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Abu Dhabi, UAEWednesday 20 February 2019

UAE's Dragon Oil targets higher production in 2019 on ramp up in markets

The Enoc entity has earmarked $13bn to be spent over the next decade

A Dragon Oil offshore oil platform in the Caspian Sea, offshore Turkmenistan. The Dubai firm currently produces 87,000 bpd in the country. Source: Dragon Oil
A Dragon Oil offshore oil platform in the Caspian Sea, offshore Turkmenistan. The Dubai firm currently produces 87,000 bpd in the country. Source: Dragon Oil

The UAE’s Dragon Oil is targeting 93,000 barrels per day of production this year on the back of an output ramp-up in Turkmenistan and southern Iraq, while it appraises opportunities in southern Yemen, Egypt and Sudan, its chief executive said. The increase forms part of wider plans to triple production to 300,000 bpd by 2025 as part of its upstream investment drive.

"For 2019, we’re talking about 93,000 bpd. [In] Turkmenistan 87,000 bpd and maybe 6,000 bpd from Iraq, [where we have] a 30 per cent equity,” said Ali Al Jarwan in Cairo.

Dragon Oil, a fully-owned subsidiary of Dubai’s Government-owned Emirates National Oil Company, is a hydrocarbons explorer operating concessions in Turkmenistan, Algeria, Egypt, Afghanistan, Tunisia and the Philippines. The company had earmarked $13 billion to be invested over 10 years with $500 million to be spent in this year alone.

In Egypt, the company had commenced drilling on one of two wells in the East Zeit concession in the Gulf of Suez region, Mr Al Jarwan said.

"We will see after drilling these two wells, we will also see in Algeria, we’re assessing prospects in Tunisia, so we’re positive...we’re looking for any opportunities that are coming,” he added.

In Turkmenistan, where production currently averages 87,000 bpd, the company is routing the gas through Russia or neighbouring Azerbaijan.

“We have two choices - through Russia or Azerbaijan and then we have local marketing and they will use it in refining and for domestic uses. We have really good relationship with the Turkmen government,” said Mr Al Jarwan.

In Iraq, where Dragon Oil has a 30 per cent stake in Block 9, with majority stakeholder Kuwait Energy and newcomer Egyptian General Petroleum Corporation, he said the company was “optimistic” about future production.

In a separate announcement on Tuesday, Dragon Oil's parent Enoc Group said it was expanding its aviation operations in Egypt through its acquisition of a share in the jet fuel hydrant system at Terminal 2 of Cairo International Airport.

"Our strong track-record in jet fuel operations will enable us to provide the highest standards of jet fuel operations, EHS [environment, health and safety] and business performance, which will undoubtedly enable the country’s aviation infrastructure," said Enoc group chief executive Saif Al Falasi.

The group also plans to establish a physical presence in Egypt by opening an office for aviation operations and jet fuel marketing.

The move follows recent agreements signed with the EGPC to supply jet fuel to all airports in the country.

The hydrant system in which Enoc announced investment currently fuels 18 aircraft at terminal two and has been in operation since 2017.

In an interview with The National in October, Mr Al Falasi said Enoc Group was looking to invest up to $2 billion in 2019 as it explored potential to develop a liquefied petroleum gas terminal in Bangladesh.

Updated: February 12, 2019 04:41 PM

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