Oslo, 10 April 2013 -- DNO International ASA ("DNO International"), the Norwegian oil and gas company, announced today that it has commenced extensive testing of the Tawke-17 exploration well in the Kurdistan Region of Iraq. At 4,775 metres, the well is the deepest drilled by the Company in the Tawke field and has encountered oil and gas shows in previously untested Jurassic and Triassic intervals underlying the main Cretaceous producing zones of the field. The planned test program, expected to last up to three months, will focus on seven newly identified reservoir intervals with production potential.
"We are encouraged by what we have observed in the Jurassic and Triassic intervals of the Tawke field and the test program now underway represents an important step in hopefully confirming and unlocking the additional deeper resource potential of what is already a world-class asset," said Bijan Mossavar-Rahmani, DNO International's Executive Chairman.
DNO International holds a 55 percent interest in and operates the Tawke license. Genel Energy plc holds 25 percent and the Kurdistan Regional Government the remaining 20 percent interest.
Other wells currently drilling in Kurdistan are the Tawke-20 development, the first horizontal well in the Tawke field, and the Bastora-2 appraisal well in the Erbil license. The previously drilled Benenan-3 well, also in the Erbil license, is undergoing completion and will be put on long term test production by summer.
Elsewhere, in Block 47, Republic of Yemen, the Yaalen-4 and Yaalen-5 appraisal wells have been drilled and temporarily suspended; development of the Yaalen field continues with first oil expected by yearend at a projected gross initial rate of 5,000 barrels per day. The ZPEB-905 rig has been moved to nearby Block 43 to drill the Nabrajah-9S3 appraisal well. This well will be drilled as a sidetrack from the previously drilled Nabrajah-9 well and target the deeper Shuqra/Basement interval at the southwest location of the field.
In Block 8, Sultanate of Oman, the Company is planning a two-well intervention program to optimize field performance in the West Bukha field. After producing around 0.5 million barrels of oil from a lower interval, the West Bukha-5 well has been temporarily suspended until another previously identified interval is brought on production later this month. In addition an attempt will be made to initiate oil production from an additional unperforated interval in the West Bukha-3 well. The Company has also completed drilling of a new development well in the Bukha field. Work is currently ongoing to establish flow from the Bukha-4 well as a gas producer. Current gross daily production from Block 8 averages 13,000 barrels a day of oil and condensate and 50 million cubic feet of gas.
The Noble Roy Rhodes rig is being mobilised to initiate redevelopment of the Saleh field offshore the Emirate of Ras Al Khaimah. The first well to be drilled, Saleh-8, is designed as a horizontal well targeting oil in the previously untapped Thamama reservoir.
DNO International recorded gross production of 55,639 barrels of oil equivalent per day (boedpd) during the first quarter of 2013, corresponding to a Company Working Interest (CWI) production of 29,061 boepd. The corresponding figures for 2012 were 67,238 boepd gross and 38,354 boepd CWI. The decrease reflects reduced deliveries from the Tawke field in Kurdistan following a 17-day maintenance shutdown of the Tawke refinery in February and lower March deliveries to the local market during the Navruz or New Year holidays. Higher deliveries have resumed in April.
Based on preliminary compilations, the Company expects first quarter revenues will range between NOK 570 million to NOK 600 million. At the end of the period, the Company's free cash position increased by approximately NOK 200 million to NOK 1.70 billion. Gross debt at period end was NOK 1.37 billion, representing a net cash position of NOK 330 million. The Company's first quarter results will be announced 7 May 2013.
--- DNO International ASA is an Oslo-listed, Middle East and North Africa focused, oil and gas company holding stakes in 17 licenses in various stages of exploration, development and production both onshore and offshore in the Kurdistan Region of Iraq, the Republic of Yemen, the Sultanate of Oman, the United Arab Emirates and the Tunisian Republic. http://www.dno.no ---
Oslo, 10 April 2013
DNO International ASA
Queries: Tom Bratlie ([email protected] or tel: +47 905 21 904)
This information is subject of the disclosure requirements acc. to §5-12 vphl (Norwegian Securities Trading Act)