Interim Management Statement

21 April 2015

Dragon Oil plc

(the "Company" or together with its subsidiaries "Dragon Oil" or the "Group")

Interim Management Statement

Dragon Oil plc (Ticker: DGO), an international oil and gas exploration, development and production company, today issues its Interim Management Statement in accordance with the EU Transparency Directive. The statement covers the period from 1 January 2015 to date. The financial, production and drilling results data are for the period from 1 January 2015 to 31 March 2015. All other information, including details on operations, is up-to-date as of 20 April 2015.

Key highlights

· Average gross production in the Cheleken Contract Area, Turkmenistan, reached approximately 88,700 barrels of oil per day (bopd) in 1Q 2015 - a 23% increase over the corresponding 2014 level;

· Average gross production in the Cheleken Contract Area for March 2015 amounted to approximately 89,600 bopd with April average gross production so far at above 93,000 bopd; and

· Capital expenditure on infrastructure, drilling and exploration assets was approximately US$153 million in 1Q 2015.

Dr Abdul Jaleel Al Khalifa, CEO, commented:

"We have seen a very strong gross production performance at 88,700 bopd in the Cheleken Contract Area in the first quarter of 2015. This represents a 23% increase over the corresponding level in 2014. Since the beginning of April, we are producing at above 93,000 bopd. This gives us added confidence in reaching our target of 100,000 bopd gross production later this year."

OPERATIONAL UPDATE

Turkmenistan

Production and entitlement

Gross field production for 1Q 2015 averaged approximately 88,700 bopd (1Q 2014: 72,300 bopd). This represents a 23% increase compared to the level of gross production in the first quarter of last year. New development wells with strong flow rates were put into production.

The entitlement production for 1Q 2015 was approximately 71% (1Q 2014: 47%) of the gross production. The entitlement barrels are finalised in arrears and are dependent upon, amongst other factors, operating and development expenditure in the period and the realised crude oil price. Higher entitlement barrels in 1Q 2015 are a result of workings of the fiscal terms of the Production Sharing Agreement and are due primarily to lower realised oil prices and higher development expenditure.

Marketing

In 1Q 2015, Dragon Oil sold 4.8 (1Q 2014: 2.7) million barrels of crude oil; this is 78% higher than the volume sold during the corresponding period last year. Higher sales in 1Q 2015 are primarily due to an increase in entitlement barrels as compared to the corresponding period last year. In 1Q 2015, Dragon Oil exported 87% (1Q 2014: 100%) of its crude oil production through Baku, Azerbaijan with the remainder of the volumes exported through Makhachkala in Russia (1Q 2014: nil). The terms are FOB (free-on-board) the Aladja Jetty, Turkmenistan. The new arrangements are in place until 31 December 2015.

Drilling

Since December 2014, Dragon Oil has completed and tested the following wells in the Dzheitune (Lam) field:

The Neptune rig is currently sidetracking the Dzheitune (Lam) C/184 well.

The Elima jack-up rig is drilling the Dzheitune (Lam) B/202 well.

Land Rig 2 is currently sidetracking the Dzhygalybeg (Zhdanov) A/102 well following an equipment failure in the well.

The Caspian Driller is expected to commence operations in the Cheleken Contract Area later in 2Q 2015.

Water injection project and artificial lift

The water injection pilot project is progressing in the pilot Dzheitune (Lam) 75 area. The acquisition of additional water injection facilities to be installed and commissioned in the Dzheitune (Lam) field is in the approval stage with the intention to procure these facilities later in 2015. The aim of the water injection programme is for pressure maintenance, to sustain production rates and increase reserves recovery.

In 2H 2014, Dragon Oil commissioned the jet pumping system on the Dzheitune (Lam) 13 platform for two wells. Additional jet pumping systems are currently being installed and expected to be commissioned during 2Q 2015. The objective of this artificial lift application is to increase production and enhance recovery.

In parallel, Dragon Oil is considering use of electric submersible pumps (ESP) with an aim to commence their application in a pilot in 2H 2015.

Infrastructure

Design and detailed engineering work is ongoing for the new wellhead and production platform Dzheitune (Lam) E and associated pipelines, awarded in February 2014. Fabrication of the platform is progressing. The platform will have eight slots with provision for another four slots to be installed later, and suitable for a jack-up drilling rig use. Construction and installation are expected to take two years; it is anticipated that the platform will be ready in 1H 2016.

Installation of the Dzheitune (Lam) F production platform is progressing and the platform is expected to be ready for drilling in 2Q 2015. At the same time we continue to add drilling slots to the existing platforms to ensure flexibility in our drilling programme.

Work to quadruple our crude oil storage capacity at the Central Processing Facility is ongoing. The tank farm is anticipated to be completed in 1Q 2016 of which three tanks will be built and commissioned on a priority basis in 3Q 2015.

The project to build another 30-inch trunkline from the Dzheitune (Lam) field to the Central Processing Facility has been deferred. The purpose of the additional 30-inch trunkline was to transport mainly gas production onshore to feed the Gas Treatment Plant that is now planned to be constructed in phases over the next three to four years. The existing 30-inch trunkline and two 12-inch pipelines are sufficient to accommodate increases in gross production in 2015 and 2016 and the plateau production of 100,000 bopd for at least five years from 2016.

