DNO Issues Northern Iraq Update

DNO has released an update on its drilling activities in Northern Iraq.

The company reports that it has successfully drilled the first exploration well within its production sharing agreement (PSA) area located in Iraqi Kurdistan. The well was spudded on November 28, 2005, and reached 3,100 meters on March 22. DNO expects the well to reach the total depth within a few days.

The Tawke #1 well has met all exploration objectives, and the drilling operations have been carried out in a safe manner without lost time accidents, states the company.

DNO notes that the well data acquired to date are being evaluated in order to optimize the additional data acquisition program for the well. Several well tests will be performed. The test results are vital in order to evaluate the hydrocarbon prospectivity and potential commerciality of the Tawke prospect.

Although the well data evaluations and well test program preparations will continue, DNO will temporarily suspend Tawke #1. The company says that the drilling rig will be moved to a new well site to commence drilling of the second well within the PSA area. Timing of the testing is dependent on several factors. DNO says that it is considering bringing in a smaller rig to perform the well testing of Tawke #1.