Shell Seeks Syria Exit While U.S. Firms Eye Al-Omar Oilfield

Shell plc SHEL is reportedly seeking an exit from Syria’s al-Omar oilfield, the country’s largest producing asset, as the government regains control of key energy infrastructure and U.S. companies signal renewed interest in the sector. The development highlights a potential reshaping of Syria’s oil and gas industry more than a decade after the war and sanctions forced Western majors to pull back.

Shell’s Long-Suspended Presence in Syria

According to Syria’s state-run Syrian Petroleum Company, Shell has asked to withdraw from the al-Omar oilfield and transfer its stake to state-owned operators. The field was operated as a joint venture between Shell and the Syrian Petroleum Company before the conflict erupted in 2011.

Shell, currently carrying a Zacks Rank #3 (Hold), suspended all exploration and production activities in Syria in December 2011 following the outbreak of the civil war and the imposition of European Union sanctions on Syria’s oil sector. Since then, its stake in al-Omar has remained inactive, with negotiations now underway to reach a financial settlement that would allow full state control of the asset.

While Shell has not publicly commented on the request, Syrian officials said the transition could be completed in a short period, though no specific timeline has been disclosed.

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Al-Omar Returns to Government Control

The move comes after Syrian government forces regained control of the al-Omar oilfield following a swift offensive against Kurdish forces, who had held the site for nearly a decade. During that time, the field was used partly as a military base and operated at a fraction of its potential capacity.

At its peak, al-Omar produced around 50,000 barrels per day. Under Kurdish control, output reportedly fell to about 5,000 barrels per day, using what officials described as basic and damaging production methods. As a result, the field now requires significant repairs and modernization before it can return to meaningful production levels.

U.S. Companies Eye a Return to Syria

Even as Shell seeks an exit, U.S. energy firms appear to be exploring opportunities in Syria’s battered oil and gas sector. Syrian officials said ConocoPhillips COP is expected to return to invest in gas fields. COP also entered into a memorandum of understanding with Syria in November 2025 to develop their existing gas resources and explore new ones. Per the new memorandum with ConocoPhillips, the gas output is expected to rise by 4-5 million cubic meters per day within the span of one year.

Other U.S. companies, including Chevron Corporation CVX and HKN Energy, have also expressed interest. While Chevron did not comment, the company acknowledged it routinely reviews various investment opportunities to support its upstream business. Syrian President Ahmed al-Sharaa recently met Chevron representatives in Damascus, signaling growing diplomatic and commercial engagement.

Officials also said Chevron could invest in offshore fields, with Syria aiming to resume oil and gas exports in the future.

Oil Production in Syria Falls Far Below Pre-War Levels

Despite the renewed interest, Syria’s oil sector remains a shadow of its former self. Current production across the country is estimated at less than 100,000 barrels per day, down sharply from about 400,000 barrels per day before the war began in 2011.

Some oilfields in the northeastern province of Hasakah are still outside full government control, but authorities say efforts are underway to secure all remaining sites. Once control is consolidated, Damascus plans to rebuild production capacity and attract foreign investment to revive output.

What Comes Next for Syria’s Energy Industry

Shell’s exit from al-Omar marks the end of an era for one of Syria’s most important energy partnerships. At the same time, growing interest from U.S. firms suggests a possible shift in the country’s energy landscape, provided political, security and sanctions-related hurdles can be managed.

For Syria, the challenge will be modernizing damaged fields, restoring production and translating renewed investor interest into tangible gains for an industry that once formed the backbone of its economy.

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This article originally published on Zacks Investment Research (zacks.com).

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