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Delivering for the future

27 April 2015

2015 AGM


Forward Looking Statements

This presentation contains statements that constitute

“forward-looking statements”. Forward-looking

statements appear in a number of places in this

presentation and include statements regarding Dragon

Oil plc’s (the “Company” or together with its

subsidiaries “Dragon Oil” or the “Group”) intent,

belief or current expectations with respect to its

results of operations and financial condition. These

statements reflect the Company’s current views with

respect to future events and are subject to certain

risks, uncertainties and assumptions. Should one or

more of the risks or uncertainties materialise, or

should underlying assumptions prove incorrect, actual

results may vary materially from those described in

this presentation as anticipated, believed, estimated,

expected or intended.

By their very nature, forward-looking statements

involve inherent risks and uncertainties, both general

and specific, and risks exist that the predictions,

forecasts, projections and other forward-looking

statements will not be achieved. The Group is under

no obligation, and disclaims any obligation, to update

or alter the forward-looking statements included in

this presentation, whether as a result of new

information, future events or otherwise after the date

of this presentation.

The updated field development plans as well as

infrastructure and drilling projects are subject to

approval by the Turkmenistan Government.

Dragon Oil plc2


Operational and CorporateHighlights

Dr Abdul JaleelAl Khalifa, CEO

Our production &

exploration sites

Our offices


Dragon Oil Today

Dragon Oil plc4

40% interest in 2

exploration blocks in

Northern Afghanistan

(Operator of one of

the blocks)

30% interest in exploration

Block 9, Basra region, Iraq

55% interest in the

Bargou Exploration

Permit, Tunisia

Our headquarters

and technical staff

are in Dubai

The Cheleken Contract Area, offshore

Turkmenistan, our main producing

asset (100% interest) where we have

operated for almost 15 years

100% interest in East Zeit

Bay exploration block,

Gulf of Suez, Egypt

40% interest in

exploration block SC 63,

offshore Palawan Island,

the Philippines

TunisiaAfghanistan

Philippines

Egypt Iraq

Turkmenistan

Dubai, UAE

Exploration assets:

Tinrhert Nord Perimeter

(70% interest and operator) and

Msari Akabli Perimeter (30%)

Algeria


Dragon Oil’s Strategy

• Organic growth:

exit 2015 at a

production target

of 100,000 bopd

and plateau for

five years

• Diversification in

Africa, Middle East

and Asia

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The Dzheitune (Lam) B platform.


Key Highlights (2014 – 1Q 2015)

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Production growth

• 6.8% growth in 2014 to 78,790 bopd

• December 2014 average gross production of

89,680 bopd;

• 2014 exit rate of 92,008 bopd reached

88,700 bopd

23%

1Q 2015 AVERAGE GROSS PRODUCTION

1Q 2015 AVERAGE GROSS PRODUCTION

GROWTH YEAR-ON-YEAR

50,000

60,000

70,000

80,000

90,000

100,000

1Q 14 2Q 14 3Q 14 4Q 14 1Q 15

Gross average daily crude oil production, bopd

The Dzheitune (Lam) C offshore platform.


Reserves and Resources in the Cheleken Contract Area

AS AT 31 DECEMBER 2014 AS AT 31 DECEMBER 2013

Proved and Probable Remaining Recoverable Reserves

Oil and Condensatemillion barrels

GasTCF

Oil and Condensatemillion barrels

GasTCF

Gross field reserves to 1st May 2035 663 1.3 675 1.4

2C Resources

Gross oil and condensate contingent resources 93 - 69 -

Gross gas contingent resources - 1.3 - 1.3

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60% REPLACEMENT OF OIL RESERVES AGAINST 2014 GROSS PRODUCTION IN THE CHELEKEN CONTRACT AREA


Discoveries in Iraq

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FORMATION TEST RATEOIL

QUALITY DEPTH2C CONTINGENT RESOURCES,

net on a working interest basis

32”/64” 64”/64”

