With reference to news headlines at Norwatch and dn.no regarding allegations of corruption in Peru, Discover Petroleum International (DPI) will give the following statement:

• According to our understanding, several Peruvian individuals have since February last year been monitored and suspected of corruption. • In March this year, DPI was invited by a business associate in Mexico, who had established contact with a businessman from the Dominican Republic with large infrastructure projects in Peru, to evaluate the possibility of applying for oil production licenses in Peru. • DPI was in Peru in April to examine the possibility to participate in the application process. During this visit, the company was encouraged by Peru Petro (the Peruvian Petroleum Directorate) to start the process of becoming pre-qualified for participation in the application round in September. In this process, DPI was encouraged to establish a relation with a local law firm that could act as our site representative and also legal representative in relation to the authorities. This was a requirement in order to become pre-qualified. This law firm has obtained legal advice from other subcontracted law firms. One of these lawyers is Quimper, who is now accused with corruption. Quimper was, according to the information we received, the best taxlawyer in Peru, and was to assist with tax advisory to our site representative. Quimper is a Board Member in Peru Petro, and runs his own law practice in Peru. • In May DPI also established, through its Mexican contact, a consultancy agreement with Romulo Leon, engaging him to assist with organizing the pre-qualification and necessary meeting-processes towards the authorities. Leon is former Minister and Member of Parliament in Peru. Leon is the second of the two individuals now under suspicion of corruption. • In July/August DPI became pre-qualified in an ordinary manner, but as a fairly new company with a short financial track-record, the company received the lowest score. • Based on the element of technology, PetroPeru (the oil company) caught interest in establishing a co-operation with DPI to participate together in the application process for the licenses. With DPI’s technological know-how and PetroPerus financial solidity, this co-operation received the highest score • In September the companies entered into such joint-venture, and applied for 7 production licenses. The joint-venture was awarded 5 licenses on 10 September. • Two weeks ago, DPI started the process of replacing Romulo Leon as site representative and changing its legal representation, by request from PetroPeru.

As the corruption allegations include payment of funds, DPI emphasize that the only financial transfers that have been made in Peru are as follows:

• USD 10,000 per month from May through October - a total of USD 60,000, has been paid to a law firm to cover legal assistance in connection with prequalification, establishing a local branch and the license application process. • A total of USD 63,750 has been paid during the period from May to this day to Romulo Leon for assistance in connection with preparation of meetings and procedures in connection with the license application process. • In addition, USD 16,637 has been paid as current capital to the branch for covering current expenditures. (Translation of case documents, Notary Public fees, etc.) • USD 5,000 has been paid to the audit firm, Ernst & Young • Securities of USD 185,420 have been made through a bank deposit in Peru, as guarantee in connection with the application process towards PeruPetro. These funds are untouched at the escrow account.

"We have never been aware of nor been responsible for any forms of such payments that they are talking about, and we strongly deny any such allegations. We have twice been requested to include success-fees in the agreements with these individuals in Peru. This has categorically been refused by us. The application process has in addition been completely open and transparent, and could not possibly have been influenced by any bribes. The fact that these individuals were being monitored under the suspicion of corruption already before we had any business interests in Peru, indicates that we are the ones that have been deceived, Jostein Kjærstad", CEO and Chairman of the Board in DPI says.

"We have been in contact with Økokrim (The Norwegian National Authority for Investigation and Prosecution of Economic and Environmental Crime) today to seek advice on how to handle this case. We will also contact Transparency International or other independent expertise, to have them examine all of our transactions and activities in Peru", Kjærstad says.