Operating Update Morocco (2486X)

TIDMCOP

RNS Number : 2486X

Circle Oil PLC

13 February 2012

13 February 2012

CIRCLE OIL PLC

("Circle" or the "Company")

Operating Update Morocco

New 8-Inch Pipeline Start of Production

Circle Oil Plc (AIM: COP), the international oil and gas exploration, development and production company, is pleased to announce the following update regarding the commissioning of the new pipeline and associated infrastructure for its Rharb Basin permits in Morocco.

The pipeline has been successfully pressure tested, certified and commissioned. Test supplies commenced on 1 February 2012 and gas has been supplied to local industry since that date.

The total delivery through the new pipeline is currently approximately 36,000 Nm3/d (1.27 MMscf/d). This is scheduled to rise to approximately 90,000 Nm3/d (3.18 MMscf/d) by the start of March. Total deliveries through the old and new pipeline will then be approximately 150,000 Nm3/d (5.30 MMscf/d) with net revenues to Circle, on an annualised basis, increasing to approximately US$14 million per annum on this initial increase in gas supply levels. Further increases in production are expected through the year with fourth quarter production anticipated to be in the order of 230,000-240,000 Nm3/d (8.13 - 8.48 MMscf/d).

Circle, through its wholly owned subsidiary, Circle Oil Maroc Ltd. holds a 75% interest in the Sebou and Lalla Mimouna Permit Concessions with the remaining 25% held by ONHYM. In addition, it holds a 60% interest in the Oulad N'zala Permit Concession with the remaining 40% held by ONHYM. Circle has a 75% interest in the new 8-inch pipeline with the remaining 25% held by ONHYM.

Prof Chris Green, CEO, said:

"I am delighted to be able to report the successful start of commercial gas deliveries from our new pipeline in the Rharb. Circle and its partner have now begun to significantly increase gas supplies and associated revenues as the next step in further exploiting our Rharb acreage".

Glossary

 
   MMscf/d   Millions of standard cubic feet per day 
    Nm3/d     normal cubic metres per day 
    ONHYM     Office National des Hydrocarbures et des 
              Mines 
 
 

For further information contact:

Circle Oil Plc ([phone])

Professor Chris Green, CEO

Evolution Securities ([phone])

Chris Sim

Neil Elliot

Fox-Davies Capital ([phone])

Daniel Fox-Davies

Richard Hail

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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