Circle Shares Suspended

AIM-listed Circle Oil, a small North Africa producer, requested a suspension of trading of its shares on London’s AIM market June 29 because its directors “believe it is likely there will be no value attributed” to shareholders at the end of its ongoing Strategic Review, given its debts.

Net debt at end-May 2016 was $69.62mn, up from $67.47mn at the end of December 2015.

In its 2015 annual results published earlier on June 29, the company said it expects a renegotiation of its existing funding arrangements or additional funding will be required in July 2016 in order to be able to discharge its financial obligations from August 2016. It again blamed  "unpredictable and infrequent payments" from state-owned Egyptian General Petroleum Corporation (EGPC) for its financial uncertainty, recalling that the World Bank’s IFC last week gave Circle one more month, until July 22, to meet its repayments.

Circle’s 2015 operating loss, before write-offs and impairments was $3.84mn, contrasting with a 2014 profit of $23.31mn. Write-offs and impairments last year were $108.82mn, up from $71.33mn.

Location of Circle's gas assets on Egypt's Red Sea coast (Map credit: Circle Oil)

Gross production in Egypt in 2015, operated by PetroAmir, averaged 7,426 b/d oil and 8.86mn ft^³/d gas – of which 2,970 b/d and 3.54mn ft³/d were net to Circle. In Morocco, average gross gas production was 5.85mn ft³/d, of which 4.39mn ft³/d were net to Circle, as operator.

Earlier this year its Tunisian ‘offshore Mahdia’ exploration permit was extended until January 2018, but the company withdrew from Oman in 2015.

Mark Smedley | www.naturalgasafrica.com