I've found a workaround for those who might need it:

Edit /etc/UPower/UPower.conf and change the line at the bottom
"IgnoreLid=false" to "IgnoreLid=true".

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https://bugs.launchpad.net/bugs/792636

Title:
  Power section no longer allows configuration of "when the lid is
  closed" action in Oneiric

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