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SASOL GROUP SERVICES – GROUP FUNCTIONS – REAL ESTATE

SERVICES – SECUNDA

ENVIRONMENTAL EXEMPTION COMPLIANCE AUDIT REPORT

16.4.19.EV33 - ESTABLISHMENT OF A TOWNSHIP EXT35

03 APRIL 2019

CONFIDENTIAL

WSP Environmental (Pty) Ltd.

ENVIRONMENTAL EXEMPTION COMPLIANCE AUDIT REPORT

16.4.19.EV33 - ESTABLISHMENT OF A TOWNSHIP EXT35

SASOL GROUP SERVICES – GROUP

FUNCTIONS – REAL ESTATE SERVICES –

SECUNDA

TYPE OF DOCUMENT (VERSION)

CONFIDENTIAL

PROJECT NO.: 41101534

DATE: APRIL 2019

WSP

BUILDING C

KNIGHTSBRIDGE, 33 SLOANE STREET

BRYANSTON, 2191

SOUTH AFRICA

T: +27 11 361 1392

F: +27 11 361 1381

WSP.COM

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:

16.4.19.EV33

Final – Compliance

Audit

EA Ref:

16.4.19.EV33

Date March 2019 April 2019

Prepared by Jenny Cope Jenny Cope

Signature

Checked by Ashlea Strong Ashlea Strong

Signature

Authorised by Jenny Cope

Signature

Project number 41101534 41101534

Report number 030 030

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

Jenny Cope

Associate

REVIEWED BY

Ashlea Strong

Principal Consultant

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

Group Functions Real Estate Services

Secunda Senior Manager

Anusha Moodley

WSP

Associate Jenny Cope

Lead Auditor Anri Scheepers

Lead Auditor Ashlea Strong

ENVIRONMENTAL EXEMPTION COMPLIANCE AUDIT REPORT Project No. 41101534 Sasol Group Services – Group functions – Real Estate Services – Secunda

WSP April 2019

TABLE OF CONTENTS

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

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

1.2 Establishment of a Township Ext35

(Authorisation Number: 16.4.19.EV33) .................. 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 .............................. 5

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

3.6 Assumptions and Limitations ................................ 6

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

5 SUMMARY OF THE AUDIT FINDINGS ... 15

5.1 Environmental Exemption .................................... 15


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TABLES

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

TABLE 2: AUDIT FINDINGS – ENVIRONMENTAL EXEMPTION . 8

TABLE 4: SUMMARY OF EXEMPTION COMPLIANCE AUDIT FINDINGS .................................... 15

FIGURES

FIGURE 1-1: APPROXIMATE EXTENT OF TOWNSHIP (SOURCE: GOOGLE EARTH, 2016) ............................... 2

FIGURE 1-2: APPROXIMATE EXTENT OF TOWNSHIP (SOURCE: 1.06_EX_TOWNSHIP EXT35_LAND USE PERMIT_BG-180_1977-09-01) ........................... 3

FIGURE 3: NUMBER/COUNT CONTRIBUTION OF FINDINGS MADE TO THE EXEMPTION CONDITIONS PER SECTION ..... 16

FIGURE 4: OVERALL COUNT FINDINGS ON COMPLIANCE TO THE EXEMPTION CONDITIONS ........ 16

FIGURE 5: PERCENTAGE CONTRIBUTION OF FINDINGS MADE TO THE EXEMPTION CONDITIONS PER SECTION ..................................... 17

FIGURE 6: OVERALL PERCENTAGE FINDINGS ON COMPLIANCE TO THE EXEMPTION CONDITIONS 17

APPENDICES

A ENVIRONMENTAL EXEMPTION (16.4.19.EV33)


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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: 16.4.19.EV33 issued on 08 October 2001) for the period

December 2014 to February 2019.

