June 21, 2021

Tethys Petroleum Limited: 2013 Annual Results

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173042068GRAND CAYMAN, CAYMAN ISLANDS–(Marketwired – Mar 31, 2014) – Tethys Petroleum Limited (“Tethys” or the “Company”) (TSX:TPL)(LSE:TPL) today announced its Annual Results for the year ended December 31, 2013.

Corporate Highlights

— Completion of a farm-out of 66.66% of the Tajik Bokhtar Production Sharing Contract agreement to subsidiaries of Total Exploration and

Production SA and China National Petroleum Corporation for USD63.4 million

— Conditional sale of 50% (plus one share) of the Kazakh oil and gas assets to SinoHan Oil and Gas Investment BV for USD75 million plus potential future bonuses

— Acquisition (completed early January 2014) of a 56% interest of Blocks XIA, XIM and XIN in Georgia for USD 9.6 million

— Decision to discontinue operations in Uzbekistan

— Drilling of AKD08 and AKD09 in Kazakhstan

Financial Highlights

— Oil and gas revenue from continuing operations of USD36.95 million – an increase of 10% on 2012 (USD33.63 million)

— Loss for the year from continuing operations of USD10.54 million – a decrease of 50% on 2012 (USD20.96 million). In addition there was a loss of USD7.10 million from the discontinued Uzbekh operation which was primarily a write-down of assets

— Basic & diluted loss per share of USD0.03 cents from continuing operations (2012: USD0.07 cents)

— Capital Expenditure of USD23.81 million – an increase of 36% on 2012

(USD17.50 million)

— Cash and cash equivalents of USD25.10 million – an increase of USD23.35 million on 2012 (USD1.75 million)

Reserve Highlights

Annual audited net reserve results of: 1P (Proved) – 13.03 million barrels oil equivalent (“boe”), 2P – (Proved plus Probable) – 23.29 million boe and 3P – (Proved plus Probable plus Possible) – 36.70 million boe. With the addition of 2013 production, these figures represent an increase on the 2012 year end volumes.

The above reserve data does not reflect the conditional sale of 50% of the Kazakh operations announced on Nov 1, 2013.

President’s Message

Dr. David Robson, Executive Chairman and President said, “2013 was a landmark year for Tethys as it developed our strategic partnerships in all its areas of operations. These partnerships have strengthened our projects in our focus areas financially, operationally and strategically.

“In Tajikistan, we completed the farm-out of a 66.66% interest of the Tajik Bokhtar Production Sharing Contract to subsidiaries of Total Exploration and Production SA and China National Petroleum Corporation for USD63.4 million. The endorsement of our belief in the super-giant potential of this section of the Amu-Darya basin by a super-major and the Chinese state oil and gas company is a great accomplishment for Tethys and puts us in a strong position to now capitalise on this potential through a partnership with financial and technical strength. We look forward to acquiring the necessary additional seismic later this year in order to locate a deep well, and then drilling in 2015, which will be an exciting time for the Company. We also welcome the news that the Chinese will commence construction of a gas pipeline from Tajikistan to China, which border each other, and which could carry any gas from a discovery, accelerating monetization. In addition, this farm-out released valuable funds which were invested in other areas of the business.

“Turning to Kazakhstan, in 2013 we signed a conditional sale of 50% (plus one share) of the Kazakh oil and gas assets to SinoHan Oil and Gas Investment BV for USD75 million plus potential future bonuses. SinoHan are a subsidiary of Beijing-based, Hanhong Private Equity Management Company, a well-known Chinese private equity firm. Globally, Hanhong is working on managing several international resources funds valued at more than USD1 billion. This is an excellent transaction for Tethys in terms of the valuation it received for its assets and also in bringing in a strong financial partner with a shared vision of the potential which these assets have, both in terms of the underlying oil production that provides valuable cash flow to support the business, and the exciting growth story in the gas market which has now opened up after the completion of the gas pipeline to China from Kazakhstan which is in close proximity to the field. We also maintain operational control and run day-to-day operations. Once this transaction completes after the necessary government consents expected mid-year 2014, the exploration and developments programmes will both move into full swing. We expect to approximately triple gas production from now until 2015 when we also expect to realize a significantly higher gas price due to selling into the Chinese market for the first time. These are shallow, cheap wells to drill and our first two wells drilled in 2014 have been successful which bodes well for the forward programme. In addition we will continue to explore and our shareholders are looking forward to drilling the Klymene exploration prospect later in the year targeting over 400 million barrels of unrisked mean prospective recoverable resources of oil. Our reserves have remained steady which provides a valuable underpinning revenue stream whilst we push forward in other areas. It is planned to increase current oil production from these reserves through the drilling of a horizontal well later this year, targeting the fractures in the Jurassic Limestone which has not been extensively produced to date, but contain significant reserves.

“We entered a new country with the acquisition (completed early January 2014) of a 56% interest of Blocks XI(A) , XI(M) and XI(N) in Georgia with Tethys being the Operator of all these PSC’s. We believe that with the application of more modern technologies than have previously been applied these PSC’s hold world class potential for conventional and non-conventional oil and gas production. The opportunity to enter Georgia, a country with a very good business climate, as Operator with a substantial acreage position and existing strong local partners is a very attractive opportunity. The independent evaluation carried out suggests potential of several billion barrels of oil in acreage with direct access to world markets and good commercial terms. We believe that these transactions will add significantly to Tethys’ current portfolio in Central Asia and will complement these projects adding to future shareholder value. The new seismic acquired to date has already allowed us to identify some good prospects and we plan to drill a well later in the year.

