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Circle Oil announces plans to drill 12 wells

Circle Oil said Tuesday it was planning to drill 12 wells this year across Morocco, Egypt and Tunisia.

Circle Oil said Tuesday it was planning to drill 12 wells this year across Morocco, Egypt and Tunisia.

The oil and gas explorer will fund the works from its cash balance of $20m at the end of December 2012, which was up 40% year-on-year.

A working capital facility of $12.5m was secured to fund projects in Egypt to allow Circle to use its available cash for alternative projects.

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Four wells are planned for Egypt through to the end of July. Gross production averaged 9,091 barrels of oil per day in January.

In Morocco, six wells will be drilled in the first half of the year in the Sebou and Lalla Mimouna permits. A 50% increase in gross production from 4.5m standard cubic feet per day (MMScfd) to between 6.5 and 7.0 MMscfd is planned for the first quarter of the year.

A further two wells will be drilled in Tunisia including one onshore the Sedouikech prospect in the Ras Marmour permit, targeting 20m barrels of oil (MMBO) stock tank original oil on place (STOOIP), and one offshore the Mahdia permit, targeting up to 179 MMBO STOOIP.

"Against the backdrop of significant change in the [Middle East and North Africa] region, Circle has used its experience in the region to consolidate its position and continues to make excellent progress in its core operations," Chief Executive Officer, Chris Green, said.

"As a result, Circle is now well placed and well funded to accelerate its operations in 2013 and begin unlocking the latent value in its substantial portfolio."

Shares rose 1.53% to 16.62p at 10:30 Tuesday.

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