1.2 ESTABLISHMENT OF A TOWNSHIP EXT35

(AUTHORISATION NUMBER: 16.4.19.EV33)

An Exemption was granted for the establishment of a Township (Activity 2(c) in terms of GNR 1182 of 05

September 1997) on the portions indicated in and with conditions as set out in an attached Record of Decision

(RoD) (in essence an EA). The proposed township is to be located on specified Portions of the following farms:

— A The Farm Twistdraai 285-IS

— B The Farm Goedehoop 290-IS

— C The Farm Middelbult

— D The Farm Driehoek

The purpose of the application for exemption was as a result of the incorporation of the land on which the Sasol

plants were located, into the extended area of jurisdiction of the Highveld East Municipality. The township

name is Secunda Extension 35, and it covers an area of 1,613.82 hectares. The site is located 5km south-west of

Secunda town, and 10km from eMbalenhle Town. No existing land uses were changed.

Figure 1-1 and Figure 2-2 provide an overview of the township.


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Figure 1-1: Approximate extent of township (Source: Google Earth, 2016)


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Figure 2-2: Approximate extent of township (Source: 1.06_EX_Township Ext35_Land Use Permit_BG-180_1977-09-01)


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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; and,

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

— Ensure the commitments contained in Condition 8.1 of the Exemption are completed, more specifically:

— “Records relating to the compliance or non-compliance with the conditions of this Exemption must be

kept in good order. Such records must be made available to this Department within seven (07) working

days from the date of a written request by the Department for such records”


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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 Exemption conditions.

The audit process comprised the following:

— Confirmation of the audit checklist;

— Review of documentation relevant to the conditions of the Exemption (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 Exemption compliance audit (Section 4).

3.2 SITE INSPECTION

No site visit was considered necessary to verify the findings of this audit.

3.3 DOCUMENTATION CONSIDERED

The following documentation was provided and considered:

— https://www.sasol.com/investor-centre/financial-reporting/annual-integrated-reporting-set;

— Environment Impact register_ New FY19_2019-02-18;

— Fugitive Emission Monitoring Plan_2018-10-18 updated;

— IWWMP SIC 2015 Final_2018-05-15;

— Waste Management Procedure_SGR-SHE-000017_Rev10_2017-09;

— SGI-SHE-000014 rev 6 - Minimum requirements for ERA_Published;

— Environmental Complaints Register_2019-02-18; and

— Various email correspondence.

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 Exemption.

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 Exemption 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.


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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 Exemption. 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 lead auditor, Jenny Cope, was supported by Broni van der Meer to whom we express our gratitude for their

time and attention during our audit. A brief summary of the external auditors’ experience is provided below.

— Lead Auditor and Quality Assurance: Ashlea Strong

Ashlea has 16 years’ experience and holds a Masters in Environmental Management; a BTech (Nature

Conservation), and a National Diploma (Nature Conservation); She is also a Certified Environmental

Assessment Practitioner of South Africa (CEAPSA). She currently provides technical and strategic

expertise on a diverse range of projects in the environmental management field, including environmental

scoping and impact assessment studies, environmental management plans, waste and water management, as

well as the provision of environmental management solutions and mitigation measures. She has been

involved in the management of a number of large EIAs within South Africa and has environmental auditing

and training experience and expertise. Ashlea has carried out over 50 compliance audits and is well versed

in the audit process.

— Lead Auditor, 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.


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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 Exemption

REF: COMMITMENT COMPLIANCE FINDING RECOMMENDATION

1. GENERAL CONDITIONS

1.1 This exemption refers only to the project as specified above

and described in Record of Decision. Separate applications

must be lodged for any other development and /or activity at

or near the proposed site, which is covered by section 21 and

22 of the Act and Government Notice R1182 and R1183 of 5

September 1997.

N/A Noted. Sasol notes that this exemption refers only to the

establishment of Secunda Extension 35.

None.

1.2 Exemption is only granted in terms of Section 28A of the

Environment Conservation Act, 1989 (Act No. 73 of 1989),

and does not exempt the holder from compliance with any

other relevant legislation.

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

Audit.

None.

1.3 Ensure that the necessary permits, approvals and/or service

agreements, from other relevant authorities are obtained

before any development on the affected areas takes place.

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

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

None.

1.4 Copies of such relevant documents must be in the possession

of this Department before any development commences. N/A This condition is considered outside of the audit period


None.

1.5 This Department may change, add and/or amend any of the

conditions in this exemption if, in the opinion of the

Department, it is environmentally justified.

