16 Dec 2008 07:00
16 December 2008
CIRCLE OIL PLC
("Circle" or the "Company")
North-West Gemsa Concession in Egypt
New Oil Discovery
Circle Oil Plc (AIM: COP), the international oil and gas exploration and development company, is pleased to announce the successful re-entry and sidetrack of well Al Amir-1X, in the North-West Gemsa Concession, Egypt.
Al Amir-1X discovered oil in a single pay zone in April 2005. This re-entry was done to redrill and test a new sidetracked section of the well in order to re-appraise the well as a potential producer. This work has now been completed and following sidetracking to a total vertical depth of 5,270 feet, two pay zones have been identified.
The previously discovered upper pay zone in the Gharib formation dolomites has been confirmed by the sidetrack well. This upper zone has been tested with a sustained rate of 416 bopd, API 16.
A new lower pay zone has also been encountered in the Gharib formation dolomites. The Company intends to test and confirm the flow rate potential from the new lower pay zone when the well is brought into commercial production.
The Egyptian General Petroleum Corporation ("EGPC") has given a positive response to the partners 'Declaration of Commerciality' submission made to them for both wells. Development plans to bring the wells into early commercial production have also been submitted to EGPC.
The North West Gemsa Concession partners include: Vegas Oil and Gas (50% interest and operator); Circle Oil plc (40% interest) and Premier Oil plc (10% interest). The concession covers an area of over 400 square kilometres and lies about 300 kilometres southeast of Cairo, in a partially unexplored part 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.
David Hough CEO, Circle Oil, said:
''The confirmation of the original Al-Amir-1 discovery together with its new lower pay zone further enhances the potential and commerciality of this part of the North West Gemsa Concession. We are delighted to have received the Declaration of Commerciality for both wells from EGPC and we plan to bring the two discoveries online in the shortest time frame.
With our two recently announced discoveries in Morocco and now two positive results in Egypt we are very pleased with our drilling results to date.''
Glossary
bopd - barrels of oil per day
API - American Petroleum Institute density scale
In accordance with the guidelines of the AIM Market of the London Stock Exchange, Professor Chris Green, Chief Operating Officer of Circle Oil plc, an explorationist and geophysicist with over thirty years oil & gas industry experience, is the qualified person that has reviewed and approved the technical information contained in this announcement. Prof. Green has relied on information supplied by the operator in carrying out his review.
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
Notes to Editors
Circle Oil Plc
Circle Oil Plc (AIM: COP) is an international oil & gas company with an expanding portfolio of assets in the Middle East and North Africa, with a combination of low-risk production in Morocco and significant development and exploration upside potential in Morocco, Tunisia, Oman, Egypt and Namibia. 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 including gas production; the Ras Mamour Permit in southern Tunisia; the Mahdia Permit offshore Tunisia; the Grombalia Permit in northern Tunisia; the Zeit Bay area of Egypt where it has had a recent oil discovery 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 Oil is available on its website - www.circleoil.net