6th Mar 2009 07:00
FOR IMMEDIATE RELEASE
6 March 2008
DRAGON OIL PLC
("Dragon Oil", the "Company" or together with its subsidiaries the "Group")
Drilling Update
Dragon Oil plc (Ticker: DGO), an international oil and gas exploration and production company, today announces that it has decided not to renew the contract for the CIS#1 platform-based rig. The management team concluded that a platform-based rig with higher performance specifications was more suitable for achieving the Company's stated production targets. Dragon Oil plans to drill higher slanted wells, thus achieving higher productivity. The tender process is underway and the estimated time for award of a contract is Q2 2009.
Dragon Oil's own rig, Rig 40, was refurbished in 2008 and spudded its first well in January 2009. Rig 40 is on schedule to spud five wells in total during the year, and four of the five wells are expected to be completed by the year-end.
The Iran Khazar rig is being relocated to begin drilling the first of four wells, three of which are expected to be completed by the year-end. The contract for the Iran Khazar rig is due to expire in H1 2009. The Company is exploring opportunities to either renew the contract or procure a replacement jack-up rig.
Abdul Jaleel Al Khalifa, CEO, commented:
"We have concluded that slanted wells will enhance productivity and put us in a better position to achieve our production targets. On that basis, Dragon Oil has decided to contract a higher specification platform-based rig. Our strategy remains on track; to develop the oil assets, monetise gas assets and diversify our portfolio geographically."
For further information please contact:
Media enquiries
Citigate Dewe Rogerson (+44 20 7638 9571)
Martin Jackson
George Cazenove
Investor and Analyst enquiries
Dragon Oil Plc (+971 4 305 3600)
For investor queries: Leanne Denman, Investor Relations Officer (+971 4 305 3660)
For analyst queries: Anna Gavrilova, Communications Officer (+971 4 305 3425)
Note:
This statement may contain forward-looking statements concerning the financial condition and results of operations of Dragon Oil. Forward-looking statements are statements of future expectations that are based on management's current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. No assurances can be given as to future results, levels of activity and achievements and actual results, levels of activity and achievements may differ materially from those expressed or implied by any forward-looking statements contained in this report. Dragon Oil does not undertake any obligation to update publicly or revise any forward-looking statement as a result of new information, future events or other information.
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