Total SA said it is suspending its operations in Syria in line with recently tightened sanctions by the European Union that indirectly target its local partner, Deir Ez Zor Petroleum Corp. (DEXPC).
Deir Ez Zor is not directly on the EU’s list of targeted firms, but the sanctions do name Syria’s state-owned General Petroleum Corp., which owns a 50% stake in DEZPC. GPC is the Syrian government’s main holding company for investments in the oil and gas sector, and the firm coordinates oil and gas production, distribution, and sales.
“We have informed the Syrian authorities of our decision to halt our operations with GPC in order to comply with sanctions,” Total said, adding that the suspension includes operations at Deir Ez Zor and its contract with Tabiyeh Gas.
The loss of Total’s 39,000 boe/d of production ushers in a further reduction in Syria’s output, which has fallen to 120,000 boe/d from the earlier 340,000 boe/d.
Total’s decision follows Royal Dutch Shell PLC, which last week said it would pull out of Syria following the EU’s imposition of tougher sanctions against the regime of the country's embattled President Bashar Al-Assad (OGJ Online, Dec. 2, 2011).
Meanwhile, Suncor Energy Inc. said it is evaluating whether the newly imposed EU Union sanctions affect its Ebla gas project, a $1.2 billion development that is operated through a joint venture with GPC.
"We are very much in the middle of reviewing the sanctions and we'll certainly comply with them," said a Suncor spokesperson, who noted that the Suncor project is producing near its capacity of 80 MMcfd of gas.
Canada's Foreign Affairs Minister John Baird last week said Suncor should be allowed to continue operating in Syria despite Canada's sanctions on the country.
“If they ceased activities there, you'd have literally thousands, tens of thousands, hundreds of thousands of homes without electricity, and that would be bad for the civilian population,” Baird said.
Baird’s remarks came even as he acknowledged the Ebla project “provides some revenue” to the Al-Assad regime, but Canada’s economic sanctions do not affect Ebla's production and sale of gas, which is not exported.
Gulfsands Petroleum PLC noted the addition of GPC to the EU’s list of proscribed organizations, and said it is “reviewing” the manner in which it interacts with GPC.
“Once an understanding has been reached on the implications of the new sanctions measures on the company’s business in Syria, the company will make a further announcement,” Gulfsands said.
Contact Eric Watkins at [email protected].
