Tethys Petroleum (LON:TPL, TSE:TPL) has been awarded a new oil field in Uzbekistan, from which it says there is good potential to increase production.

The Chegara field currently has limited production from three wells and lies 14 km south-west of the firm's existing North Urtabulak asset.

It has been the subject of minimal drilling and Tethys believes that with more work, it can increase production "substantially".

The deal at Chegara is for a 25 year production enhancement contract.

Tethys also announced today it had signed a memorandum of understanding (MOU) with NHC Uzbekneftegaz concerning a potential exploration  agreement for a block in the North Usyturt basin in Uzbekistan. 

The company believes this basin has very similar geological characteristics to the Akkulk block where it has the Doris oil discovery.

Chairman and president of Tethys, David Robson said he was delighted at the award of the Chegara field: "I would like to thank our partners, Uzbekneftegaz, Uzneftegazdobycha and Uznefteproduct, for their support and hard work in negotiating this new contract."

"We believe the Chegara Group of Fields has good potential through increasing production in existing wells and also large upside in undrilled areas."

Tethys has interpreted a significant volume of historic seismic, drilling, geological and production data relating to Chegara and plans to initially work over the existing wells.

It also plans to collect data to identify undrilled areas that provide high potential upside. 

Currently there are only State reserves assigned to the field and no figures yet under NI 51-101 reporting procedures, it said.

Earlier today, the company revealed it had increased the resource estimate for its Kazakhstan assets to 1.17 billion barrels of oil.

The upgrade was a result of additional 2D and 3D seismic acquisition and interpretation as well as drilling data, which has also increased the chance of success in the area.

Separately, it also told investors that its revenues jumped 45 per cent to US$6.49 million in the first quarter compared with the same period of 2011 as production increased to 5,117 barrels of oil equivalent per day (boepd) from 4,531 boepd.

Average output from the Doris field in Kazakhstan was 1,038 bopd -  up from 337 bopd a year earlier.

Tethys Petroleum (LON:TPL, TSE:TPL) has increased the resource estimate for its Kazakhstan assets to 1.17 billion barrels of oil.

In addition the oil resource, the new resource report - which is compliant with the NI51-101 standard – estimated the company’s associated unrisked gas prospective resources at 231 billion cubic feet (bcf).

There is also a separate, non-associated gas resource of 375 bcf.

The upgrade was a result of additional 2D and 3D seismic acquisition and interpretation as well as drilling data, which has also increased the chance of success in the area.

Tethys is now preparing to spud the AKD07 well, located to the south east of the original AKD01 (Doris) discovery well, in mid-2012 to test the Dyna exploration prospect that currently has a recoverable resource estimate of 128 million barrels of oil.

The well is also targeting 3P reserves at the Cretaceous Aptian sand level and a Jurassic sand similar to the horizon that tested oil in the AKD03 exploration well.

To date, over 13,000 barrels of oil per day (bopd) have been tested from exploration and appraisal wells in and around the Doris oil discovery.

“We are extremely pleased with this significant increase in our estimated oil resources in Kazakhstan,” said chairman and CEO of Tethys David Robson.

“With oil production forecast to steadily increase this year following the upgrade to the Aral Oil terminal, we believe that our strong and growing cash flow and upside in these large exploration targets provides a well-balanced development and exploration portfolio.”

A separate update from Tethys revealed that its revenues jumped 45 percent to US$6.49 million in the first quarter compared with the same period of 2011 as production increased to 5,117 barrels of oil equivalent per day (boepd) from 4,531 boepd.

Average output from the Doris field in Kazakhstan was 1,038 bopd, up from 337 bopd a year earlier.

Kazakhstan-focused oil firm Tethys Petroleum (LON:TPL, TSE:TPL) today received permission to extend the Akkulka exploration contract.

Akkulka hosts the ‘high potential’ Doris oil discovery as well as several other exciting exploration targets, Tethys said.

The extension allows Tethys to explore the area for another two years. As such it means that Tethys will be able to appraise the Doris discovery comprehensively, it added.

"This important extension will enable us to move forward on additional attractive exploration/appraisal prospects which have been identified using the recently interpreted 3D and 2D seismic data,” said Tethys’ chief Dr David Robson.

“This is extremely important to the company as it gives us the potential to explore for the considerable resources which we believe exist within the large Akkulka Block as well as to further develop and appraise the Doris oilfield.”

