Yemen plans to start negotiations with foreigner buyers of its liquefied natural gas to raise LNG prices in an effort to increase the impoverished country’s revenue, the Yemeni oil minister said in remarks published Wednesday.
The oil ministry is working on improving the prices paid for LNG cargoes bound for the U.S. next year and is developing a strategy to increase prices for all LNG sales in 2014, Oil Minister Ahmed Dares said in a statement posted on the ministry website.
The price rises will “meet the economic and developmental aspirations and achieve the desired aspirations of our country in various fields,” Mr. Dares said.
Last month, French oil major Total SA (TOT) and GDF Suez Trading agreed to raise the price of Yemeni LNG sold under long-term contracts from next year, in a move that Mr. Dares said would boost the country’s natural gas revenues to at least $340 million from $160 million.
Total, which has an almost 40% interest in the country’s liquefaction plant, and GDF Suez have also agreed to divert some Yemeni LNG cargoes from the U.S. market to other markets in Asia and Europe, while the price of LNG was raised from $3 to $7.21 per million British thermal units on a free on board basis, Mr. Dares has said.
Several producers have been discouraged from shipping LNG cargoes to the U.S. due to low gas prices and are now diverting their sales to other markets where oil-linked gas prices have risen above U.S. levels.
– Summer Said, (c) 2012 Dow Jones & Company