant lower selling prices which were only partly offset by the weakening in the rand. |  | 1 979
Chemical Work Up & Heavy Alcohols value chain* |  | The impairment is mainly due to significantly lower selling prices and an increase in the WACC rate. Overall Solvents prices decreased by 12% compared to the prior year. |  | 1 668
Southern Africa Wax value chain* |  | The impairment is mainly due to lower wax selling prices, an increase in the WACC rate and the higher cost to procure gas in the longer term. |  | 3 777
Chemicals Eurasia | ​ | ​ | ​ | ​
Wax | ​ | The impairment is mainly due to lower wax selling prices, driven by the negative macro-economic conditions as well as increased market competition experienced from low cost paraffin wax producers. This was partly offset by increased volumes in the wax emulsion market. | ​ | 2 838
Other | ​ | ​ | ​ | 2 172
​ | ​ | ​ | ​ | 112 736
| * | Impairment results for 2020 for these CGU's have been revised.
​
​ | ​ | ​ | ​ | ​
Segment and Cash-generating unit | ​ | ​ | ​ | 2019
(CGU) | ​ | Description | ​ | Rm
Chemicals America | ​ | ​ | ​ | ​
Tetramerization value chain (LCCP) | ​ | The impairments were driven by an increase in capital cost for the Lake Charles Chemicals Project (LCCP) and lower US ethylene and global mono-ethylene glycol price assumptions as at 30 June 2019. | ​ | 7 403
Ethylene Oxide/Ethylene Glycol (EO/EG) | ​ | The upstream ethane cracker is a corporate asset and the increase in its capital cost has an impact on the downstream derivative units. All cash generating units linked to the LCCP were assessed for impairment. | ​ | 5 460
Sasol Canada – Shale gas assets | ​ | The impairment was resulted from the depressed Canadian gas price environment. | ​ | 1 947
Chemicals Africa | ​ | ​ | ​ | ​
Ammonia value chain | ​ | The impairment was as a result of lower international ammonia sales price assumptions in the short- to medium-term and increased gas feedstock prices in the longer term. | ​ | 3 509
Other (net of reversal of impairment) | ​ | ​ | ​ | 600
​ | ​ | ​ | ​ | 18 919

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