The Akkulka contract now runs until March 10 2015. 

Tethys plans to spud its next Doris appraisal well in the coming months, with ‘mid-2012’ pencilled in the schedule. This well, known as AKD07, will take around 60 days to drill and it is located to the south-east of the original discovery well. 

The firm is currently awaiting the completion of a new resources report, and it says it will disclose the prospective resource target for the AKD07 well once it is complete. The report is due in the current quarter.

Beyond AKD07, Tethys has identified other exploration and appraisal targets, using recently acquired 2D and 3D.

Tethys says that having tested over 13,000 barrels a day in wells in and around Doris it believes the oil accumulation could realistically achieve sustained production of around 5,000 to 6,000 barrels a day.

Central Asia-focused oil firm Tethys Petroleum (LON:TPL, TSE:TPL) today revealed that it more than doubled revenues to US$30.3 million in 2011.

This comes as the firm continues to appraise and develop the Doris oil discovery in Kazakhstan and the imminent start of operation at the newly completed Aral oil terminal will allow Tethys to significantly increase oil sales further.

During 2011, Tethys produced on average 5,730 barrels of oil equivalent per day and in the latter part of the year, as production continued to increase, it was producing 6,584 barrels a day.

Operationally much of the focus has been on exploration and appraisal work in both Kazakhstan and Tajikistan. And it is in the process of acquiring new projects in Uzbekistan.

"In 2011 we made significant progress on the key projects in Tethys,” said chief executive Dr David Robson.

“In Kazakhstan we drilled successful appraisal wells and made a new exploration discovery both significantly increasing our core reserves. 

“The modeling work we have now completed based on these drilling results bodes well for the new appraisal/exploration wells we will drill in 2012 where success would see further reserves upgrades. 

He added: “In Tajikistan we advanced the deep sub-salt exploration program with the completion of the graviometry survey, the results of which are very exciting and confirm our previous geological evaluation, indicating the possible presence of giant Jurassic reefs below the salt. 

“Looking forward in 2012 the new final seismic survey will focus on the most prospective areas with the intention of firming up a location to spud a deep well."

For the twelve months ended December 31 2011, Tethys reported revenues of US$30.3 million. Capital expenditure for the year was US$41.9 million and operating costs totalled US$10.78 million. 

Overall the improved revenue performance helped Tethys cut net losses slightly to US$26.99 million from US$29.65 million last year.

Tethys ended the year with US$11.63 million in cash.

The group added it is also targeting a new exploration prospect named "Dyna" that may be part of a different, larger sand fan system. 

The prospective resource for this new target will be disclosed after the completion of a new independent Kazakhstan Resource Report, which is expected in the second quarter of 2012, Tethys added.

The new resources estimate consists of 14.5 million barrels of oil equivalent of 1P (proved) reserves, a 96 per cent increase, and 25.3 million barrels of 2P (proved and probable) reserves, a 45 per cent improvement.

Out of that, proved oil reserves rose by 108 per cent to 5.8 million barrels and probables by 62 per cent to 12.5 million barrels, while 1P gas reserves rose by 89 per cent to 52.5 billion cubic feet and 2P gas reserves by 31 per cent to 76.7 billion cubic feet.

Tethys said the upgrade stemmed from the successful 2011 Kazakhstan drilling campaign including the Doris appraisal wells AKD05 and AKD06 and the successful AKD03 exploration well, which discovered the Dione field.

It added that the next appraisal well, AKD07, is expected to spud in and will be located to the south-east of the original AKD01 discovery well and will target 3P reserves at the Cretaceous Aptian sand level in what is believed to be a channel sand system.

Dr David Robson, Tethys’ chief executive, said: "The 2011 drilling programme was focused on two things, increasing 2P reserves and also ensuring sufficient oil production was available to meet our production targets. This programme has successfully met both objectives. 

“We are still in the early stages of appraising and exploring this attractive oil discovery and we look forward to further success with this year's programme based on our new seismic analysis and better geological understanding of the area."

Hammond has also been appointed as a member of the executive board of Tethys.

Listed on the Toronto and Kazakhstan stock exchanges, the company has projects in Kazakhstan, Tajikistan and Uzbekistan.

In December 2011 it unveiled initial results of its Persea 1 exploration well in  Tajikstan, and said its plans to carry out production testing on the well in the New Year.

