DNO International Files Q1 Results, Reaches Important Milestone in Iraq

Tawke area of Iraqi Kurdistan
(Click to Enlarge)

DNO International announced its interim results for the first quarter 2009.

The total operating revenues in the first quarter were NOK 184 million, down 56 per cent compared to the first quarter 2008. This is
primarily a result of significantly reduced oil prices and lower production.

The operating profit (EBIT) in the first quarter amounted to NOK -77 million (NOK 154 million). The cash flow in the period, represented by netback, amounted to NOK -6 million (NOK 232 million).

Net profit in the first quarter ended at NOK 138 million (NOK 62 million) due to a partial impairment reversal on the DETNOR

Capital expenditures for the first quarter were reduced to NOK 77 million compared to NOK 238 million in the same period last year.

"DNO has clearly shown its operational flexibility by acting quickly in response to the recent drop in oil prices. Our long-term
strategies remain intact, but we have shifted our focus towards near term development and production, with exploration activity to be undertaken on a more selective basis. This has resulted in lower investments in the first quarter and the overall investment level for this year will be significantly lower than in 2008," said Helge Eide, Managing Director.

DNO reached an important milestone in the first quarter by completing the Tawke pipeline tie-in to the Northern pipeline system in Iraq, in close co-operation with the Kurdistan Regional Government (KRG) and the North Oil Company (NOC). Furthermore, DNO received formal notice by KRG on May 10, to commence export of crude oil from the Tawke field on June 1, 2009. DNO has been instructed to complete any outstanding work and undertake all necessary preparations to ensure safe and smooth operation on the commencement date.

"We have made strong progress towards our goal of delivering full scale production from the Tawke field, through the pipeline tie-in
and confirmation of oil export commencement. As instructed by the KRG, DNO is now fully focused on preparations for initial oil exports from the Tawke field," continued Helge Eide.



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