Dubai’s Emirates National Oil Co (ENOC) plans to expand in the region after the United Arab Emirates deregulated fuel prices, lifting financial pressure on the company, it said on Wednesday.
The firm has struggled in recent years, losing hundreds of millions of
dollars annually because it was obliged by UAE rules to sell
gasoline at a fraction of international market rates.
But the UAE government said this month it was abandoning fixed,
subsidised fuel prices and would let gasoline and diesel prices float
in response to global trends. In August, the price of a litre of octane
95 gasoline will climb 24% while diesel will fall 29%.
ENOC, which is owned by the Dubai government and operates
service stations, fuel terminals and oil tankers as well as a refinery,
said in a statement that it would now look at accelerating plans to
enter “new geographies regionally”.
“With the Ministry of Energy having deregulated oil prices, this
decision will now enable us to move forward with our expansion
plans,” it said without elaborating.
Banking sources told Reuters in February that ENOC had hired a
five-person team to work on mergers and acquisitions as it sought to
expand beyond Dubai.
The company secured a $1.5 billion, nine-year loan from 21 banks
in June to support its growth.