Tethys Petroleum Announces Interim Results and Corporate Update
Rhea-AI Summary
Tethys Petroleum (TSXV: TPL) reported mixed Q1 2025 financial results, with oil and gas sales doubling to $4.0 million from $1.9 million in Q1 2024, and a net profit of $0.3 million compared to a $1 million loss last year. Despite the improvement, revenues fell short of management expectations due to multiple operational challenges.
The company faces production constraints including logistics issues, gas-to-oil ratio (GOR) increases requiring reduced production to ~250 tons/day (below the licensed 485 tons/day), and mini-refinery buyers' limitations following naptha export elimination. Additionally, spring weather conditions affected road accessibility.
Tethys is currently conducting seismic surveys through its DMS subsidiary on Aral 4 and Diyar blocks, with plans to identify and drill exploration wells by end of 2026, subject to regulatory approvals.
Positive
- Oil and gas sales increased 104% year-over-year to $4.0 million in Q1 2025
- Turned $1 million loss in Q1 2024 to $0.3 million profit in Q1 2025
- Received production license in November 2024 after shutdown period
- Completed seismic acquisition on Aral 4 block and commenced work on Diyar block
Negative
- Revenue fell below management expectations in Q1 2025
- Production reduced to 250 tons/day due to high gas-to-oil ratio, well below license capacity of 485 tons/day
- Cash flow constraints affecting ability to fund required capital expenses
- Facing challenges with mini-refineries' ability to prepay and manage logistics due to naptha export elimination
- Delayed payments for gas and new gas contract affecting operations
News Market Reaction
On the day this news was published, TETHF gained 34.85%, reflecting a significant positive market reaction.
Data tracked by StockTitan Argus on the day of publication.
Grand Cayman, Cayman Islands--(Newsfile Corp. - May 29, 2025) - Tethys Petroleum Limited (TSXV: TPL) ("Tethys" or the "Company") today announced that it has filed its interim results for the three months ended March 31, 2025 with the Canadian securities regulatory authorities comprising its Audited Financial Statements together with Management's Discussion and Analysis and other required forms. Copies of the filed documents may be obtained via SEDAR at www.sedar.com or on Tethys' website at www.tethys-group.com.
Financial highlights
Oil and gas sales increased by
Revenues for Q1 were improved from Q1 2024 but were disappointing relative to management expectations. Tethys received a production license in November 2024 after a period of being shut down. There are a number of factors which can influence the level of oil production. In addition to the limitation of the logistics and what is allowed under the production license (currently 485 tons/day), Tethys is required to have gas treatment for the associated gas. Tethys's model has been to sell the oil for delivery in the oil field and is therefore dependent on the oil buyers in terms of the logistics. The elimination of the export of naptha has damaged the overall profitability of the mini-refineries who have been the traditional purchases of Tethys oil. This appears to have not only impacted the price that Tethys can expect to receive but may have also impacted the ability of the mini-refineries to prepay for the oil and their ability to manage the necessary logistics. Given the remote location of the Kulbas field, an oil buyer needs to coordinate the trucking, the rail cars and coordinate with any rail terminal involved in the transshipment. The condition of the roads in March was a factor as the area went through a spring thaw as temperatures got above freezing. Given above average precipitation, it appeared the roads remained inoperable for a longer period than usual.
While management believes the logistics issues have been largely resolved, a new problem has appeared. The ratio of gas per oil produced (the GOR) has increased. While long term getting gas from the oil production will be a positive, short term it is a negative as Tethys doesn't have the necessary facilities in place to treat the full amount of gas being produced. As a result, production rates have been reduced of late to about 250 tons/day so that Tethys won't have to flare the excess gas. While it is hoped that the high GOR level may drop back to previous levels or that certain wells and zones with lower GOR ratios may be enhanced to increase the oil production without increasing the GOR, there is no certainty in this regard. Tethys is working on plans to increase the gas utilization capacity of the Kulbas field so that production can be increased to the allowed levels. The delay in getting paid for its gas, getting a new gas contract and getting the oil production license have had residuary effects on the level of cash and the Tethys's ability to fund required capital expenses.
Tethys through its DMS subsidiary is acquiring seismic on two of its exploration blocks. The acquisition for the seismic on Aral 4 has been recently completed and the seismic crew contracted for the work has moved to acquire the seismic on the Diyar block. The seismic will then be more fully processed and interpreted to identify potential sites to consider for exploration. DMS will then need to go through a permitting process to get regulatory approval before it can drill any well. If a favorable prospect and well site is developed, the goal is to drill the well(s) by the end of 2026.
About Tethys
Tethys is focused on oil and gas exploration and production activities in Central Asia and the Caspian Region. Tethys believes that significant potential exists in both exploration and in discovered deposits in the area.
Disclaimer
Some of the statements in this document are forward-looking. No part of this announcement constitutes, or shall be taken to constitute, an invitation or inducement to invest in the Company or any other entity and shareholders of the Company are cautioned not to place undue reliance on the forward-looking statements. Save as required by applicable law, the Company does not undertake to update or change any forward-looking statements to reflect events occurring after the date of this announcement.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Contact Information:
| Tethys Petroleum | |
| Casey McCandless | |
| Chief Financial Officer | info@tethys-group.com |
| 901-763-4001 | www.tethys-group.com |
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/253894
FAQ
What were Tethys Petroleum's (TSXV: TPL) Q1 2025 financial results?
Why did Tethys Petroleum reduce its production in Q1 2025?
What operational challenges is Tethys Petroleum (TPL) currently facing?
What are Tethys Petroleum's exploration plans for 2025-2026?
How has the elimination of naptha exports affected Tethys Petroleum's operations?
