I am not 100% certain but I assume he'd cut out two ovals, one smaller and one bigger oval. He cut out the center of the smaller to use that within the frame of the bigger one and thus painted that newly created small circle with black gesso.
After that dried, he sticked the smaller frame on the canvas, thus hiding that black circle and leaving a (smaller) oval open, to paint his creation.
I intend to paint this one in the very near future and it's one of the two possibilities to do it.
The other one, I will reveal after I painted it but it will not be the best option, so if you try this painting, stick to the two ovals!
Have fun and good luck!