Dragon Oil sees Egypt as ‘prime’ area for expansion, CEO says
DUBAI, United Arab Emirates (Bloomberg) -- Dragon Oil Plc CEO Abdul Jaleel Al Khalifa sees Egypt as “one of the prime areas” for expansion after the explorer secured its first contract in the country.
“There’s a lot of potential in small deals in Egypt,” Al Khalifa said in a phone interview. “There are also big acquisition targets available. It’s a country with its own challenges, but it’s considered to be a huge growth market for newcomers.”
The company, focused mostly on projects in Turkmenistan, in May signed an exploration accord for Block 19 East Zeit Bay in the Gulf of Suez with the Egyptian authorities. Dubai-based Dragon Oil, which has about $1.9 billion in cash, is looking for assets to expand outside of Central Asia, the CEO said.
Dragon said net income gained 20% to $289 million in the first half from a year earlier, partly on higher oil prices. The company maintained its 100,000-bpd production target for the end of 2015, having raised crude output to about 81,000 bpd in August.
“The company and the board are very much willing to put money in good assets and we are in the market looking for potential targets,” Al Khalifa said. “We are more active than before.”
In Iraq, the company and Kuwait Energy Corp. are drilling an exploration well in Block 9, which has reached its first target, Dragon said.
In the Iraqi well “there are excellent shows, we feel the potential is there,” Al Khalifa said. “These are oil shows,” he said, declining to elaborate.