Tuesday, April 1, 2008 – Bozoi, Kazakhstan – Tethys Petroleum Limited (“Tethys” or the “Company”) (TSX: TPL) today announced that the AKK14 exploration well had tested gas from two intervals at a combined rate of 13.3 million cubic feet (MMcf) (377 thousand cubic meters (Mcm)) of gas per day, the highest rate tested on a well by Tethys to date.
The AKK14 well was drilled in the central part of the Akkulka Block on a separate prospect between the AKK13 and AKK04 discoveries and targeted both the Kyzyloi Sand interval (the productive reservoir in Tethys’ nearby Kyzyloi Field) and the deeper Tasaran Sand interval. To date the Tasaran has not been deemed to be productive in the area and most of the older shallow gas wells have not targeted this interval. However analysis of the seismic data acquired by Tethys last year over the area and subsequent processing to highlight possible gas bearing zones, led Tethys to drill the AKK14 well not only to explore this new Kyzyloi structure but also the Tasaran as a secondary target at this location.
The well reached a total depth of 2,152 feet (656 metres) having encountered the top of the Tasaran Sand at 1,985 feet (605 metres) and the Kyzyloi Sand at 1,608 feet (490 metres). Evaluation of the wireline log data indicated that gas was present in both zones and as such two separate production tests were carried out on the well.
The Tasaran Sand interval flowed gas at a stabilised rate of 7.5 MMcf/d (212 Mcm/d) with a flowing tubing head pressure (“FTHP”) of 163 psig (11.1 atm) on a 76/64ths inch (30 mm) choke. The Kyzyloi Sand interval flowed gas at a stabilised rate of 5.8 MMcf/d (164 Mcm/d) with a flowing tubing head pressure (“FTHP”) of 152 psig (10.4 atm) on a 76/64ths inch (30 mm) choke. Further work will be required to ascertain the extent of the deposit.
This is the first commercial discovery of gas made in the Tasaran Sand in the area and opens up a new play over the Company’s Akkulka and Kul-Bas Blocks. The Tasaran is made up of several units of thick (up to 20 feet (6 metres)), blocky, medium grained sandstones and are more conventional reservoirs than the generally thinner and finer grained overlying Kyzyloi sandstone unit. In the light of the Tasaran test Tethys is re-examining existing seismic and in conjunction with revised petrophysics has outlined several potential untested Tasaran zones in older wells, as well as new leads, which will form part of the focus for further exploration for this play within Akkulka and Kul-Bas areas later in the year.
Dr David Robson, Chairman, President and Chief Executive Officer of Tethys commented, “This is a exciting discovery – our most successful well to date! Not only have we continued to discover gas in our primary Kyzyloi target, we have now opened up gas potential in a whole new reservoir with considerable upside. The decision to acquire more seismic over the Akkulka and Kul-Bas areas has resulted in a more comprehensive set of data, the results of which we are now seeing through the drill-bit and this discovery opens up a new high potential play in our acreage. Recent announcements by GazProm that they will pay European prices for Central Asian gas means higher prices in the region in 2009, which should directly benefit us when our phase two development comes on production in Q4 2008, and with further development of new discoveries such as the new Tasaran gas play.”
Tethys is focused on oil and gas exploration and production activities in Central Asia with activities currently in the Republic of Kazakhstan and more recently the Republic of Tajikistan. This highly prolific oil and gas area is rapidly developing and Tethys believes that significant potential exists in both exploration and in discovered deposits. This press release contains “forward-looking information” which may include, but is not limited to, statements with respect to our operations. Such forward looking statements reflect our current views with respect to future events and are subject to certain risks, uncertainties and assumptions. More information on the Company and its properties can be found in the Company’s Annual Information Form filed on SEDAR at www.sedar.com .
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