Circle Oil Plc Regulatory News (COP)

29 Jan 2008 07:00

Circle Oil PLC29 January 2008 29 January 2008 CIRCLE OIL PLC ("Circle" or the "Company") EGYPTIAN FARM-IN Circle Oil plc (AIM: COP), the oil and gas exploration and development group, istoday pleased to announce that Circle Oil Egypt Ltd (COEL), its wholly ownedsubsidiary, has signed a farm-in agreement covering the exploration andexploitation of hydrocarbons with Vegas Oil and Gas SA for the NW Gemsa Block inEgypt. The agreement, which is subject to ratification by Egyptian General PetroleumCorporation (EGPC) and the Minister of Petroleum, will result in Circle Oilholding a 40% interest in the concession. Vegas Oil and Gas is operator with a50% interest and Premier Oil plc 10%. The NW Gemsa concession, which covers an area of over 400 square kilometers liesabout 300 kilometers southeast of Cairo in a partially unexplored part of theGulf of Suez Basin. It includes the Al Amir-1 well which discovered oil inApril 2005. This well flowed 787 barrels of oil per day on test. The concession agreement has recently entered its second phase of three and isvalid for a further two and a half years. It has the right of conversion to aproduction licence of 20 years, plus extensions, in the event of commercialdiscoveries. As part of the agreement Circle will contribute towards the cost of the AmirSE-1 exploration well which will target the Nubia Sandstone at a depth of 12,870feet. The Nubia Sandstone is a well known producer within the Gulf of Suez Basinand in the area of the proposed Amir SE-1 exploration well, it is approximately1200 feet thick. The drilling rig contract is due to be concluded shortly andthe well is scheduled to commence drilling in early February 2008. The structureis a partial dip and fault closure and has an operator estimated potential of100MMBO in situ based on the present outlined closure area. Commenting on the farm-in agreement David Hough, CEO, Circle Oil plc said: "This is another exciting farm-in for Circle Oil bringing with it theopportunity to develop a lasting relationship with a progressive Egyptian OilCompany. If successful, it will allow fast track appraisal and development ofthe field into an existing infrastructure. This is in line with our statedstrategy which we are pursuing vigourously in order to further enhance Circle'sposition." For further information contact: Circle Oil plc David Hough, CEO (+44 20 7638 9571) Citigate Dewe Rogerson (+44 20 7638 9571) Media enquiries: Martin Jackson Analyst enquiries: George Cazenove Collins Stewart Europe Limited (+44 20 7523 8350) Chris Howard Notes to Editors Circle Oil Circle Oil plc (AIM: COP) is an international oil & gas exploration anddevelopment company with a growing portfolio of assets in Egypt, Morocco,Tunisia, Namibia, Oman and Panama. The company listed on AIM in October 2004. Circle has the largest licence holding of any company in Oman. In addition toBlock 52, the company also has an ongoing exploration program in onshore Block49. Worldwide, the company is active in exploration in the Owambo Basin,Namibia; in the Caribbean Sea, offshore Panama; the Rharb Basin, Morocco; theRas Mamour Permit in southern Tunisia and Grombalia Permit in northern Tunisia. The Company's strategy is to locate and secure licences in new hydrocarbonprovinces and through targeted investment programmes, monetise the value inthose assets for the benefit of shareholders. This could be achieved throughfarm-outs to selected partners who would then invest in and continue thedevelopment of the asset into production, or Circle may itself opt to use itsown expertise to appraise reserves and bring assets into production, generatinglong term cash flow for further investment. www.circleoil.net This information is provided by RNS The company news service from the London Stock Exchange