Dubai's Dragon Oil will invest $1 billion (Dh3.67bn) over five years in upstream assets in Egypt after replacing BP in the Gulf of Suez.
Dragon Oil, a subsidiary of state-owned Emirates National Oil Company, completed the purchase of BP's assets on Monday and is set to join the Egyptian General Petroleum Corporation in the Gulf of Suez Petroleum Company (Gupco), which operates 11 exploration and production concessions.
In June, BP, one of the largest international oil companies in Egypt, announced its intention to sell some of its concessions in the country as part of a plan to divest more than $10bn worth of assets over the next two years.
Gupco plans to raise production from its concessions to above 75,000 barrels per day by 2021 from the current level of 60,000 bpd.
However, Dragon Oil aims to boost output beyond the projected 75,000 bpd and maintain that level for 10 years, with additional drilling and investment of $1bn over the next five years.
The company said in February it was aiming to produce 93,000 bpd this year with an output ramp-up in Turkmenistan and southern Iraq, while it appraises opportunities in southern Yemen, Egypt and Sudan. Dragon Oil plans to triple production to 300,000 bpd by 2025 as part of its upstream investment drive.
The hydrocarbons explorer operates concessions in Turkmenistan, Algeria, Egypt, Afghanistan, Tunisia and the Philippines. The company had earmarked $13bn for investment over 10 years with $500 million to be spent this year.