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SASOL SYNFUELS OPERATION: MARKET & PROCESS INTEGRATION

ENVIRONMENTAL AUTHORISATION COMPLIANCE AUDIT REPORT

16.25.14 EV 1 - NATURAL GAS EXPANSION

20 MAY 2019

CONFIDENTIAL

WSP Environmental (Pty) Ltd.

ENVIRONMENTAL AUTHORISATION COMPLIANCE AUDIT REPORT

16.25.14 EV 1 - NATURAL GAS EXPANSION

SASOL SYNFUELS OPERATION: MARKET &

PROCESS INTEGRATION

TYPE OF DOCUMENT (VERSION)

CONFIDENTIAL

PROJECT NO.: 41101534

DATE: MAY 2019

WSP

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Q U A L I T Y M A N A G E M E N T

ISSUE/REVISION FIRST ISSUE REVISION 1 REVISION 2 REVISION 3

Remarks Draft for Review –

Compliance Audit

EA Ref: 16.25.14 EV

1

Draft for Review –

Compliance Audit

EA Ref: 16.25.14 EV

1

Final – Compliance

Audit

EA Ref: 16.25.14 EV

1

Date April 2019 May 2019 May 2019

Prepared by Mpendulo Dlamini Mpendulo Dlamini Mpendulo Dlamini

Signature

Checked by Jenny Cope Jenny Cope Jenny Cope

Signature

Authorised by Jenny Cope Jenny Cope Jenny Cope

Signature

Project number 41101534 41101534 41101534

Report number 031 031 031

File reference file:///W:\000 NEW Projects\41101534 - Sasol EA and EMP Audits\42 ES\2-REPORTS\

S I G N A T U R E S

PREPARED BY

Mpendulo Dlamini

Consultant

REVIEWED BY

Jenny Cope

Associate

This Compliance Audit report (Report) has been prepared by WSP Environmental (Pty) Ltd (WSP) on behalf and

at the request of Sasol Synfuels: Secunda Operations (Client), to provide the Client with an understanding of their

compliance with the conditions included in the Environmental Authorisation.

Unless otherwise agreed by us in writing, we do not accept responsibility or legal liability to any person other than

the Client for the contents of, or any omissions from, this Report.

To prepare this Report, we have reviewed only the documents and information provided to us by the Client or any

third parties directed to provide information and documents to us by the Client. We have not reviewed any other

documents in relation to this Report, except where otherwise indicated in the Report.

P R O D U C T I O N T E A M

CLIENT

SHE: Environmental Compliance

Specialist

Broni van der Meer

Market and Process Integration

Production Senior Manager

Deon van Zyl

WSP

Associate Jenny Cope

Lead Auditor Anri Scheepers

Lead Auditor Ashlea Strong

Consultant Mpendulo Dlamini

ENVIRONMENTAL AUTHORISATION COMPLIANCE AUDIT REPORT Project No. 41101534 SASOL SYNFUELS OPERATION: MARKET & PROCESS INTEGRATION

