Overview of Country and Country Permits
Morocco is currently dependent on oil and gas imports and is thus a net importer. As part of the country’s overall energy strategy and to attract inward investment into hydrocarbon exploration, the Kingdom has established a hydrocarbon agreement with attractive and favourable fiscal terms. The country remains historically underexplored and overall can be considered capable of low cost operation and operational cost.
Sebou Permits
In this context Circle Oil Maroc Ltd. (COML), a wholly owned subsidiary of Circle Oil Plc signed an Exploration and Exploitation Agreement with ONHYM (Office National des Hydrocarbures et des Mines) for the Sebou Concession ( originally before first relinquishment 296 km sq.), situated in the Rharb Basin, Morocco.
This Exploration Agreement is for a total period of 8 years with the right of automatic conversion up to (but extendable) 30 year Exploitation period. The Sebou Permit has previously been owned, explored and exploited by ONHYM. In the new partnership the shareholding is COML 75% and ONHYM 25%. Concession sub-areas, such as Gaddari Sud once converted into exploiting assets are named and given an initial yet extendable period of validity, and are registered and recorded in the Official Bulletin.
In addition COML signed a similar agreement for the small Oulad N’Zala Concession (25 sq.km.) which is contained within the boundaries of the Sebou Concession, which as an existing concession backed into, remains bound by the previous hydrocarbon code. The percentage interests for this concession are ONHYM 40% and COML 60%.
Lalla Mimouna permit
In early 2010 COML signed the Lalla Mimouna Permit Agreement for permits named "Lalla Mimouna Nord" and "Lalla Mimouna Sud" which are also situated in the Rharb Basin. These Permits cover an area of over 2211.3 km3 and are a continuation of the same geology and a similar exploration play to the adjacent Sebou Permit.
The agreement is also for a period of 8 years with the right of automatic conversion to a minimum (but extendible) 30 year exploitation period for areas agreed to have discovered commercially exploitable hydrocarbons. Under the terms of the agreement, the percentage interests for the permit are COML 75% and ONHYM 25%.
Going Forward
To date COML have undertaken a 3D seismic survey in the Sebou Permit and drilled some 11 exploration wells -10 of which were discoveries and completed as producers and one remains to be tested. Small scale production commenced in late 2008 utilizing existing infrastructure and this is now being supplemented with the construction of a new 8-inch pipeline capable of delivering up to 23.5MMscfd. Exploration and development is on-going, with new seismic and more drilling planned on an annual basis as part of the anticipated plans for the future of COML activity in this region.
Page updated January 2012