Dragon Oil has plans to increase the loading capacity at the Aladja Jetty by installing another 16-inch pipeline and associated loading arms to support export of higher volumes in 2H 2015.

Gas Treatment Plant

The bids for an engineering, procurement, installation and construction project of the Gas Treatment Plant are in the evaluation stage. We anticipate the construction to be phased out and the project to take three to four years to complete after the contract is awarded.

EXPLORATION

Iraq

In 2014, the partners in Block 9 in Iraq, announced the discovery of oil in two formations in the consortium's first exploration well, Faihaa-1 in which Dragon Oil holds 30%. Open and cased hole tests were conducted in the Mishrif and Yamama formations with encouraging results. The well has been completed as a producer from the Yamama formation and the drilling rig has been released.

The consortium plans to drill two additional appraisal wells in 2015 in order to fast track the development.

Algeria

In 2014, Dragon Oil in partnership with ENEL Trade S.p.A. ("Enel") was awarded two exploration perimeters in Algeria, Tinrhert Nord Perimeter (Dragon Oil 70% paying interest and operator, Enel 30%) and Msari Akabli Perimeter (Dragon Oil 30% paying interest, Enel 70% and operator). The contract for the exploration and exploitation of hydrocarbons was signed on 29 October 2014. Work is ongoing to secure environmental permits, interpret available 3D seismic data, select drilling targets and progress the necessary tenders to enable the drilling of the first exploration well in 1H 2016.

Egypt

Work as per the Concession Agreement is ongoing for the exploration of the East Zeit Bay (Dragon Oil 100%), offshore the Gulf of Suez, Egypt. We are currently working on the reprocessing of the existing seismic data in the block and are in the process of awarding the contract to an international contractor.

Afghanistan

In early 2015, the consortium, comprising Dragon Oil (40%, operator of Sanduqli block), TP Afghanistan Ltd. (TPAL, 40% and operator of Mazar-i-Sharif block) and the Ghazanfar Group (20%), commenced the airborne gravity and magnetic survey in both blocks, which has been temporarily suspended due to unavailability of a suitable aircraft. The consortium is actively looking for such an aircraft to resume and complete the survey.

Tunisia

As we reported on 17 February 2015, the extension to the current exploration phase taking it to 7 August 2015 had been granted for the Bargou Exploration Permit (the joint venture partners: Dragon Oil, 55%; Cooper Energy, 30% and operator; and Jacka Resources Ltd, 15%).

The Philippines

As we reported on 17 February 2015, the partners, Dragon Oil (Philippines SC 63) Limited (40%), Nido Petroleum Philippines Pty Ltd (ASX: NDO, 20% participating interest) and PNOC-EC (40% and operator) are in the process of integrating information and data obtained from the Baragatan-1 well into current geological models and Dragon Oil is assessing its future interest in the block.

FINANCIAL UPDATE

Realised prices

With Brent averaging about US$54 per barrel during 1Q 2015 (1Q 2014: US$108.2), the average realised crude oil price during the quarter was approximately US$40 per barrel (1Q 2014: US$92 per barrel), which was at a 26% (1Q 2014: 15%) discount to Brent. The weighted average discount to Brent between the two routes was US$14 per barrel in 1Q 2015.

Cash and cash equivalents

The cash and cash equivalents and term deposits at 31 March 2015 were approximately US$1,924 million (31 December 2014: US$1,975 million), excluding funds set aside for abandonment and decommissioning activities.

Capital expenditure

Capital expenditure for 1Q 2015 was around US$153 million (1Q 2014: US$107 million). Of this capital expenditure, approximately 50% was attributable to development and appraisal drilling (1Q 2014: 43%), 47% spent on infrastructure (1Q 2013: 50%) with the balance spent on exploration assets. The infrastructure spend during 1Q 2015 included installation of the Dzheitune (Lam) F platform, fabrication of the Dzheitune (Lam) E platform, construction of crude oil storage tanks, commissioning of an infield pipeline and expenditure on other onshore and offshore infrastructure facilities.

MATERIAL EVENTS

Final dividend for 2014

The Board of Directors of Dragon Oil recommended the payment of a final dividend of 16 US cents per share (2013: 18 US cents). Together with the interim dividend of 20 US cents, the total dividend for the year ended 31 December 2014 is 36 US cents. The final dividend of 16 US cents is subject to shareholder approval at the Annual General Meeting to be held in London, UK on 27 April 2015. If approved, the final dividend of 16 US cents is expected to be paid on 30 April 2015 to shareholders on the register as of 7 April 2015.

The exchange rate for the pound sterling or euro amounts payable was determined by reference to the exchange rates applicable to the US dollar on the closest practicable date, being 15 April 2015, to the dividend payment date.

