Sasol writes down Canada shale gas assets on lower natgas prices

08 August 2012 18:18  [Source: ICIS news]

TORONTO (ICIS)--Sasol has decided to take impairment and depreciation charges on its Canadian shale gas assets to account for lower North American natural gas prices in an oversupplied market, the South Africa-based energy and petrochemicals firm said on Wednesday.

Sasol said it was taking impairment charges of Canadian dollar (C$) 120m ($120m) and a write-down of C$171m as it had become more conservative in the valuation and depreciation of its Canadian shale gas assets.

“This approach is in line with other companies that have exposure to North American shale gas assets,” the company said.

“We have lowered our long-term North American gas price estimate to take cognisance of the unpredictability relating to the current oversupply of gas and the resultant potential impact on the long-term North American gas market,” it added.

However, Sasol said that it remained committed to developing its Canadian assets.

“We remain committed to developing the Canadian shale gas assets and will reassess our position once we have taken a GTL [gas-to-liquids project] investment decision in North America,” it added.

In June, Canadian oil and gas firm Talisman said it had decided not to proceed with a joint venture GTL project with Sasol in western Canada.

In related industry news on Wednesday, two Japanese firms completed a deal for a stake in shale gas deposits in Canada’s western British Columbia province

($1.00 = C$1.00)

By: Stefan Baumgarten
+1 713 525 2653

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