DNO ASA - Update on Tawke Area, Northern Iraq.

As reported in the Stock Exchange Notice on 23 March 2006 the Tawke # 1 well was nearing its total depth and all exploration objectives had been met.
 
The well data acquired to date have been reviewed and evaluated. Interpretations of wireline logs and other well data show the presence of oil in five reservoir intervals. Based on these results it has been decided to perform several well tests in Tawke # 1.
 
The objectives of the well tests in Tawke # 1 are to evaluate the production capacity of the individual reservoir intervals and to determine the characteristics of oil.
 
Testing of Tawke # 1 will be undertaken before moving the rig to the next well location. Following the completion of the testing program the rig will move to the location of Tawke # 2 some 2 km west of Tawke # 1. Tawke # 2 is planned to be drilled to approximately 2,000 meters.
 
DNO is currently undertaking feasibility studies for future possible oil production from the Tawke Area, including a fast-track option. Based on the results to date and contingent on successful outcome of the well tests, first test production of oil from the Tawke Area could commence first quarter 2007.
 
DNO has also contracted a second rig from Greatwall Drilling Company Ltd. which will be mobilized to the PSA area of operations in June 2006. This rig has the same drilling capabilities as the first rig. In addition 3D seismic acquisition over the Tawke Area is planned to commence in May 2006.
 
On Saturday 8th April a press conference was arranged in Erbil by Kurdistan Regional Government ("KRG") announcing the status of Tawke # 1. Representatives from the Ministry of Oil in Baghdad were present during this press conference, including the Deputy Minister of Oil, Mo'tasam Akram.
 
Commenting on the results Managing Director Helge Eide says:
 
"We are very pleased to have drilled our first exploration well in Iraqi Kurdistan, which represents another milestone achieved by DNO. The considerable efforts by our project team have ensured that the drilling has been undertaken successfully and safely. This demonstrates DNO's capabilities of undertaking challenging operations as a prudent Operator.
 
"We would also like to give credit to the Kurdistan Regional Government for their valuable assistance and cooperation in planning and execution of our operations. We are looking forward to receiving the results from the well testing, which will serve as an important and valuable strategic indicator for the future plans of our joint project with the KRG in Iraqi Kurdistan".
 
Contacts:
 
 
Website : www.dno.no
 
 
 
Notes to the Editors:
 
 
DNO ASA is an independent oil and gas exploration and production company based in Oslo, Norway.
 
The company has a diversified, risk balanced portfolio with interests in Norway, UK, Yemen, Northern Iraq and Africa.
 
Hydrocarbon production is currently focused on its operations in Yemen and Norway, with current daily production of a. 17,000 BOPD. The Company commenced production on its Nabrajah concession in Yemen in July 2005, which is expected to increase the daily output in 2006.
 
Following an additional oil discovery early in 2006 in Norway, DNO currently holds proven and probable reserves of more than 100 million barrels. This has also resulted in an increase in the proven plus probable reserve base by more than 250 % since December 2004. The increase in reserves comes from a combination of successful exploration drilling and acquisitions.
  
In 2006 the Company will increase its exploration activities across all of its core areas of interests which will increase DNO's exploration budget to approximately USD 100 million. Throughout the year DNO plans to participate in 22 exploration wells, of which 15 as Operator.