Production Starts from Discovery Wells in NW Gemsa

Circle Oil Plc, the international oil and gas exploration and development company, is pleased to announce that both the Al-Amir SE-3 appraisal well and the Geyad-1 discovery well in the NW Gemsa Concession, Egypt, have been connected to pipeline infrastructure by the operator Vegas Oil and Gas and have commenced commercial oil production.

Circle is also delighted to confirm that average gross daily oil production from the four producing wells* on the NW Gemsa Concession has now reached approximately 4,300 - 4,350 bopd following an initial production period from two news wells.

The rig, Mubarak-1, is now drilling the Al-Amir SE-4 appraisal well and results will be communicated to the market in due course.

The NW Gemsa concession covers an area of over 260 square kilometres and 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 NW Gemsa Concession partners are Vegas Oil and Gas (50% interest and operator), Circle Oil plc (40% interest) and Premier Oil (10% interest). The producing wells are located within development leases, valid for a 20 year period and separately delineated within the NW Gemsa Concession area.

*Al-Amir SE-1, Al-Amir SE-2, Al-Amir SE-3 and Geyad-1
Commenting on this latest discovery, David Hough, CEO of Circle, said:

"We are obviously delighted with the successful tie-in of these two additional producing wells on our NW Gemsa interest, which effectively doubles Circle's Egyptian oil production. We look forward to further increases in producion from our contimuing appraisal and development drilling programme in the region including bringing the Al-Amir 1 heavy oil discovery into production.

"In Morocco, we are working to increase our gas production volumes from the present 70,000 cubic metres per day with 4 discovery wells remaining to be brought into production."