Syria’s oil and gas sector is showing signs of renewed activity, with domestic production increasing, damaged infrastructure returning to service and international energy companies exploring new investment opportunities. The recovery, however, is also raising a critical question for the country’s longer-term energy strategy: under what terms will foreign companies participate in rebuilding and developing Syria’s hydrocarbon resources?

According to data released by the Ministry of Energy, Syria produced 14.8 million barrels of crude oil and 1.429 billion cubic metres of raw natural gas during the first half of 2026. Output also included 3.5 million tonnes of petroleum products, 1.252 billion cubic metres of clean natural gas and 35,500 tonnes of liquefied petroleum gas.

The figures come as the government seeks to restore an energy industry severely weakened by years of conflict, infrastructure damage and underinvestment, while opening the sector to renewed international participation.
Wells and infrastructure return to service

Rehabilitation has been a major component of the recovery effort. During the first half of the year, 152 wells were returned to operation, 10 new wells entered production and 21 wells were repaired, according to the ministry.

The Al-Thawra Petroleum Center and Al-Bashri Station were rehabilitated, while primitive burners were removed in four governorates. Two drilling rigs were restored and the Amrit offshore drilling rig returned to service.

Other infrastructure work included rehabilitating five kilometres of the Conoco gas pipeline, restarting the main pumping station in Homs after 12 years of inactivity and bringing gas turbines at the Jbessa field back into operation.

The Dabousiya Gas Station was also prepared to facilitate gas transfers to Lebanon, highlighting the potential for Syria’s recovering energy infrastructure to regain a wider regional role.
Foreign companies explore opportunities

Alongside rehabilitation, international engagement with the Syrian energy sector is beginning to move beyond preliminary discussions. The Ministry of Energy said seven memoranda of understanding and three petroleum-sector development contracts were signed with international companies during the first half of 2026.

Among the most significant developments is renewed interest from TotalEnergies. In July, CEO Patrick Pouyanné said the company was evaluating an offshore exploration contract following an earlier technical review agreement with QatarEnergy and ConocoPhillips covering Block 3 off the Latakia coast.

Security conditions, however, continue to influence investment decisions. Pouyanné indicated that the situation did not yet allow TotalEnergies to resume onshore operations.

The offshore initiative follows a June agreement involving ConocoPhillips and Novatera to develop existing gas fields and explore new prospects. Initial projections cited in the Syrian Observer suggest the initiative could add between four and five million cubic metres of gas per day within a year.

The involvement of major American, European and regional companies could mark the beginning of a broader restructuring of Syria’s energy investment landscape after years of limited foreign participation.
Large gap remains from pre-war production

Despite recent progress, Syria remains far below its former production capacity.

Before the conflict, the country produced around 380,000 barrels of oil per day and approximately 900 million cubic feet of natural gas. Estimates cited by the Syrian Observer indicate that oil production subsequently fell by nearly 80%, while gas output was roughly halved.

The first-half 2026 crude figure of 14.8 million barrels is equivalent to an average of about 82,000 barrels per day, illustrating the scale of the remaining recovery challenge.

While rehabilitating existing wells and facilities can generate relatively rapid gains, restoring production on a larger scale will require substantial investment, modern technology and reliable infrastructure and export routes.
Imports remain essential

Syria also continues to depend heavily on imported energy supplies.

During the first half of 2026, oil terminals received 110 tankers. Imports included 1.5 million tonnes of crude oil, 1.016 billion cubic metres of natural gas, 598,000 tonnes of mazut, 283,000 tonnes of gasoline, 196,000 tonnes of liquefied petroleum gas and 32,000 tonnes of fuel oil.

Electricity plants received 2.059 billion cubic metres of gas and 859,251 tonnes of fuel oil, while 3.5 million tonnes of petroleum products were supplied to the domestic market.

The figures underscore the dual challenge facing the sector: Syria must increase domestic production while continuing to secure sufficient imported supplies to meet immediate energy demand.

Progress had already been reported during 2025, when natural gas supplies increased by 35% to nine million cubic metres per day. Syria also received 96 million cubic metres of Qatari gas and 364 million cubic metres of Azerbaijani gas during the year.
Investment brings a new question: on what terms?

As foreign capital returns, attention is increasingly shifting from simply raising production to determining the contractual framework governing investment.

Oil and gas projects can operate under concession agreements, production-sharing arrangements or service contracts, each distributing risk, costs, profits and control differently between the state and foreign operators.

For Syria, which needs considerable external capital and technical expertise, attracting investors will require commercially viable terms. But analysts cited by the Syrian Observer caution that countries rebuilding after prolonged instability can find themselves negotiating from a relatively weak position.

Energy security analyst Umud Shokri estimates Syria’s remaining resources at around 2.5 billion barrels of oil and 8.5 trillion cubic feet of natural gas. Turning those resources into sustained production will require major capital expenditure, while security, infrastructure, financing and regulatory risks can lead investors to seek more favourable contractual conditions.

The challenge for Syria will therefore be to attract sufficient capital without surrendering an excessive share of the long-term economic value of its resources.
Transparency, technology and local capacity

Oil market expert Othman al-Hadiri argues that the identity or nationality of an investor is less important than the financial and technical conditions attached to an agreement.

Revenue-sharing arrangements, contract duration, cost-recovery provisions and government oversight can ultimately determine how much value remains within the Syrian economy once production begins.

Technology transfer and workforce development are equally important. Foreign investment could provide Syria not only with financing but also with modern drilling techniques, reservoir management expertise and technical skills that have been difficult to access during years of isolation.

Transparent auditing of operating and development costs will also be important, particularly under arrangements allowing companies to recover investment expenditure from production revenues before profits are divided.
Syria’s regional energy role could also revive

The recovery of domestic production is only one dimension of Syria’s potential energy importance.

Its geographic position gives the country strategic value as a possible transit route between Iraqi and Gulf energy resources and Mediterranean markets. The potential revival of the Kirkuk–Baniyas oil pipeline, linking Iraqi fields with Syria’s Mediterranean coast, could reinforce that role.

According to the Syrian Observer, Washington expressed support in July for efforts to reactivate the pipeline. If realised, such projects could give Syria additional economic value through transit, refining and export activities beyond its own upstream production.
From restoring output to shaping the sector’s future

Syria’s energy recovery has therefore entered a more complex stage. The return of wells, pipelines and processing facilities demonstrates that production can gradually be restored, while interest from international companies suggests that foreign capital and technical expertise could accelerate the process.

But the next phase will not be measured solely by barrels of oil or cubic metres of gas.

The agreements negotiated today could shape the ownership structure, revenue distribution and strategic direction of Syria’s energy industry for years to come. Contract duration, competitive bidding, review mechanisms, technology transfer, employment requirements and cost-recovery provisions will all influence how much of the sector’s eventual recovery translates into lasting domestic economic value.

For Syria, the objective is consequently broader than bringing foreign energy companies back or restoring pre-war production. The greater challenge will be using international investment to rebuild the sector while ensuring that the long-term value generated by Syria’s natural resources remains an important component of the country’s own economic recovery.

Sources: SANA; The Syrian Observer