DGO.L Regulatory News (DGO)

16 December 2011

DRAGON OIL PLC

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

Drilling Update

70,000 barrels of oil per day production rate reached

Dzheitune (Lam) 28/164 well tested at initial rate of 3,018 barrels of oil per day

Dragon Oil plc (Ticker: DGO), an international oil and gas exploration, development and production company, announces the completion and initial testing of the Dzheitune (Lam) 28/164 development well. The well was drilled to a depth of 1,865 metres and completed as a single producer by the NIS rig. The well tested for initial production at 3,018 barrels of oil per day. The NIS rig has skidded to the next slot and has spudded the Dzheitune (Lam) 28/166 development well.

The Iran Khazar rig is currently drilling the Dzheitune (Lam) A/165 well. The Dzheitune (Lam) 13/163 well has encountered low oil producing zones and is being completed in shallower reservoir intervals. Rig 40 has been moved to perform a sidetrack of the Dzheitune (Lam) 13/140 well.

Dr Abdul Jaleel Al Khalifa, Chief Executive Officer, commented:

"Having successfully put on stream the Dzheitune (Lam) 28/164 well, we reached the production rate of 70,000 barrels of oil per day. This solid progress gives us further comfort in achieving the target gross production growth of above 25% for 2011."

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For further information please contact:

Investor and analyst enquiries

Dragon Oil plc (+44 (0)20 7647 7804)

Anna Gavrilova

Media enquiries

Citigate Dewe Rogerson (+44 (0)20 7638 9571)

Martin Jackson

Kate Lehane

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-producing fields, Dzheitune (Lam) and Dzhygalybeg (Zhdanov).

www.dragonoil.com

Disclaimer

This news release 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.