www.tethysoil.com
Interim report Q3 2013
www.tethysoil.com
An oil company delivering solid growth
• Founded 2001
• MUSD 400 oil and gas company
• A share price rise of more than 600 percent since IPO
• Average daily production ~ 4,700 barrels of oil
• Interests in oil producing licenses onshore Oman and Lithuania
“We combine growth with low risk by the
strategy to search for oil and gas in areas
where findings previously have been made,
but was never put into commercial
production. This means lower risk and higher
potential than in traditional exploration.”
Market cap
www.tethysoil.com
Producing assets in Oman and Lithuania
Oman Area Interest Phase
Blocks 3 & 4 34,610 km2 30% Production
Block 15 1,389 km2
40% Exploration
Lithuania Area Interest Phase
Gargzdai 884 km2 25% Production
Rietavas 1,594 km2 14%* Exploration
Raseiniai 1,535 km2 26%* Exploration
Licence Area Interest Phase
France Attila 1,986 km2 40% Exploration
France Alès 215 km2 37.5% Exploration
Sweden Gotland 581 km2 100 % Exploration
* For full diclosure, see the annual report 2012
www.tethysoil.com
Focus on appraisal projects
Operational targets:
• Develop Tethys Oil’s business as an
attractive licence holder and partner
• Focus on developing the assets in
Oman
• Evaluation of both conventional and
unconventional assets in Lithuania
• Actively evaluate new projects
www.tethysoil.com
Financial targets
Long term capital structure targets:
$
Target Status Q3, 2013
Debt/equity ratio of 30-40% 37%
Net debt/EBITDA of up to 2x 0.43*
Strong cash position to have
the ability to grow
MSEK 246
*Last twelve months
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Financials P&L Q3 2013
Q3 2013 Q3 2012 +/-
Revenue (MSEK) 142 116 22,4%
EBITDA (MSEK) 96 77 24,7%
Result for the period (MSEK) 52 46 13,0%
Operating cash flow (MSEK) 68 38 78,9%
EBITDA-margin (%) 67,6 66,4
EBIT-margin (%) 42,3 53,4
Earnings per share (SEK) 1,46 1,35 8,1%
Cash flow per share (SEK) 1,92 1,11 71,9%
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Sales
Sales growth Over/underlift
7
0
20
40
60
80
100
120
140
160
180
-30,0
-20,0
-10,0
0,0
10,0
20,0
30,0
40,0
50,0
60,0
Q3 Q4 2013 Q1 Q2 Q3
Sales Oil and gas, MSEK Sales growth %
% MSEK
0
50 000
100 000
150 000
200 000
250 000
Q3 Q4 2013 Q1 Q2 Q3
Bbl
Sold volumes Produced volumes after government take
• Underlift position per 30 Sept, 30 404 barrels
• Underlift increase in Q3 of 10 600 barrels
www.tethysoil.com
Oil price development
80,00
85,00
90,00
95,00
100,00
105,00
110,00
115,00
120,00
125,00
jul-12 aug-12 sep-12 okt-12 nov-12 dec-12 jan-13 feb-13mar-13 apr-13 maj-13 jun-13 jul-13 aug-13 sep-13
US
D p
er
Barr
el
Spot Brent and Omani Blend Futures
BRENT SPOT OMANI BLEND FUTURES TETHYS OIL SALE PRICE
www.tethysoil.com
EBITDA
Q4 2012 and Q1 2013 EBITDA include revenues from associates (Lithuania) and the Mitsui bonus.
0
50
100
150
200
250
Q3 Q4 2013 Q1 Q2 Q3
EBITDA, MSEK EBITDA-marg %
0,0
20,0
40,0
60,0
80,0
100,0
120,0
Q3 Q4 2013 Q1 Q2 Q3
Operating expenses Administrative expenses EBITDA
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Result overview Q3
10
Net sales of oil and gas
MSEK 142
Operating result
MSEK 60
Operating expenses
MSEK 42
Depreciation of oil and gas
properties
MSEK 36
Administrative expenses MSEK 6
Revenues Operating result
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Financials BS Q3 2013
2013-09-30 2012-12-31
Cash (MSEK) 246 248
Shareholders equity (MSEK) 1047 860
Long term debts (MSEK) 420 417
Investments (MSEK) 208 875
Equity per share (SEK) 29,49 24,23
Cash per share (SEK) 6,93 6,99
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Investments
• Majority of invesments were
made on Blocks 3 & 4
• Investments focus on appraisal
drilling, seismic and water
injection programmes
• About MSEK 15 spent on Block
15
12
0
50
100
150
200
250
300
Q3 Q4 2013 Q1 Q2 Q3
MSEK Investments
Investments
www.tethysoil.com
Blocks 3 & 4 JV:s investments
12 months 2012 9 months 2013
Drilling -Exploration/Appraisal
Drilling - Development
Geology and seismic
Facilities/Pipeline
Other capex
www.tethysoil.com
Share price
0
10
20
30
40
50
60
70
80
0
500 000
1 000 000
1 500 000
2 000 000
2 500 000
3 000 000
# Shares
Total volume Closing price
SEK
www.tethysoil.com
Oman – Block 3 & 4 update
• Evaluating the seismic data to
plan for next years drilling
programme
• Appraisal drilling on B4EW4
confirmed presence of oil and
in long term production test
• Appraisal well B4EW4-5 in
progress
• Exploration well in B4EW5 wet
and work to increase flow is
undertaken
www.tethysoil.com
Oman production
• Average daily production 4,682 bbl
• Production from: Farha South,
Saiwan East and test production
B4EW4
• The JV’s share of production currently
52 percent
• Selling price USD 102.1 (101.09)
0
1 000
2 000
3 000
4 000
5 000
6 000
Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec
Oman - Daily production Tethys' share (bo)
2012 2013
