(MENAFN- The Arabian Post) Arabian Post Staff -Dubai

Dubai-based upstream operator Dragon Oil has announced a major new oil discovery offshore Egypt's Gulf of Suez, a development that industry watchers say could underpin its ambition to boost production significantly by 2026. The company, a unit of Emirates National Oil Company, made the find at its North-East Ramadan Concession, reaching a total depth of 13,425 feet to intersect the Crystal NER-1X reservoir in the Honey Sand formation. Initial wireline logs confirmed a 224-foot hydrocarbon column, indicating meaningful commercial potential.

The well was drilled under the company's commitment agreement in the NE Ramadan concession in partnership with Egypt's Egyptian General Petroleum Corporation and the Gulf of Suez Petroleum Company. The pair of state-owned Egyptian entities jointly operate with Dragon Oil in the concession. The flow to production is projected at around 3,000 barrels per day once the well is tied into existing infrastructure. Final wireline logging, core sampling and reservoir evaluation are underway before full integration into the production grid scheduled for July.

The discovery supports Dragon Oil's longer-term plan to raise output from its current base of more than 140,000 barrels of oil per day and achieve an aggregate target of roughly 300,000 barrels of oil equivalent per day by 2026, according to the company's investor materials. The Gulf of Suez investment follows earlier gains from assets in Turkmenistan, Iraq and Algeria. Additionally, the firm signed a strategic memorandum of understanding with PETRONAS in late October to explore upstream growth opportunities in Asia-Pacific and other frontier regions, signalling a willingness to pursue both organic and acquisition-driven expansion.

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In Turkmenistan, Dragon Oil expects production to rise to approximately 200,000 bopd by 2030, leveraging digital-technology programmes such as artificial-intelligence-enabled reservoir modelling and real-time monitoring. The company has invested more than US$11 billion in the country's oil sector since the production-sharing agreement began in 1999 and has added more than 200 social-development projects in local regions. That upstream base remains a pillar of its global growth model.

Analysts say the Egyptian find is particularly significant because it taps an under-developed offshore domain using advanced Ocean-Bottom Node seismic technology that identified the Honey Sand formation. The drilling from the existing Al-Fanar platform avoided major new infrastructure investment, improving cost efficiency and time to tie-in. The fact that Dragon Oil already holds the working interest via its GUPCO joint venture means it can fast-track upstream investment and production.

Nevertheless, a number of risks remain. The Egyptian concession still requires commercial validation of reservoir behaviour and sustained flow testing; many wells encounter initial signs of hydrocarbons but fail to deliver long-term viability. The broader upstream industry is also under increasing pressure from the energy-transition agenda and environmental-regulation developments. Investors and stakeholders will watch closely how Dragon Oil balances growth ambitions with the demands of sustainability, given the global shift away from fossil fuels.

Company leadership emphasises that the teamwork between its Dubai and Cairo operations, together with EGPC and GUPCO partners, reflects a mature technical capability that bodes well for further exploration success. Chief Executive Abdulkarim Ahmed Al Maazmi said the technical result“demonstrates the strength of our technical partnership and underlines our vision to unlock new opportunities across our assets in Egypt.”

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Regionally, the Gulf of Suez has been a mature producing basin, yet the new find suggests there remains untapped potential when combined with modern subsurface imaging and drilling techniques. Some energy-sector commentators believe the discovery could encourage other operators to revisit older fields or deeper formations, heightening competition.

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