Yemen losses near $1-billion after pipeline blast

Sanaa, Yemen— Reuters

Jun. 21, 2011

Yemen has lost nearly $1-billion U.S. in revenues since a blast blamed on tribesmen supporting efforts to oust the president cut off the country’s main oil (CL-FT) pipeline, a senior official said on Tuesday.

The impoverished country has witnessed months of violent clashes which have killed dozens. Protesters are demanding president Ali Abdullah Saleh end his more than three decades in power.

“Yemen loses around $10-million a day due to the production and export stoppage since mid-March,” the official told Reuters.

The country of some 23 million people relies on oil exports for up to 70 per cent of its budget, the official said.

The blast cut off the supply of oil from the central Maarib province to the main export terminal at Ras Isa on the Red Sea.

It also stopped work at the main refinery in Aden, where officials this week began using oil donated from neighbouring Saudi Arabia to begin a restart.

No date has been set to repair the pipeline, which carries nearly half of the country’s 260,000 barrels per day (bpd) oil production.

“No date has been fixed,” the official said. “It depends on reaching an agreement between the government and the opposition.”

Tribesmen, who have repeatedly damaged the pipeline in the past, have prevented technicians from repairing it.

The Maarib oil fields, where international oil companies operate, produce high quality light oil which is in demand following the stoppage of similar exports from war-torn Libya.

The government has blamed the pipeline blast on tribesmen supporting opposition groups demanding Saleh’s ouster.

But tribal sources have said that relatives of a Yemeni mediator killed by mistake last year in an air strike targeting al Qaeda were to blame.

They said that Jaber al-Shabwani, who had been trying to persuade members of al Qaeda to surrender, died when his car was destroyed in a strike blamed on a U.S. drone.