N/A Noted. Sasol advised the auditor that, to its knowledge, it has not

received notification that any of the conditions have been added to,

changed or amended.

None.


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1.6 The content of this exemption must be made known to all

interested and affected parties within fourteen (14) days

from the date of exemption.

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


None.

2. CONSTRUCTION AND OPERATION

2.1 If any changes need to be made to the site and/or associated

infrastructure, this Department must be informed thirty (30)

days in advance, to be able to decide whether the changes

will need authorisation or not.

C Sasol has advised the auditor that no changes have been made to

the township site and/or associated infrastructure since the

issuance of the exemption, that are not covered by separate

authorisations.

None.

2.2 Sufficient provision must be made in the annual budget for

mitigation of environmental impacts during construction and

operation of the township.

C The auditor notes that the construction period for the development

of the township is outside of the audit period.

The auditor was advised that since Sasol Group is listed on the

New York Stock Exchange, the business adheres to the Sarbanes

Oxley (SOX) legislation in the US which requires transparent

financial disclosure, including its environmental liabilities, to be

included in the company financial statements. The environmental

and asset retirement obligations for both SSO and SCO (with

whom responsibility for environmental asset retirement obligations

rests) is therefore a liability provision for closure purposes and not

for any activities regarded as operational costs. Provision is made

for the removal of surface infrastructure, in line with the future

land use, as well as for the remediation of areas that would remain

a liability post-closure in terms of potential future contamination.

Financial reporting is available on Sasol’s website.

Evidence:

— https://www.sasol.com/investor-centre/financial-

reporting/annual-integrated-reporting-set

None.

2.3 No development of physical structures may take place within

1:50 year flood line area. N/A This condition is considered outside of the audit period


None.


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2.4 The developer must notify this authority within 24 hours in

the event of non-compliance with any of the conditions of

the exemption and/or in the case of any event that results in

negative environmental impacts.

C All environmental incidents are recorded in an incident register

that is available at the Environmental department. All incidents

are investigated and reported in line with the environmental

emergency and incident procedure and as per legal requirements.

No environmental incidents were noted associated with the

township development.

Evidence:

— Environment Impact register_ New FY19_2019-02-18

None.

3. AIR POLLUTION

3.1 Air pollution should be handled as indicated by the relevant

authorities. C The auditor notes that the construction period for the development


No significant sources of air pollution have been identified

associated directly with the township facilities that are not also

covered under other authorisations (including WML, and AELs).

At the wider Sasol Synfuels site Sasol makes use of an integrated

approach to air quality management as governed by National

Environmental Management: Air Quality Act. A fugitive

emissions Monitoring Plan was viewed by the auditor.

Sasol advised the auditor that it has received no specific direction

regarding air pollution from the Authorities for the township

facility.

Evidence:

— Fugitive Emission Monitoring Plan_2018-10-18 updated

None.

4. WATER POLLUTION

4.1 Any pollution of surface or ground water should be avoided

at all cost. C No significant sources of water pollution have been identified

associated directly with the township facilities, that are not also

covered under other authorisations or under Sasol Secunda’s

None.


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combined Water Use Licence (WUL). The associated Integrated

Water and Waste Management Plan (IWWMP) aims to identify the

activities related to Sasol’s operations within the context of the

receiving environment (with a focus on water resource protection),

identify the risks associated with these operations, and

subsequently manage these risks by means of an action plan

committed to by Sasol management.

Surface water monitoring is done on a weekly basis as well as real

time for the various RESMs.

Groundwater monitoring is conducted biannually and quarterly.

Evidence:

— IWWMP SIC 2015 Final_2018-05-15

Groundwater and surface water monitoring hosted on SHE

Sharepoint site

5. WASTE MANAGEMENT

5.1 All waste generated during construction and operation of the

township shall be stored, handled and disposed of in an C The auditor notes that the construction period for the development


None.


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environmentally acceptable way and as directed by this

Department or any other relevant authority.

The auditor viewed the Waste Management procedure that is in

place, and this provides an approach to manage waste in line with

the internationally accepted waste hierarchy, whereby disposal to

land is considered the last management option to undertake once

avoidance, re-use, recycling, recovery and treatment options have

been considered / eliminated. The procedure further details waste

disposal and management through characterisation and

classification that is detailed in site-specific waste registers.


regarding waste management from the Authorities for the township

facility.