WSP May 2019

TABLE OF CONTENTS

1 INTRODUCTION ........................................ 1

1.1 Terms of Reference ................................................. 1

1.2 Natural Gas Expansion – 16.25.14 EV 1 ................ 1

2 AUDIT SCOPE ........................................... 4

3 AUDIT METHODOLOGY ........................... 5

3.1 Audit Checklist ........................................................ 5

3.2 Site Inspection ......................................................... 5

3.3 Documentation Considered ................................... 5

3.4 Audit Compliance Assessment .............................. 6

3.5 Audit Team ............................................................... 6

3.6 Assumptions and Limitations ................................ 7

4 AUDIT FINDINGS ...................................... 8

5 SUMMARY OF THE AUDIT FINDINGS ... 13

5.1 Environmental Authorisation ............................... 13


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TABLES

TABLE 1: COMPLIANCE LEVEL DEFINITION AND TARGET COMPLETION DATES .................. 6

TABLE 2: AUDIT FINDINGS – ENVIRONMENTAL AUTHORISATION ......................... 8

TABLE 3: SUMMARY OF EA COMPLIANCE AUDIT FINDINGS ........................ 13

FIGURES

FIGURE 1-1: THE NATURAL GAS PROJECT AREA (SOURCE: GOOGLE EARTH, 2018) ............................... 2

FIGURE 2-2: THE NATURAL GAS PLANT (SOURCE: GOOGLE EARTH, 2018) .............................................. 3

FIGURE 3: NUMBER/COUNT CONTRIBUTION OF FINDINGS MADE TO THE EA CONDITIONS PER SECTION ............................ 14

FIGURE 4: OVERALL COUNT FINDINGS ON COMPLIANCE TO THE EA CONDITIONS .............................. 15

FIGURE 5: PERCENTAGE CONTRIBUTION OF FINDINGS MADE TO THE EA CONDITIONS PER SECTION ..... 15

FIGURE 6: OVERALL PERCENTAGE FINDINGS ON COMPLIANCE TO THE EA CONDITIONS ................ 16

APPENDICES

A ENVIRONMENTAL AUTHORISATION (16.25.14 EV 1)


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1 INTRODUCTION

1.1 TERMS OF REFERENCE

Sasol South Africa (Pty) Limited operating through its Secunda Synfuels Operations (Sasol) appointed WSP

Environmental (Pty) Ltd (WSP) as an independent environmental consultant, to undertake a compliance audit and

compile an audit report according to the requirements of the National Environmental Management Act (No. 107

of 1998) as amended (NEMA). This report presents the findings of the compliance audit completed for the

Environmental Authorisation (EA) (Reference number: 16.25.14 EV 1 issued on 25 June 2001) for the period

December 2014 to February 2019.

1.2 NATURAL GAS EXPANSION – 16.25.14 EV 1

The Natural Gas Expansion project was implemented to de-bottleneck and increase the intake of natural gas in

order to have higher loads for maximum efficiency. Natural gas is a methane-rich gas, and which is piped from

Mozambique via an underground pipeline. The Natural Gas Expansion plant was constructed to accept the natural

gas at a range between 7 000 kPa and 12 500 kPa, filter it through dust-settling cyclones, and then reducing its

pressure to the Sasol factory’s operating pressure which is around 4 500 kPa. Locations of the natural gas plant

equipment are show in Figures 1-1 and 1.2.

An EA authorising the expansion project was granted by the Mpumalanga Department of Agriculture,

conservation and Environment on 25 June 2001.


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Figure 1-1: The Natural Gas project area (Source: Google Earth, 2018)


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Figure 2-2: The Natural Gas plant (Source: Google Earth, 2018)


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2 AUDIT SCOPE The 7 April 2017 amendment to the Environmental Impact Assessment (EIA) regulations introduced the

requirement for the auditing for all EAs and EMPrs in effect on 8 December 2014 and submission of audit reports

to the Department of Environmental Affairs (DEA) by 7 December 2019 and every five years thereafter. This

audit is designed to meet the requirements of Regulation 34 of the EIA Regulations, 2014.

The audit period runs from December 2014 to February 2019, therefore any construction related conditions that

would have been relevant pre-December 2014 are considered not applicable (outside audit period).

The objective of the audit was to:

— Assess the level of compliance with the conditions of the EA

— Identify and assess any new impacts and risks that result from undertaking the activity;

— Make recommendations in order to achieve compliance in terms of the;

— Ensure the commitments contained in Condition 7.01 of the EA are completed, more specifically:

— “Records relating to compliance/non-compliance with the conditions of the Authorisation must be kept

in good order, Records must be made available to Dept within 5 days on a written request of the

Department.”


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3 AUDIT METHODOLOGY The International Organisation of Standardisation (ISO) 14010, ISO 14011 and ISO 14012 guideline documents

were utilised as a template during the compliance audit process. This methodology ensures that the compliance

audit was conducted in a systematic and independent manner that was documented and objectively evaluated to

determine compliance to the EA conditions.

