Operating Update Egypt

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 that the Al-Amir SE-6X down-dip flank appraisal well has commenced coring the objective Kareem Sandstones in the Al-Amir Development Lease in the onshore North West Gemsa Concession in Egypt. This well is being drilled to delineate the Oil Water Contact, which is required for technical reasons. A high pressure zone with some oil and gas shows had been encountered in the shallower South Gharib section of the well and intermediate casing was run and cemented for safe practice to drill ahead to the objective Kareem section. The Al Amir SE-6X well is also planned to drill deeper to a secondary target of the Nubia Sandstones. Once the well is logged and evaluated a further announcement concerning the results of the well will be made.

The NW Gemsa Concession, containing the Al-Amir and Geyad Development Leases, covering an area of over 260 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 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 Sea Dragon Energy (10% interest).

Ends

In accordance with the guidelines of the AIM Market of the London Stock Exchange, Professor Chris Green, Interim 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, Interim CEO

Evolution Securities (+44 20 7071 4300)

Rob Collins

Chris Sim

Neil Elliot

Fox-Davies Capital (+44 20 7936 5230)

Daniel Fox-Davies

Citigate Dewe Rogerson (+44 20 7638 9571)

Martin Jackson

Murray Consultants (+353 1 498 0320)

Joe Murray

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 Marmour 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 is available on its website at www.circleoil.net.