Dubai has reshaped its oil and gas operations by allowing Emirates National Oil Co Ltd (Enoc) to take over Dubai Natural Gas Co Ltd (Dugas).

Enoc yesterday confirmed that Dubai has transferred ownership of Dugas to Enoc. "Yes, it is true and is under moves to bring another Government of Dubai oil and gas company under Enoc," said a company spokesperson.

The addition of Dugas would make the group stronger and more competent to meet the challenges currently facing the oil and gas industry, Enoc chief executive Hussain Sultan said.

"The new structure will provide opportunities and challenges to all those involved and will take the Enoc group a step further towards providing an integrated energy strategy for Dubai," Sultan said. "The Enoc group will work hard to ensure its new subsidiary is fully equipped to achieve improved performance and further growth."

Sheikh Hamdan bin Rashid Al Maktoum, Deputy Ruler of Dubai and Minister of Finance and Industry, is chairman of both companies. While Sultan is Enoc chief executive, Mirza Hussain Al Sayegh was as Dugas vice-chairman.

Established in 1993, Enoc aims at development of downstream and upstream activities in the oil and gas sector and beyond, and to encourage the UAE's economic diversification.

One of its prominent subsidiaries is Emirates Petroleum Products Co (Eppco). Enoc has a growing range of business ventures including refining, trading, storage, petroleum retailing, IT, jet fuel supply and aviation fuelling. It has joint ventures with major international companies such as Caltex and Vopak.

Enoc operates a subsidiary, Emirates Gas (Emgas), a leading liquefied petroleum gas (LPG) supplier in Dubai and the Northern Emirates.

Dugas, inaugurated in 1980, processes associated natural gas produced with Dubai's crude output and from other sources such as Sharjah's gasfields. In 1997 it set up a $250 million MTBE (methyl tertiary butyl ether) plant in Jebel Ali.