Yemenat – special
Decision No. (193) of the Second Instance Public Funds Prosecution Office concerned with corruption cases, issued on June 4, 2014, indicated that Total Company targeted liquefied gas reserves for export from Balhaf amounting to (167.5) million tons – equal to 9.2 trillion cubic feet from the source with the justification of increasing Yemen’s revenues from 4 to 7 billion dollars, as it was noted that these additional revenues targeted an increase of (35 million tons – equal to 2 trillion cubic feet) over the quantities allocated for the project in the agreements, and their availability had not been previously announced through the Dijler and McKinton certificates issued on May 1. 2005 AD.
The prosecution’s decision stressed the need for the Ministry of Oil to adhere to the quantities allocated to the project (132.5 million tons during the life of the project – equal to 7.2 trillion cubic feet).
The Yemenat website asked the oil expert in charge of the Public Prosecution Office the following question: Was the quantity (2 trillion cubic feet) really available for the Ma’rib Gas Electricity Projects 3 and 2?
And the oil expert stated that in order to clarify the answer to this very important question, it is necessary to refer to many facts, justifications and practices of the partners in the gas project through the documents they submitted to the Ministry of Oil and to the Public Funds Prosecution, indicating that to facilitate understanding for the follower, the answer will be dealt with through several axes:
1- Knowing the quantities allocated to the project and local consumption in the agreements.
And he confirms that, according to the text of Article 2.1 of the Gas Development Agreement, a maximum amount has been allocated for the Balhaf project for a period of 25 years, amounting to (132.5 million tons per unit weight – and it requires supplying the project with an amount of 7.2 trillion cubic feet) from the gas delivery point in sector (18), while the same amount has been allocated Article (250 million cubic feet per day) for Marib electricity projects in its three phases, with a total amount of (3.6 trillion cubic feet) for a period of 40 years, according to the requirements of the government and the House of Representatives, given that Sector (18) – according to the estimates of the Oil Authority at the time – contains an initial reserve of gas in the subsoil The land amounted to 18 trillion cubic feet, in exchange for the partners’ announcement of an abundance of 12 trillion cubic feet, according to the report of Dagler and McInton August 1996.
2- Estimated remaining proven oil and gas reserves on January 1, 1996
During the year 1996 AD, Hunt (Exxon) entered into partners with Total in the natural gas project, and according to the provisions of Article 3.4 of the Gas Development Agreement, they submitted an assessment of the remaining gas reserves on January 1, 1996 AD, at about (10.2) trillion cubic feet) distributed according to the provisions of the agreements. as follows:
The share of the Belhaf project (7.2 trillion cubic feet) for a period of 25 years.
– The share of Marib electricity projects (1 trillion cubic feet) is restricted by the text of Article (5.1) of the gas supply agreement that was not presented to the House of Representatives and contradicts Article (2.1) of the Gas Development Agreement, and with the justification for the lack of sufficient reserves.
– A quantity (2 trillion cubic feet) allocated for fuel and deflation in the upstream facilities controlled by Hunt or the subsequent operator.
3- Planning to keep Hunt as operator of the upstream facilities until the end of the life of the gas project.
With the justification for starting to export gas to Balhaf from January 2001 AD and the complete depletion of oil reserves in November 2005 AD, the text of Article (5) of the Upstream Facilities Agreement was put in place through which Total authorized Hunt to export gas to Balhaf until the end of the Marib agreement to participate In oil production on November 14, 2005 AD, then Total authorized Hunt Liquefied Gas Company to own and operate Sector 18 facilities until the end of the gas project under the name of the Marib Company to serve the fictitious source that does not exist except on paper. This is a blatant violation of the sovereign right of Yemen to own and operate Sector (18) pursuant to the Marib Agreement for sharing in oil production and the recommendations of the House of Representatives No. (110) dated 3/11/97 when the Council approved the agreements.
Gas export did not start in 2001, and oil did not run out in November 2005. Rather, sector (18) continued to produce 100,000 barrels per day after producing the reserve provided by the partners in November 1996. Therefore, Hunt Company resorted to requesting an extension of the Marib agreement to participate in the Oil production to November 2010 AD and postponing the export of gas to January 2009 AD so that the partners remain in control of the upstream facilities in accordance with Article (5) of the Upstream Facilities and Services Agreement, and the government approved the extension.
4- The plan of the partners in the gas project (Hunt and Total) to export gas from January 2009
The oil expert pointed out that Total and Hunt Company – on the assumption of extending the latter to 2010 AD and its remaining as operator for the delivery of gas to Balhaf from January 2009 AD to 2033 AD – documented the gas export plan to Balhaf from January 2009 to 2033 AD in the report of Diggler and Macinton Company The American Ministry of Oil issued on June 21, 2005 officially recognized them by the Ministry of Oil, and by the Ministry of Oil to the Prosecution, targeting the export of 8.4 million tons annually (compared to 5.3 million tons annually according to the gas development agreement) with a total of liquefied gas targeted for export from Belhaf (187 million tons equal to 9.1 trillion Cubic feet), which are the same quantities recorded in the Diggler and Macinton certificate dated May 26, 2005 CE, which is completely contradictory to the Diggler and MacInton certificate issued on May 1, 2005 CE submitted by the partners to the Ministry of Oil, with a difference of (2.6 trillion cubic feet) that the government has not previously announced about its abundance. It is the actual share of the Ma’rib electricity projects 2,3, which the partners deliberately concealed in the ground, and this is the height of misleading and even giving priority to the interests of the partners at the expense of the government. A replacement of the House of Representatives and the government and the texts of the agreements to allocate net reserves of (2 trillion cubic feet) for the Balhaf project through the issuance of a Diggler and Macinton certificate dated May 26, 2005.
