DUBLIN-BASED oil and gas exploration group Circle Oil has secured an investment of £19 million (€23.5 million) from an investment fund set up by Libya's ruler Col Muammar Gadafy to help fund its exploration activities in Morocco, Tunisia and Egypt. This forms part of a £33 million funding round by the London-listed company.

It is understood Circle has placed 173.7 million new shares with investors at a price of 19 pence each. The biggest new backer is Libya Oil Holdings Ltd, a Mauritius-registered subsidiary of Libya Africa Investment Portfolio, a fund set up in 2006 by Mr Gadafy to invest in the development of other African countries.

Other investors include Kaupthing Bank of Iceland, which has agreed to invest £10 million in the Irish company. Kaupthing will have a 15.6 per cent share in Circle. This is a major coup for Circle as it has a market capitalisation of just £47 million.