DNO is the Operator of Block 43 in Yemen with a working interest of 75%.
A farm-out arrangement has been concluded with an Australian based oil company, Oil Search (Yemen) Limited (OSL). OSL will participate in the block with 25% working interest with effective date 1st September 2003. DNO's new interest after the farm-out is 50%.
OSL will pay DNO an entry fee of $2.2 mill and make a further two-for-one payment of the costs of the first of the two remaining committment wells on the block. All other expenditures will be paid by OSL in accordance with it's interest share. The two committment wells are planned drilled end 2003 and early 2004.
DNO has through this farm-out reduced it's risk of the remaining exploration programme and maintained a substancial share of the lisence.