YEMEN TO SEEK WESTERN HELP

Yemen will invite western oil companies to beef up the delayed oil development project being undertaken by the Soviet company Technoexport in Yemen. The project to develop three fields in Block 4 and lay a pipeline to export facilities on the coast is about 1 year behind schedule.

April 15, 1991

2 min read

Yemen will invite western oil companies to beef up the delayed oil development project being undertaken by the Soviet company Technoexport in Yemen.

The project to develop three fields in Block 4 and lay a pipeline to export facilities on the coast is about 1 year behind schedule.

Western companies will be asked to bid for interests in Block 4 covering the production project and exploration programs. Terms are not settled, but sources said there is certain to be an upfront payment designed to offset some of the $600 million Yemen owes to the Soviets for previous drilling campaigns and pipeline construction.

The government had hoped to start production next month at about 20,000-30,000 b/d, with flow building to more than 100,000 b/d in 1992. The May start-up date is now in doubt.

Yemeni authorities have lost patience with the Soviets as the U.S.S.R.'s economic position has crumbled. About 800,000 expatriate Yemeni workers returned home as a result of the Middle East conflict, and Yemen's backing for Iraq cut the inflow of aid from Saudi Arabia and Kuwait.

More revenues from oil exports are needed to offset those losses, but they have not materialized.