9 Sep 2010 07:00
9 September 2010
CIRCLE OIL PLC
("Circle" or the "Company")
Operational Update
Morocco and Oman
Circle Oil (AIM: COP), the international oil and gas exploration, development and production company is pleased to announce the following operational update on its activities in Morocco and Oman.
Morocco
Following the winter flooding, existing access roads have been repaired and new access roads and concrete drilling bases for the first three wells in the current five well drilling program have been completed. The civil engineering works for the fourth wellsite are currently in progress.
The drilling rig has now commenced drilling at the first wellsite in the Sebou Permit. The first well, designated KAB-1, is planned to drill to a Miocene Guebbas Sand target with the well expected to TD at 1,360 metres. The drilling of this and each subsequent well in this campaign is presently expected to take approximately five to six weeks per well. All wells are targeting Miocene aged gas sand targets varying in depth from 900 to 1,700 metres.
As part of this campaign the DRJ-6 well, drilled in 2009, is scheduled to be re-entered and tested. As previously announced, a local transport strike prevented its testing during that drilling campaign.
Pre-planning for the 62 km extension to the gas trunk line is well advanced and the order for materials for the new 8-inch pipeline, which will have a production capacity of 23 MMscfd, has been placed.
Total gas production from our Morocco wells from start up in November 2008 to end August 2010 is 923 MMscf (26.13 MMNm3). Gross daily production is ranging between 1.4 to 2.2 MMscfd (40,110 to 62,643 MNm3), and is contracted to supply local industry demands.
Oman
Block 49
The Block 49 3D seismic acquisition survey (900 sq km) has been completed together with a 2D tie line of approximately 130 km between nearby wells. The field data is being transferred for processing and this will be followed by comprehensive interpretation in the Company's offices in the UK and Oman.
Early interpretations of the field data have indicated the potential presence of the Ara Salt Formation, a major productive interval in adjacent areas of Southern Oman.
Block 52
The Block 52 2D marine seismic acquisition contract has been awarded and signed with BGP Oil & Gas Services LLC. The vessel, BGP Challenger, will acquire 5,000 km of 2D data to assist in firming up and maturing the prospect inventory within the Block and is expected to undertake the survey in the latter part of the fourth quarter of 2010 with field operations presently scheduled to be completed before year-end.
Commenting Prof. Chris Green, CEO, said:
"We are pleased to report the start-up of the Moroccan drilling programme as recovering from the impact of the floods over last winter and spring has been a challenging task and we must thank our Moroccan staff, service companies and ONHYM for their support and hard work. In addition, the progress of the seismic surveys in Oman is on schedule and following processing, the interpretation of these data will enable Circle to firm up an inventory of prospects for drilling."
Glossary
TD Target Depth
MMscf Million standard cubic feet
MMscfd Million standard cubic feet per day
MMNm3 Million cubic metres
MNm3 Thousand cubic metres
Sq km Square kilometres
km Kilometres
2D Two dimensional
3D Three dimensional
ONHYM Office National des Hydrocarbures et des Mines
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 a 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.
For further information contact:
Circle Oil Plc (+44 20 7638 9571) Professor Chris Green, CEO
Evolution Securities (+44 20 7071 4300)Rob CollinsChris SimNeil Elliot
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 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.