Gulfsands in rights issue warning

London-listed oil producer Gulfsands Petroleum today said it may need a rights issue to replace revenues lost as a result of the Syria conflict.

In an announcement before its annual shareholders meeting today, the company said it has made no significant revenues since “force majeure” was declared on its business in Syria – the bulk of the group’s operation – in December 2011 and its activities in the country ceased.

It said it may be necessary to issue new shares to raise money to keep the company running.

“We certainly do not rule out the possibility that we many need to issue new share capital, although we would only do so on terms that make commercial sense and with an emphasis on minimising dilution,” a spokesman said.

Shares fell by 1.22p to 47.62p. However, the spokesman said other options remained open to the company, which is also building a presence in Columbia, Morroco and Tunisia to offset the freezing of its activities in Syria.