Circle Oil wins permit extension for Mahdia license in Tunisia

CORK, Ireland -- Circle Oil has announced that the Tunisian Authority has approved the application to renew the exploration permit on its Mahdia block. The permit is being extended for three years until Jan. 19, 2018, and Circle Oil, as operator, currently has a 100% working interest in the permit.

The Mahdia permit offshore Tunisia covers an area of 3,024 sq km, and contains the El Mediouni structure, which was drilled by Circle's EMD-1 well in August 2014. As announced on Aug. 26, 2014, the well encountered notable oil shows in the Ketatna (Oligo-Miocene) carbonates. While mud losses prevented log data acquisition, Circle considers the shows to indicate a significant resource from the structure.

The extension of the license carries with it a one exploration well and one appraisal well commitment and a requirement to acquire 300 sq km of 3D seismic.

Circle outlined its strategy for the Mahdia license at its recent AGM. Given its material working interest the company intends to select suitable partners with whom it can evaluate and develop the El Mediouni structure and other prospects on the permit. Circle has already had initial expressions of interest from a number of oil and gas companies with the financial strength and industry experience to make them suitable joint venture partners. The confirmation of this extension of the permit will give interested parties greater certainty in making a formal approach and should greatly assist the company in concluding an agreement.

This farm out strategy will minimize Circle's financial commitment, reduce risk, and still allow the company to benefit from the potential of the discovery.