Evidence:

— Waste Management Procedure_SGR-SHE-

000017_Rev10_2017-09

6. RISK ASSESSMENT

6.1 Risk assessment should be handled as indicated by relevant

authorities. C Sasol advised the auditor that it has a Governance SHE Risk and

Assurance department that assesses environmental risks and drives

implementation by business.

The SHE Environment department facilitates Environmental Risk

Assessments per business entity to ensure that gaps are addressed

through implementation of mitigation measures via the Integrated

Management System. Sasol further addresses all Key Undesirable

Events (KUEs) from a group perspective.

A Procedure was viewed by the auditor that defines the

requirements, responsibilities, and the process to be followed in the

management, execution, and control of environmental risk

assessments.


regarding risk assessment from the Authorities for the township

facility.

Evidence:

None.


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— SGI-SHE-000014 rev 6 - Minimum requirements for

ERA_Published

7. MONITORING

7.1 Monitoring should be done as indicated by relevant

authorities. C Site wide air and water monitoring is completed on a routine basis,

and is reported under relevant EAs held for various facilities

within the township.


regarding monitoring from the Authorities for the township

facility.

Evidence:

— Fugitive Emission Monitoring Plan_2018-10-18 updated

Groundwater and surface water monitoring hosted on SHE

Sharepoint site

None.

8. REPORTING

8.1 Records relating to the compliance or non-compliance with

the conditions of this Exemption must be kept in good order. N/A This audit represents the first required audit for this Exemption.

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

None.


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Such records must be made available to this Department

within seven (07) working days from the date of a written

request by the Department for such records.

Environmental Impact Assessment (EIA) regulations, no audit

against this Exemption was required.

8.2 Non-compliance with, or any deviation from the conditions

as set out in the Record of Decision, is regarded as an

offence and, after reasonable provision has been made for

remedial action, will be dealt with in terms of Section 29, 30

and 31A of the Act.

N/A Noted. Sasol has confirmed to the auditor that no communications

have been received from the Authorities regarding non-

compliances.

None.

8.3 Any complaints regarding the said development must be

brought to the attention of this Department within 24 hours

after receiving the complaint. A complaints register must be

kept up to date for inspection by members of the

Department.

C The auditor notes that the construction period for the development


Sasol has advised the auditor that all environmental complaints

received from interested and affected parties, both internal and

external to the organisation, are recorded in a complaints register

that is available and the Environmental department. Complaints

are investigated and reported in line with the procedure and as per

legal requirements.

The auditor viewed the complaints register and confirmed that no

relevant (township) complaints were logged in the audit period.

Sasol has advised the auditor that the Department has not made a

request to view the complaints register, however it would be made

available upon request.

Evidence:

— Environmental Complaints Register_2019-02-18

None.


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5 SUMMARY OF THE AUDIT FINDINGS

5.1 ENVIRONMENTAL EXEMPTION

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

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

3 below.

Table 3: Summary of Exemption Compliance Audit Findings

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

GENERAL CONDITIONS 6 0 0 6

CONSTRUCTION AND OPERATION 4 3 0 1

AIR POLLUTION 1 1 0 0

WATER POLLUTION 1 1 0 0

WASTE MANAGEMENT 1 1 0 0

RISK ASSESSMENT 1 1 0 0

MONITORING 1 1 0 0

REPORTING 3 1 0 2

Total Count 18 9 0 9

Total Percentage 50% 0% 50%

Percentage Compliance with Applicable Conditions 100%


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Figure 3 illustrates the number/count contribution of the findings of the Exemption per section while Figure 4

presents the total proportion of compliance for the facility.

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

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

0

1

2

3

4

5

6

7

Sectional Count Contribution

C

NC

N/A

9

0

9

Total Compliance

C

NC

N/A


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

the total percentage compliance for the facility.

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

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

0102030405060708090

100

Sectional Percentage Contribution

C

NC

N/A

50%

0%

50%

Total Percentage Compliance

C

NC

N/A

APPENDIX

A ENVIRONMENTAL EXEMPTION

(16.4.19.EV33)

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