Circle Secures Reserve Based Lending Facility

Monday, March 17, 2014

Circle Oil has signed a reserve based lending facility of up to $100 million with IFC, a member of the World Bank Group. The facility matures in June 2018 and is secured against the company’s producing assets in Egypt and Morocco.

IFC, subject to conditions precedent usual for a facility of this nature, will hold $50 million of the facility and syndicate the remainder to a group of international and regional banks. Syndication is ongoing and will close after signing.

The facility is designed to release capital for investment in new exploration and development for Circle in both its core markets and elsewhere. It will also be used to repay the existing working capital facility of $12.5 million agreed with Ahli United Bank Egypt in December 2012. Redetermination of the loan amount is expected to be undertaken every six months based on updated technical and economic assumptions and it provides a mechanism through which new producing assets may be added in the future.

Commenting on signing of the Facility, Prof. Chris Green, CEO, said: “We are very pleased to have signed this loan agreement with IFC which together with our existing reserves will provide Circle with the financial strength to exploit and expand its current portfolio of assets in the Middle East and Africa. This debt facility also demonstrates the quality of our producing assets in both Egypt and Morocco.”

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