Sinochem, Gulfsands shut down Syria oil ops

Mon Dec 12, 2011 9:41am GMT
 

* State-controlled chinese group caught in EU sanctions

* Gulfsands shares fall

By Tom Bergin

LONDON, Dec 12 (Reuters) - 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.

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 from this.

The Syrian fields are the only cash-generating assets Gulfsands owns, save for a few small interests in the U.S. 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.

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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