South African petrochemicals giant Sasol Ltd has opted to give up its licence to explore for gas off the Mozambique coast, the company said on Sunday.

“Sasol will return Block 16/19 in its entirety to the Government of Mozambique. To this end, a withdrawal notification has already been sent to the relevant Mozambican authorities”, the firm said in a statement.

Sasol was awarded the research licence in 2005.

In 2013 it abandoned the deep water part of the licence, retaining the shallow water allotment to assess its hydrocarbon potential.

It is still exploring for gas onshore in the fields of Pande and Temane, in the northern province of Inhambane.

Sasol, the world’s top producer of motor fuel from coal, is trying to shed assets to pay off its debt pile and avoid a rights issue of up to $2 billion.

In June the Energy and chemical company, Sasol, issued unions with a Section 189 retrenchment notice to cut an unspecified number of jobs.

Sasol’s global workforce is over 31 000 with the bulk of employees based in South Africa.

The move is likely due to a drop in oil prices and production as economies around the world came to a halt due to the pandemic.

In the video below, Economist Mike Schussler explains why more jobs are likely to be shed: