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Several foreign oil firms in Yemen were already looking to withdraw even before the start of Saudi-led air strikes in Yemen this week. The latest developments are only likely to accelerate the process.
Crude production is running at 125,000 b/d, down two-thirds since 2010, with revenue down even further due to falling prices ( MEES, 19 December 2014 ). Yemen relies on its relatively-meagre oil and gas exports for around 60% of its revenues.
Even before the 26 March Saudi-led intervention three foreign oil companies had already relinquished at least some of their Yemeni assets since the start of the year.
Canada’s TransGlobe last month followed UK independent Dove Energy and Cnooc subsidiary Nexen in reducing its exposure to the country, giving its notice to the government to hand over its interests in two concessions – Blocks 32 and 72 – citing concerns about the deteriorating security situation, and the projects’ poor economics. Dove Energy and Nexen relinquished their stakes in Blocks 53 and 51 respectively, just weeks earlier ( MEES, 20 February ). (CONTINUED - 712 WORDS)