VZCZCXYZ0001
RR RUEHWEB

DE RUEHYN #1086 1601204
ZNR UUUUU ZZH
R 091204Z JUN 09
FM AMEMBASSY SANAA
TO RUEHC/SECSTATE WASHDC 2100
INFO RUEHFR/AMEMBASSY PARIS 0191
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHDC

UNCLAS SANAA 001086 
 
SIPDIS 
 
DEPT FOR EEB/IDF/OIA HEATHER GOETHERT AND KIMBERLY BUTLER 
 
E.O. 12958: N/A 
TAGS: CASC EINV KIDE OPIC PGOV FR YM
SUBJECT: YEMEN: 2009 REPORT ON INVESTMENT DISPUTES AND 
EXPROPRIATIONS 
 
REF: A. STATE 49477 
     ¶B. 08 SANAA 1038 
 
¶1. As per REF A request, Post is aware of one ongoing claim 
(Claimant A) of United States persons against the Republic of 
Yemen (ROYG).  A separate claim (Claimant B) that was listed 
in last year's report (REF B) was resolved in 2008. 
 
¶2. Claimant A (2005) informed Post on 25 September 2005 of 
his property claim against the Sanaa Governorate.  Claimant A 
contends that the Governorate seized 113 "libnas" of his land 
(a libna is a local unit of land area equal to roughly 210 
square meters).  The seized portion of land is part of a 
larger 250-libna block in the Beir Obeid zone of Sanaa where 
the government is planning to build a new road.  According to 
Claimant A's lawyer and an official in the Sanaa Governorate 
Capital Secretariat, compensation for the land seizure would 
require the personal approval of Sanaa's mayor.  To date, 
Claimant A has received no decision on compensation in the 
case, though local officials say the responsibility for 
pursuing the compensation claim lies with Claimant A.  Rather 
than pushing for compensation, Claimant A maintains that the 
entire seizure is inappropriate and that the property should 
be returned.  Claimant A has not contacted the Embassy about 
this matter since September 2005. 
 
¶3. Claimant B's (2005-2008) oil production sharing agreement 
(PSA) with the ROYG expired on 14 November 2005.  The PSA 
covered an oil concession in Block 18 in the Marib region, 
which was taken over by the Government-owned Safer 
Exploration and Production Operations Company.  Claimant B 
had signed a five-year extension agreement with the Ministry 
of Oil in January 2004, and believed that the agreement was 
still binding.  Claimant B argued that the ROYG required the 
company to commit to additional investments based on the 
extension agreement.  The Yemeni Parliament overturned the 
extension agreement, and the cabinet of then-Prime Minister 
Bajammal terminated the new PSA and provided Block 18 to the 
ROYG-owned Safer Company.  The ROYG contends that the 
agreement required, and failed to obtain, parliamentary 
approval and is therefore not legally binding. 
 
¶4. Claimant B filed arbitration procedures against the ROYG 
on 21 November 2005 before the International Court of 
Arbitration of the International Chamber of Commerce in 
Paris, and sought damages of more than USD 1 billion. 
Hearings took place on the case in September 2007 and, in 
2008, the Paris court decided the case in favor of the ROYG. 
Nonetheless, the court ordered the ROYG to pay Claimant B's 
legal fees, amounting to USD 20 million.  Both sides accepted 
the result of the Paris court's decision. 
SECHE