The audit process comprised the following:

— Confirmation of the audit checklist;

— Site inspection (29 March 2019);

— Review of documentation relevant to the conditions of the EA (e.g. records, permits/certificates/maintenance

logs/monitoring results/previous reports etc.); and

— Compilation of an audit report.

3.1 AUDIT CHECKLIST

WSP compiled an audit checklist to assist with the EA compliance audit (Section 4).

3.2 SITE INSPECTION

Mpendulo Dlamini conducted the site inspection on 29 March 2019. The findings and observations of the site visit

are recorded and summarised in Section 4 with evidence included in Table 2. Key personnel interviewed included:

— Peet van Zyl (Area Manager Production)

— Neeren Naidu ( Production Foreman MPI)

— Richard van der Berg (Production Foreman MPI)

3.3 DOCUMENTATION CONSIDERED

The following documentation was provided and considered:

— 16.25.14_EV1_2001-06-25;

— SSO DQS ISO 14001 2015;

— 2018 DQS 3rd Party Audit Report_Sasol Secunda Synfuels Operations.

— EA_EX Handover_SSO_MPI;

— EA_EX Handover_SSO_MPI_Amend SM;

— NGE Conversion scoping report_2001-05-17;

— Compliance_Water_Secunda Complex.dox

— IWWMP SIC 2015 Final_2018-05-15;

— GWMonitor Report Aug 2018 Final_Prj6163_2018_10_31

— AEL Sasol Synfuels 0016-2018-F03(2018)

— Risk Assessment: SGI-SHE-000014

— Environmental Complaints Register (Period: December 2014 – March 2019)

— Various email correspondence.


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3.4 AUDIT COMPLIANCE ASSESSMENT

WSP utilised a pre-prepared audit checklist to assist with the audit execution (Table 2). The checklist included

the conditions and associated requirements as specified in the EA.

Each condition was verified, either by reviewing documentation, interviewing employees and/or visually

inspecting the facility. Each condition was rated in accordance with Table 1 below, and recommendations with

associated target completion dates included.

It should be noted that some of the EA conditions were apportioned according to the elements requiring

compliance assessment therein. Although some elements of the condition may have been compliant, if one of the

elements was determined to be non-compliant, the entire condition has been reported as such (and counted as such

during percentage compliance calculation). This apportionment further allowed for the development of focussed

recommendations and timeframes.

Table 1: Compliance Level Definition and Target Completion Dates

COMPLIANCE LEVEL DEFINITION

Compliant (C) Sasol could provide evidence for compliance with the commitment and condition and/or

relevant actions were implemented.

Non-compliant (NC) Specified commitments, conditions and documents were not in place or implemented according

to the requirements of the EA. Non-complaint conditions are given target completion dates, as

follows:

— Short term: 0 – 6 months.

— Medium term: 6 – 12 months.

— Long term: 12 – 18 months.

Not applicable (N/A) These are commitments are either not required yet or not applicable to Sasol.

— Conditions marked as “Noted” are considered information points only.

— Where conditions are considered “not auditable” within the scope of this assessment this

is stated and explained within the condition commentary.

Refer to Section 4 for the detailed audit findings (including evidence, recommendations and target completion

dates).

3.5 AUDIT TEAM

The Consultant, Mpendulo Dlamini, was hosted by Peet van Zyl, Neeren Naidu and Richard van der Berg to

whom we express our gratitude for their time and attention during our visit. A brief summary of the external

auditors’ experience is provided below.

