ENOC questions Dragon’s production target

Offshore staff

DUBAI, UAEEmirates National Oil Co. (ENOC), which has submitted a takeover bid for Dragon Oil, foresees operational challenges with Dragon’s targeted production of 100,000 b/d of oil over the next five years.

These, it says, include pressure decline, increasing gas and water production, wax deposition, sand production, and wells that need to be shut in.

ENOC believes that mitigating these issues will likely require additional investments above Dragon Oil’s stated budget of up to $700 million capex in 2015.

Assuming the takeover goes through, ENOC says it would set sustainable and de-risked targets including production in the near term of around 90,000 b/d, in order to maximize recoverable reserves.

07/16/2015

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