Dana Gas, the Middle East's first and largest regional private-sector natural gas company, has declared a discovery from a new oil zone in its Egyptian concessions, marking the first discovery in the company’s US$ 170 million drilling campaign for 2008.

Drilling of the “Al Baraka-2” well in the Komombo concession, where Dana Gas made its first commercial oil discovery last year, has been completed. The new well confirmed the first discovery, Al Baraka-1, in the Abu Ballas formation, and proved a new discovery in the underlying Six Hills formation.

“This is the first discovery for Dana Gas in its major drilling campaign for this year,” said Ahmed Rashid Al Arbeed, Executive Director, Upstream. “We hope such discoveries continue to build company revenues and profitability, particularly in light of current high oil prices.

“In the coming weeks, Dana Gas will perform hydraulic fracturing of the producing reservoirs in two wells, Al Baraka-1 and Al Baraka-2, to enhance their productivity,” he noted.

Dr Hany Elsharkawi, Dana Gas Egypt Country Director, provided further details and said, “In addition to this discovery, we have commenced drilling of the West Baraka-1 exploration well in a new prospect in the Komombo concession, with completion expected before the end of next month, and are in advanced stages of drilling deeper gas exploration wells in our Nile Delta acreage, with results expected soon.”

“The recent oil discoveries made by Dana Gas in Upper Egypt, are of great importance as they prove the presence of a hydrocarbon system for the first time in the history of the area,” Dr Elsharkawi explained. “It certainly enhances the chances of proving large oil reserves in this part of the country which will positively impact the prosperity and the well being of the region and its residents, for the benefit of the Egyptian economy as a whole.”

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