Dragon Oil to Drill Two New Wells in Dzheitune Area (Turkmenistan)

Dragon Oil plc, an international oil and gas exploration, development and production company, today publishes an update on the wells completed in the second quarter of 2013 and production numbers for 1H and June 2013.

Since the previous quarterly drilling update on 2 April 2013, Dragon Oil has completed four wells, including one sidetrack, and performed workovers on three existing wells.

The leased platform-based rig has completed the Dzheitune (Lam) 28/182 development well as a single producer in April and performed the Dzheitune (Lam) 28/151A sidetrack in June. The Dzheitune (Lam) 28/182 well was drilled and completed to a depth of 1,986 metres and the well tested for initial production at 1,876 barrels of oil per day (bopd). The Dzheitune (Lam) 28/151A sidetrack was completed as a single producer to a depth of 2,000 metres and tested for initial production at a rate of 869 bopd. The rig is currently being mobilised to the Dzheitune (Lam) 22 platform where it is to drill two additional wells before the end of the year.

The jack-up rig has drilled the Dzheitune (Lam) 21/180 and 21/181 development wells in a batch drilling mode. The Dzheitune (Lam) 21/180 well encountered a high gas pressure zone and was temporarily suspended. The Dzheitune (Lam) 21/181 well was drilled to a depth of 3,475 metres and completed as a dual producer in June. It is currently being optimised and is producing at a rate of 960 bopd from both strings. The rig has been mobilised to drill three slots on the Dzheitune (Lam) C platform and is currently drilling the Dzheitune (Lam) C/183 well.

The 2013 workover programme on old wells continued with the hydraulic workover unit on the Dzheitune (Lam) 4/4 and 4/8 wells with recompletions in new horizons and added perforations in the Dzhygalybeg (Zhdanov) 60/68 well. The total incremental production from these activities was 450 bopd.

The average Cheleken field production for 1H 2013 was 73,600 bopd (1H 2012: 64,200 bopd), representing an increase of 14% over the corresponding period in 2012. The average production for June 2013 was 75,800 bopd (June 2012: 61,600 bopd). The Company added: “We reiterate our guidance for the growth rate for the full year 2013 to be at the lower end of the medium-term growth rate range of 10% to 15%.”

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Press Release, July 10, 2013