Total: Our facilities are in the hands of the coalition and there are no guarantees about the security and political situation
Total looks forward to resuming LNG production in Yemen
On Thursday, the French company Total said that the security and political situation at the national and local levels in Yemen are not able to guarantee the safe resumption of the LNG project, saying it hopes the conditions will be met again.
The French oil giant said in a statement obtained by the Almasdar online that Total has not had foreign employees in Yemen since 2015, and that the company's actions are aimed at ensuring the safety of local employees and ensuring the maintenance of the Balhaf plant for the resumption of LNG extraction once peace returns to Yemen.
Total revealed that in April 2017, The Yemeni LNG company received a request from the internationally recognized Yemeni government to use part of the Balhaf site facilities for the benefit of Saudi-led coalition forces.
The company stated that “the responsibility and management of the facility had been transferred in full to the coalition forces”. It also added that it had no information regarding the Saudi-led coalition's use of the facility, and that since 2015, neither YLNG nor Total have benefited in any way from this situation nor been offered compensation.
The French company expressed its aspirations in the future to be able to resume LNG production, which would contribute to Yemeni state revenue.
According to sources within the Yemeni oil sectors, Total stipulated that their sites be provided with adequate security protection. This came in the form of, among other things, the deployment of security forces along the 300-km-long export pipeline between the Safer oil fields in Marib govrernorate and the export port in Balhaf, in southeastern Yemen.
The LNG project is the largest industrial and venture capital project in Yemen, worth $4 billion and with production capacity of 6.9 million tons of natural gas per year.
On April 14th, 2015, Yemen LNG announced the situation of force Majeure in their export port and production plant and evacuated its employees due to security conditions. As a result, teh gas production in the country was halted.
According to a report by the Yemeni Ministry of Planning, the suspension of gas exports has seen the Yemeni government forego an estimated $3.2 billion between April 2015 and November 2019.
Yemen began producing and exporting LNG in 2009 with a total production capacity of 6.7 million metric tons per year, with gas export revenues contributing 6.9% and 5.1% of total budget revenues in 2014 and 2015, respectively.
In 2015, LNG exports decreased by 80.3% compared to 2014, as production companies left the country and halted LNG production and export on April 3, 2015.
Yemeni government data show that gas exports fell to 1.31 million metric tons in 2015, while 6.7 million metric tons were planned.