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1 Feb 2010 07:00
01 February 2010
CIRCLE OIL PLC
("Circle" or the "Company")
New Moroccan Permits Signed
Circle Oil Plc (AIM: COP), the international oil and gas exploration, development and production company, is pleased to announce that Circle Oil Maroc Ltd ("COML"), its wholly owned subsidiary, has signed a Petroleum Agreement with the Office National des Hydrocarbures et des Mines ("ONHYM") for the Lalla Mimouna area covering the Exploration and Exploitation of Hydrocarbons for the "Lalla Mimouna Nord" and "Lalla Mimouna Sud" Exploration permits situated in the Rharb Basin, Morocco.
The permits cover an area of over 2,200 sq kms and are issued for an initial period of 8 years with the right of automatic conversion to a minimum (but extendable) 25 year exploitation period in relation to areas where it is agreed that commercially exploitable hydrocarbons have been discovered. Under the terms of the agreement the percentage interest in the permits is COML 75% and ONHYM 25%.
COML has agreed to carry out an initial targeted 80 sq km 3D seismic survey to assist in the assessment and ranking of prospects already identified in the area and to assess any newly identified prospects. The agreement also requires the completion of a minimum 2 well drilling programme in the first 3 years of the permits.
Both Lalla Mimouna exploration permits are, in the main, geologically similar in nature to Circle's existing Sebou Permit (296 sq kms) and with the extended combined area it provides Circle with substantially greater opportunity to further explore for, and if successful, exploit more natural gas accumulations in the Rharb Basin.
Commenting on the agreement David Hough, Chief Executive of Circle Oil said:
"This agreement is very significant as it provides Circle with a much larger low risk permit area, similar in both geology and background to our existing Sebou Permit. If our exploration programme is successful in the new Lalla Mimouna area, with its already recognised potential for low cost, fast track development and production, the permits are ideally placed geographically to feed into the new gas pipeline planned for construction later this year. Continuing success here will add to the long term earnings contribution for the Company. Circle was delighted to be offered participation in these permits by ONHYM as it further underlines our commitment to assist in hydrocarbon exploration and production in Morocco. Future drilling programmes will cover prospects within both our Sebou permit and the newly added Lalla Mimouna permits".
For further information contact:
Circle Oil Plc (+44 20 7638 9571
David Hough, CEO
Collins Stewart Europe Limited (+44 20 7523 8350)
Adrian Hadden
Fox-Davies Capital (+44 20 7936 5230)
Daniel Fox-Davies
Citigate Dewe Rogerson (+44 20 7638 9571)
Martin Jackson / George Cazenove
Murray Consultants (+353 1 498 0320)
Joe Murray
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, Egypt and Namibia with a combination of low-risk near-term production and significant exploration upside 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; the Zeit Bay area of Egypt and the Owambo Basin, Namibia. Circle also has the largest licence holding of any Company in Oman. In addition to its highly prospective Block 52 offshore, 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. This could be achieved through farm-outs to selected partners who would then invest in and continue the development of the asset into production, or Circle may itself opt to use its own expertise to appraise reserves and bring assets into production, generating sustained cash flow for further investment.
Further information on Circle is available on its website at www.circleoil.net.
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