DNO reports record revenue as it chases new growth

DNO, the Norwegian oil and gas operator, has reported record second quarter revenue of USD 761 million, up 21 percent quarter-on-quarter, as strong North Sea production sold at high commodity prices more than offset the impact of the production shutdown in the Kurdistan region of Iraq.

Operating profit increased 55 percent quarter-on-quarter to USD 439 million, while net profit rose 65 percent to USD 83 million.

Net production averaged 88,400 barrels of oil equivalent per day (boepd) during the quarter, with North Sea assets contributing 84,900 boepd, West Africa 3,200 boepd and Kurdistan 300 boepd. DNO's largely unhedged North Sea production captured the upside from strong oil and gas prices driven by continued Middle East crisis.

'We're unhedged, but not unhinged by market turmoil,' said Executive Chairman Bijan Mossavar-Rahmani. 'We'd gladly trade a little excitement for greater price stability and improved security in Kurdistan. In the meantime, our North Sea assets are hitting on all 12 cylinders.'

With the bulk of annual maintenance activity completed and new developments now onstream, DNO has raised its 2026 North Sea production guidance to 85,000 boepd, an increase of 3,000 boepd from its projection at the start of the year.

In Kurdistan, as a precautionary safety measure, DNO halted production and drilling activities on its operated Tawke license following U.S.-Israeli air strikes against Iran in late February.

Limited field operations restarted at the Tawke license on 9 April with the resumption of workovers on existing wells and the relaunch of the previously announced eight-well drilling campaign. On 28 June, DNO initiated production from the Tawke field and on 11 July from the Peshkabir field.

With contribution from new wells and absent adverse security developments, DNO expects production at Tawke license to stabilize at around pre-shutdown levels. While DNO continues to seek access to export markets or export prices, the Company is currently selling its entitlement oil at prices in the mid-to-upper USD 30s per barrel.

DNO holds a 75 percent stake in the Tawke license, with a subsidiary of Genel Energy plc holding the balance.

Following the end of the quarter, on 7 August, DNO announced a possible offer to acquire Genel Energy plc. The indicative offer of 69 pence per share represents a premium of 38 percent to Genel's closing price on 6 August 2026, being the last business day before the announcement of the possible offer. The proposal represents a liquidity event for Genel shareholders providing an attractive opportunity to receive cash and realize their investments against a backdrop of poor trading liquidity in the Genel shares. Alternatively, Genel shareholders may elect to receive a combination of cash and newly issued DNO shares equivalent in value to the indicative cash offer per Genel share.

'This is a compelling proposal for Genel shareholders,' said Executive Chairman Bijan Mossavar-Rahmani. 'Rather than resisting a generous offer, the Genel Board of Directors should make way for a transaction that gives shareholders an immediate premium and the opportunity to come along for the DNO ride, where DNO is a strong, diversified growth-oriented business with an established track record of dividend payments.'

DNO’s Board of Directors approved a quarterly dividend of NOK 0.375 per share, payable in September 2026, maintaining the same level as the previous four quarters.

A videoconference call with executive management will follow today at 10:00 (CET). Please visit www.dno.no to access the call.

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Source: DNO