DNO ASA — Earnings Release 2016

Aug 18, 2016

DNO Drilling New Tawke Wells on Back of Profitable Second Quarter

DNO Drilling New Tawke Wells on Back of Profitable Second Quarter

Oslo, 18 August 2016 - DNO ASA, the Norwegian oil and gas operator, today

announced a second consecutive quarter of operating profits and the launch of an

aggressive drilling campaign at the company's flagship Tawke field in the

Kurdistan region of Iraq.

Following an extensive workover campaign at Tawke, five new production wells

will be drilled in the second half of the year to boost capacity. Two rigs are

currently active at Tawke; the Tawke-31 well, targeting the main Cretaceous

reservoir, is the first production well to be drilled at the field since late

2014 and will reach target depth of 2,200 meters in September. A third rig will

be added to drill an appraisal well in the fourth quarter at the previously

discovered Peshkabir field.

The company's operated production in the second quarter climbed 27 percent to

122,900 barrels of oil equivalent per day. Tawke production stood at 117,000

barrels of oil per day, nearly all of which was exported at an average price of

USD 34 per barrel.

Company-wide revenues reached USD 61 million, marking the fifth consecutive

quarter in which revenues totaled USD 50 million or higher. DNO's operating

profit in the second quarter was USD 16 million, up from USD 8 million the

previous quarter.

"Resumption of regular and predictable export payments underpin new investments

at Tawke and other fields," said DNO's Executive Chairman Bijan Mossavar-

Rahmani. "There is more value we can unlock in Kurdistan," he added.

The company last month launched a cash and shares offer to acquire Kurdistan-

focused Gulf Keystone Petroleum conditional upon completion of the latter's

financial restructuring, timely and irrevocable undertaking of support by the

largest noteholders and bondholders and approvals from the Kurdistan Regional

Government. Combined, DNO and Gulf Keystone would place first among European

independent E&P companies in terms of production and also proven and probable

(2P) reserves.

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For further information, please contact:

Media: media@dno.no

Investors: investor.relations@dno.no

Tel: +47 911 57 197

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DNO ASA is a Norwegian oil and gas operator focused on the Middle East and North

Africa. Founded in 1971 and listed on the Oslo Stock Exchange, the company holds

stakes in onshore and offshore licenses at various stages of exploration,

development and production in the Kurdistan region of Iraq, Yemen, Oman, the

United Arab Emirates, Tunisia and Somaliland.

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This information is subject to the disclosure requirements pursuant to section

5-12 of the Norwegian Securities Trading Act.

[HUG#2035818]