DNO Issues Update on Private Placement

Reference is made to announcements on 12 June 2007 regarding the proposed Private Placement in Det Norske Oljeselskap AS ("Det Norske Oljeselskap"), a wholly owned subsidiary of DNO. The board of directors in Det Norske Oljeselskap has approved the Private Placement.

The total number of new shares to be issued in the Private Placement is 18 562 500 shares and the subscription price has been set to NOK 24 through a book-building process. Total gross proceeds from the transaction are NOK 445,5 million. Det Norske Oljeselskap will be listed on the over the counter exchange (OTC) with the intention to apply for a listing on the Oslo Stock Exchange within 12 months.

Det Norske Oljeselskap experienced strong interest for the transaction both from international and Norwegian investors and the Private Placement was oversubscribed.

DNO will retain a minimum of 80% ownership in Det Norske Oljeselskap following the placement and the subsequent offering.

Commenting on the Private Placement, Roar Tessem, Managing Director of Det Norske Oljeselskap said:

"We are satisfied that the Private Placement was successfully completed enabling us to move forward with our ambitious plans. The investment proposition for a wholly focused Norwegian exploration and production company has been highly appealing to both European and North American investors, and we look forward to building a second position E & P company in Norway."

Det Norske Oljeselskap will carry out a subsequent offering of up to 6 187 500 new shares. The subsequent offering will be directed at the shareholders in DNO ASA as of 21 June 2007 ("Eligible Shareholders") that were not invited to subscribe for shares in the private placement, subject to restrictions set forth by certain jurisdictions.

The subsequent offering is expected to commence during August 2007 following approval of an offering prospectus by Oslo Bors.

Det Norske Oljeselskap has retained Pareto Securities as financial advisors in connection with the private placement and the subsequent offering.


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