Sinochem, Gulfsands shut down Syria oil ops

State-controlled Chinese group Sinochem caught in EU sanctions; Syria will continue to produce oil from the fields.

By REUTERS
December 12, 2011 12:03
1 minute read.
An oil drilling rig [illustrative]

An oil drilling rig 311. (photo credit: Andrea De Silva / Reuters)

 
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LONDON - Chinese state-controlled Sinochem and UK-listed explorer Gulfsands Petroleum have shut down their oil operations in Syria following European Union sanctions related to the crackdown on the uprising against the rule of President Bashar al-Assad, Gulfsands said.

Although China has resisted sanctions on Syria, Sinochem is bound by EU sanctions since it bought its interest in the Syrian fields by taking over UK-listed Emerald Energy, through which it still owns the assets, a Gulfsands spokesman said on Monday.

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Syrian state-controlled General Petroleum Corporation (GPC) will continue to produce oil from the fields, in exploration block 26, the company said in a statement.

Analysts said the further development of the block would be delayed, postponing expected cashflows.

The Syrian fields are the only cash-generating assets Gulfsands owns, save for a few small interests in the US which it is selling. However, a spokesman said it had $120 million on the balance sheet and no debt.

The company said it would retain a presence in Syria.

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Sinochem declined immediate comment.

Gulfsands shares, which have lost more than half their value so far in 2011, were down 7.9 percent at 171.5 pence by 0930 GMT.

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