Foreign Investment in Hadramaut on the Rise [Archives:2001/32/Business & Economy]
The Governorate of Hadramaut ranked first with regard to the size of foreign investment in Yemen thanks to its huge oil reserves, its richness in fish and animals, and several well appreciated touristic attractions. For more than 500 years, Hadramaut’s main economic activity has been gum trade via marine and land routes.
70% of Yemen Oil from Hadramaut
Based on some local figures, the Hadramaut Valley has become an attractive area for foreign investment which incited the government to make big efforts to complete the infrastructure and facilities necessary for the region’s development.
Oil sources state that 70 percent of the total oil production of Yemen amounting to around 460000 barrels per day is extracted from oil fields located in Hadramaut. The most important one in the region, called al-Maseelah oil field, reaches a daily production of around 290000 barrels and is run by Canada-based Nexen.
Moreover, other sources indicate that 15 international companies operate in oil exploration and extraction in the Hadramaut Valley, such as TOTAL of France operating Block No. 10 with a production of 120000 barrels a day.
Recently, geophysical studies unveiled that the region contains huge oil and natural gas reserves which require tremendous capitals for their exploitation.
Investors Flock in Hadramaut
An oil refinery plant has recently been established by some Yemeni and Saudi businessmen in Mukalla, the capital of Hadramaut District, at a cost estimated to be around USD 500 million.
News reports say that foreign companies operating in Hadramaut originate from 20 countries and carry out more than 80 projects at the estimated cost of USD 1,5 billion.
Economic reports also indicate that oil production in Hadramaut will reach at the end of the current fiscal year over 340000 barrels a day after the Maseelah block saw its oil reserves jump from 76 million barrels to 199 million barrels.
Promoting investment in Hadramaut
The government is pressing ahead with its efforts to connect the Hadramaut Valley with the different districts of the region by building a network of asphalted roads which will facilitate transports within the Governorate. Furthermore, new telecommunication facilities and ground satellite dishes were set up to connect the Governorate with the rest of the world.
The Governorate of Hadramaut is also well-known for its palm products covering 55% of domestic demand, its high quality natural honey, with 40% of the production used for local consumption and the rest exported to the Gulf countries, and top quality sea products which are exported. The region is an excellent touristic destination as well that attracts people from all over the world.
In conclusion, Hadramaut with all its resources and potentials has become an essential economic actor which contributes for 60% of the national gross domestic product of Yemen.