Yemen launched exportation of LNG to World Market

President Ali Abdullah Saleh inaugurated Yemen’s exportation of the first liquefied natural gas shipment on Saturday. The gas was from a plant at the port of Belhaf, Shabwa province, and is on its way to South Korea, into the world market. The 149,000 cubic meters shipment of LNG was transported by a Korean tanker.

The shipment is to be followed by another shipment, about 190,000 cubic meters of LNG, and will be transported by a Yemeni tanker owned by the Yemen Liquefied Natural Gas Company (Yemen LNG).

President Saleh added that an industrial zone would be set up near from Belhaf region and will include petrochemical plants that should provide numerous employment opportunities.

“Today marks this project’s inaugural liquefied natural gas production for exportation to Korea, East Asia, and the Americas.

The President stressed the need for every Yemeni to work together to ensure the country’s safety and security defeating those that would want to return to the past—either to an imam’s regime or to colonial rule. In addition, he highlighted the essential role of strategic projects like these, that help maintain Yemen’s.

“Now we are  eliminating rebellion, treason, sedition, and terrorism in the province of Sa’adah,” Saleh emphatically concluded.

Amer al-Aidaros, the Yemeni Oil Minister, pointed out that the second shipment of 160,000 cubic meters will be transported by one of Yemen LNG’s tankers named “Arwa”. The company owns four tankers, the Bilquis, Belhaf, Arwa, and Marib, which combined, cost over a billion dollars

“The gas project, which is forty times larger than any current investment in Yemen, will stimulate economic progress and development and create a Yemeni industrial boom in the next few years,” Aidaros predicted. “It will also engage local companies in commercial investments,” he said.

Minister Amer al-Aidaros also explained that the scheduled shipments have been modified to conform to international needs, stating that the project will focus on the European and Asian markets, particularly China and India. He assured that exportation will proceed according to the announced amounts after the second production and exportation line is completed in 2010. The line is already 90 percent complete, he added.

LNG project will create 10,000 jobs and is the second gas project rising to the level of the surrounding Arab region.

The director of Yemen LNG said that the company would export gas to  Korea, Mexico, and United States, and possibly China in 2010.

“Yemen has the power to manage large, strategic projects such as this one, successfully,” the director added. “This will help Yemen in the near future to build a strong industrial area.” He praised efforts of the Yemeni government to bring the project into success.

Yemen LNG has committed 100 percent of the guaranteed plant capacity to fewer than three 20-year LNG sales agreements, which includes GDF Suez, Total Gas and Power and Korea Gas Corp (KOGAS).

Construction of the plant started in October 2005. The owners include French oil and gas firm, Total, with a 39.6% sharehold, a U.S. firm, Hunt Oil, with a 17.2% share and Yemen Gas Co. with a 16.7% share, the Social Insurance and Salary Authority with 5%, the S. Korean SK Corporation with 9.55%, the S. Korean Gas Corporation KOGAS with 6 percent and the Hyundai Company with 5.88%.

The Yemen LNG project, with a total construction costs of an estimated $4.5 billion, is considered the largest economic project in the contemporary history of Yemen and the second of its kind in the Arab world.

The initial exports will focus on Europe and Asia, under schedules taking into account the world market priorities.

China and India are expected to be a focus, he said, adding that the second half of 2010 will be the most productive time for the company, having 90% of the project complete.

Partners of the project, donors, municipal officials and managers of petroleum companies were at the launch ceremony.

“It is a clear message that Yemen is the land of investment and encourages foreign capitals to flow into Yemen,” said Minister of Oil and Minerals, Amir Salim al-Aidrous.

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