— Auditor: Mpendulo Dlamini

Mpendulo has 5 years’ experience and is a multi-disciplined individual who completed his double major BSc

Environmental Science degree (Life Science and Environmental Science) at the University of KwaZulu-Natal

in 2014. He then further completed his BSc Honours Environmental Science (Spatial Epidemiology Research)

in 2015 at the same institution. Mpendulo has had exposure in the following sectors; oil and gas,

environmental consulting as well as environmental and public health. As a University Student, he has had

extensive training in biodiversity management and monitoring with a focus in plant science (undergraduate),

and with Lakes Environment air quality and modelling software as well as environmental GIS and remote

sensing in spatial modelling (Post graduate). He also has experience as an Environmental Control Officer as

well as with working on Water Use License Applications and Integrated Water and Waste Management Plans

(Triplo4 Sustainable Solutions).


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— Project Manager and Quality Assurance: Jenny Cope

Jenny is an environmental due diligence specialist, with over 11 years’ experience in the Environmental

Sector. Jenny’s experience includes managing and completing projects and portfolios internationally;

undertaking both detailed and broad Environmental, Health & Safety compliance and audits of across a range

of sectors. Jenny’s recent experience includes completion and management of several pan-European and

global projects requiring reviews of extensive virtual data rooms, on a very rapid turnaround, and providing

clients with ‘red flag’ reports to give clear commercial advice. Jenny has worked both in environmental

consultancies and with a developer, giving context to understanding the practicalities of implementing

recommendations.

3.6 ASSUMPTIONS AND LIMITATIONS

This Report has been prepared by WSP on behalf and at the request of Sasol, to provide the Client an

understanding of the Relevant Documents.

Unless otherwise agreed by us in writing, we do not accept responsibility or legal liability to any person other than

the Client for the contents of, or any omissions from, this Report.

To prepare this Report, we have reviewed only the documents and information provided to us by the Client or any

third parties directed to provide information and documents to us by the Client. We have not reviewed any other

documents in relation to this Report and except where otherwise indicated in the Report.

The findings, recommendations and conclusions given in this report are based on the author’s best scientific and

professional knowledge, as well as available information. This report is based on survey and assessment

techniques which are limited by time and budgetary constraints relevant to the type and level of investigation

undertaken; WSP and its staff reserve the right to modify aspects of the report including the recommendations if

and when new information may become available from on-going research or further work in this field, or

pertaining to this investigation.

Although WSP exercises due care and diligence in rendering services and preparing documents, WSP accepts no

liability, and Sasol, by receiving this document, indemnifies WSP and its directors, managers, agents and

employees against all actions, claims, demands, losses, liabilities, costs, damages and expenses arising from or in

connection with the services rendered, directly or indirectly by the use of the information contained in this

document.

This report must not be altered or added to without the prior written consent of the author. This also refers to

electronic copies of this report which are supplied for the purposes of inclusion as part of other reports. Similarly,

any recommendations, statements or conclusions drawn from or based on this report must make reference to this

report. If this report is used as part of a main report, the report in its entirety must be included as an appendix or

separate section to the main report.


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4 AUDIT FINDINGS Table 2: Audit Findings – Environmental Authorisation

REF: COMMITMENT COMPLIANCE FINDING RECOMMENDATION

GENERAL CONDITIONS

1.01 This Authorization refers only to the project as specified

above. Separate applications must be lodged for any other

development and/or activity at or near the proposed

development, which is covered by S21 and 22 of the Act and

Government Notice R1182 of 5 September 1997.

N/A Noted. The project remains as per the authorised activities for which

the EA was granted. No additions or alterations have taken place on

or near the project’s location.

Sasol is aware of the requirement to lodge separate applications

should further works be required for the authorised activity.

None.

1.02 Authorization is only granted in terms of S 22 of the Act and

does not exempt the holder from compliance with other

relevant legislation.

N/A Noted. A full legal review does not form part of the scope of this

audit.

The Sasol Complex operates with a dedicated environmental and

legal teams, and therefore ensures that they comply with applicable

legislation.

In addition, site is operated under ISO14001:2015, which requires

the compilation of a legal register. Furthermore, WSP has been

provided with the 2018 ISO audit for review, which specifically

states “the development of the compliance risk management

protocol (CRMP) to assist the organization to reach a higher level

of legal compliance is commendable”.

Evidence:

— SSO DQS ISO 14001 2015;

— 2018 DQS 3rd Party Audit Report_Sasol Secunda Synfuels

Operations.

None.

1.03 No development may take place on the area of concern

without necessary permits/approvals and/or service

agreements from other relevant authorities.

N/A This condition is considered outside of the audit period

(construction pre-2014). It is therefore considered not applicable.

None.


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Furthermore, the consultant was notified that no new developments

or upgrades have been undertaken.

1.04 Copies of the relevant documents mentions in 1.3 above must

be forwarded to this Department within (3) three months of

issuing this authorisation.



None

1.05 This Department may change or amend any of the conditions

in this Authorization if, in the opinion of the Department, it is

environmentally justified.

N/A

No changes or amendments have been communicated to Sasol by

the Department since issue of the EA.

None

1.06 The development must comply to all mitigatory measures as

set out in the Scoping Report. NC A copy of an EIA report covering multiple natural gas conversion

projects, dated 17 May 2001 was provided for review. The NGE

project is covered, however no mitigation measures are listed.

Sasol has stated no other information is available. In the absence of

the Report, compliance with relevant operational phase conditions

cannot be verified.

Evidence:

— NGE Conversion scoping report_2001-05-17

In the absence of the

Scoping Report, this

condition is considered non-

rectifiable.

1.07 The content of this document must be made known to all

registered interested and affected parties within 14 days of the

date of its issuing by the Department.



None

ESTABLISHMENT OF THE ENTERPRISE

2.01 This authorisation is repealed if construction has not been

started within 2 years from date of this authorisation N/A

This condition is considered outside of the audit period


None

2.02 This department should be notified in the earliest convenient

time of any decision to discontinue the operation of the said

development.

N/A Noted. Sasol have advised that there are no current plans to close or

decommission or discontinue the operation of the facility.

None


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WATER POLLUTION & MANAGEMENT

3.01 Water pollution and management should be handled as

indicated by relevant authorities. N/A According to the Area Manager, the plant does not utilise water, and

it would not be possible for it to cause water pollution. In terms of

stormwater management, the plant is tied in with the Sasol Secunda

Stormwater Management Plan. Therefore, should exceedances be

picked up, these would not be attributed to the Natural Gas

Expansion Plant.

In addition, all staff, contractors and visitors are provided with

induction training, which includes pollution of the environment.

Evidence:

— Compliance_Water_Secunda Complex.dox

— IWWMP SIC 2015 Final_2018-05-15

— GWMonitor Report Aug 2018 Final_Prj6163_2018_10_31

None

AIR POLLUTION

4.01 Air pollution should be handled as indicated by relevant

authorities

C The gas turbines at the Natural Gas Expansion are covered in the

Sasol Synfuels AEL (Ref. 0016/2018/F03) under section 5.1.1.2 –

Gas Turbines.

The consultant was notified by Area Manager that the Natural Gas

Expansion plant has gas monitors that monitor in real-time across

the entire facility, especially at critical areas such as the flanges. The

gas monitors were observed during the site-walkover.

The plant also has a venting stack where gas is occasionally

released; however, this is not a usual occurrence. Release is typically

None


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carried out as a controlled process. The venting stack also has a real-

time gas monitor.

The Area Manager notified the auditor that there have no incidences

or exceedances at the Natural Gas Expansion plant.

Evidence


RISK ASSESSMENT

5.01 All employees who will be working in the natural gas

expansion project should be aware of the emergency

procedures in case of any accident.

C A work instruction for Minimum requirements for environmental

risk assessments for all Sasol Synfuels and Sasol Chemical

Operations is also available on Sasol’s web-based system, and its

latest review date is 01 February 2017.

Safety and emergency information for Sasol is also available on its

web-based system and every staff member has access to it.