“Turning to recent events in Ukraine, where we do not operate, we would like to stress that, whilst this is disturbing for that particular country, we do not see this affecting the countries in which we operate. Kazakhstan and Tajikistan have experienced a long period of stability now and all the signs are that this will continue going forward. Georgia has a democratically-elected government that has strong popular support and indeed is very pro-business with a stable relationship with Russia. Countries in the former Soviet Union tend to be unfairly grouped together when in fact they are all uniquely independent and different.

“We are now in three countries and have, what we believe to be, the right partnerships for each of those countries. We believe it is a diversified portfolio that provides good oil and gas production to support the business with very exciting exploration upside that we will capitalise on in order to bring shareholder value in 2014 and beyond.”

The full Annual Results together with Management’s Discussion and Analysis and Annual Information Form 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 Tethys’ website at www.tethyspetroleum.com. The summary financial statements are attached to this press release.

The Company’s 2013 financial statements are prepared under International Financial Reporting Standards (“IFRS”).

The above highlights along with other financial details will be further discussed in a scheduled conference call. Details of the conference call can be found below:

Conference Call:

A conference call will be held at 8:00AM EDT (1:00PM BST) on Tuesday, April 1, 2014. The North American conference call number is 866-700-6293 and the outside North America conference call number is +1-617-213-8835. The conference call code to use is 73537454. Please call in about 10 minutes before the starting time in order to be patched into the call.

Webcast:

The call is being webcast and can be accessed at http://edge.media-server.com/m/p/45b4kzfw/lan/en.

Tethys is focused on oil and gas exploration and production activities in Central Asia and the Caspian Region. This highly prolific oil and gas area is rapidly developing and Tethys believes that significant potential exists in both exploration and in discovered deposits.

Cautionary Statements

This press release contains “forward-looking information” which may include, but is not limited to, statements with respect to our operations, completion of the sale of an interest to SinoHan Oil and Gas Investment BV; tripling of gas production from the Company’s Kazakhstan projects, realizing significantly higher gas prices due to selling in the Chinese market; adding to shareholder value and drilling targets. Such forward-looking statements reflect our current views with respect to future events and are subject to certain risks, uncertainties and assumptions, including the risk that approvals for the sale to SinoHan Oil and Gas Investments BV will be delayed; risk that gas production will not increase as anticipated, the risk that gas prices will not increase and the risk of changes in our drilling programmes. See our Annual Information Form for the year ended December 31, 2013 for a description of risks and uncertainties relevant to our business, including our exploration activities.

Possible reserves are those additional reserves that are less certain to be recovered than probable reserves. There is a 10% probability that the quantities actually recovered will equal or exceed the sum of proved plus probable plus possible reserves.

A barrel of oil equivalent (“boe”) conversion ratio of 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.

The references in this press release to “Prospective Recoverable Resources” means those quantities of petroleum estimated, as of 15th January 2014, to be potentially recoverable from undiscovered accumulations by application of future exploration and development projects. Prospective resources have both an associated chance of discovery and a chance of development. There is no certainty that any portion of these resources will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of these resources. The product types that may reasonably be expected from potential production consist of oil, condensate, natural gas and associated gas.

The resource estimate contained or referred to are estimates only and are not meant to provide a determination as to the volume or value of hydrocarbons attributable to the Klymene prospect. There are numerous uncertainties inherent in estimating quantities of resources and cash flows that may be derived, including many factors that are beyond the control of the Company. The following is a non–exhaustive list of factors which may have a significant impact on the above estimates of prospective resources: despite the classification that they are as yet undiscovered but may be potentially recoverable the Company may be unable to carry out the development or their potential recovery; the activity may not be economically viable; the Company may not have sufficient capital or time to develop them; there may be no market or transportation routes for the potential production; legal, contractual, environmental and governmental concerns might not allow for the recovery being undertaken; reservoir characteristics might prevent recovery. The recovery of the resources is subject to the following risks and uncertainties: market fluctuations, the proximity and capacity of oil and gas pipelines and processing equipment, government regulation, political issues, export issues, competing suppliers, operational issues (exploration, production, pricing, marketing and transportation), extensive controls and regulations imposed by various levels of government, lack of capital or income, the ability to drill productive wells at acceptable costs, the uncertainty of drilling operations, factors such as delays, accidents, adverse weather conditions, and the availability of drilling rigs and the delivery of equipment. See the Company’s Annual Information Form for the year ended December 31, 2013 for further information with respect to factors and contingencies relevant to this estimate.

Tethys Investor Relations

Tethys Petroleum Limited

Sabin Rossi

Vice President Investor Relations

[email protected]

Media / IR Enquiries – London

FTI Consulting

Ben Brewerton

+44 207 831 3113

Asia Pacific

Quam IR

Anita Wan

+852 2217 2999

Tethys Petroleum Limited

[email protected]

Web: http://www.tethyspetroleum.com

Twitter: https://twitter.com/tethyspetroleum

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