The following table details the currency exchange rates applicable for the 2014 final dividend:

Exchange Rates:

1 USD = 0.9433 EUR

1 USD = 0.6789 GBP

The following is the dividend timetable for the shareholders' information:

17 February 2015: Declaration of final dividend

2 April 2015: Ex-Dividend Date

7 April 2015: Record Date

27 April 2015: Annual General Meeting

30 April 2015: Dividend Payment Date.

Approach from Emirates National Oil Company Ltd L.L.C ("ENOC")

On 17 March 2015, Dragon Oil announced that the Company had received an approach from ENOC regarding a possible offer for the entire issued and to be issued ordinary share capital of Dragon Oil that it does not already own. The Company formed an Independent Committee of the Board to evaluate the approach by ENOC. Nomura International plc and Davy Corporate Finance are acting as joint financial advisers to the Independent Committee. There can be no certainty that any firm offer for the Company will be made nor as to the terms on which any firm offer might be made. Further announcements will be made as appropriate.

OUTLOOK

We re-iterate our production growth and capital expenditure guidance given on 17 February 2015. In 2015, our target is to grow average gross production at around 10% or higher and exit the year at 100,000 bopd. We plan to complete 15 to 20 wells a year in 2015 and 2016 given the present and future availability of drilling rigs. We aim to average the gross production at 100,000 bopd in 2016 and maintain this level of production for a minimum period of five years.

We expect to invest between US$500mn and US$600mn in infrastructure and drilling excluding the cost of the Gas Treatment Plant in the Cheleken Contract Area in Turkmenistan, as well as around US$50-100mn in exploration assets in 2015.

- end -

For further information please contact:

Dragon Oil plc +44 (0) 20 7647 7804

Anna Gavrilova, Investor Relations

Joint Financial Advisers and Brokers

Nomura International plc +44 (0) 20 7521 2000

Andrew Forrester

John Bigham

Henry Phillips

Davy +353 (1) 679 6363

John Frain

Brian Garrahy

PR Advisers

Citigate Dewe Rogerson +44 (0) 20 7638 9571

Martin Jackson

RESPONSIBILITY

The directors of Dragon Oil accept responsibility for the information contained in this announcement relating to Dragon Oil, the Dragon Oil group of companies, the directors of Dragon Oil and members of their immediate families, related trusts and persons connected with them. To the best of the knowledge and belief of the directors of Dragon Oil (who have taken all reasonable care to ensure that such is the case) the information contained in this announcement is in accordance with the facts and does not omit anything likely to affect the import of such information.

DISCLOSURE REQUIREMENTS OF THE IRISH TAKEOVER RULES

Under the provisions of Rule 8.3 of the Irish Takeover Rules, if any person is, or becomes, "interested" (directly or indirectly) in 1% or more of any class of "relevant securities" of Dragon Oil, all "dealings" in any "relevant securities" of Dragon Oil (including by means of an option in respect of, or a derivative referenced to, any such "relevant securities") must be publicly disclosed by not later than 3:30 p.m. (Irish time) on the "business day" following the date of the relevant transaction. This requirement will continue until the date on which a scheme of arrangement becomes effective or on which the "offer period" otherwise ends. If two or more persons co-operate on the basis of any agreement either express or tacit, either oral or written, to acquire an "interest" in "relevant securities" of Dragon Oil, they will be deemed to be a single person for the purpose of Rule 8.3 of the Irish Takeover Rules.

Under the provisions of Rule 8.1 of the Irish Takeover Rules, all "dealings" in "relevant securities" of Dragon Oil by ENOC , or by any person "acting in concert" with ENOC must also be disclosed by no later than 12 noon (Irish time) on the "business day" following the date of the relevant transaction.

A disclosure table, giving details of the companies in whose "relevant securities" "dealings" should be disclosed can be found on the Irish Takeover Panel's website at www.irishtakeoverpanel.ie. "Interests in securities" arise, in summary, when a person has long economic exposure, whether conditional or absolute, to changes in the price of securities. In particular, a person will be treated as having an "interest" by virtue of the ownership or control of securities, or by virtue of any option in respect of, or derivative referenced to, securities.

Terms in quotation marks are defined in the Irish Takeover Rules, which can be found on the Irish Takeover Panel's website.

If you are in any doubt as to whether or not you are required to disclose a "dealing" under Rule 8, please consult the Irish Takeover Panel's website at www.irishtakeoverpanel.ie or contact the Irish Takeover Panel on telephone number +353 1 678 9020; fax number +353 1 678 9289.

About Dragon Oil

Dragon Oil plc is an international oil and gas exploration, development and production company, quoted on the London and Irish Stock exchanges (Ticker symbol: DGO). Its principal producing asset is in the Cheleken Contract Area, in the eastern section of the Caspian Sea, offshore Turkmenistan.

Dragon Oil (Turkmenistan) Ltd., a wholly owned subsidiary of Dragon Oil plc, holds 100% interest in, and is the operator of, the Production Sharing Agreement for the Cheleken Contract Area. The operational focus is on the re-development of two oil and gas producing fields, Dzheitune (Lam) and Dzhygalybeg (Zhdanov).

The Group has exploration blocks in Tunisia, Iraq, Afghanistan, Egypt, the Philippines and Algeria. Dragon Oil's diversification strategy is to add exploration and production assets within Africa, parts of Asia and the Middle East in order to create a diversified and balanced portfolio of assets for the Group.

www.dragonoil.com