AXP Energy has struck a farm-in deal to earn a 25% interest in Block 9, a prolific onshore Syrian oil and gas contract with substantial historical prospective resources, positioning the company amid a reopening Middle East energy market.
- Farm-in grants 25% interest in 10,039 km² Block 9 PSC in Syria
- Historical prospective resources up to 765 MMboe at Itheria prospect
- Sanctions lifted in 2025 open Syria to major international oil players
- AXP plans seismic reprocessing and drilling two wells in 2027
- Michael C.P. Rego joins AXP board, bringing Middle East expertise
Strategic Entry into a Tier-1 Hydrocarbon Basin
AXP Energy Limited (ASX:AXP) has secured a significant foothold in the Middle East by earning a 25% participating interest in the Block 9 Production Sharing Contract (PSC) in north-west Syria. Spanning over 10,000 square kilometres in the prolific Palmyride Basin, Block 9 represents a rare opportunity to access a Tier-1 hydrocarbon system at a pivotal moment of geopolitical reopening.
The asset boasts historical prospective resources estimated by previous operators at up to 765 million barrels of oil equivalent (MMboe) for the Itheria prospect and 178 MMboe for the Bashaer prospect on a 100% basis. AXP’s economic interest will be lower due to its 25% stake and applicable royalties. These figures, while substantial, are based on legacy assessments from 2010 and 2011 and have not yet been independently verified by AXP, underscoring the exploration and development risks ahead.
Geopolitical Reset Unlocks Investment Window
The timing of AXP’s farm-in aligns with Syria’s recent geopolitical reset, which has dismantled sanctions that had stifled foreign investment for over a decade. Key sanctions were lifted sequentially throughout 2025, including by the EU, UK, Australia, and critically, the repeal of the US Caesar Act in December 2025. This has attracted major international oil companies such as Chevron, ConocoPhillips, TotalEnergies, and Eni to re-engage with Syria’s oil and gas sector, validating the opportunity and intensifying competition for early positions.
Syria’s strategic location offers export routes to the Mediterranean that bypass the volatile Strait of Hormuz, enhancing the geopolitical appeal of Block 9. Existing infrastructure, including pipelines and terminals at Banias and Tartous, provides potential low-cost tie-in points for future production, a notable advantage in a region where infrastructure rehabilitation is underway.
Planned Work Program Targets 2027 Drilling
AXP plans to commence immediate 3D seismic reprocessing using modern techniques to refine the geological model, with reinterpretation expected to complete in the first half of 2027. The company aims to drill two wells in the fourth quarter of 2027: re-entering the suspended Itheria-1 well to a deeper target and drilling the Bashaer-1 prospect. These milestones will provide crucial data points for AXP to assess commercial viability and unlock value.
The farm-in deal requires AXP to fund 35% of capital expenditure during the earn-in phase, including drilling and performance bonds, with an initial US$100,000 deposit and a further US$1 million advanced payment. The operator, Simpora Latakia Limited, holds 75% of Block 9 and brings significant in-country expertise, supported by its parent company Septima Energy. Michael C.P. Rego, Septima’s Managing Director with over 40 years of global oil and gas experience, will join AXP’s board to steer operations in Syria.
Balancing Middle East Ambitions with Oklahoma Operations
While AXP ventures into the Middle East, it continues to develop its Oklahoma acreage, where it holds 1,400 acres in Kay County with over 30 potential drilling locations. Recent progress in Oklahoma includes the Charlie #1 well reaching initial production, marking a transition toward revenue generation and demonstrating AXP’s operational capabilities in established US basins.
This dual focus reflects a strategy to balance high-potential frontier exploration with near-term production upside. The Oklahoma assets provide a cash flow foundation, while the Syrian farm-in offers exposure to a potentially transformative growth story as the Palmyride Basin’s oil and gas sector reactivates.
Bottom Line?
AXP’s farm-in to Block 9 positions it at the forefront of Syria’s energy sector revival, but the path to commercial production hinges on seismic reinterpretation and drilling outcomes in 2027 amid geopolitical uncertainties.
Questions in the middle?
- How will AXP’s seismic reprocessing reshape the understanding of Block 9’s prospects?
- What impact will the entry of majors into Syria have on AXP’s ability to advance its projects?
- Can AXP balance capital demands between its Syrian exploration and Oklahoma development programs?