DNO ASA - Update on the Tawke Field in the Kurdistan region of Northern Iraq

Drilling results
As previously reported, two drilling rigs are currently operating on the Tawke Field for production and appraisal drilling. Both rigs have been drilling wells (Tawke #5A and Tawke #8) targeting the deeper reservoir levels at the central location of the field.
DNO is pleased to announce that Tawke # 8 has confirmed oil in the central/down flank position of the field. An extensive test and formation evaluation program is ongoing. Good reservoir properties have been confirmed, and so far the well has achieved a gross rate of more than 17,000 bopd aggregated from four tests. A maximum of 8,000 bopd was achieved from the most productive test interval.
Tawke #5A has been drilled to its final depth, confirming oil in the central area of the Lower Reservoir. Formation evaluation and testing is currently being conducted.
In addition, DNO has procured a third smaller carrier rig. Tawke #1 has been re-entered using this rig and will be re-tested including acid stimulation, to confirm the reservoir properties and production potential of the deeper reservoir horizons.
Test production
In June, DNO started extended test production from wells at the Tawke Field in Kurdistan in order to gather additional reservoir- and well productivity information. The produced volumes during test production has been included in the monthly reports for June and July on 55 % working interest basis, and the oil has been delivered to the domestic marked by tanker trucking. The test production has continued in August.
The Tawke Field is within the Dihok PSA area and DNO holds a 55% working interest in this Production Sharing Agreement. However, under the current arrangement with KRG, DNO is entitled to all produced volumes of oil from Tawke, net after royalty, until all project costs to date have been recovered. All production from the Tawke field will be reported on this basis. Thereafter the cost oil will be adjusted to standard terms, which is expected to be 40 - 45 %.
22 August 2007

Helge Eide, MD DNO ASA
+47 23 23 84 80
Roar Tessem, Det Norske Oljeselskap AS
+ 47 23 23 84 80
Ketil Jørgensen, Crux Communication (Norway)      
+47 930 36 866
Ben Willey, Buchanan Communications (UK)
+44 207 466 5000
Investor Relations:
Haakon Sandborg, CFO DNO ASA
+47 23 23 84 80
Robert Arnott, Advisor (UK)
+44 207 839 7764