Syria Signs Deal to Develop Oil Shale Deposits in Aleppo for Fertilizer Production

An Untapped Natural Resource

Syria's oil shale deposits are drawing renewed economic attention following the launch of a new investment project linking this resource to the phosphate sector and fertilizer manufacturing. Oil shale is a sedimentary rock containing organic matter that can be converted into oil and gas through thermal processing, with by-products applicable across electricity generation, chemical industries, asphalt materials, and fertilizer production.

Syria's principal oil shale reserves are concentrated in the Khanasir area of rural Aleppo, where geological estimates indicate substantial quantities with layer thicknesses that could support mining and industrial processing projects under the right conditions.

Memorandum of Understanding with a Saudi Firm

On 21 April 2025, the General Establishment for Geology and Mineral Resources signed a memorandum of understanding with Saudi company SAMIROCK, which specializes in mining, geological surveying, exploration, drilling, and industrial project execution. The agreement aims to study the use of oil shale as a feedstock in the production of diammonium phosphate (DAP) fertilizer, leveraging the company's proprietary ammonia gas production technologies within the Khanasir area.

SAMIROCK's vice chairman Ibrahim Babli stated that the oil shale found in Khanasir ranks among the best in the Arab region in terms of both quality and quantity, noting the strong global demand for phosphate fertilizers.

Project Phases and Financing

Syria's Ministry of Energy outlined a two-phase approach for the project:

• Phase One: Comprehensive evaluation studies covering geological, technical, and logistical aspects over a four-month period, aimed at determining economic feasibility and the parameters of a final contract.
• Implementation Phase: Should feasibility be confirmed, execution is expected to take approximately two years to reach full operational status, according to preliminary estimates.

On financing, the Ministry indicated that bank financing will be the primary mechanism given the scale of investment required and the difficulty of a single entity bearing the full cost directly.

Economic Dimensions of the Project

Political economy researcher Yahya Al-Sayed Omar noted that oil shale's significance extends beyond its role as a partial substitute for conventional fuel, as it serves as a raw material for chemical industries and fertilizer production, conferring broader added value. He added that linking it to DAP production could reduce operational costs, enhance the competitiveness of the final product, and achieve industrial integration among available natural resources.

Al-Sayed Omar identified several key factors bearing on the economic viability of such projects:

• High extraction and processing costs.
• The need for advanced technologies and specialized expertise.
• The long-term nature of investment and slow payback periods.
• The impact of global energy prices on project profitability.
• Availability of adequate infrastructure and a stable investment environment.

Challenges and Historical Context

Oil shale projects face multiple challenges, including technical requirements for modern processing technologies, the financial burden of large-scale investment, and environmental concerns related to water consumption and emissions. Al-Sayed Omar emphasized that the success of partnerships in this sector depends on clear legal frameworks, balanced interests among parties, and a transparent and stable investment climate.

This is not the first time the resource has attracted official interest. Syria's Ministry of Petroleum announced the discovery of oil shale in Khanasir in 2010, and the Syrian Investment Commission presented it in 2021 as a power generation opportunity with an estimated cost of 800 million dollars. A cooperation memorandum was also signed that year with Russia's Ros Geologiya covering an oil shale block, yet none of those initiatives advanced to implementation.