Dragon Oil Announes Successful Caspian Sea Well

Dragon Oil announced that the drilling of the LAM 22-101 well was successfully completed on 9 June, to a total depth of 3791 meters in the Lower Red Series reservoir. This is the first well the Company has drilled on the Cheleken Contract Area, offshore Turkmenistan in the Caspian Sea. Final logs will be run from total depth to 2860 meters prior to setting casing. Last month, an intermediate logging run over the interval 2248 - 2860 meters already indicated the presence of hydrocarbons. Testing to establish oil flow rates will follow later in the month after which the well will be completed for production.

On successful completion of this first well for production, the rig will continue with the drilling of LAM 22-102, the second in a planned series of up to six wells from this platform. With further drilling and increases in production, Dragon plans to construct new facilities or upgrade existing ones to handle the increased production volumes.

Dragon Oil holds a 100% of the foreign interest in the Cheleken Contract Area where the well is being drilled on the LAM Field. The Block also contains the Zhadanov Field. Reserves of both fields have been independently certified at almost 600 million barrels of proven and probable reserves, in addition to some 2.3 TCF of associated gas.