Dana Negotiates Farmout Deal for Australian Drilling Program

Northern Perth Basin
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N. Perth Basin Seismic
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The Board of Dana is pleased to report that it has negotiated a 3-for-1 farm-out deal on exploration license WA-226-P offshore Western Australia, such that Dana will be free carried on all costs relating to the next exploration well to test the Fiddich prospect.

Transocean's semisub, Sedco 703, has been contracted by well operator Apache Energy, with a currently planned spud date of May 2004. The licesce operator, Origin Energy, has estimated mid-case reserves potential of the Fiddich prospect to be approximately 60 million barrels of oil (12 million barrels net to Dana) with an upside case of around 100 million barrels (20 million barrels net to Dana).

Dana has farmed-out to a subsidiary of Australian independent Voyager Energy Limited ('Voyager'), an existing co-venturer in WA-226-P. Under this agreement, Voyager will earn a 10% interest in the license by paying all costs associated with Dana's current 30% interest from 1st January 2004 through to completion of operations on the well.

Following this farm-out, equity interests in WA-226-P will be Origin Energy as license operator with 28.75%; Apache Energy as well operator with 28.75%; Dana Petroleum with 20%; Voyager Energy with 15%; and Norwest Energy with the remaining 7.5%.

Dana's Chief Executive, Tom Cross, commented:

'Dana's technical team is very focused on the Group's core areas of the North Sea and West Africa. Currently this program is centered around driving forward cash generation, through developments in the UKCS, and exploring for major new reserves offshore Mauritania.

This farm-out positions Dana shareholders to benefit from exploration upside in a non-core, frontier area at no cost to the Company. It also allows the concentration of Dana's technical and financial resources on its priority growth areas.'

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