13 Sep 2010 07:00
13 September 2010
Circle Oil Plc
("Circle" or the "Company")
Operational Update Egypt
Circle Oil Plc (AIM: COP), the international oil and gas exploration, development and production company is pleased to announce the following operational update on its activities in Egypt.
The exploration/appraisal well Al Ola-1X is presently drilling ahead after setting casing at 10,600ft MD in the Upper Rudeis, following drilling through the Kareem Formation. Log analysis has shown both sand units of the Kareem Formation to be oil bearing with no indication of the OWC. Formation pressure testing shows some limited communication with the updip Al Amir SE producers, and the well proves up the southern field extension in the Al Ola area. The Top Kareem Shagar was encountered at 9,731ft MD with 6ft of net pay and the Top Kareem Rahmi at 9,782ft MD with 19 ft of net pay (operator figures). The oil column is presently down to the base Rahmi Sand at 9,802ft MD (9,719ft SS).
The secondary objective in the Lower Rudeis Formation has also been reached where oil and gas were tested in the Al Amir SE-6X well. Strong gas shows were encountered in the interval 13,400-13,520 feet. The Al Ola-1X well is planned to be drilled to a total depth of 13,700 feet.
A further announcement on the well results, including testing, will be made in due course.
Separately, the partnership has also agreed the required plans to bring the gas associated with the NW Gemsa Concession producing wells into production, which is presently planned to be completed within the next 6 months.
Current gross production from the Al Amir, Al Amir SE and Geyad fields in the NW Gemsa Concession is 9,000 to 9,500 bopd.
The NW Gemsa Concession, containing the Al Amir and Geyad Development Leases, covering an area of over 264 square kilometres, lies about 300 kilometres southeast of Cairo in a partially unexplored area of the Gulf of Suez Basin. The concession agreement includes the right of conversion to a production licence with a 20 year term, plus extensions, in the event of commercial discoveries. 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).
Commenting Prof. Chris Green, CEO, said:
"Circle is maintaining its planned operational momentum and the work programmes are proceeding in line with our expectations. We are delighted with Al Ola-1X proving up the Kareem sands yet again and proving up the field extension in the south. The secondary target has also given strong shows of gas . Once this well is finished, we will consider the need for some injector support drilling before undertaking more appraisal and development wells."
Glossary
MD Measured Depth
OWC Oil-water contact
SS Sub-sea depth
bopd barrels of oil per day
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, is the qualified person, as defined in the London Stock Exchange's Guidance Note for Mining and Oil and Gas companies, who has reviewed and approved the technical information contained in this announcement. Professor Green has relied on primary information supplied by the operator in carrying out his review.
For further information contact:
Circle Oil Plc (+44 20 7638 9571) Professor Chris Green, CEO
Evolution Securities (+44 20 7071 4300) Rob Collins Chris Sim Neil Elliot
Fox-Davies Capital (+44 20 7936 5230) Daniel Fox-Davies
Philip Davies
Citigate Dewe Rogerson (+44 20 7638 9571) Martin Jackson George Cazenove
Murray Consultants (+353 1 498 0320) 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 producing, low-risk near-term production and acreage with significant upside exploration 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; and the Zeit Bay area of Egypt. Circle also has the largest licence holding of any Company in Oman. In addition to offshore Block 52, 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. Circle may use its own expertise to appraise reserves and bring assets into production, generating sustained cash flow for further investment. In addition it may seek farm-outs to selected partners who would then invest in the exploration and continue through to the development of the assets for production.
Further information on Circle is available on its website at www.circleoil.net.