Mr. Mahdi Sajjad, General Manager of Gulfsands Petroleum Syria Limited

Last updated Jan 19, 2011

Interview with Mr. Mahdi Sajjad, General Manager of Gulfsands Petroleum Syria Limited.

Q1: How did Gulfsands Petroleum start operating in Syria, and what are the stages it has been through up to the current situation?
Our operations in Syria started in 2005 when Devon Energy assigned its shares to Gulfsands Petroleum and Gulfsands became the operating company.

Various technical studies and seismic surveys were conducted before drilling which was finally commenced in the beginning of 2006.

During 2006 and early 2007, two wells were drilled, and by the end of June and early July 2007 drilling was commenced at Khurbet East (KHE 1 – well) which was Gulfsands first commercial discovery, and after drilling two appraisal wells thereafter, Gulfsands approached the Syrian Government to approve Khurbet East and consider it as a Commercial Discovery that can be developed in January 2008.

Gulfsands obtained Government approval in early February 2008 and concluded an agreement with the Syrian Petroleum Company to establish Early Production Facility (EPF) in April 2008.
The Syrian Petroleum Company completed work at EPF within three and half months which is a record time. On 21 July 2008 Gulfsands started production from Khurbet East with capacity of 10,000 bopd.

During EPF development and in early 2009 Gulfsands drilled other development wells which enabled Gulfsands to study and evaluate the estimated oil reserves of this new discovered field, and increase production up to 11,000-12,000 bopd.

After one year of production, drilling operations, and completion of seismic studies, production capacity of EPF was increased to 18,000 bopd, as other development wells were linked to this facility and Gulfsands achieved production of more than 18,000 bopd.

In the second half of 2009, Gulfsands Petroleum drilled an exploration well in Yousfieh, which led to drilling two more appraisal wells, and in early 2010 a second request was sent to the Syrian Petroleum Company and the General Petroleum Company to approve the new Commercial Discovery. EPF Substation was established with a capacity of 3000 bopd, and production was commenced from Yousfieh field in mid 2010.

In 2010, and after obtaining the approval of the Ministry of Petroleum and Mineral Resources and the General Petroleum Corporation, and with the remarkable support of the Syrian Petroleum Company, Gulfsands Petroleum Syria Ltd in cooperation with Dijla Petroleum Company implemented pipeline project with length of 25 km to pump produced oil to Tel Adas station instead of shipping it by trucks in order to avoid any environment damage and road accidents. The pipeline was operated on 3 October 2010 with capacity of 25,000 bopd noting that DPC current production is around 21,000 bopd.

And recently, DPC signed a contract with SAIPEM –Italy to establish Central Production Facility (CPF) as we intend to increase production up to 30,000 bopd by the fourth quarter of year 2012.

Q2: The Ministry of Petroleum has announced new onshore blocks for development and exploration, and intends to announce other offshore blocks in the Mediterranean.. Does Gulfsands intend to participate in new areas and expand its business in Syria depending on its successful achievements in this domain?
Since we believe in the promising investment in the Syrian oil, we recently signed a partnership agreement with ENI and submitted two offers to explore the announced onshore blocks depending on studies of primary data provided for these two areas, and we believe that we have proposed encouraging and competitive offers to the concerned parties in Syria.

We hope that our offers will be evaluated as soon as possible, and that the evaluators would take into consideration the importance entry of such a big company like ENI for the first time to the Syrian markets.
Also, we are interested in offshore areas as Gulfsands intends to actively invest in this new area in Syria.

Q3: what are the future plans of Gulfsands in Syria?
As I previously mentioned, we, in Gulfsands Petroleum intend to increase production to 30,000 bopd, and expand our business and investments in Syria as well as we always endeavor to search for other investing opportunities.

Also we will continue our programs and training plans that we have already started earlier to support and develop our Technical teams and local staff working in Oil and Gas industry. However, we will maintain implementing sustainable development of local communities by funding and supporting activities of charity and civil Societies particularly in Block 26 in Al Hassakah where Gulfsands in cooperation with Al- Hassakah Governorate will provide Computer technology training centers inside local schools in adjacent areas of our Fields.

What I would like to clarify here is, there’s a mutual and fruitful cooperation between the Syrian Government and Gulfsands Petroleum, and at the end of the day these efforts will benefit the interest of both parties, because the success of «Gulfsands» will be a success of the country in which it operates.
In addition to Gulfsands Petroleum plans to continue exploring and developing its expanded investments and business in the Middle East practically in Iraq, Tunisia, and the Gulf of Mexico.

Q4: How do you read the Investment Environment in Syria’s Oil and Gas?
The economic situation in Syria is going in the right direction, and there is effective implementation of important economic programs, as well as there are lots of development areas in Syria although of the very few foreign investment, whereas it should be the contrary, in the sense that volume of Foreign investments can be huge, and I think that just few decisions can guarantee attracting investments from abroad by a larger percentage ,the thing which will help to attract the largest of range of foreign investments.

Generally speaking, I believe there are promising economic future opportunities in Syria and this is what seems clear from the active movement currently taking place in all fields.

Q5: Finally, we want You to give us an idea of your resume and your work with Gulfsands, specially that successful accomplishments were achieved with You being as a General Manager..
Currently, I am Executive Director and President of Gulfsands Petroleum Plc, a Listed company in London Stock Exchange (AIM), and General Manager of Gulfsands Petroleum Syria Limited. I completed my Education in the United Kingdom, and worked from 1981–1988 with a consortium of British companies marketing products and engineering services in the Middle East and Africa. In 1988, I joined International Development Corporation in Dubai as a Senior Executive and later as Managing Director whilst also serving during the same period through to 1995 as a Director of Oil & Minerals Development Corporation. I had also established, as a founder, shareholder and financier, a number of companies with interests in the Middle East in different industry sectors but with particular emphasis on the energy and mining sectors. In 1998 I joined Gulfsands Petroleum as a founder and Executive Director.