Business & Economy - Issue 45

45 - 5 November, 2001 thru 11 November, 2001, Vol XI

Deputy Minister of Oil
"Partnership agreement in oil production has developed methods that reflect the long-term experiences gained by the oil sector since the beginning of oil exploration in the 1980s."

Future oil and gas efforts made in the Republic should be directed towards the sedimentary basins. The discovery of oil and gas in commercial quantities and encouraging results from geo-physical and geological surveys suggest that Yemen still has great potential and augurs well for future oil and gas discoveries in other parts of the sedimentary basins.
In July 1984, after many years of disappointing results, the first commercial oil discovery was finally made in Yemen by Hunt Oil Company in the Marib - Al-Jawf Basin. In 1987, another oil discovery was also made in the Ayad - Masilah Basin - Hadramout by Canadian Nexen Company (Canada) and other international companies.
All these discoveries put Yemen on the world oil & gas map. Since this discovery, Yemen has become one of the most active regions for hydrocarbon exploration in the Arabian Peninsula, a result of promising hydrocarbon potential in this country which forced exploration teams to rethink their ideas about the region's petroleum geology. It has raised the question: Are there other oil-rich fields still to be discovered in Yemen? Mr. Hassan Al-Zaidi of Yemen Times met the Deputy Minister of Oil, Abdulmalik Mohammed Alama, and filed the following interview.

Q: What are the facilities granted by the Ministry of Oil and Minerals in the field of oil and gas exploration?
A: First, I would like to thank Yemen Times staff for their remarkable interest in displaying the activities and the achievements of the productive and economical sectors in our country due to its great importance. This will of course show our natural potentials and capabilities objectively and accurately to the Arab and foreign investors and encourage them to invest their capitals in the available projects present in different economic sectors, especially in the field of gas and oil exploration. First, I would like to highlight the facilities provided currently by the Minister to Arab and foreign investors interested in oil and gas exploration. Furthermore, I would like to point out that the partnership agreement in oil production has developed efficient methods which reflect the long-term experiences gained by the oil sector since the beginning of oil exploration in the 1980s. As for the facilities provided by the Ministry of Oil and Minerals for the Arab and foreign investors in the field of oil and gas exploration, the oil sector remarkably improved as a result of the successful nature of activities performed by the operating companies in the authorized sectors of oil exploration or production. I would like to mention here the competitive incentives provided to oil exploration companies interested in this field:
* Royalty does not exceed 10 percent and it might slightly increase during specific periods in the nearest future .
* Production share has increased to the benefit of investors in line with production and potential reserves.
* Oil cost percentage has increased and, therefore, it is refunded in accordance with size of the project.
* Operating expenses can be wholly reimbursed, that is 100 percent.
* Interested oil companies in the field of oil investment may get various exemptions in different aspects and activities.
This kind of agreement is inapplicable in our country but is applicable in most of other oil producing countries. All these facilities are existing and have so far been applied as stipulated in the partnership agreements. I would like to stress out here that the grants in oil investment were offered more particularly in the field of oil and gas exploration. Oil exploration incentives are not restricted to exploration only but there are also additional facilities granted to the operating companies during the developing phase of to-be operated oil fields. Moreover, the political leadership headed by the President of the Republic of Yemen will give his full support and encouragement to the interested oil companies in the field of oil exploration, whether Arab or foreign companies.

Q: How do you assess Arab and foreign investment in Yemen particularly in the field of oil, mining, and gas industry?
A: We can say that the future of the Arab and foreign investment in the field of oil, gas, and mining exploration as well as the mineral resources in Yemen are promising. On this basis, we will rely on the following premises and conclusions:
- The success of our country's foreign policy with friendly and sisterly countries has led to the enhancement and strengthening of relations among countries.
- Stability and safety throughout the country, particularly in the remote places, and the political leadership's permanent support chaired by the President of the Republic not only for the Arab and foreign investment but also in all issues in the economic sectors.
- The sedimentary basins located in our territorial waters in both the Red Sea and the Arabian Sea are promising.
- Coping with the world changes in all economic aspects in a drive to attract Arab and foreign interests as a way of flowing investment in the oil and gas sectors.
- The continuous development of oil and mineral map surveys has become one of the most important activities in the Republic of Yemen.
All these factors have led to positive and substantial results represented by the increase in the agreements and memoranda of understanding signed between oil companies and the Ministry of Oil and Mineral to explore oil and gas in the country. These companies have various investments and gained a lot of experience throughout the world, especially the American and Russian companies. In addition, the Ministry is still receiving offers from oil companies interested in oil exploration.

Q: Any last comment?
A: Using Yemen Times' channel, I call upon the oil entrepreneurs and investors to inject their capitals in an environment of healthy and fair competition where profit can be made, that is oil and gas explorations, by making use of the available facilities. I also call upon businessmen of the neighboring countries to invest in the field of mineral resources found in Yemen.

Yemen's Wonders:
Administrative Blackmail in Government Posts

Abduh Al-Kawi Al-Qubati
It is truly saddening to realize that Yemen has turned into an a house full of greedy and crooked people who continue to waste the country's resources year after year, causing more devastating effects to the already distressed population.
Institutions or public utilities in our country represent the main pillar of the Yemeni economy. The beneficiaries who receive advantages and privileges are confined to a specific group of people known as cronies. These people behave as if they enjoy a high status, particularly these in the political security circles. Those in charge of the cronies are to provide them with privileges and various opportunities. This supervision will be at the expense either of qualified people or those stationed in their workplaces and therefore submitted to administrative strict punishments. The worse thing is that some institutions and government offices adopt double-standard policies to take great care of privileges entrusted to these cronies.
We are in need of real reforms in every aspect of life and every matter that connects the authority to the people. In turn, the country's wheel of development in the country would move faster and all malpractices of some individuals in the administrative system will be uprooted.
Consequently, the situation of the blue-collar workers has been greatly affected since 1990 as a result of the augmentation of prices and the current policies of economic reforms. In a contrast, those who use all means to gain money legally or illegally make unbelievable amounts of money exceeding by far their monthly salaries. This phenomenon has greatly affected the nature of work circumstances in most institutions and public utilities. Therefore, some of the cronies dedicate themselves and perhaps exploit public properties for their own benefit. Such uncivilized behavior from corrupt people, or as it is called by administrators, unofficial groups, constitutes a huge problem in our society.
What shocks me a lot is that if the administrative management delays the progress of our country, the responsible officials are unable to differentiate a qualified worker for a specific post from an unqualified one and are also incapable of checking and re-checking who is the careless employee. What makes matters worse is that those who control everything belong to the illiterate segment and are only interested in humiliating others, especially the skilled people.
Administrative reform is of high importance and, if not carried out, no achievements could be accomplished. To fight corruption, bribery and complex routine, the concerned authorities must conduct administrative reforms by applying a transparent and fair system based on reward and punishment. Any corrupt official should be held accountable for their wrong actions. Otherwise, the reform program will show no value whatsoever. So far, we have not seen or heard of any corrupt individual brought to justice. This has actually intensified frustration on people's part and has led to their dashed hopes on the feasibility of these reforms.
We are in dire need of amending regulations and by-laws which could ensure an improvement in business administrations and administrative departments. In our country, some of the bureaucrats and cronies have been blocking the way, using legal and illegal avenues, to preserve their privileges. Therefore, I deeply appreciate the honest and sincere people who serve this country without any sense of hypocrisy or flattering. I hope this country will be prosperous and achieve continuous success.