DNO ASA — Earnings Release 2019

Oct 31, 2019

DNO Reports Third Quarter 2019 Results

DNO Reports Third Quarter 2019 Results

Oslo, 31 October 2019 - DNO ASA, the Norwegian oil and gas operator, today

reported strong third quarter revenues of USD 227 million, up 33 percent from a

year earlier, on the back of solid production averaging 99,300 barrels of oil

equivalent per day (boepd) on a Company Working Interest (CWI) basis, up 22

percent year on year. Notwithstanding strong underlying performance, 2019 third

quarter results were impacted by non-recurring items as well as lower oil prices

and higher exploration expenses, resulting in a net loss of USD 96 million.

In the Kurdistan region of Iraq, third quarter production at the Tawke license

containing the DNO-operated Tawke and Peshkabir fields (shared 75-25 with

partner Genel Energy plc) averaged 119,800 barrels of oil per day (bopd). The

Company expects to exit the year with Tawke license production averaging

120,000 bopd and to maintain this rate into 2020. The Company recently reached a

significant milestone of 300 million barrels of cumulative oil production from

the Tawke and Peshkabir fields.

Activity remains high as the Company continues to deliver its largest drilling

campaign in its 48-year history with some 36 wells in 2019, of which 22 are

development/infill wells and 14 exploration/appraisal wells. DNO projects full-

year operational spend of USD 620 million (post-tax), of which USD 454 million

was spent through the end of the third quarter, including USD 244 million in

Kurdistan and USD 210 million (post-tax) in the North Sea.

Financial results were impacted by impairment charges of USD 138 million,

including USD 89 million for technical goodwill on the Brasse discovery (Norway)

and USD 33 million for decommissioning of the Schooner and Ketch fields (United

Kingdom).

With USD 228 million in cash from operations during the third quarter, the

Company resumed its share buyback program and acquired 23 million shares at a

cost of USD 35 million, lifting its overall stake to 58 million treasury shares,

representing 5.35 percent of the total outstanding shares at end quarter. DNO

also bought back an additional USD 17 million of FAPE01 bonds during the

quarter.

DNO maintained its previously approved dividend distribution program with

another semi-annual payment of NOK 0.20 per share to be made on 4 November 2019.

"We continue to deliver across a range of operating and financial targets even

as we paused this quarter for early spring cleaning of our balance sheet," said

DNO's Executive Chairman Bijan Mossavar-Rahmani. "Given global headwinds, we are

budgeting at the low end of the industry's Brent price range of USD 60-70 per

barrel," he added.

CWI production during the third quarter included 84,400 bopd from Kurdistan and

14,900 boepd from North Sea assets acquired earlier this year.

In 2019, nine wells were spud in Kurdistan through the end of the third quarter,

with an additional ten wells planned for the fourth quarter. In the North Sea,

13 wells were spud through the end of the quarter, with an additional four wells

planned for the fourth quarter, including DNO's first operated exploration well,

Canela, in the North Sea since 2007.

DNO exited the third quarter with a cash balance of USD 624 million in addition

to USD 110 million in treasury shares and marketable securities.

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For further information, please contact:

Media: media@dno.no (mailto:media@dno.no)

Investors: investor.relations@dno.no (mailto:investor.relations@dno.no)

Tel: +47 23 23 84 80

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

North Sea. 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, Norway, United

Kingdom, Netherlands, Ireland and Yemen.

This information is subject to the disclosure requirements pursuant to section

5-12 of the Norwegian Securities Trading Act.