Dana Gas, one of the largest private natural gas companies in the Middle East, has signed an initial agreement with Syrian Petroleum Company to explore redevelopment and expansion of natural gasfields in central Syria, as the country looks to revive its energy sector and increase production.
The deal includes an assessment of Abu Rabah gasfield, one of the largest in Syria, Dana Gas said in a statement on Wednesday to the Abu Dhabi Securities Exchange, where its shares are traded.
The UAE company said it is the first gas developer to sign such an agreement in Syria.
“Dana Gas will conduct a comprehensive technical assessment of the identified fields and propose a development plan aimed at significantly increasing total gas production if the evaluation is successful and both parties reach a final agreement,” the company said.
The move comes as Syria seeks to revive its energy sector and attract more investment after US President Donald Trump announced the lifting of sanctions on the country during his trip to the Gulf in May.
Saudi Arabia, Qatar and Turkey have since pledged to invest in the country to help it rebuild its infrastructure, energy and other sectors after the devastating nearly 14-year civil war.
Richard Hall, chief executive of Dana Gas, said: “This agreement marks an important first step in evaluating opportunities to redevelop Syria’s gas infrastructure and unlock the potential that exists within its gas sector.
“The fields identified ... could make a real difference to domestic gas production, strengthening Syria’s energy security and supporting local communities.”
The company’s early completion of the KM250 expansion project in Iraq alongside its operating partner and the technical strength of the Syrian Petroleum team prepared Dana Gas to take up the new challenge, he added.
“The lessons and capabilities we developed there are directly transferable to projects such as this, where hands-on execution, technical and financial discipline, and regional understanding are key to delivery,” Mr Hall said.
Before the civil war, oil was a central pillar of Syria's economy. It accounted for up to 25 per cent of its gross domestic product, the International Monetary Fund estimated, and about $3 billion in annual revenue.
But production had nosedived by 2014, plummeting to about 25,000 barrels per day, according to a US Energy Information Association country analysis in 2015. Syria produced an estimated 380,00 to 400,000 bpd before the outbreak of the civil war in 2011.
The sharp decline was driven by extensive damage to infrastructure, such as power grids and gas refineries, after ISIS took control of key oilfields and Syria lost its connection to global energy markets.
Syria is seeking more than $30 billion to fully rehabilitate the country’s oil, mineral, electricity and water sectors, Ahmed Sleiman, director of communications for the Ministry of Energy, told The National in an interview last week.
In September, Syria announced the dispatch of the country's first official crude export shipment in 14 years, signalling its return to the global energy market.
The 600,000 barrels of heavy crude set sail from the historic port of Tartus aboard the Nissos Christiana tanker, under a deal with B Serve Energy, Reuters reported.
