The man running South Africa’s iconic energy and chemicals company

Simon Baloyi was recently appointed as the president and chief executive officer of Sasol and has the high-stakes task of transitioning the energy and chemicals giant from fossil fuels to more sustainable energy sources.

However, the 48-year-old veteran is tempering ambitions in the short term by focusing on reducing the company’s debt and maximising its existing operations before exploring growth opportunities in less carbon-intensive businesses.

Baloyi is a seasoned chemicals engineer with over two decades of experience at the energy and chemicals giant, which supplies roughly 40% of South Africa’s transport fuel.

Sasol is perhaps best known globally for developing coal liquefaction, which produces synthetic crude oil from coal.

That breakthrough has ensured South Africa is not fully reliant on foreign countries for fossil fuels.

Sasol’s board appointed Baloyi following an extensive internal and external search for a successor to Fleetwood Grobler, who helped steer the company through dire circumstances.

With a bursary from Sasol, Baloyi studied at the University of the Witwatersrand from 1995 until 2002, obtaining his undergraduate, Honours, and Master’s degree in chemical engineering.

He joined Sasol immediately after leaving university.

Over the years, Baloyi gradually climbed the ranks and served in several leadership positions in maintenance, technical, and general management in Sasol’s South African operations.

His first executive position was as the vice president of Secunda-based Sasol Synfuels from 2015 to 2017, after which he became vice president of engineering, centralised maintenance, and operations.

Subsequently, he was appointed as Secunda Chemicals Operations senior vice president for regional operations and asset services.

After that, he became executive vice president of Sasol Energy Operations and Technology before being appointed CEO in April 2024.

Speaking in a recent interview with BizNews editor Alec Hogg, Baloyi touted a conservative approach in his first year at the helm.

Baloyi was part of the Sasol executive team that had to take urgent action when the company’s share price plunged from over R300 to R20 due to the Covid-19 pandemic’s impact on fuel demand.

That has provided him with experience in making difficult decisions to ensure the company’s survival — including selling certain assets.

Baloyi acknowledged that he definitely felt pressure to deliver value for shareholders.

“This is other people’s money that you are working with. We definitely respect the shareholders’ capital,” he said.

In his first five months at the helm, Baloyi has hit the ground running.

He has spearheaded the streamlining of the company’s top management and the separation of Sasol’s international chemicals from its South African fuel operations.

These changes were part of ensuring the company’s various divisions operate as effectively as possible.

Lowering debt before dividends

Baloyi said his immediate focus is ensuring all Sasol’s divisions generate cash with full efficiency.

“Once we’ve reached our potential, we will focus on sustenance capital, to make sure that we maintain our businesses from an integrity and safety point of view,” he explained.

Balyoi said that once Sasol gets its debt under $4 billion, it will resume paying dividends to shareholders.

He expects that this will be achievable in the company’s current financial year ending June 2025.

“There has to be a healthy competition between growth and returning cash to the shareholders,” Baloyi stated.

“That growth has to be disciplined, we have to learn from the lessons in our recent past.”

While Baloyi acknowledges the potential for new oil exploration in offshore areas like the Orange Basin, he said that Sasol’s initial focus will be on enhancing its liquified natural gas (LNG) operations, including its onshore operations in Mozambique.

LNG produces 40% less emissions than coal and 30% less than oil, making it the cleanest fossil fuel.

Baloyi believes that this resource will be important for lowering South Africa and Sasol’s carbon intensity during the transition period to greener energies.

“This company must transition from predominantly coal into a sustainable energy company,” he said.

“But before we get ahead of ourselves, we must first fix our balance sheet…and once we have it, we can explore near-term growth areas.”