Dune Energy Strikes with Two Wells in Bayou Couba Field

Dune Energy reports that it has successfully completed its second and third wells, the DSCI 51 ST and DSCI 15 ST, in the Bayou Couba Field located in St. Charles Parish, Louisiana, under the Company's Joint Development Agreement (JDA) with Exxon Mobil Corp. and American Natural Energy Corporation.

The DSCI 51 ST (20.625% W.I.) well was successfully completed on December 24, 2005 at an initial production rate of 85 Boe/d on a 7/64" choke and a flowing tubing pressure of 1,050 psi. Currently, the well has been choked back in order to minimize water production. The well was perforated 6 feet between 5,905 and 5,911 feet in the Ted W Miocene sand, which exhibited a porosity value of 30%.

The DSCI 15 ST (50% W.I.) well was placed on production December 29, 2005 and is currently producing 185 Boe/d with a flowing tubing pressure of 450 psi. The well was perforated 14 feet between 7,601 and 7,046 feet in the Chris I formation, which exhibited a porosity value of 30%.

"This is the third successful well in as many attempts in which Dune has participated," stated Dr. Amiel David, President and Chief Operating Officer. "We are very pleased with these results, as they further confirm both the geology and high rates of return we originally expected. We are currently evaluating several similar low risk development opportunities on our acreage and, depending upon rig availability, we anticipate spudding additional wells shortly."

Alan Gaines, Chairman and Chief Executive Officer stated, "In addition to the numerous development locations Dune intends to exploit during the coming year, we look forward to the drilling of high impact exploratory prospects at Bayou Couba. We intend to drill locations targeting the flanks of the salt dome at depths approximating 12,000 feet, as well as a sub-salt test during the first half of 2006, any one of which, if successful, would be quite significant to Dune."