Syria's oil minister says production unit in Banias refinery damaged in explosion

AMMAN (Reuters) - There was a large explosion in one of the production units of Syria’s Banias refinery near the Mediterranean coast during maintenance operations, Syria’s oil minister said on Thursday.

One worker was killed and an engineer was injured, minister Ali Ghanem was quoted as saying on state television about the blast at Syria’s largest refinery.

It was not clear how extensive the damage was and if it affected the refinery, which has the capacity to process over 130,000 barrels per day of crude.

A report on state-owned Ikhbariyah television station earlier said the explosion took place during welding of one of the tanks at the refinery.

Banias along with Homs refinery, the only other refinery, cover a significant part of Syrian demand for diesel, fuel for heating, gasoline and other petroleum products, according to industry experts.

Some crude and products have been imported from Iran and Russia during the Syrian war but U.S. and EU sanctions have made it difficult to get many supplies of Iranian crude and some products to cover shortfalls.

Oil production in government-controlled areas in Syria collapsed after Damascus lost most of its oil producing fields in a stretch east of the Euphrates River in Deir al-Zor.

These oilfields have been in the hands of Kurdish-led Syrian Democratic Forces (SDF) since they seized them from Islamic State militants. U.S. President Donald Trump has said that despite withdrawal of American troops from northern Syria in October he would keep a small number in the Kurdish-held areas “where they have the oil”.

Banias gets a significant part of its oil needs from these areas where trucks transport crude from Kurdish controlled fields in Hasaka and Deir al Zor province into government-held territory, diplomats say.

Washington allows this trade to help secure a source of revenues for the Kurdish-led authorities to finance their administration, industry experts and Western diplomats say.

Reporting by Suleiman Al-Khalidi; Editing by Peter Graff and Grant McCool