Tethys Petroleum: Q2 Results – Gas Revenue Up 137%

Tethys Petroleum Limited today announced its Results for the quarter ended June 30, 2015.

Q2 Financial Highlights (all figures reported in USD millions)

— Oil and gas revenue of USD6.8m (2014: USD7.1m)
— Gas revenue increased 137% to USD4.8m (2014: USD2.0m)
— Production expenses USD4.2m (2014: USD3.2m)
— G&A expenses down 39% to USD3.1m (2014: USD5.0m)
— EBITDA adjusted for share based payments(i) of negative USD4.4m (2014 USD2.5m)
— Loss for the period from continuing operations – USD25.3m – including: depletion of properties re-classified from Assets Held For Sale of USD19.4m (non-cash) and restructuring and transaction expenses of USD2.6m (2014: USD0.1m)
— Basic & diluted loss per share from continuing operations – USD0.08 (2014: USD0.01)
— Capital expenditure of USD4.0m (2014: USD2.5m)
— Cash and cash equivalents of USD4.9m (2014: USD11.6m)

(i) Non GAAP measure

Q2 Operational Highlights

— Total gas production up 77% to 3,250 barrels of oil equivalent (“BOE”)/day (2014: 1,839 BOE/day)
— Highest quarterly gas production in 3 years (since Q1 2012)
— Total Production up 21% to 5,204 BOE/day (2014: 4,312 BOE/day)

Q2 Corporate Highlights

— Non-completion of the SinoHan transaction resulting in the re-classification of Kazakh assets and liabilities from Assets Held For
Sale
— USD9.3m convertible loan financings
— Announcement of intention to close Guernsey office

Post Q2 Highlights

— A strategic review of the business which encompasses options including asset sales, farm-outs, financing, investments at the corporate level,or the sale of the Company is continuing to be conducted
— Discussions have been ongoing with a number of interested parties on these potential avenues, subject to any agreed exclusivity or non-solicitation provisions
— USD5.0m convertible loan facility secured on August 10, 2015 with Nostrum Oil & Gas PLC (“Nostrum”)
— Tethys has entered into a limited period of exclusivity with Nostrum with respect to a possible offer received from Nostrum for the entire issued and to be issued share capital of the Company. The exclusivity period runs through to August 24, 2015 and is subject to certain customary exceptions
— Akkulka Production Contract (gas) Mining Allotment was expanded by 363% to 396.2 km2 (97,901 acres) from surface to the base of the Paleogene interval, effective July 10, 2015
— Current average Q3 production to date is 4,972 BOE/day comprising 1,795 bopd of oil and 539 Mcm/d (19.06 MMcf/d) of sales gas.
— Current average production to date in August is 4,494 BOE/day

John Bell, Executive Chairman, commented:

“The turnaround is now well underway, some of which is reflected in these financial results. I am encouraged by the performance of the gas division and the cost reductions achieved at Group level. The strategic review is ongoing, and the team is working hard to both conclude the strategic review process and continue to improve the operations.”

The full Quarterly Results together with Management’s Discussion and 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 athref=”http://www.tethyspetroleum.com”>www.tethyspetroleum.com. The summary financial statements are attached to this press release.

The Company’s Second Quarter 2015 financial statements are prepared under International Financial Reporting Standards (“IFRS”).