Gulfsands Says Syria Sanctions Cloud Oil Production Outlook

Gulfsands Petroleum Plc (GPX), a U.K.- based oil explorer, said U.S. and European Union sanctions against crude imports from Syria cloud production prospects.

Gulfsands’s output in the country rose to 12,050 barrels of oil equivalent a day in August from 10,300 barrels in January, the company said in a statement in London. It drilled four exploration wells in Syria that yielded two discoveries, bolstering net income by 87 percent to $31.2 million in the first half.

Last month the company, which has operated in Syria since 2000, suspended payments to a cousin of Syrian President Bashar al-Assad after a state crackdown on dissidents killed thousands, prompting the sanctions. Gulfsands also suspended the voting rights of Rami Makhlouf, who owns 5.75 percent of the company and is one of the officials subject to EU visa bans and asset freezes.

“Uncertainty exists as to the production outlook for the remainder of the year as the Syrian government adapts to the sanctions imposed by the U.S. and the EU,” Gulfsands said in the statement in London.

The company said group working interest output rose to 10,923 barrels of oil equivalent a day in the first half from 9,689 barrels a year earlier. Gulfsands plans to drill two more exploration wells in Syria this year and one in Tunisia, and it has pre-qualified to participate in bidding rounds for 12 exploration blocks in Iraq.

To contact the reporter on this story: Brian Swint in London at bswint@bloomberg.net

To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net

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