The Yemen’s Strategic Location: The Internationally and Regionally

Greatest Investment Project

Beyond the shadow of doubt, Yemen’s strategic location gives it a unique feature which prompts the founding of giant investments of crucial and fundamental nature. This trait ensures not only the regional and international success of such projects but also their prosperity, particularly those in the field of refining & petrochemicals industries. Regardless of the availability of Yemeni gas and oil potentials, Yemen’s location is in itself an investment that guarantees success and prosperity.

In other words, in addition to other huge investments in other fields, a closer look at the world’s globe would reveal that Yemen’s strategic location could be exploited as the greatest project of all investments. In short, a number of investments can be founded on the Yemeni land. Such include:

Studies on & Promotion of Installing new Refineries :

Being founded mainly to operate Ma’reb Refinery, YORC has undertaken other assignments such as up-dating and expanding the Refinery and promoting for investment in latter’s units. Other strategic objectives and accountabilities were to do necessary preparations to embark into the arena of petrochemicals and refining industries. This is through the installation of new refineries at different but adjacent to production and consumption sites and export ports. It is committed to set up a sound foundation for this industrial activity and to expand it, and when doing so, should fall back on modern and up-to-date bases. In addition to drafting studies on expanding, modernizing, and promoting for Ma’reb Refinery, YORC adopted a number of refining industries through conducting preliminary studies and promotional programs for such projects. All of that was by holding scientific seminars and conferences in and outside Yemen.

Ma’reb Refinery:

• Achieving an Increase in refining profits through causing a considerable increase in the production of gasoline as being the main product which is of the highest economic returns;
• Obtaining a decrease in the costs of oil derivatives transportation from Ma’reb Refinery to nearby provinces and areas;
• Encounter the increasing demand on such derivatives, a fact which goes along with population growth in Yemen in general and in neighboring areas in particular;
• Fulfilling the increase in gas and oil operations at oil and gas sites in Ma’reb-Al-Jawf basin; an example is providing the liquefied natural gas project with such necessary oil derivatives.
• Elevating the Refinery’s operation and production capacity to conform with the crude oil quality produced in neighboring oil fields;
• Changing the equipments and instruments of the Refinery in the near future, due to that they are out of date;
• Update monitoring and control mechanism in order to reduce production loss and avoid any problems.

Expansion and Modernization Project’s Stages:

• During the pervious period of time, the project passed through a number of phases, of which the following were obtained:

• Collecting information of the features of the Yemeni market using oil derivatives:

• Jotting down the rationales and reasons of the carrying out this project:
• Thoroughly and in detail scrutinize such rationales and reasons; the outcome of all that was the perquisite of not only studying but also implementing such a project due to a number of technical, economic and strategic factors;
• Communicating with a number of companies and organizations such as the Chinese firm, Petro Fac Company;
• Contacting and achieving an agreement with Cozmo, a Japanese oil company, which had carried out the preliminary study of the project’s quality parameters;
• Contacting the Americans. Contacts were made with TDA. A visit was paid to the TDA during which the TDA signed an agreement to fund the technical and economic quality parameter study as a grant from the American government;
• Signing the agreement with VECO for carrying out expansion and modernizing study of Ma’reb Refinery as a grant from the TDA, a matter which indicated that the economic and technical study of the project was achieved by VECO;
• Negotiating with VECO to complete the subsequent stages of the project;
• Promoting investment opportunities in the project.
• Seeking for financial support in cash to enable the company be a partner in the project as the Yemeni Government’s representative.

Expansion and Modernization Project’s Stages:

• During the pervious period of time, the project passed through a number of phases, of which the following were obtained:

• Collecting information of the features of the Yemeni market using oil derivatives:

• Jotting down the rationales and reasons of the carrying out this project:

• Thoroughly and in detail scrutinize such rationales and reasons; the outcome of all that was the perquisite of not only studying but also implementing such a project due to a number of technical, economic and strategic factors;

• Communicating with a number of companies and organizations such as the Chinese firm, Petro Fac Company;

• Contacting and achieving an agreement with Cozmo, a Japanese oil company, which had carried out the preliminary study of the project’s quality parameters;

• Contacting the Americans. Contacts were made with TDA. A visit was paid to the TDA during which the TDA signed an agreement to fund the technical and economic quality parameter study as a grant from the American government;

• Signing the agreement with VECO for carrying out expansion and modernizing study of Ma’reb Refinery as a grant from the TDA, a matter which indicated that the economic and technical study of the project was achieved by VECO;

• Negotiating with VECO to complete the subsequent stages of the project;

• Promoting investment opportunities in the project.

• Seeking for financial support in cash to enable the company be a partner in the project as the Yemeni Government’s representative.

The Components of the Project:

The project main components include:

• New units to increase the production capacity;
• Liquefied Natural Gas Production Unit;
• The refinery’s old units to be upgraded and thus networked with the new ones.

Hadhramout Refinery Project:

The Republican Decree 38/2002 was to endorse the agreement of establishing refineries at Hadhramout. The Ministry of Oil and Minerals, as the Government’s representative, and Hadhramout Refinery Company signed the agreement. Located at Alshaher district, north-east of Althabah, the project has an initial 50 thousand b/d capacity; the type of oil to be refined is Al-Masila crude oil blending from which gasoline, kerosene, diesel and mazot are produced.

Stages: 

• The economic & technical feasibility study of the project was completed;

• The final technical & engineering designs of the project were accomplished;

Ra’ess Issa Refinery Project:

The Republican Decree 59/2003 was to endorse the agreement of establishing Ra’ess Issa Refinery at Hudaidah province. The agreement was signed by the Ministry of Oil and Minerals, as the Government’s representative, and Hood Oil Company Ltd. Having a capacity of 50 thousand b/d, it is located at Ra’ess Issa; the type of oil to be refined is that of Ma’reb crude oil from which liquefied gas, first-rate and normal gasoline, kerosene, diesel and mazote are produced.

The stages of the project are

• Finalizing the procedures of purchasing the property of project;

• Carrying out environmental studies by Stanley Company, an American firm;
• Executing a Soil Test on the project’s site by CBI Company, an American firm.
• Signing the agreement with IFC to fund the project:
• Signing an agreement with an American company competent in making technical & engineering designs.

Hydrogen Diffraction (hydro-cracking) Unit/Aden Refinery

The Government of Yemen represented by the Ministry of Oil and Minerals and the Yemen-Gulf Oil Refinery Company signed the Hydrogen Diffraction Unit Construction Agreement.

Production Capacity: 40 thousand b/d of crude oil.

Location:

Al-Buryaqa’a Area, Aden Province.

Type of Refined Oil: Ma’reb Crude Oil

Products:

liquid gas, gasoline, kerosene, diesel, mazot.

Aims:

Distribution of products on nearby areas according to market needs and Export of surplus quantities.

Stages:

The following are the phases of this project:

• The Korean Company, Hyundai, conducted the technical and economic feasibility study which aimed at raising the production capacity of the refinery to meet the local demand for certain products and then to export the surplus of such products;

• The existing units of the refinery are to be updated and modernized in order to improve the specifications of its products;

• A number of companies have shown interest to invest in the refinery.