The Persea 1 well, drilled some five kilometres from the town of Kurgan Teppa, reached a total depth of 2,655 metres.

Wireline logs showed a 50 metre gross zone of possible hydrocarbons, which occur in crude oil, within a mixed sandstone and carbonate sequence assigned to the Alai formation. This is a similar to the formation about to be tested in the East Olimtoi well.

Snow drifts along the northern section of the route from Shalkar to Emba are to blame for the temporary shutdown.

Oil production this month has averaged 1,860 barrels a day. 

“It is expected trucking to Emba will resume once weather conditions improve, which is forecast to be soon,” the company said in a statement to investors.

The southern route, which links the Doris field production facilities to a soon-to-be-completed rail loading facility, remains open.

When up and running in around a month’s time, the new terminal will allow the group to more than double production to around 4,000 barrels a day.

Listed on the Toronto and Kazakhstan stock exchanges, Tethys has projects in Kazakhstan, Tajikistan and Uzbekistan. 

Earlier this month the company unveiled initial results of its Persea 1 exploration well in 

Tajikstan, and said its plans to carry out production testing on the well in the New Year.

The Persea 1 well, drilled some five kilometres from the town of Kurgan Teppa, reached a total depth of 2,655 metres.

Wireline logs showed a 50 metre gross zone of possible hydrocarbons, which occur in crude oil, within a mixed sandstone and carbonate sequence assigned to the Alai formation. This is a similar to the formation about to be tested in the East Olimtoi well.

The Persea 1 well, drilled some five kilometres from the town of Kurgan Teppa, reached a total depth of 2,655 metres.

Wireline logs showed a 50 metre gross zone of possible hydrocarbons, which occur in crude oil, within a mixed sandstone and carbonate sequence assigned to the Alai formation - similar to the formation about to be tested in the East Olimtoi well (EOL09), the company said.

Because of hole stability issues, Tethys said the section was drilled with relatively high mudweights, which tends to mask hydrocarbon shows while drilling.

The company now plans to run 7-inch liner in preparation for a production test, with the aim of establishing commercial flow of hydrocarbons from this zone.

The actual testing will be carried out in the first half of 2012, with the cost to be financed by internally-generated cash flow, the company said.

The news comes following Tethys' recent announcement that it acquired an additional interest in the Bokhtar production sharing contract, which includes the Persea prospect. The company now holds an 85 percent working interest in Persea.

Tethys is an oil and gas exploration and production company with activities in Central Asia, focused on the Republics of Kazakhstan, Tajikistan and Uzbekistan.

Shares of the company moved more than 4.3 percent higher in early trading on Monday, to 48 cents as of 9:39am ET.

The oil and gas company said it expects to sell around 26 million ordinary shares at 52 Canadian cents each.

Tethys said the shares represent 10 percent of the current issued share capital of the company.

The private placement is slated to be completed on December 14, and is subject to regulatory approval.  The ordinary shares of the company are listed on the Toronto Stock Exchange and the London Stock Exchange under the symbol "TPL".

Seven Stars Energy – of which Tethys already owns 51 percent – holds the rights to the Bokhtar production sharing contract in Tajikistan. Tethys has the option to acquire an additional 34 percent in the venture from its partner. Once this option is exercised, an outstanding loan from Tethys to Seven Stars will be restructured and Tethys will hold 85 percent of the joint venture.

Proceeds from the offering will also be used for additional work on the Beshtentak oilfield in Tajikistan, where flow testing of a recompleted well showed rates of over 600 barrels of oil per day.

Tethys currently has oil and gas exploration and production activities in the former Soviet republics of Kazakhstan, Tajikistan and Uzbekistan.

The company said that drilling data and wireline logs indicated the oil in the Cretaceous sandstone was encountered above prognosis, and at a higher elevation than in the AKD01 Doris discovery well.

Tethys added the oil is of "good quality" and has similar net pay thickness to AKD01, which flowed over 5,400 barrels of oil per day from this unit.

The AKD01 is the first deep exploration well drilled under the Akkulka exploration contract on the Akkulka block, and has tested oil at over 6,800 barrels of oil per day.

Meanwhile, the Jurassic limestone was also tested above prognosis and slightly higher compared to the AKD01 well, with similar character to the recently drilled AKD05 well, which flowed over 1,500 barrels of oil per day from this zone.

