TIDMCOP

RNS Number : 8187K

Circle Oil PLC

28 August 2012

28 August 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.

Al Ola-3 Well

Water injection well Al Ola-3 was spudded on 16 July 2012 and is located in the southern part of the AASE field, downdip of and to support the oil production from the Al Ola-1 and Al Ola-2, AASE-12ST and AASE-1X production wells, respectively and is located 870 metres to the south of the Al-Ola-1 well and 1,445 metres south-east of Al-Ola-2 well. The well's objective was to appraise both the Shagar and Rahmi sands for water injection in that location. The well was successfully drilled to a total depth of 10,550 ft MD into the Upper Rudeis. The well encountered 18 ft of net reservoir in the Kareem Shagar sand (between 10,164-10,182 ft MD) and 20 ft of net reservoir in the Rahmi sand (between 10,232-10,252 ft MD), with high water saturations present to the base of the reservoir as expected. Formation pressure tests in the Kareem sands of Al Ola-3 indicate fluid communication in this southern extent of the AASE field. The well will be dually completed as a Shagar and Rahmi water injector.

Geyad-6 Well

Following the successful completion of the Al OIa-3 well, the rig will drill the infill production well Geyad-6, in the south central part of the Geyad field.

Production and Injection

Currently production from the AASE, Geyad and Al Ola fields is approximately 9,100 bopd (gross) varying to date in August 2012 within the range 9,000-10,000 bopd. Cumulative production from the NW Gemsa Concession has now exceeded 8.9 million barrels of 42 degree API Crude oil. Water is currently being injected at a rate of approximately 22,000 barrels per day, with a cumulative injection to date of approximately 5.4 million barrels.

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 very pleased with the results of the Al Ola-3 well, which will be completed as a water injector to support the oil production from the updip Al Ola-1 and Al Ola-2 wells. This well result further proves up the southern extent and pressure communication of the AASE field and will add to the ultimate recovery from the field. The rig will now drill the Geyad-6 well, which is intended as a central infill producer for the Geyad field, and is part of the overall plan to improve the productivity of the NW Gemsa accumulations."

Glossary

 
  bopd   Barrels of oil per day 
  ft     Feet 
  MD     Measured depth 
  TD     Target depth

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.

This information is provided by RNS

The company news service from the London Stock Exchange

END

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