Liquefied natural gasMore clarifications [Archives:2003/630/Business & Economy]

Mahyoub Al-Kamaly
In clarification of what has been published in last week's issue on developing and marketing of the Yemeni liquefied natural gas which was based on statements by Director-General for Gas Affairs Taha Ahmed al-Ahdal published recently in Oil and Minerals newspaper, the oil official has tackled certain axes on this topic. We are in this article to explain and shed light on the whole subject as mentioned by that official.

The first premise as mentioned by Mr. al-Ahdal is:
The situation of the project:
The major activities relating to the LNG have been finished, except for marketing. The more important of those activities was the technical side which had been finalized and the documents required for inaugurating the second phase of the project had become ready. Studies related to the increase in efficiency of the project had been completed in the first quarter of the year 1998.
The second aspect is the marketing. In this regard Yemen had begun marketing the LNG outside the framework of the investment project for 1997 when foreign partners had joined to participate in the Yemeni Company for Oil and Gas following negotiations lasted for some time.
Al-Ahdal mentions in his article in that newspaper that the marketing activity began after signing an agreement by participants from two major areas for traditional markets for LNG, namely, Korea, Japan and Turkey and a number of other Asian countries. Regarding the targeted new markets there were India, China and Thailand. Up till now those marketing activities are fruitful. They have revealed significant results and placed the Yemeni project in the first place of other new competing gas projects.
Those marketing efforts, though did not lead to obtain commitment to maintained buying of the Yemeni gas, they had found abroad a momentum for the project that would result in the Yemeni Company for LNG gaining of a share in the world market of this commodity as it would be possible to depend on the Yemeni project for providing gas supplies for world markets.
Al-Ahdal has also recommended to setting up a strong strategy aimed at finding markets for gas and also to include definition of goals.

The second premise as mentioned in al-Ahdal's article is:
Evaluation of possible options:
Al-Ahdal sees that renewing the agreement on development of the gas project and its exportation was among the options. The government has adopted the option of extending work in the present agreement on developing gas in order to reach at the best economic benefits. That option enables the project team to continue in its marketing efforts and entering into agreements on selling with buyers without the Yemeni gas company being exposed to pressures for offering concessions regarding any of the advantages accumulated in its favor in markets.
Therefore for the purpose of clarification of what has been reported in the previous article we say that we did not mean that the companies which renewed the contract for investment of the Yemeni gas are now exporting it, but rather limited quantities of gas are being exported by the Yemeni company of gas in mercantile ship.
Yemen depends in operating the gas project on the group of investment companies and it has obtained their acceptance for exporting it to Asian markets. This activity would supply the government budget with hard currency that helps boost the national income.
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