Yemen will sell its liquefied natural gas (LNG) at global market prices next year after negotiations with its buyers, its oil minister said yesterday.
An agreement came out of the negotiations with France’s Total and GDF Suez at the end of 2012 stipulating the sale of LNG at $7.21 per million British thermal units (mmBtu), Ahmed Dares was quoted as saying in state-run newspaper Al Thawra.
The previous price of $1.50 per mmBtu will hold until the end of 2013, the paper said.
The impoverished gas producer told South Korea in August it had to pay global market prices by the end of 2013 after complaining it had lost hundreds of millions of dollars of potential earnings over recent years because of the low price that state-run Korea Gas Corp (Kogas) secured in a long-term deal with Yemen’s only gas export plant.
It was unclear from the minister’s statement to Al-Thawra whether Kogas also agreed to start paying the higher price at the start of 2014.
Yemen LNG, the country’s largest-ever industrial project, signed 20-year sales agreements in 2005 with Kogas, GDF Suez and Total, which the Yemeni government has since complained undervalue the gas and deprive it of much needed public funds.
Korea is the biggest consumer of gas from Yemen. Kogas holds a 6% stake in the Yemen LNG facility.