MISHRIF 2,000 bopd 3,400 bopd 20º API 2,700m

• 198 million barrels of oil

• 56 Bscf of gas

YAMAMA 5,000 bopd 8,000 bopd 35º API 4,000m

• Pending a report from independent

petroleum engineer

BLOCK 9

30%

866km2

Onshore in Basra province

IRAQ

BAGHDAD

Exploration

Block 9

BASRA

IRAQ

• Two appraisal wells planned for 2015 to fast

track the development


Diversification: Two Onshore Blocks in Algeria

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• Contract for the exploration and

exploitation of hydrocarbons

signed on 29 October 2014

• In partnership with ENEL Trade

S.p.A. (“Enel”)

• For Tinrhert Nord Perimeter:

commitment during the

exploration period includes

acquisition and interpretation of

2D seismic data and drilling four

wells

• For Msari Akabli Perimeter:

commitment during the

exploration period includes

acquisition and interpretation of

3D seismic data and drilling three

wells

TINRHERT NORD BLOCK

Operator, 70% paying interest

34.3% participating interest in

the development and production

period

2,907km2

Onshore Illizi Basin

MSARI AKABLI BLOCK

30% paying interest

14.7% participating interest in

the development and production

period

8,096km2

Onshore Ahnet Basin

ALGERIA


Financial Strength

• US$1.9bn in cash and cash

equivalents and term

deposits, excluding funds set

aside for abandonment and

decommissioning activities,

as of 31 March 2015

• 28% average dividend growth

since 2010

• 9% increase in 2014

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14

11

1518

16

-

5

10

15

20

25

30

35

40

2010 2011 2012 2013 2014

Dividends per share

Interim Final

US cents

per share


Rigs Deployment in 2015

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Status

Jack-up rig Elima Contracted until May 2016

Jack-up rig Neptune Contracted until Mercury is ready to replace Neptune

Caspian Driller jack-up rig Five-year initial contract + a two-year optional extension

Land Rig No2 Contracted for two years + one-year option


Infrastructure Highlights

• Fabrication of Dzheitune (Lam) E platform

and associated pipelines commenced

• Dzheitune (Lam) F platform in the central

part of the Dzheitune (Lam) field

substantially completed

• Quadrupling of our crude oil storage capacity

at the Central Processing Facility is

progressing

• Additional equipment installed to increase

the capacity of the Central Processing Facility

to handle 100,000 bopd and 150 mmscf of gas

per day

• Structural strengthening and slot addition

works at a number of platforms continue

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Construction of crude oil storage tanks.

Construction of an offshore platform.


Surface Facilities: New Well Slot Preparation

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Challenges• No space on existing platforms

• Structural adequacy to be checked

• Additional topside facilities to be created

• Additional instrumentation & control system to be installed

Achievements• Prepared for drilling 14 slots on Lam 4, Lam B, Lam C,

Lam 22 & Lam 28

• Six slots on Lam-10 to be ready post driving piles soon


Surface Facilities: New Water Bath Heater at CPF

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Objective• To increase the incoming fluid

temperature by 25-30ºC at CPF

Observed problems• Insufficient heating for incoming fluid

leading to process issues, especially

during winter times and at a higher

flow rate

Achievements• Installed WBHs in the inlet of Heater Treater–A/B/C

• Increased the inlet fluid temperature from 14ºC to 30ºC

• Improved oil water separation in heater treaters

• Water cut in the oil outlet reduced from 0.7-1.0% to 0.3%

• Improved oil-in-water ppm from above 5000 ppm to less than 1000 ppm


Surface Facilities: New Added Equipment at CPF

• Enabled accommodating the Slug and availed sparing capacity

at the CPF

• New Finger Type Slug Catcher & Three-Phase Separator

• 5TH Heater Treater with Pre-Heat Exchanger

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Secondary Oil Recovery: Artificial Lift

• Objective is to increase production and

enhance recovery

• Artificial lift application commenced

in June 2013 with installation in two wells

• Jet pumps installed in two more wells in

2014

• Additional jet pumping systems currently

being installed

• Plans to expand artificial lift in 12 more

wells in 2015

• Plans to introduce the use of electric

submersible pumps (ESP)

Dragon Oil plc16

Dragon Oil team with a jet pump on a slickline.


