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1 Dec 2008 07:00
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01Β December 2008Β
Β
CIRCLEΒ OILΒ PLC
("Circle" or the "Company")
OPERATINGΒ UPDATE
MoroccoΒ andΒ Tunisia
Circle Oil Plc (AIM:Β COP), the international oil and gas exploration and developmentΒ company, today announced the following operating update.
Morocco
Sebou Permit;Β Discovery
The exploration well CGD-9 has been drilled, logged and successfully tested in the Sebou Permit,Β Morocco.
The Company confirms a discovery in the Lower Guebbas Formation with the well testing gas at a sustained rate of 8.86MMscfd. The well has been completed as a potential producer. A full technical evaluation of all the results of the well is underway which will allow for forward planning as a precursor to further assessment of the resource,Β including conducting an extended well test and a more complete estimation of theΒ reserves.
The drilling rig has now moved to the next drilling locationΒ onΒ thisΒ permitΒ to commence drillingΒ ofΒ the KSR-8 well, the third ofΒ a plannedΒ six well drilling programmeΒ in the area.
TheΒ SebouΒ PermitΒ (Circle Oil 75% working interest, ONHYM 25%)Β liesΒ north-east ofΒ RabatΒ in the RharbΒ Basin,Β Morocco. TheΒ RharbΒ BasinΒ is aΒ foredeepΒ BasinΒ located in the external zone of the Rif Folded belt. The concession agreement includes the right of conversion to a production licence of 30 years, plus extensions, in the event of commercial discoveries.
Ouled N'ZalaΒ Concession;Β Commerciality indicatedΒ on second well
Planning for the extended well test on the ONZ-6 discovery, which flowed under test at a sustained rate of 3.32MMscfd, is well advanced and initial analysis of the results from the well testing indicatesΒ itΒ is likelyΒ to be commercial. The final Reserve estimation will not be known until completion and analysis of the extended well test.
The ONZ-4 wellΒ which was scheduled to go into production in mid September is now inΒ continuousΒ production at a rate of approximately 1.5MMscfd.Β Following the initial start-up, problems with the main pipeline infrastructure occurred and these have now been resolved.
All of the gas produced in theΒ RharbΒ BasinΒ is sold locally and there is substantial demand for additional gas supplies in the area.
Tunisia
Grombalia Permit;Β SerdoukΒ exploration well
The Serdouk exploration well has been completed and loggedΒ to the targets in the Bou Dabbous and Abiod formations with a target depth of 1620Β metres.Β The well confirmed the prospect stratigraphy and structure butΒ noΒ oil shows were encountered. Logging and sampling indicates a lack of permeability leaving the formationsΒ "tight".Β The wellΒ has been pluggedΒ and abandoned.
David Hough, CEO of Circle, said:
"The second consecutive discovery in our drilling campaign inΒ MoroccoΒ is more excellent news for Circle. The well has been completedΒ as a potential producerΒ and the initial field test results are above our expectations for this area. The flow rates under test are amongst the best sinceΒ drillingΒ began in the Rharb. The results to date show that we are definitely benefiting from the additional information provided by the 3D seismic and the advanced quantitative techniques we are employing to achieve success.
Overall,Β weΒ areΒ extremelyΒ pleased with theΒ successΒ of our drilling programmeΒ to dateΒ and look forward to the resultΒ of the next well."
For further information contact:
Circle Oil plcΒ (+44 20 7638 9571)
David Hough, CEOΒ
Collins Stewart Europe LimitedΒ (+44Β 20 7523 8350)Adrian Hadden
Fox-Davies CapitalΒ (+44 20 7936 5230)
Daniel Fox-Davies
Citigate Dewe RogersonΒ (+44 20 7638 9571)
Martin Jackson
George Cazenove
Β Β
Notes to Editors
Circle Oil Plc
Circle Oil Plc (AIM:Β 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 onΒ AIMΒ in October 2004.Β
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 inΒ 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 -Β www.circleoil.net
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