DNO Acquires Stake in Goliat Field

Shell and DNO have entered into an agreement whereby DNO will take over Shell's 15 percent interest in Goliat (PL 229) and its 25 percent interest in PL 035 and PL 272. The companies have agreed not to publish the terms of the agreement. The transfer of the license interests will be subject to approval by Norwegian authorities.

The Goliat field is located in the Barents Sea, 85 km northeast of Hammerfest and 50 km southeast of the Snohvit field. An oil discovery has been made in the license, and the operator, Agip, intends to drill another exploration well in the license this year.

PL 035 and PL 272 are located in block 30/11 in the North Sea, 20 km southwest of Oseberg Sor. The block contains several interesting exploration prospects. An exploration well will be drilled in the summer of 2004.

The Norwegian shelf has high priority to DNO, and the transfer of the above-mentioned license interests forms an important part of the company's further strategy in Norway. The company focuses on licenses with proved resources and a significant upside, which in DNO's view is the case for these licenses. DNO is pleased with the cooperation with Shell, which has resulted in an agreement that attends to both companies' priorities on the Norwegian shelf.

It is important to DNO that there is value-added activity associated with the licenses in which the company participates. In 2003 DNO participated in 4 exploration wells and 3 production wells on the Norwegian shelf, with well results proving considerable oil and gas resources. The transfer of the new license interests means that DNO will be participating in two exciting wells to be drilled on the Norwegian shelf in 2004.

The transfer is part of Shell's active license portfolio management. Both licenses were part of the portfolio Shell took over when the company acquired Enterprise Oil in 2002. The core area of Shell's European upstream activity is the Atlantic Margin. To Shell's activities in Norway, this means that focus will primarily be on the Norwegian Sea, where the good cooperation with Statoil continues in the 18th licensing round. This cooperation has been expanded and extended to 2009.

The transfer means that Shell will not longer have license interests in the Barents Sea. The company still believes the Barents Sea contains commercial resources, and will reconsider participation in the area when it is opened up to oil and gas activity in the future.