DNO ASA - May Production Update

The oil production net to DNO (WI) from Norway and Yemen was as follows (BOPD):

 

 

 

 

The May 2006 production was down by 1.105 BOPD compared to April. The reduction is caused by lower production from Yemen primarily due to well work undertaken at the Nabrajah Field and reduced water handling capacity at Tasour.

 

Installation of increased water handling capacity and gas injection capacity at Nabrajah is expected to be completed during June. This should allow all the Qishn wells to be brought on stream adding more production volumes. Reinstallation of the water handling capacity at the Tasour Field is also expected to be completed gradually during the next moths.

 

Due to the lower production from Nabrajah Field YTD the Company expect that the 2006 full year production will be lower that the guided target of 20.000 BOPD (WI). A revised target for the year will be released to the market at a later stage.

 

The main contribution to the increased production in 2006 was expected to come from the Nabrajah Field in Yemen. As installation of increased water handling capacity and gas injection facilities has been delayed this has reduced the YTD output from Nabrajah. In addition no new production has been achieved from Basement.

 

Nabrajah # 10 which was drilled within the same fault terrace as the basement producer, Nabrajah # 5, was not tested in basement. This was based on observation from an injectivity test indicating limited connecting fractures. This well was also testing oil from the Naifa / Kohlan interval. Althogh the well produced > 1.000 BOPD from Naifa / Kohlan during a short period, it was not possible to achieve sustainable flow.  Nabrajah # 10 will now be suspended and the rig moved to the Nabrajah # 11 location, 1 km to the west of Nabrajah # 5. The test results from Nabrajah # 10 will be further investigated and it is possible that re-testing of both the Naifa / Kohlan and basement intervals will be undertaken at a later stage. Nabrajah # 5 (basement producer) remain to deliver a stable production of approximately 5.000 BOPD.

 

The development of the Godah oil discovery is targeting first oil 4Q 2006.  Initial gross flow rates are expected to be between 2.000 and 4.000 BOPD.

 

Tasour # 21 which was drilled as an appraisal well at Tasour is producing approximately 1.200 BOPD (gross). A new well, Tasour # 22 is planned to be drilled within this area in 3Q 2006. Positive outcome from this well combined with the Godah development will add new production volumes to the Tasour facilities during the second half of 2006.