BP to sell oil assets in Egypt to Dragon Oil

CAIRO – 4 June 2019: BP decided to sell its interests in Gulf of Suez oil concessions in Egypt to Dubai-based oil and gas company Dragon Oil.

The deal is subject to the Egyptian Ministry of Petroleum and Mineral Resources’ approval.

The agreement, whose financial details are not being disclosed, stipulates that Dragon Oil will purchase producing and exploration concessions, including BP’s interest in the Gulf of Suez Petroleum Company (GUPCO).

According to BP, the deal is expected to be completed during the second half of 2019 and is part of BP’s plan to divest more than $10 billion of assets globally over the next two years.

Dragon Oil is a wholly-owned subsidiary of the Emirates National Oil Company (ENOC).

“Egypt is a core growth and investment region for BP. In the past four years, we have invested around $12 billion in Egypt – more than anywhere else in our portfolio – and we plan another $3 billion investment over the next two years. We look forward to continuing to broaden our business here, working closely with the government of Egypt as we develop the country’s abundant resources,” BP Chief Executive Bob Dudley said.

“We continue to bring on new developments and deliver important gas supplies for the country. We remain on track to triple our 2016 net production from Egypt by 2020. As we grow our business here, we also keep our portfolio under review. We believe Dragon Oil is well-placed to operate these mature assets, delivering further value for Egypt,” Regional President of BP North Africa Hesham Mekawi said.

In February, BP announced first gas production from the second stage of its West Nile Delta development offshore Egypt. The project, which produces gas from the Giza and Fayoum fields, was developed as a deep-water, long-distance tie-back to an existing onshore plant.

Previously, BP and UAE-based Mubadala Investment Co signed an agreement to buy stakes in the Nour deep water gas concession off the northern coast of Sinai. Upon this agreement, BP bought 25 percent and Abu Dhabi state fund Mubadala bought 20 percent of the Nour concession from Italian energy company Eni.