ENOC trims Turkmen plan in Dragon takeover

Emirates National Oil Co. Ltd. (ENOC), Dubai, will lower target oil production from the Cheleken area offshore Turkmenistan after acquiring full control of Dragon Oil PLC as it expands into upstream oil and gas operations.

The company has until now focused on downstream and midstream operations. It has a 120,000 b/d light-oil refinery and a natural gas processing plant in Jebel Ali along with trading and retail businesses.

ENOC owns 53.84% of Dragon Oil but has managed it as an autonomous holding. It has made a cash offer for remaining Dragon Oil shares and plans to take the company private “so that we can convert a current investment into an integrated operating subsidiary.”

In documents related to its takeover offer, it stated plans to “create a global, integrated oil and gas company.”

Dzheitune (Lam) and Dzhygalybeg (Zhdanov) fields, in 8-42 m of water on the Apsheron Ridge of the Caspian Sea, account for all of Dragon Oil’s production.

The operator increased output to a peak of 100,658 b/d on June 9 from an average of 7,000 b/d in 2000, when its wholly owned subsidiary Dragon Oil (Turkmenistan) Ltd. acquired a 25-year production-sharing contract with negotiable extension rights.

Dragon Oil planned to produce 100,000 b/d during 2006-21, but ENOC said it considers 90,000 b/d a more sustainable target in view of pipeline, storage, and water-handling investments required to meet the higher target.

Dragon Oil, Dubai, also holds exploration interests in Tunisia, Iraq, Afghanistan, Egypt, Algeria, and the Philippines.

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