Oil facilities in Yemen change hands in $21.6 million deal

A global energy company has acquired oil producing facilities in war-torn Yemen from another international firm. The move comes as the country's Houthi rebels have repeatedly targeted terminals and tankers in efforts to stop their rivals from exporting oil.

Zenith Netherlands, a subsidiary of Zenith Energy Ltd., announced that it has agreed to acquire energy assets of Vienna-based OMV in Yemen, in a deal worth more than $21.6 million.

The deal is still pending the approval of authorities in Yemen and Austria. There was no immediate comment from Yemen's internationally recognized government.

"The acquisition of OMV Yemen represents a very significant milestone for Zenith Energy," Andrea Cattaneo, Zenith's CEO, said. "The existing production from the asset and, more importantly, the near-term future oil and natural gas production ... position Zenith on an extremely exciting organic growth trajectory."

The largest of OMV's assets was its shares in the al-Uqlah oil field in central Yemen, which is controlled by the internationally recognized government, according to the deal announced by Zenith Netherlands.

The field produced an average of 6,000 barrels per day as of January 2022 because of a lack of drilling activities, the announcement said. That amount was down from around 15,000 barrels per day before Yemen's civil war.

OMV also sold its shares in two smaller fields in central Yemen, along with an estimated of 571 billion cubic feet of recoverable gas, the announcement said.

Yemen's war began in 2014 when the Iran-backed Houthi rebels descended from their stronghold in the north, occupying the capital, Sanaa and forcing the internationally recognized government to flee into exile to Saudi Arabia. The following year, a Saudi-led coalition entered the war, aiming to dislodge the Houthis.

OMV was one of the largest international energy firms still operating in Yemen. It announced in June that it would sell its assets in the country as part of plans to downgrade its oil activities.

The firm reported that its oil and gas production in Yemen decreased by 15% to 1.1 million barrels in 2021 at the height of a Houthi offensive on the energy-rich central province of Marib.

Since the warring parties failed to renew a U.N.-brokered truce in October, the rebels have repeatedly attacked oil terminals and energy firms working in the country in an attempt to prevent oil exportation by the internationally recognized government.

In October, the rebels launched a drone attack targeting on oil tanker owned by Athens-based Okeanis Eco Tankers Corp. off an oil terminal operated by the government. They targeted another oil vessel with an explosive-laden drone in the country's south in November.

Yemen, the Arab world's poorest country, has reserves of some 3 billion barrels of oil and 17 trillion cubic feet of gas, according to the U.S. Energy Information Administration.