5- The House of Representatives’ decision to reject the extension of Hunt Company to 2010 AD and the issuance of Cabinet Resolution No. (111) of 2005 AD stating that it is the Marib agreement to participate in oil production on the date of November 14, 2005 AD and to hand over the facilities of the sector (18) to the Yemeni government to continue exploration, development and production operations As a sovereign right of Yemen and the gas project on its day, and Sector (18) on November 15, 2005 AD produces 70 thousand barrels of oil and 24 million barrels of domestic gas as sovereign rights of Yemen, in addition to Yemen’s sovereign right to own natural gas outside the entitlement of the gas project, and thus The partners were removed from the upstream facilities and the upstream facilities and services agreement was invalid in its entirety due to the absence of one of its parties, the Marib Company as an operator, and for the contradiction of Article (5) with the recommendations of the House of Representatives No. (110) issued on March 11, 1997 AD confirming the exclusive right of the government to appoint the operator of the field on November 15 / November 2005 AD.
The alternative plan for the partners is to seize a quantity of (2 trillion cubic feet) due to their removal from the upstream facilities and to hand it over to the government.
6- The ruse of gas sales contracts through the Total editor on June 17, 2005 AD
– Through the editor of Total Company dated June 17, 2005 AD, it confirmed that it had secured three contracts aimed at exporting the quantities allocated for the project (132.5 million tons – equal to 7.2 trillion cubic feet) for a period of 25 years at an annual rate of 5.3 million tons, within 20 years at an annual export rate of 6.7 million tons.
And it became clear through the investigations of the prosecution and the report of the oil expert that Total deliberately falsified the numbers of gas reserves in its editor dated June 17, 2005 AD and the testimony of the American Diggler and Macinton Company dated May 26, 2005 AD, through which it allocated 9.1 trillion cubic feet for the Balhaf project – to export liquefied gas From Balhaf amounting to 167.5 million tons without any technical cover for those reserves – in exchange for the maximum share allocated to the project in the gas sales agreements and contracts (7.2 trillion cubic feet – to export 132.5 million tons). The oil expert, Limnat, confirmed that the targeted additional reserves (2 trillion cubic feet) have not been announced before, and are outside the quantities of gas allocated to the project in the agreements.
7- Recommendations of Parliament No. 675 dated July 12, 2005 AD.
The House of Representatives prevented the government from approving gas sales contracts through the recommendations referred to above, except after submitting a certificate from an international expert proving the adequacy of gas reserves for export and domestic consumption for all economic sectors, and through the documents of the file submitted to the Council of Ministers, it was found that Total’s letter dated June 17 was absent. June 2005, and all the certificates of the Dagler and Macinton company referred to above, with the presence of papers called the ECL report of an unidentified company, without mentioning in its pages that there are gas reserves for domestic consumption amounting to 5 trillion and 900 billion cubic feet, of which 3 trillion cubic feet are attributed to sector (18) outside Allocated in the agreements, all of which are forged and without support, and accordingly the government approved gas sales contracts for a period of 20 years in the amount allocated in the agreements, and refused to sell 167.5 million tons for non-compliance with the agreements, as documented in the report of the committee formed by Cabinet Order No. 135 of 2005 AD.
Accordingly, the Ministry of Oil, through its editorial dated August 23, 2005, agreed to increase the production capacity of Balhaf facilities to 6.7 million tons, and the same forged reserves figures were adopted in the Total company editorial dated June 17, 2005 AD.
After the start of gas exports in January 2009, those concerned with gas affairs in the Ministry of Oil and Total replaced the above-mentioned Total and Ministry of Oil editors with the texts of the agreements by issuing illegal fatwas through the British company Clyde Andko, the latest of which was Clyde’s fatwa on February 12, 2014. Which was conditional on the validity of the gas reserves figures in Total’s editor dated June 17, 2005 AD, in a manner that does not contradict the provisions of the agreements, and was submitted by the Ministry of Oil to the Prime Minister, Mr. Muhammad Salem Basindoh, to invite the Supreme Economic Council to approve the allocation of additional reserves for the Belhaf project of $2 One trillion cubic feet outside what is required by agreements and sales contracts, and the Public Funds Prosecution Office dealt with it according to Prosecution Resolution No. 193 of June 4, 2014 AD, and on the contrary, the Minister of Oil in Aden, Dr. Cairo, at the end of the year 2022 AD, that the contracts aim to export 9.2 trillion cubic feet without technical or legal support for that..!!!
From all of the above, it is clear that Total violated the provisions of Articles 6.3 of the Gas Development Agreement and Articles 10.1 to 10.3 of the Upstream Facilities and Services Agreement regarding the granting of additional reserves for the project with the loss of professionalism and credibility of the partners in the gas project and the evidence of their planning to seize all the capabilities of the sector (18), which led to Causing serious economic damage to the government side, and according to the provisions of Articles 20 and 24 of the Gas Development Agreement, the Public Prosecution Office initiated investigations with both parties to the contract under the umbrella of the Supreme National Commission for Combating Corruption, which is supported by United Nations anti-corruption laws.
The oil expert hoped that the House of Representatives would assume its responsibility towards this disaster
The next episode will discuss the details of the economic damage, its causes, and its documentary evidence.