Secondary Oil Recovery: Water Flood

• Objective is to increase reserves,

increase production rate and extend

plateau

• Pilot water injection project ongoing

at the Dzheitune (Lam) 75 area

• Plans to expand to other platforms

in 2015

• Wider scale implementation in the

future

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Reservoir modelling.


Subsurface Techniques: Expandable Sand Screen

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Expanded screen

Lam 28/179 7” ESS

Completion inside 8.5” OH:

ESS set across 98m of

producing intervals

Qo = 2,860 bopd

Lam 13/199 Standard 5.5”

MeshRite inside ” 9-5/8”Casing:

Perforated 103.5 net pay

in A-Sand

Qo = 1,796 bopd

Standard screen


Subsurface Techniques: RT Scanner Technology for Thin Lamination

• RT Scanner can resolve thin

lamination and calculate

resistivity vertical (Rv)

• In anisotropic formation it

enables to calculate correct

hydrocarbon saturation

• Potential increase of 10~20%

HC Saturation

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GR Rv P40 D-N Sw


Low Resistivity Pay Technology (LRP)

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- Campaign to perforate

LRP zones leads to

more production gain

(500 bopd) per well

LAM 13/135 well

LRP


Gas

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Strip condensate for sale and target

long-term gas sales agreement or other

alternatives

Evaluation of bids to select a contractor

for EPIC of the Gas Treatment Plant

ongoing with award expected in due

course

CONSTRUCTION OF THE GAS TREATMENT PLANT

2015 2015-19

Central Processing Facility. Central Processing Facility.


Marketing of Crude Oil

• Diversification achieved: one-year agreement with two buyers for all

anticipated entitlement export production in 2015

• FOB (free-on-board) the Aladja Jetty, Turkmenistan exporting via Baku,

Azerbaijan and Makhachkala, Russia

• Expected discount to Brent of approximately US$14 per barrel

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• US$14/barrel discount

to Brent in 1Q 2015


Our Talent

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Dragon Oil employees in Dubai.

Dragon Oil team in Ashgabat.

• 1,900 professionals

• 93% of workforce in Turkmenistan are

local people

• 475 people joined in 2014

98% RETENTION RATE

ACROSS THE GROUP


Training and Development

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• In-house and external training programmes

• Partnerships with educational institutes in the

region

• More employees have enrolled to receive

assistance with higher education tuition fees

English language courses.

Fire fighting training.

Dragon Oil employees, Ashgabat, Turkmenistan.


Health & Safety

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• The Group continued to

operate without fatalities

or major accidents

• Significant increase in the

number of HSE-focused

training courses

HSE training.HSE training.

LTIF IMPROVED FURTHER TO 0.6


Investment in Community

• Allocation of

approximately

US$10mn annually

for

• jointly identified

social projects and

• training programmes

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School in Hazar, Turkmenistan.


Tarun Ohri,

Director of Finance

2014 Financial Results


2014 Financial Highlights

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Revenue Net Profit Cash Balance

US$1.1bn US$650.5mn US$2.0bn

• Production growth

• Lower realised oil prices

• Final dividend of

16 US cents per share

for 2014

• 2014 full-year dividend

amounts to 36 US cents

per share

• Self-financing of

development &

exploration expenditure

• No debt

• Diversification

opportunities

• Dividends


2014 Financial Highlights

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US$mn 2014 2013 CHANGE

Revenue 1,093.1 1,047.9 4%

Operating profit 578.6 687.7 -16%

Net profit 650.5 512.6 27%

Basic earnings per

share (US cents)132.32 104.44 27%

Dividend per share

(US cents)36.0 33.0 9%

Capital employed 3,708.2 3,239.5 14%

Net cash from

operating activities821.8 652.2 26%

Net cash used in

investing activities(627) (763.5) -18%

Cash balance (excl.

