With a growing number of Yemenis looking expectantly at President Abdo Rabbo Mansour Hadi to resolve Yemen-France controversial LNG deal (Liquefied Natural Gas), TOTAL which is Yemen’s biggest foreign investor, faces a complicated future, as many feel the French company overstayed its welcome the second it attempted to exploit the nation’s natural resources.
And even though TOTAL management rejects any wrong doings, Yemenis overwhelmingly feel they were cheated out of several billion dollars’ worth of income while the company increased its profits margin.
With large interests in Yemen and a pending PSA (Production Sharing Agreement) renewal TOTAL could be standing on shaky grounds should negotiations fail to satisfy not only Yemen officials but the greater public. With so much riding on the re-alignment of LNG prices with world markets, experts have warned that TOTAL could lose its footing in Yemen.
Back in 2005, former President Ali Abdullah Saleh signed a 20-year contract with TOTAL and GDF Suez (both French-owned) by which he agreed to sale Yemen’s LNG at a fraction of the market. For the past 19 years the French giant has been purchasing LNG for $3 per million BTU. Reports say that's $11 dollars less than average international market prices.
Earlier in February an official at the Oil ministry admitted that over the past 19 years Yemen had lost billions of dollars in unrealised revenues. Activists have argued that such funds could have helped alleviate poverty and prevented Yemen’s economy to unravel. With over 40% of its population having been classified at food risk by the UN, Yemenis have not looked kindly on the squandering of national resources.
Judicial sources have confirmed that TOTAL-Yemen LNG deal has been put under investigation since it resulted in significant damages to the interests of Yemen.