Tethys Petroleum reports Q3 results

Tethys Petroleum Limited has announced its third quarter 2014 financial results and activity update.

Highlights

• Loss for the period from continuing operations US$ 2.4 million.
• Oil and gas revenue from continuing operations of US$ 7.3 million.
• Production expenses reduced by 3% to US$ 3.0 million.
• Administrative expenses reduced by 12% to US$ 4.2 million.
• Business development expenses reduced by 16% to US$ 0.5 million
• Capital expenditure of US$ 6.2 million.
• Cash and cash equivalents at the end of Q3 2014 of US$ 10.1 million.

Denise Lay, Director and Chief Financial Officer, commented: "Q3 has seen consistency of production over Q2 and reductions in operating, business development and G&A costs. Cost reduction is a key focus for the company and a comprehensive plan of cost reductions, which will be phased, has already commenced, the results of which will be realised over the coming months. This, combined with an anticipated step change in revenue when we bring on stream additional gas production in Q1 2015, should be reflected in the bottom line results in Q1 and Q2 of 2015."

Operations

Kazakhstan

Shallow Gas Program Update

All the key items within the next phase of the gas development program are on track and it is expected that the additional production will be ready to be brought on stream in January 2015. This includes the installation of a gas dehydration unit and construction of shallow gas tie-ins for the new gas wells to hook up the previously drilled gas wells.

SinoHan Transaction Update

In October 2015 Tethys announced that it had agreed with SinoHan Oil and Gas to extend the one-year longstop date for completing the sale by a period of six months, until 1 May 2015. This extension keeps the current agreement in place while discussions continue with the Kazakh State.

Once this transaction has completed the new partnership can then move forward quickly to further develop the shallow gas resource where the company has identified a number of new attractive prospects, drill a horizontal well on the Doris field to increase production, and also move ahead with drilling the exciting deeper Klymene exploration prospect.

Tajikistan

The seismic acquisition programme planned to identify the location of the first deep well to be drilled commenced in the third quarter. This new wide line 2D survey is specially designed to image the deep targets described in the Independent Resource Report and consists of a first phase of 826 km with an option for an additional 200 km, all to be acquired within 2014 and the first three quarters of 2015. As well as 2D acquisition and processing, a concurrent low cost passive seismic survey is planned and a Magnetotellurics survey is also being acquired now along the dip lines.

Processing of data from the survey will be concurrent so interpretation and mapping will be underway before the end of this year. This data set will assist in the identification of the best possible location to spud the first deep well by the end of 2015.

Adapted from press release by Katie Woodward

Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/17112014/tethys-q3-2014-results-1822/