Circle Oil provides the following update regarding its operations in Tunisia.

Circle Oil Tunisia Limited (Circle Tunisia), a wholly owned subsidiary of the Company, has reached agreement with Tethys Oil and Mining Inc (Tethys) to acquire the remaining 30% working interest in the offshore Mahdia exploration licence area in Tunisia (the "Licence").

Under the terms of the agreement Circle Tunisia will, subject to the approval of the Tunisian authorities, acquire the remaining 30% interest in the Licence in return for a payment of US$3 million payable in two separate tranches. The acquisition will be funded from Circle's existing cash flow and internal resources. Following completion of the terms of the agreement, Circle Tunisia, will hold a 100% working interest in the Licence.

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