GRAND CAYMAN, CAYMAN ISLANDS–(Aug. 15, 2016) – Tethys Petroleum Limited (TSX:TPL)(LSE:TPL) today announced its Results for the quarter ended June 30, 2016.
Q2 Financial Highlights (all figures reported in USD unless stated otherwise. 2015 amounts are for the quarter ended June 30, 2015).
• Oil and gas revenue down 48% to USD3.5m (2015: USD6.8m);
• Production expenses down 68% to USD1.3m (2015: USD4.2m);
• G&A expenses down 60% to USD1.2m (2015: USD3.1m);
• Loss of USD4.9m (2015: USD25.3m) due to lower depreciation, depletion and amortisation;
• Capital expenditure down 92% due to lower spend on the Company’s assets relating to Kazakhstan exploration and development and Tajikistan exploration;
• Net debt increased as a result of interim finance obtained as part of larger strategic transactions which are ongoing.
Q2 Operational Highlights
• Current quarter oil production averaged 965 bopd compared with 1,954 bopd in Q2 2015, reflecting a natural decline in overall production as well as prolonged spring oil trucking disruption;
• Oil production cost per barrel in the current quarter reduced to USD7.73 compared with USD7.81 in Q2 2015 despite lower production volume as a result of cost reductions initiatives as well as the devaluation of the Kazakhstan currency, the Tenge;
• Oil prices averaged USD7.94 per bbl in the quarter compared with USD13.00 per bbl in Q2 2015, a reduction of 39%, reflecting the fall in World oil price and the devaluation of the Tenge.
• Current quarter gross gas production averaged 2,312 boe/d compared with 3,250 boe/d in Q2 2015, reflecting a natural decline in overall production;
• Gas production cost per Mcm in the current quarter reduced to USD16.84 compared with USD22.90 in Q2 2015 despite lower production volume as a result of cost reduction initiatives as well as the Tenge devaluation;
• An increase in gas price in local currency of over 50 percent was obtained from January 1, 2016, however, this was negatively affected in USD terms due to the Tenge devaluation.
Note: 6,000 cubic feet (169.9 cubic metres) of natural gas = 1 barrel of oil has been used and is based on the standard energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
Q2 Corporate Highlights
• All resolutions put to shareholders at the Annual General and Special Meeting held on May 31, 2016 were passed on a poll at the meeting including the transaction with Olisol;
• The Company received the first USD1 million drawdown of a newly agreed USD10 million loan facility from a leading Kazakhstan bank;
• Total and CNPC, the Company’s partners in Tajikistan filed for arbitration proceedings at the International Court of Arbitration in relation to the Company’s cash call defaults and the partners’ notice to withdraw;
• The full Q2 Results together with Management’s Discussion & Analysis have been filed with the Canadian securities regulatory authorities. Copies of the filed documents may be obtained via SEDAR at www.sedar.com or on the Tethys website at www.tethyspetroleum.com. The summary financial statements are attached to this press release.
This press release contains “forward-looking information” which may include, but is not limited to, statements with respect to our operations and completion of the Olisol transaction. Such forward-looking statements reflect our current views with respect to future events and assume the completion of the Olisol transaction. These forward-looking statements are subject to certain risks and uncertainties, including the risk that the Olisol transaction will not receive required court and regulatory approvals, that closing conditions will not be satisfied or that one or more aspects of the Olisol transaction will be otherwise delayed and accordingly that the Olisol transaction will not be completed. See our Annual Information Form for the year ended December 31, 2015 for a description of risks and uncertainties relevant to our business, including our exploration activities.
About Tethys Petroleum
Tethys Petroleum’s aim is to become the leading independent E&P Company in Central Asia, by exercising capital discipline, by generating cash flow from existing discoveries and by maturing large exploration prospects within our highly attractive frontier acreage.
Tethys Petroleum Limited
130 King Street West, Suite 1800