21 Jul 2010 07:00
21 July 2010
CIRCLE OIL PLC
("Circle" or the "Company")
Operational Update - Egypt
Successful Production Testing of Al-Amir SE-6 Appraisal Well
Circle Oil Plc (AIM: COP), the international oil and gas exploration, development and production company, is pleased to announce that the Al-Amir SE-6 appraisal well has been successfully drilled and production tested in the Al-Amir Development Lease in the onshore North West Gemsa Concession ("NW Gemsa") in Egypt.
Circle is delighted to confirm that the Kareem Shagar Formation Sandstones under test flowed 42˚ API oil at a sustained average rate of 4,626 bopd and 3.91 MMscfd of gas using a 48/64" choke from the upper of the two identified pay zones. The well, which is the fifth appraisal well to be drilled in the Al-Amir SE discovery area, was shut in for a pressure build up and later placed on stream at an initial rate of 1,106 bopd using a 16/64" choke.
Log result interpretations indicate that the total net thickness of the tested pay zone is approximately 30 feet in the interval 9,806 feet to 9,836 feet measured depth.
The NW Gemsa concession, containing the Al-Amir and Geyad Development Leases, covering an area of over 260 square kilometres, lies about 300 kilometres southeast of Cairo in a partially unexplored area of the Gulf of Suez Basin. The concession agreement includes the right of conversion to a production licence of 20 years, plus extensions, in the event of commercial discoveries. NW Gemsa partners include: Vegas Oil and Gas (50% interest and operator); Circle Oil Plc (40% interest); and Sea Dragon Energy (10% interest).
The Al-Ola X-1 well spudded on 15 July and, as at 20 July 2010, was drilling ahead at 1,542 feet. This well is being drilled outside of the southern boundary of the Al-Amir SE Development Lease and is intended to capture a southern extension to the Al-Amir SE oil field.
With the placement of the Al-Amir SE-6 well on stream, the NW Gemsa gross production has now reached approximately 9,500 bopd.
Commenting on this latest appraisal well in the NW Gemsa Concession, Professor Chris Green, CEO of Circle, said:
"We are delighted with the successful testing and completion of the Al Amir SE-6 well, which has now been placed into production. Ongoing drilling will now focus on appraisal and development to enable us to better understand the reservoir geology of the field and plan for pressure support ".
Glossary
bopd - Barrels of oil per day
boepd - Barrels of oil equivalent per day
mmbbls - Million barrels
MMscfd - Millions standard cubic feet per day
In accordance with the guidelines of the AIM Market of the London Stock Exchange, Professor Chris Green, Chief Executive Officer of Circle Oil plc, an explorationist and geophysicist with over thirty years oil & gas industry experience, is the qualified person, as defined in the London Stock Exchange's Guidance Note for Mining and Oil and Gas companies, who has reviewed and approved the technical information contained in this announcement. Professor Green has relied on primary information supplied by the operator in carrying out his review.
For further information contact:
Circle Oil Plc (+44 20 7638 9571) Professor Chris Green, CEO
Evolution Securities (+44 20 7071 4300) Rob Collins Chris Sim Neil Elliot
Fox-Davies Capital (+44 20 7936 5230) Daniel Fox-Davies
Philip Davies
David Porter
Citigate Dewe Rogerson (+44 20 7638 9571) Martin Jackson George Cazenove
Murray Consultants (+353 1 498 0320) Joe Murray Joe Heron
Notes to Editors
Circle Oil Plc
Circle Oil Plc (AIM: COP) is an international oil & gas exploration, development and production Company with an expanding portfolio of assets in Morocco, Tunisia, Oman and Egypt, with a combination of producing, low-risk near-term production and acerage with significant upside exploration potential. The Company listed on AIM in October 2004.
Internationally, the Company has continued to expand its portfolio over the past 2 years and now has assets in the Rharb Basin, Morocco; the Ras Marmour Permit in southern Tunisia; the Mahdia Permit offshore Tunisia; the Grombalia Permit in northern Tunisia; and the Zeit Bay area of Egypt. Circle also has the largest licence holding of any Company in Oman. In addition to offshore Block 52, the Company also has an ongoing exploration program in Block 49 onshore.
The Company's strategy is to locate and secure additional licenses in prospective hydrocarbon provinces and through targeted investment programmes, monetise the value in those assets for the benefit of shareholders. Circle may use its own expertise to appraise reserves and bring assets into production, generating sustained cash flow for further investment. In addition it may seek farm-outs to selected partners who would then invest in the exploration and continue through to the development of the assets for production.
Further information on Circle is available on its website at www.circleoil.net.