Dragon Oil Completes LAM 21/106 Sidetrack

Dragon announces the successful re-entry, sidetrack and completion of its development well LAM 21/106 drilled on the refurbished LAM 21 platform in the Cheleken Contract Area, offshore Turkmenistan. Well LAM 21/106 had been plugged and temporarily suspended for technical reasons earlier in the year.

The well was re-entered on October 17, 2004 and drilled to a Total Depth of 3,093m as part of Dragon's continuous drilling program in the Cheleken Contract Area.

Well LAM 21/106 tested at a rate of 2,652 barrels of oil per day ('bopd') from Zones 3 and 4.

The jack-up rig will be mobilized immediately to the refurbished LAM 10 platform to spud well LAM 10/110.

Hussain M. Sultan, Chairman of Dragon Oil, commented:

'Despite technical difficulties previously encountered in drilling well LAM 21/ 106 at this start of the year, I am pleased to report that we were able to successfully sidetrack and complete the well, and deliver such encouraging results.

We are currently in line to achieve 20,000 bopd by the end of 2004 as a result of our continuous drilling and workover program'.