27th Oct 2009 13:30
27th October 2009
CIRCLE OIL PLC
("Circle" or the "Company")
Successful Testing of Al-Amir SE-4X Appraisal Well,
NW Gemsa Development Lease, Egypt
Circle Oil plc (AIM: COP), the international oil and gas exploration, development and production company, is pleased to announce that the Al-Amir SE-4X appraisal well has been successfully drilled and tested in the onshore North West Gemsa Development Lease in Egypt.
Circle is delighted to confirm that the Kareem Formation (the "Formation") sandstones under test flowed 42° API oil and gas at sustained average rates of 5,500 bopd and 7.159 MMscfd using a 64/64" choke from the lower of two identified pay zones. The well, which is the third appraisal well to be drilled on the Al-Amir SE discovery area, has been completed, connected into the local infrastructure and is in production.
Log result based interpretations indicate that the total net thickness of the two pay zones is approximately 69 feet. The upper pay zone identified in the Kareem Shagar Sandstone is 23 feet thick and will be tested at a later date. The lower tested pay zone in the Kareem Rahmi Sandstone is 46 feet thick.
A full technical evaluation of all the results is underway to permit development planning and is a precursor to further assessment of the resource potential. An assessment of reserves has not yet been completed.
The Al-Amir test programme began once the drilling rig moved to the north and commenced drilling the Geyad 2 well which is the first appraisal well in the Geyad discovery area. The primary target will again be the Kareem Formation and it is planned also to test for secondary targets in the Pre-Miocene Nubia sandstones prognosed at a depth of 11-12,000 feet.
The NW Gemsa Development Lease is contained within the NW Gemsa concession covering an area of over 260 square kilometres and lying 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 of 20 years, plus extensions, in the event of commercial discoveries. The North West Gemsa Concession partners include: Vegas Oil and Gas (50% interest and operator); Circle Oil plc (40% interest); and Premier Oil plc (10% interest).
David Hough, CEO of Circle, said:
"This successful appraisal well, which has given the best results to date in the Al-Amir discovery area and will add to our current production, is yet more excellent news for Circle Oil. Al-Amir SE-4X has gone into production and we will achieve stabilized production from the well as quickly as possible. We can be justifiably very pleased with the results of our ongoing drilling programme as these drilling successes further strengthen the Company's position and we look forward to the continuing appraisal of these growing assets."
Glossary
Bopd - Barrels of oil per day
API - American Petroleum Institute density scale
MMscfd - Millions standard cubic feet per day
In accordance with the guidelines of the AIM Market of the London Stock Exchange, Professor Chris Green, Chief Operating 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. Professor Green has relied on information supplied by the operator in carrying out his review.
For further information contact:
Circle Oil plc (+44 20 7638 9571)
David Hough, CEO
Collins Stewart Europe Limited (+44 20 7523 8350)
Adrian Hadden
Fox-Davies Capital (+44 20 7936 5230)
Daniel Fox-Davies
Citigate Dewe Rogerson (+44 20 7638 9571)
Martin Jackson
George Cazenove
Notes to Editors
Circle Oil Plc
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, Egypt and Namibia 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 2 years and now has assets in the Rharb Basin, Morocco; the Ras Mamour Permit in southern Tunisia; the Mahdia Permit offshore Tunisia; the Grombalia Permit in northern Tunisia; the Zeit Bay area of Egypt and the Owambo Basin, Namibia. Circle also has the largest licence holding of any Company in 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 at www.circleoil.net
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