Dana Gas announces new gas discovery in Egypt

The well has been tested and flowed at a rate of 9.5 million standard cubic feet per day (mmscf/d) of Gas and 1,022 barrels of Condensate per day (bc/d) at 28/64" choke from the Qawasim sands.

Centurion Petroleum Corporation, the upstream division of Dana Gas, drilled the EWW-2 well to a total depth of 3,175 meters and encountered 8.3 meters of net pay over a gross pay interval of 24 meters. The EWW pool represents a new block to the west of El Wastani gas field. Estimates of recoverable reserves from this new pool are under evaluation.

Dr. Hany Elsharkawi, Dana Gas Country Director in Egypt, said, "We are excited about this discovery as it enhances the prospectivity of the area west of El Wastani field currently being explored".

The EWW-2 well is located approximately 800 meters from the Company's El Wastani Gas Processing Facilities. The well has been tied into the facilities and came on stream May 29, 2007.

Meanwhile, work-over of another well, EW-12, has been successfully completed. Additional perforation in the gas bearing zone of the Abu Madi formation has resulted in an increase of the well production.

An infill well, EW-8, in the El Wastani was spud on May 13, 2007 and is expected to be completed by end of June 2007. This well will add to El Wastani Gas and Condensate production from the Abu Madi formation.

The new LPG extraction facilities at the El Wastani field have been operating in start-up mode since the beginning of 2007: "This is Dana Gas's first LPG production in Egypt and with the current international market prices for LPG, we expect this to have a significant positive impact on our revenues for 2007," Dr. Elsharkawi said.

Duncan Nightingale, Dana Gas General Manager for Exploration and Production, added, "A complete integrated study of Dana Gas's exploration and producing acreage is near completion. The results of the study have permitted the identification of potentially prolific new drilling locations in the currently producing assets and have heightened the potential for further exploration success. The study has also identified new and potentially high volume deeper reservoirs". It is expected that Dana Gas will drill a total of 12 Exploration wells will be drilled in Egypt before the end of 2007.

The Exploration Drilling Program in the West El Manzala and West El Qantara concessions is progressing utilizing two drilling rigs. The Marzouk-1 Exploratory well, located in West Manzala concession, has reached a depth of 2,623 meters at the top of Abu Madi formation. Gas bearing zones have been identified in Kafr El Sheikh Formation at a depth of 1,363 meters. The well will continue drilling to penetrate the primary reservoir target, the Sidi Salim formation.

In the frontier area of Upper Egypt, Centurion has spudded its first exploratory well Komombo-4, on 25 May 2007, in partnership with Kuwait International Oil & Environment Company (KIOEC). The well will be drilled to a total depth of 2,562 meters to test the Cretaceous and Jurassic sandstone reservoirs.

Dana Gas is also pleased to announce that the recently drilled Luzi-1 discovery well will commence in June 2007. In July 2006 Centurion drilled the Luzi-1 well inside the West Manzala concession. The well encountered 37 meters of net pay in the Abu Madi formation. The well tested 9.5 mmscf/d of gas and 123 bbl/d of condensate. Centurion declared Luzi-1 as a commercial gas and condensate discovery and submitted a plan of development to the Egyptian Government. The Approval was granted on the 16th of April 2007, to develop the Luzi-1 discovery.

Dana Gas is currently Egypt's 6th largest natural gas producer and the Company's Egypt Business Development team continues to pursue expansion projects and new business opportunities in North Africa.