(Adds details, analyst comment, updates shares)
* Petrofac says COO sup ended, resigns from board
* Move relates to SFO investigation into Unaoil
* Petrofac shares fall 29 pct
* CEO Asfari stays on but removed from dealing with investigation
By Rahul B and Karolin Schaps
May 25 (Reuters) - Oilfield services provider Petrofac has suspended its chief operating officer in response to the UK Serious Fraud Office's investigation into Monaco-based Unaoil, another setback for the company that has been hit by the oil market downturn.
Petrofac's shares slumped as much as 29 percent, wiping more than half a billion pounds off its market capitalisation, after the company said in a statement on Thursday that COO Marwan Chedid had been suspended and had resigned from the board.
Investors feared the SFO investigation and Chedid's suspension could hurt the company's ability to win work.
Petrofac said on May 12 that CEO Ayman Asfari and COO Chedid had been questioned under caution by the SFO in connection with a global investigation into oil and gas services firm Unaoil.
Asfari will continue as chief executive officer, but will not be involved in any matters connected to the investigation, Petrofac said in its statement.
"The board is today announcing a number of decisions to ensure Petrofac can retain its focus on its operations and clients, whilst also ensuring the company is able to continue to engage with the SFO's investigation," Petrofac said.
The SFO launched a criminal investigation last July into Unaoil, its officers, employees and agents in connection with suspected bribery, corruption and money laundering.
The investigation is now threatening to embroil other British oil services companies after another British oil services company, Wood Group, said this week it was carrying out its own investigation into dealings with Unaoil.
Last month, Wood Group acquisition target Amec Foster Wheeler was also required by the SFO to disclose information on its relationship with Unaoil and Amec said it expects this "may well" develop into an investigation.
Petrofac has said it engaged Unaoil primarily in Kazakhstan to provide local consultancy services between 2002 and 2009.
Last year, the company commissioned law firm Freshfields Bruckhaus Deringer and accountants KPMG to carry out an investigation into its dealings with Unaoil in Kazakhstan after media allegations of misconduct, but said the investigation found no evidence to support the allegations.
On Thursday, Petrofac said it had set up a committee responsible for responding to the investigation, comprising its chairman, chief financial officer and independent non-executive directors, and would also hire an senior external specialist to review its compliance processes, given the scale of the investigation.
"We are concerned that (Chedid's) departure may have a knock-on effect on Petrofac's operational oversight and ability to secure new work," Morgan Stanley analyst Robert Pulleyn said.
The company had $617 million in debt at the end of last year, according to its financial results published in February.
Analysts at Bernstein estimated that, if found guilty, the company could face a potential SFO fine of $150 million-200 million.
It based its estimate on its assessment of Petrofac's profits in Kazakhstan and on previous fines the SFO has handed out to companies in similar cases.
A spokesman for Petrofac declined to comment. (Reporting by Rahul B in Bengaluru and Karolin Schaps in London; Additional reporting by Arathy Nair and Tenzin Pema in Bengaluru; Editing by David Clarke and Susan Fenton)