A&D)1,974.9 1,923.6 3%

Debt nil nil -

• Strong balance sheet

allows us to

• Continue with the

development of the Cheleken

Contract Area

• Appraise Iraqi discovery and

progress other exploration

assets

• Pay regular dividends

• Maintain an unleveraged

position


2014 Cash Flow

• Cash and term deposits total US$1,924mn

as at 31 March 2015

• Cash and term deposits totalled US$1,975mn

as at 2014 year-end and included:

• Term deposits of less than three months

of US$39mn

• Term deposits of more than three months

of US$1,936mn

• Abandonment and decommissioning fund

totalled US$664mn

• Net cash from operations higher by 26%

• Total capital expenditure in 2014 was

US$679mn and US$597mn cash outflow after

movement in payables including additions to

intangible assets

• Cash maintained with international

and UAE banks

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1,975

597

185 115

937

11

1,924

FINANCING: DIVIDENDS OF $187mn, PARTLY OFFSET BY ISSUE OFSHARE CAPITAL OF $2mn

NET CASH FROM OPERATIONS

INVESTING: PPE ADDITIONS OF

$627MN & INTANGIBLES OF

$52mn

INTEREST RECEIVED ON BANK DEPOSITS

A&D INCREASE OF $115mn

US$mn

OPENING CASH (excl. A&D) CLOSING CASH (excl. A&D)


2014 Capital Expenditure

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• Drilling (44%)

• 14 development and appraisal wells, including

two sidetracks, completed

• Infrastructure (49%)

• Relocation of Dzheitune (Lam) F platform

• Construction of the tank farm

• Additional slots on a number of platforms

• Exploration (7%)

• Iraq

• Tunisia

• Egypt

121

332

72

151

295

76

52

2013

2014

1Q 2015Infrastructure

Drilling

Exploration activities59

• Afghanistan

• The Philippines

• Algeria

5

Construction of offshore platforms at the harbour area.


Dr Abdul Jaleel

Al Khalifa, CEO

Outlook


Production

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• Target annual production growth

of around 10+% in 2015 and exit

2015 at 100,000 bopd

• Maintain this rate as plateau for

at least five years

• Water injection at more

platforms

• Jet pumps in 12 more wells

The Dzhygalybeg (Zhdanov) A offshore platform.


Drilling

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• Complete between 15 and 20 wells a year

in 2015 and in 2016

• Four drilling rigs (three jack-up and one

platform-based rigs) in 2015

• Caspian Driller is being commissioned

for commencement of drilling operations

in 2Q 2015

Platform based drilling rig.


Infrastructure

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• Installation of the Dzheitune

(Lam) F platform ongoing

• Fabrication and installation

of the Dzheitune (Lam) E

platform

• US$500mn to US$600mn

estimated capital expenditure

for infrastructure and drilling

excluding the Gas Treatment

Plant cost in Turkmenistan in

2015

An offshore platform.


Diversification

• Two appraisal wells in

Block 9, Iraq

• Re-processing of existing 2D

seismic data in East Zeit Bay, Egypt

• Airborne gravity and magnetic

data acquisition in Afghanistan

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Investor and analyst enquiries

Dragon Oil plc

Anna Gavrilova

+ 44 20 7647 7804

[email protected]

[email protected]

Media enquiries

Citigate Dewe Rogerson

Martin Jackson

+44 20 7638 9571

Joint Corporate Brokers

Davy

John Frain

+353 1 679 6363

Joint Corporate Brokers

Nomura International plc

Andrew Forrester

+44 20 7521 2000

Thank you

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