Shell is taking decisive steps towards a complete withdrawal and liquidation of its operations in Syria, cross-referenced sources told Zaman al-Wasl on Thursday. This strategic decision marks the end of decades of the company's presence in the Syrian oil and gas sector.
The corridors of the Syrian Ministry of Petroleum and Mineral Resources have witnessed a series of meetings to discuss the implications of Shell's decision. The main meeting brought together senior company officials with the Minister of Energy, Eng. Mohammed al-Bashir, to discuss the legal and financial framework for the exit process.
It is worth noting that the operations of "Al-Furat Petroleum" (operated by Shell) have been practically suspended since 2012, in compliance with European Union sanctions imposed on the Syrian regime. Although it joined the list of European companies that suspended field operations, Shell maintained its legal presence in the country until the current liquidation decision.
Complex Scenarios and a Heavy Legacy:
The liquidation decision opens the door to several complex legal possibilities, especially since Shell's contract in Syria includes other international partners (a Chinese and an Indian company). Fundamental questions arise regarding the fate of this partnership:
Will Shell cede its share to the current (Chinese and Indian) partners?
Or will an agreement be reached to terminate the entire joint contract by the three partners and the Syrian side (the Syrian Petroleum Company)?
Will the state choose to grant operating rights ("blocks") to an entirely new company replacing the European giant?
Substantial Debt and Technical Legacy:
Parallel to the withdrawal negotiations, the issue of outstanding debts owed by the Syrian side to Shell, estimated at approximately $200 million US dollars, comes to the fore. This thorny file is expected to form a central part of the liquidation agreement. This indebtedness stems from Shell's financing of technical support and production in fields such as Al-Omar, Al-Tayim, Al-Ward, and Al-Tanak, where these costs, plus a specified profit margin, were to be recovered from the oil production of those fields.
On the technical side, sector experts praise Shell's role (through Al-Furat) as a high-caliber oil school, as its stringent standards contributed to qualifying and training a generation of Syrian personnel, equipping them with global expertise.
Additional Background and Motives for Withdrawal:
The company's operations have remained suspended since 2012, with previous hope of resuming activity if Western sanctions were lifted. Analysis suggests that the actual motives for withdrawal may be primarily technical, especially since some fields linked to the company's work, foremost being the Al-Omar field, are outside the control of the Syrian government, complicating any prospect of resuming operations or recovering investments.
Editing by Mohamed Hamdan
Zaman Al Wasl
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