DGO.L Regulatory News (DGO)

3 August 2011

DRAGON OIL PLC

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

Drilling Update

Dzheitune (Lam) 28/158 well tested at initial rate of 2,876 bopd

Dragon Oil plc (Ticker: DGO), an international oil and gas development and production company, announces the completion and initial testing of the Dzheitune (Lam) 28/158 development well. The well was completed as a single producer by the NIS rig to a depth of 1,786 metres. The initial test result from the well was 2,876 barrels of oil per day ("bopd"). The NIS rig has skidded to the next slot and is in the process of spudding the Dzheitune (Lam) 28/161 well. The Iran Khazar rig and Rig 40 are currently drilling the Dzheitune (Lam) B/159 and 13/160 wells, respectively.

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

"I am pleased to report the successful completion and initial testing of the Dzheitune (Lam) 28/158 well. The Group is currently producing at a healthy rate of above 60,000 bopd, which puts us in a comfortable position to ensure meeting our gross production growth target by the end of the year."

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About Dragon Oil

Dragon Oil plc is an international oil and gas 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.