The Syrian government’s seizure of key oil and gas fields from the Kurdish-led Syrian Democratic Forces (SDF) in the country’s northeast has raised hopes of reviving its dilapidated energy sector after years of war and international sanctions.
Syrian authorities announced on Sunday that government forces had captured several oil fields, including Al-Omar, Syria’s largest, and the Conoco gas complex in the north and northeast of the country.
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Damascus made the announcement after the United States-trained SDF agreed to relinquish control of Deir Ezzor, Raqqa and Hasakah governorates as part of a ceasefire deal.
The return of Syria’s energy reserves to government control is a watershed moment for the country’s war-torn economy, while Damascus faces obstacles ranging from damaged infrastructure to chronic underinvestment, according to industry experts.
“Despite the strategic importance of recovering oil and gas assets, translating sovereignty into production recovery will be slow and technically complex,” Ahmad Al-Dahiq, an oil and gas expert in Qatar, told Al Jazeera.
“Oil reservoirs have been damaged by uncontrolled drilling and equipment damage, while pipelines and processing facilities require extensive rehabilitation. Gas, by contrast, is generally less capital-intensive to restore and is directly linked to power generation, making it an early recovery priority.”
Fossil fuel reserves of Syria
Syria holds an estimated 2.5 billion barrels of oil and 8.5 trillion cubic feet of natural gas, but the country’s energy sector has been in turmoil since the war in 2011 following a brutal crackdown on largely peaceful anti-government protests.
While Syria never ranked among the world’s top fossil fuel producers, the country’s pre-war production met its domestic energy needs and generated significant revenue for government coffers. The country produced about 380,000 barrels of oil and about 25 million cubic meters of gas per day, generating 20-25 percent of the state’s income.
By 2015, when much of Syria was under ISIL (ISIS) control, output had fallen to roughly 40,000 bpd, according to an analysis by S&P Global Commodity Insights.
Production fell further after the SDF’s defeat of ISIL to between 15,000bpd and 30,000bpd in 2019, according to the market analysis firm.
“Rehabilitation and new exploration is possible but it will take time and requires political stability and a clear regulatory framework,” Carol Nakhle, CEO of consulting firm Crystal Energy, told Al Jazeera.
“Government control may allow for more coordinated rehabilitation, but progress will depend on investment, expertise and market access.”
Possibility of foreign investment
The lifting of most sanctions on Syria by the US, European Union and the United Kingdom in response to the fall of al-Assad’s regime in December 2024 is likely to boost investment flows from foreign companies that played a central role in the country’s pre-war manufacturing.
Before the war, the state-run Syrian Petroleum Company (SPC), a joint venture between British multinational Shell, China National Petroleum Corporation and India’s Oil and Natural Gas Corporation, was Syria’s single largest oil producer, accounting for more than a quarter of output.
SPC CEO Youssef Keblawi told reporters earlier this week that Shell had expressed its intention to withdraw from the Al-Omar oil field altogether, although the British multinational has not commented publicly on its plans.
France’s Total Energy, the UK’s Gulfsands Petroleum, China’s Sinochem and Canada’s Suncor Energy also maintained power projects in Syria until sanctions halted their operations.
SPC has signed several preliminary agreements or memorandums of understanding with foreign energy companies in recent months, including US-based ConocoPhillips, UAE’s Dana Gas, Saudi Arabia’s Arabian Drilling and Qatar’s UCC Holding.
In December, Syria and neighboring Turkey announced an agreement to strengthen energy cooperation, including the restoration of a gas pipeline linking Aleppo and the Turkish city of Kilis.
Syrian President Ahmed al-Shar’a met with Texas-based Chevron representatives last month to discuss cooperation in developing the country’s energy reserves.
Decisive political and economic moment
David Butters, a Middle East analyst at Chatham House, said he expected UK-based Gulfsands to try to restart its suspended operations at Block 26 oilfields in Hasakah, while Egyptian companies such as NP and Petrojet would also be interested in investing in the field.
“I expect the Damascus government to seek private investment in the infrastructure of the eastern Deir Ezzor field and to issue tenders for certain projects,” Butter told Al Jazeera.
“We can see Egyptian companies like Enppi and Petrojet participating in the deal.”
Crystol Energy’s Nakhle said that while Syria may be able to attract “small, adventurous investors”, leading companies may be reluctant to invest due to the uncertainty of the country’s governance and security situation. Sunday’s The ceasefire remains After a new battle report.
“In short, while Syria’s oil and gas sector has potential, its reconstruction will be slow, risky and highly dependent on policy, security and investment conditions,” Nakhleh said.
Al-Dahiq said it would take years to bring Syria’s production back to pre-2011 levels even under favorable conditions.
“Restoring state control over Syria’s main oil and gas assets is a key political and economic moment. Yet hydrocarbons alone cannot drive the recovery,” he said.