Circle Oil Plc Regulatory News (COP)

23 July 2012

CIRCLE OIL PLC

("Circle" or the "Company")

Operating Update Egypt

Circle Oil Plc (AIM: COP), the international oil and gas exploration, development and production company, is pleased to announce the following update regarding the Al Amir SE Field ("AASE") and the Geyad field.

AASE-12X ST 1 Well

Development well AASE-12X was spudded on 25 April 2012 and is located in the south- central part of the AASE field, updip of the Al Ola-1X producer. The well's objective was to appraise both the Shagar and Rahmi sands production in that location. The well reached a TD of 10,200 ft MD before being sidetracked to the north-east, for geological reasons, as AASE-12X ST1 and was then successfully drilled to a total depth of 10,300 ft MD into the base Kareem. The well encountered 15.5 ft of net pay in the Kareem Shagar sand, with oil bearing sands present to the base of the reservoir. The well has been completed as a Shagar sand producer and has been perforated in the interval 9,669 to 9,684.5 ft MD and flowed oil and gas on test at an average rate of 2,595 bopd and 4.7 MMscf/d respectively, on a 48/64" choke. The well has now been placed on production at an initial flow rate of 1,038 bopd using a 28/64" choke.

Al Ola-3 Well

Following the successful completion of the AASE-12X ST1 well, the rig has been mobilised to drill the appraisal/injection well Al Ola-3, in the southern part of the AASE field. The well is expected to be an injector well targeting the Kareem sands, located to the south of Al Ola-1 and Al Ola-2 wells. 

Production

Currently production from the AASE, Geyad and Al Ola fields is approximately 9,300 bopd (gross). Cumulative production from the NW Gemsa Concession has now exceeded 8.6 million barrels of 42 degree API Crude oil.

The NW Gemsa Concession, containing the Al Amir, Geyad and Al Ola Development Leases, covering an area of over 260 square kilometres, lies approximately 300 kilometres south-east of Cairo in a partially unexplored area of the Gulf of Suez Basin.

In the event of commercial discoveries, the concession agreement includes the right of conversion to a production licence of 20 years plus extensions. The NW Gemsa Concession partners include: Vegas Oil and Gas (50% interest and operator); Circle Oil Plc (40% interest) and Sea Dragon Energy (10% interest).

Prof Chris Green, CEO, said

"Circle is pleased with the results of the AASE-12X ST1 well, which has been completed as a Shagar sand producer with good initial flow. This well result further proves up the south central part of the AASE field and will add to the production rate and ultimate recovery from the field. The rig has now being moved to drill the Al Ola-3 well, which is intended as a southern water injector for the AASE field and is part of the overall plan to improve the productivity of the NW Gemsa accumulations."

Glossary 

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, and Dr Stuart Harker, VP Geology, also with over 30 years experience, are the qualified persons as defined in the London Stock Exchange's Guidance Note for Mining and Oil and Gas companies, who have reviewed and approved the technical information contained in this announcement. Professor Green and Dr Harker have relied on primary information supplied by the operator in carrying out their review.

For further information contact: 

Circle Oil Plc (+44 20 7638 9571)

Professor Chris Green, CEO

Investec (+44 20 7597 5970)

Chris Sim

Neil Elliot

Liberum Capital Limited (+44 20 3100 2222)

Simon Atkinson

Citigate Dewe Rogerson (+44 20 7638 9571)

Martin Jackson

Kate Lehane

Murray Consultants (+353 1 498 0300)

Joe Murray

Joe Heron

Notes to Editors

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 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 two 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 its prospective Block 52 offshore, Circle also has an ongoing exploration programme in Block 49 onshore.

Circle's strategy is to locate and secure additional licences 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.