DNO Makes New Oil Discovery in Yemen with Godah 2 Well

Block 32: Godah # 2 Confirms New Oil Discovery
The Godah #2 appraisal well was drilled to evaluate the extent of the oil accumulation found at the Godah #1 exploration well. Godah #2, located approximately 1,100 meters to the northeast of Godah #1, encountered the Qishn S-1A sands 20 meters structurally lower than at Godah #1. Godah #2 was production tested from a 4.0 meter interval at a stabilized rate of 1,160 barrels of oil per day and 117 thousand cubic feet per day of gas (maximum test pump capacity).

The well will be equipped with a larger Electrical Submersible Pump ("ESP") and suspended as a potential oil producer. The well logs and the production test have demonstrated an oil column of at least 23 meters. Additional drilling in a structurally lower position and further to the east will be required to determine the location of the oil/water contact and the eastern extent of the pool.

The Godah discovery is located approximately 14 km east of the Tasour Field. The Godah #1 and #2 wells have confirmed the presence of oil at commercial rates. A plan is being prepared to drill additional development/appraisal wells and to connect them to the Tasour main CPF facilities with a 23 km pipeline. The Godah oil discovery will increase production and reserves within Block 32.

Block 32: Tasour # 21 Confirms Extension of Tasour Field
The Tasour #21 delineation well was drilled to a total depth of 1,996 meters and completed as a production well. The well encountered oil bearing upper Qishn S-1A sands in a separate fault segment located south of the Tasour Field. The well was completed and placed on production as a Qishn S-1A oil producer with an initial production rate of 785 Bpd of oil and 2,355 Bpd of water. The well is now being equipped with a larger ESP to increase the total fluid production from the well.

In addition to development/appraisal drilling at Godah and Tasour, the Block 32 Joint Venture Group plans to drill additional exploration wells during 2006. An exploration well targeting a fractured Basement prospect immediately south of the Tasour field is planned to commence drilling in the third quarter. In the meantime the rig will move to first exploration well location in Block 44.

Block 43: Nabrajah # 10 Approaching Basement
Nabrajah # 10 has reached a depth of 2.627 meters and a 9 5/8 casing have been set. The well is located in one kilometer north-east of, and in the same fault terrace as Nabrajah # 5 production well. The main objective of the well is to increase production from the Basement interval.

Block 53: Sharyoof # 20 is Currently Testing
Sharyoof # 20 infill has reached a its total depth of 2.422 meters. Following some tests currently being undertaken in some deeper intervals the well will completed as an Qishn oil producer.