Yemeni Company Constructs 45,000-Barrel-per-Day Refinery to Meet Local Demand

---

Researched by Industrial Info Resources (Sugar Land, Texas)--Yemen has an oil refining capacity of 120,000 barrels per day (BBL/d), produced by two aging plants. The refinery in Aden, operated by Aden Refinery Company, has a capacity of 110,000 BBL/d. The Ma'rib refinery produces 10,000 BBL/d. The Aden refinery, which originally had a design capacity of 170,000 BBL/d, sustained significant damage in the country's 1994 civil war, but was later partially rebuilt. Both refineries are state-owned and are under the control of the Ministry of Oil and Mineral Resources.

In April, the Yemeni government announced the signing of a memorandum of understanding with Total SA (NYSE:TOT) (Paris, France). Under this agreement, which was signed by Yemen's Deputy Minister of Petroleum and Minerals Ahmed Abdullah Dars and Total's vice president for Exploration and Production in the Middle East, Total will spend $32 million in two phases to explore for oil in Yemen.

The minister of petroleum pointed out promising investment opportunities in the oil, gas and minerals sectors in Yemen, saying that Yemen has 100 oil sectors, only 12 of which are producing at the moment. In addition, 80% of the area allocated for exploration has not been explored yet.

Ahmad al-Aesy, the chairman of Yemeni-Gulf Oil Services Company (YGOSC), said it would construct an oil refinery in the Ras Issa area of the Hodeidah province with an investment of up to $500 million. Aesy said the company would complete the first stage of the project in the third quarter of 2010. The refinery will have a capacity of 45,000 BBL/d. Aesy said that the project would provide more than 1,000 jobs. YGOSC includes the Trade al-Aesy Group of Yemen and the Oil al-Hussam Company of Saudi Arabia. In May 2006, the company signed an agreement with an Indian oil company to implement the first phase of the project, and construction began in the second quarter of 2008.

Industrial Info Resources (IIR) is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. IIR's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.