OMV has signed a new Production Sharing Agreement with the Ministry of Oil and Mineral Resources of the Republic of Yemen. The new agreement enables OMV (YEMEN) Al Mabar Exploration GmbH, a wholly owned subsidiary of OMV, to conduct exploration and production activities in Block 2 (Al Mabar). OMV will start exploration activities as operator as soon as the Parliament of Yemen ratifies the contract. This is expected for the third quarter 2005.
Block 2 is located in central western Yemen, close to the OMV operated Block S2, where OMV discovered oil in previous wells. OMV is evaluating the commercial potential of the block and conducts further drilling activities ("Habban-1" well). Helmut Langanger, OMV Executive Board member responsible for Exploration and Production stated: "Yemen is well integrated into the OMV portfolio and provides an excellent strategic fit. It is part of our core region Middle East and we are working to expand our activities in Yemen, where we have already discovered oil."
OMV has been active in Yemen since the early 1990s. The company has an office in Sana'a, Yemen, with 10 employees, including 3 expatriates. OMV (Yemen Block S2) Exploration GmbH, a wholly owned subsidiary of OMV Exploration & Production GmbH, operates Block S2 on behalf of OMV (44%) Sinopec of China (37.5%), The Yemen Resource Limited (6%), and The Yemen General Corporation for Oil & Gas (12.5%). Exploration drilling is ongoing.
Block S2 was acquired with the international portfolio of Preussag, and OMV discovered oil in the "Al-Nilam 1" well in 2003. Further drilling in 2005 follows comprehensive block evaluation in 2004. OMV signed a Memorandum of Understanding with the Ministry of Oil and Mineral Resources for Block 2 on October 17, 2004. This outlined the terms of a Production Sharing Agreement to be agreed with the MOM, actual signing being part of this press release.
