The Biden administration has decided it will not renew a waiver that allowed a politically connected US oil company to operate in northeast Syria under President Donald Trump's pledge to “keep the oil” produced in the region, according to a US official familiar with the decision.
Treasury Department rules prohibit most US companies from doing business in Syria. The waiver for Delta Crescent Energy was issued in April 2020, months after Trump announced that he wanted to keep some US troops in the oil-rich region to maintain control of the oil profits.
Trump's “keep the oil” message was no longer US foreign policy under the Biden administration, and using the US military to facilitate Syrian oil production was deemed inappropriate, according to the official, who was not authorized to publicly discuss the decision and spoke on condition of anonymity, The Associated Press reported.
The company was founded in 2019 by James Cain, US ambassador to Denmark under President George W. Bush; James Reese, a retired Army Delta Force officer; and John Dorrier Jr., a former executive with United Kingdom-based Gulfsands Petroleum. Cain, a onetime executive with the NHL’s Carolina Hurricanes, has donated more than $30,000 to the Republican Party and GOP candidates over the years.
Northeastern Syria is the center for what remains of Syria’s oil industry. It is in shambles but remains one of the main sources of revenues for the Kurdish-led autonomous administration there.
Trump repeatedly spoke of keeping some US troops in Syria to help “keep the oil" and “secure the oil," but his aides sought to dispel the idea the United States was trying to profit from the region's oil reserves. After DCE's license, from the Office of Foreign Assets Control, to operate became public last August, the State Department issued a statement in which it underscored that the “United States government does not own, control, or manage the oil resources in Syria."
Trump's comments about Syria's oil frustrated critics, and some allies, who said the loose talk fed into the narrative that American policy in the Middle East was driven by US energy concerns and they argued it undercut US diplomatic efforts to press for peace and stability in the region.
Dorrier, DCE's CEO, said the company had some $2 billion in contracts to sell oil into the international market that will benefit American allies in northeast Syria that have helped in the fight against the ISIS group. He said Trump’s comments did not lead to the company winning the oil licensing agreement and that presidential orders issued during the Obama administration had invited US companies to apply for licenses in agriculture, telecommunications and oil and gas in Syria.
“If the Biden Administration chooses not to renew the OFAC license, it will be a substantial change in policy that does not support Coalition Allies who fought and died to eliminate ISIS,” Dorrier said in a statement.
“Depriving our Allies of the opportunity for sanctions relief on critical infrastructure as laid out by the Obama administration would, in effect, turn the North and East of Syria over to Russian, Regime and Iranian forces.”
Dorrier also said Trump’s “keep the oil” message “was hyperbole, not policy.”
The White House press office declined to comment about the decision, stating that as “a general matter” it does not comment on specific licenses, including to confirm whether one exists.
Biden administration officials, during a visit this month to northeast Syria, stressed to Kurdish administrators overseeing the area that the US military presence was exclusively focused on preventing an ISIS resurgence, according to a State Department official who was not authorized the discuss the matter publicly and spoke on condition of anonymity.
DCE said it has not received word from the Treasury Department that the license, which was set to expire at the end of April, will not be renewed. The department typically gives companies additional time to wind down operations, according to the US official.
