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Johannesburg - With an R8.4bn injection into its hard wax business, petrochemical giant Sasol looks to double its local output of the adhesive commonly used to seal cereal boxes.
According to Sasol, the increasing demand for hard wax merited the R8.4bn investment. "This large investment shows Sasol's commitment to the wax business and enables us to grow with our customers in this market," said Sasol Wax MD Johan du Preez.
In a media release sent on Tuesday morning, Sasol group general manager for its chemical division Reiner Groh said: "This is a significant investment for the Sasolburg site, and demonstrates our commitment to our South African asset base."
The project will be completed in two phases. Phase one will come on line by 2012, upping the group's hard wax capacity by 40%. Phase two will be operational by 2014, ultimately doubling Sasol Wax's current production capacity.
Sasol added this new project will result in an increased production of medium waxes, mostly used by the candle industry in southern Africa, as well as liquid paraffins used in a variety of industrial applications.
Hard wax (as a hot melt adhesive) acts as a seal on cereal boxes, and is also used in printing ink as well as in mixtures used to create polyvinyl chloride (PVC), a substance typically seen in pipes and window frames.
By midday on Tuesday Sasol was trading up 1.01% at R293.75 per share.
- Fin24.com