According to the Area Manager; at each plant, personnel undergo a

general and plant-specific induction, which includes all the health

and safety aspects as well as the emergency procedures of the

particular plant. Refresher trainings are held every three years from

the initial induction for each personnel.

Evidence

— Risk Assessment: SGI-SHE-000014

None

MONITORING

6.01 This Department must be granted access at any reasonable

time to the property to investigate any possible environmental

impacts that may be caused by the operation

N/A The condition is noted by Sasol. The department may request access

if necessary, and it shall be organised with the security as well as the

hosts.

None


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6.02 Emissions should be monitored as indicted by the relevant

authorities. C The venting stack has a gas monitor installed, which monitors

emissions in real-time as per AEL’s requirement for continuous

monitoring. At points were fugitive emission are possible, there are

gas monitors that monitor in real-time. The Area Manager also

notified the Consultant that at the settling cyclones, dust particles do

not escape but are captured in filters and the filters are removed and

disposed of during maintenance.

Evidence


None.

REPORTING

7.01 Records relating to compliance or non-compliance with the

conditions of the Authorisation must be kept in good order,

Records must be made available to Department within seven

(7) days from the date of written request for such records by

the Department.

N/A This audit represents the first required audit for this Exemption.

Prior to the introduction of the 7 April 2017 amendment to the

Environmental Impact Assessment (EIA) regulations, no audit

against this Exemption was required.

None

7.02 Non-compliance with or any deviations from the conditions

of this Authorization is regarded as an offence and after

reasonable provision has been made for remedial action, will

be dealt with in terms of S 29,30 and 31A of the Act.

N/A Noted. None

7.03 Any complaints regarding the said development must be

thoroughly investigated and addressed to the satisfaction of

all parties concerned. Copies of such complaints must be

forwarded to the Department within forty-eight (48) hours of

such a complaint.

C

The complaints register from 2008 to date was available for review

and there have been no complaints lodged with regards to the

operation of the Natural Gas Expansion plant for the 2014-2018

audit period.

Evidence

— Environmental Complaints Register (Period: December 2014

– March 2019)

None


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5 SUMMARY OF THE AUDIT FINDINGS

5.1 ENVIRONMENTAL AUTHORISATION

The audit findings have been summarised into the following categories: compliance, non-compliance and not

applicable. The overall audit findings concerning compliance to the EA conditions are as listed in Table 3

below.

Table 3: Summary of EA Compliance Audit Findings

SECTION OF THE EA NO. COMMITMENTS C NC N/A

GENERAL CONDITIONS 7 0 1 6

ESTABLISHMENT OF THE ENTERPRISE 2 0 0 2

WATER POLLUTION & MANAGEMENT 1 0 0 1

AIR POLLUTION 1 1 0 0

RISK ASSESSMENT 1 1 0 0

MONITORING 2 1 0 1

REPORTING 3 1 0 2

Total Count 17 4 1 12

Total Percentage 100% 24% 6% 71%

Percentage Compliance with Applicable Conditions 80%


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Figure 3 illustrates the number/count contribution of the findings of the EA per section while

Figure 4 presents the total proportion of compliance for the facility.

Figure 3: Number/Count contribution of findings made to the EA conditions per Section

4

1

12

Total Compliance

C

NC

N/A

0

1

2

3

4

5

6

7

8

Sectional Count Contribution

C

NC

N/A


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Figure 4: Overall count findings on compliance to the EA conditions

Figure 5 illustrates the percentage contribution of the findings of the EA conditions. Figure 6 presents the total

percentage compliance for the facility.

Figure 5: Percentage contribution of findings made to the EA conditions per Section

4

1

12

Total Compliance

C

NC

N/A

0102030405060708090

100

Sectional Percentage Contribution

C

NC

N/A


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Figure 6: Overall percentage findings on compliance to the EA conditions

24%

6%

71%

Total Percentage Compliance

C NC

N/A

APPENDIX

A ENVIRONMENTAL AUTHORISATION

(16.25.14 EV 1)