www.tethysoil.com
Wells in Oman
• Focus on the water injection programme
• Three rigs employed, actively sourcing a fourth
4
8
1
2
1
4
4 6
1
1 2
1
1 4
1
0
2
4
6
8
10
12
Q3-2012 Q4-2012 Q1-2013 Q2-2013 Q3-2013
Appraisal wells
Water source wells
Exploration wells
Water injection wells
Wells in previouslyundrilled fault block
Production wells4
22
37
26
0
5
10
15
20
25
30
35
40
2010 2011 2012 2013 9 m
www.tethysoil.com
Water Injection Fault Block B
0
200
400
600
800
1000
1200
1400
1600
1800
2000
8-Oct-10 5-Feb-11 5-Jun-11 3-Oct-11 31-Jan-12 30-May-12 27-Sep-12 25-Jan-13 25-May-13 22-Sep-13
Oil
Pro
du
ctio
n (b
/d)
Well Test
Model
Model WI
Bottom Hole
Pressure
Water injection started June 19, 2012
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Appraisal and exploration wells 2013
B4EW4
Well Date Type of well Target reservoir Result
B4EW4 February Exploration Multiple Oil
B4EW4-2 June Appraisal Middle Buah No flows
B4EW4-3 June Appraisal Lower Al Bashir Oil
B4EW4-4 July Appraisal Lower Buah Oil
B4EW4-5 November Appraisal Lower Buah Oil
B4EW4-6 On-going Appraisal Lower Buah On-going
B4EW5
Well Date Type of well Target reservoir Result
B4EW5 Sept Exploration Buah Oil
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Oman - Block 15 update
• JAS-1 in long term production
test - minor flows
• Drilling of vertical sidetrack to the
JAS-2 completed – testing of
Natih C reservoir in progress
www.tethysoil.com
21
Lithuania - Gargzdai update
• 7 producing fields
• Production declining according to
plan
• Evaluation of enhanced recovery
techniques
• 2-3 undrilled conventional prospects
• Exposure to thick shale sections
prospective for shale oil/shale gas
• Cores and other data collected in shale section for analysis
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Lithuanian production
• Average daily production 126 bbl
in Q3
• Declining production - according
to plan
• Evaluation of various production
enhancing techniques
0
20
40
60
80
100
120
140
160
180
Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec
Lithuania - Daily production Tethys' share (bo)
2012 2013
www.tethysoil.com
Lithuania – Rietavas update
Conventional exploration and shale
exposure. Work programme fully funded
by Chevron*
• Soviet era Silale discovery
successfully appraised
• Silale-1 in intermittent production
• Appraisal well Silale-5 (previously
Silale-2) encounters oil in the
Cambrian – testing pending
• Exploration well Rietavas-1 in
progress
*Chevron has an option to acquire part of Tethys’ interest
www.tethysoil.com
Lithuania – Raseniai update
Exploration for conventional oil in Silurian
Reefs and other carbonites
• Twin of Soviet era stratigraphic well,
Lapgiriai-1 drilled during spring -
presence of oil confirmed.
• 3D seismic study, partly funded by EU
in progress. Data collection almost
completed. Processing will start
before year end.
www.tethysoil.com
Seismic Activities
850km2 2D completed 100% in 2013
Processing ongoing
600km2 3D completed
Processing ongoing
B4EW4: 470km2 3D completed
Processing completed
Farha old: Reprocessing completed
Farha new: 510km2 3D completed
Processing completed
www.tethysoil.com
Farha
Farha Old 3D • Producing Barik FB: 16 • New FB drilled 2013: 1 (FS-68 in A
Farha New 3D • Leads
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B4EW4 and Buah
B4EW4 Several oil bearing layers- one in production • Producing Buah: 1 field • Lower Buah wells: 3, • Middle Buah wells: 1, • LAB wells: 1, LB-3 S/I
NOTE: these two in
Farha new 3D
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B4EW4 Structure Seismic Interpretation
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Lower Buah fields and prospects
North
B4EW4 area
B4EW5
B4EW6 prospect
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Outlook
• B4EW4 appraisal continues - well no 6 targeting Lower Buah in progress
• In house estimate of B4EW4 structure Lower Buah 2P reserves 2-4 million barrrels of oil net Tethys
• Several Lower Buah leads and prospects to be drilled
• Farha leads and prospects expected to increase as seismic interpretations continues
• Following the 2013 seismic programme, next years work programme likely to be more focused on exploration drilling
• Appraisal / exploration in Lithuania continues - costs covered
30
www.tethysoil.com
Outlook to increase Production and Reserves
• Increased Production from Farha South Water Injection Programme
• Significant Appraisal Drilling on B4EW4 structure
• Continue to explore the potential of the Farha trend -seismic interpretation ongoing
• Lower Buah opening up a completely new play to increase reserves and production -seismic interpretation ongoing
• 2D seismic study from the Eastern part of Block 4 indicates chance to a “mirror” Farha trend together with more Buah prospects
• Lithuania drilling activity and pending new seismic studies
31
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