Yemen LNG says pipe blast to cut exports by four cargoes

DUBAI Sat Mar 31, 2012 12:48am EDT

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DUBAI (Reuters) - The closure of the Yemen LNG terminal, after its feed pipeline was blown up on Friday night, is expected to cut its super-cooled gas exports by about four cargoes, the operator said in a statement.

Gunemn blew up the 38 inch gas pipeline that links Yemen's block 18 to the liquefied natural gas (LNG) terminal at Balhaf on the Gulf of Aden in retaliation for a U.S. drone attack that killed at least five suspected al Qaeda militants hours earlier.

"Yemen LNG confirms the sabotage," Yemen LNG, which is run by France's Total (TOTF.PA), said in a statement late on Friday.

"Production has stopped but the loss of production is expected to be limited to four cargoes as the LNG plant was due to shutdown on April 15 for annual maintenance."

The $4.5 billion plant -- the impoverished country's biggest industrial complex -- was also forced to close in October 2011 after its feed line was blown up by suspected Al Qaeda militants.

But the quick repair of the pipeline and the rescheduling of annual maintenance at the terminal to coincide with the repairs allowed Yemen LNG to deliver all the 106 LNG cargoes it agreed to sell last year.

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EIA on Yemen: here

Map of Yemen energy: link.reuters.com/kyt62s

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The attacks on Yemen LNG's supplies follow a series of attacks on oil pipelines which have intensified the country's economic crisis since early 2011.

Although attacks and labor disputes have disrupted Yemeni oil exports, which amount to less than 0.5 percent of global supply, several times, the closure of Yemen's 6.7 million tonne (6.6 million tons) per year LNG export terminal is more significant for energy markets.

Protecting pipelines in a sparsely-populated, mountainous and increasingly lawless country is difficult, leaving Yemen LNG highly exposed to further attacks.

The company delivers LNG - gas cooled to liquid for export by ship - under long term contracts to GDF Suez (GSZ.PA), Total and Korea Gas Corp (036460.KS).

(Reporting by Daniel Fineren, Editing by Jonathan Thatcher)

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