Bloomberg News

Yemen LNG Plant Production Halted After Gas Pipeline Attack

October 15, 2011

(Updates with death toll in Sana’a from first paragraph.)

Oct. 15 (Bloomberg) -- Yemen LNG, the Arab country’s liquefied natural gas exporter, said production was halted after an attack on a gas pipeline as fighting in the country’s capital, Sana’a, left 16 people dead.

The explosion on a line transporting fuel from a field to the Balhaf processing plant occurred 12:30 a.m. this morning and caused no victims, Yemen LNG said in a statement received by e- mail today. “The production has stopped but the loss of production is expected to be limited as the LNG plant was due to shut down on Oct. 23 for annual maintenance,” it said.

Attacks against the country’s pipeline network have disrupted exports and caused nationwide shortages since protests against President Ali Abdullah Saleh started this year. The Al Shabwan tribe in March blew up part of the pipeline carrying oil from the central province of Marib to Ras Eisa, Yemen’s main outlet for crude exports. The government said it had to raise refined product prices until the line was repaired in July.

Total SA owns about 40 percent of the Yemen LNG venture and is the project leader as well as a buyer of the fuel. The company is Yemen’s biggest foreign investor. Korea Gas Corp., which has agreed to buy 2 million tons a year of LNG from Yemen, owns 6 percent of Yemen LNG. GDF Suez SA also has a long-term supply contract with the plant.

Sana’a was rocked by blasts and gunfire today as forces loyal to Saleh battled tribes in northern parts of the city. Four supporters of Himiar al-Ahmar were killed in the clashes with government forces, al-Ahmar’s spokesman Fawzi al-Jaradi said in a phone interview. A policeman and a civilian were killed in clashes with protesters, the official Saba news agency said, citing an unidentified interior ministry official. Ten policemen were wounded, Saba reported.

Al-Qaeda

Ten protesters were killed and dozens wounded in the anti- Saleh protests today, Mohammed al-Qubati, a doctor at the field clinic of the protest camp, said by phone. Saleh returned to Yemen on Sept. 23 after three months in Saudi Arabia, where he received medical treatment and called for talks with opposition groups who want to oust him.

Seven suspected al-Qaeda militants were killed in overnight air strikes in the southern province of Shabwah, Yemen’s defense ministry reported today on its website. Ibrahim al-Banaa, an Egyptian national and a media officer for al-Qaeda in the Arabian Peninsula, was killed by the bombing, the ministry said.

Hours after the strike against the suspected militants, unidentified people attacked a pipeline in the area, Mohammed Baodhah, a resident in the area, said by phone today.

Yemen has the eighth-largest crude reserves in the Middle East and relies on oil sales for 90 percent of its hard currency earnings, according to the U.S. Energy Information Oil Administration. The Arab Peninsula country pumped 260,000 barrels a day of crude last year, down from an estimated 286,000 barrels in 2009 and a 2001 peak of 440,000 barrels, according to the EIA.

--With assistance from Glen Carey in Dubai. Editors: James Kraus, Kim McLaughlin

To contact the reporters on this story: Ayesha Daya in Dubai at adaya1@bloomberg.net; Mohammed Hatem in Dubai at mhatem1@bloomberg.net

To contact the editor responsible for this story: Andrew J. Barden at barden@bloomberg.net


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