Circle Oil PLC 2012 Interim Results -5-

The gain on the fair value of the conversion option (relating to the convertible loan) arose as a result of the convertible loan being amended and extended on 24 May 2012 at which time the embedded derivative lapsed and the value was written-off to the Income Statement for the six months ended 30 June 2012.

   7.    Finance costs 
 
                                             6 months   6 months     Year ended 
                                                   to         to    31 December 
                                              30 June    30 June           2011 
                                                 2012       2011 
 Interest payable:                             US$000     US$000         US$000 
 Convertible loan                               3,256      2,511          5,239 
 Capitalised to exploration and 
  evaluation assets                              (93)       (26)          (114) 
 Unwinding of discount on decommissioning 
  provision                                        21          -             20 
 
                                                3,184      2,485          5,145 
                                            =========  =========  ============= 
 

Interest payable relating to the convertible loan includes interest paid of US$893,000 (H1 2011: US$893,000) and an effective interest expense (non-cash) of US$2.34 million (H1 2011: US$1.62 million) plus amortisation of transaction costs of US$28,000 (H1 2011: US$28,000).

   8.     Reconciliation of operating profit to net cash generated by operations 
 
                                            6 months   6 months     Year ended 
                                                  to         to    31 December 
                                             30 June    30 June           2011 
                                                2012       2011 
                                              US$000     US$000         US$000 
 Profit before taxation                       13,346      8,704         25,647 
 Finance revenue                             (1,789)    (2,909)       (10,823) 
 Finance costs                                 3,184      2,485          5,145 
 (Decrease)/increase in trade 
  and other payables                         (2,731)      (152)          3,054 
 Increase in trade and other receivables     (1,957)   (10,078)       (18,198) 
 Decrease in inventory                            19         40            109 
 Impairment of exploration costs                 109         50            163 
 Foreign exchange (gain)/loss                   (95)         40              1 
 Depreciation                                  4,079      3,536          6,526 
 
 Net cash generated by operations             14,165      1,716         11,624 
                                           =========  =========  ============= 
 
   9.   Interim Report 

Copies of the Interim Report are available by download from the Company's web-site at www.circleoil.net

For further information contact:

Circle Oil Plc ([phone])

Professor Chris Green, CEO

Brendan McMorrow, CFO

Investec ([phone])

Chris Sim

Neil Elliot

Liberum Capital Limited ([phone])

Simon Atkinson

Tim Graham

Citigate Dewe Rogerson ([phone])

Martin Jackson

Kate Lehane

Murray Consultants ([phone])

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

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