Currently, further analysis of initial results is underway, the company said.

Tethys also said in a statement that production liner has been installed and cemented as the company plans to gather more geophysical data to tie the AKDO6 well into a new 3-D seismic dataset.

The well will then be tied into the test production facility, with two production tests planned on the reservoir units. Testing is expected to start in the next month.

Tethys Petroleum is focused on oil and gas exploration and production activities in Central Asia, with activities in the Republics of Tajikistan, Kazakhstan and Uzbekistan.

Shares of Tethys closed Friday at 55 cents on the Toronto Stock Exchange.

Electric log testing indicated that the well has been drilled into rock of Carboniferous age, with over 100 metres of gross potential hydrocarbon-bearing zones, and overlying Jurassic-aged rock.

Following the running of seven-inch liner for the well, and pending approval from Kazakh authorities, which Tethys said could take up to two months, it will begin a comprehensive testing program on both the Carboniferous and Jurassic intervals of the Kalypso well.

The Alibekmola oil field, located 250 kilometres north in the pre-Caspian Basin subsalt, produces from a similar Carboniferous shelf. Tethys said it is likely that its own Kalypso project, like the properties in the Alibekmola field, will require acidisation and possible fracture simulation to achieve optimal production.

However, it said it will evaluate these factors, among others, during the testing program.

In other news, Tethys said its AKD06 Doris appraisal well is drilling ahead of schedule, at a depth of 1,755 metres, toward the Aptian sandstone target.

Tethys is focused on oil and gas exploration and production activities in Central Asia, with activities currently in the Republics of Tajikistan, Kazakhstan and Uzbekistan.

Based in Toronto, Tethys' shares started the day a cent higher than Wednesday's close, but then came down to $0.51 per share as of 2:08 pm EDT.

Tethys said that, as a commercial oil and gas company, it could not offer the same terms as CNPC, which would in its view, it added, make the project non‐commercial.
Still, it said it sees the good oil and gas potential of Afghanistan and will continue to evaluate future opportunities there.

Currently, the company is focused on production and exploration in Tajikistan, Kazakhstan and Uzbekistan.

The British Isles-based company, which recently opened its Doris oil production facility in Kazakhstan, saw its shares slip 3.7% to $0.52 as at 2:08 pm EDT.

Its appraisal well (AKD06) at the Doris oil discovery, located on the Akkulka block in western Kazakhstan, has been drilled to a depth of 641 metres, of a planned 2,400 metres in total, which the company expects to complete by October.

During the second quarter, well AKD01, also on the Doris oil discovery, flowed at over 5,400 barrels of oil per day (bbl/d), while the AKD05 well flowed at over 1,500 bbl/d, of what the company calls "good quality oil".

The Kalypso wildcat exploration well (KBD01), also in Kazakhstan, has been drilled to 4,128 metres, close to the 4,300-metre completion depth.

Tethys said it has also completed 3,765 metres of drilling at its East Olimtoi exploration well (EOL09) on the Bokhtar property in southern Tajikistan. Electric logs are currently being run at the oil play to further determine areas of interest.

The company also said it has begun a gravity, gradiometry and magnetic aerial survey, covering the entire 35,000 square kilometre Bokhtar area. The results from the survey are expected in the fourth quarter of the year.

Meanwhile, in Uzbekistan, Tethys' recent jet pump trial on the North Urtabulak oilfield increased oil rates on two test wells by 20%.

Further work is underway to determine the economics of extending the jet pump usage, which, together with the water injection reconfiguration carried out earlier this year, should have a positive impact on oil production in the second half of 2011.

Still, in the first half of the year, oil production already rose 60% to 5,566 barrels of oil equivalent per day (boe/d), with revenues nearly doubling.

In the three month period ending June 30, sales hiked 76% to $10.6 million, from $6.1 million a year ago.

Net loss for the quarter narrowed to $2.7 million, or $0.01 loss per share, compared to a $3.3 million loss, or $0.02 loss per share, in the second quarter of 2010.

The U.K.-based company also said it is continuing negotiations with Uzbek authorities on production enhancement contracts for two further oilfields in the Bukhara area.

The company's stock on the Toronto Stock Exchange closed at $0.65 per share on Monday, up 10.17%.

Tethys said its main listing for ordinary shares will remain on the Toronto Stock Exchange, and the company will continue to retain its secondary listing on the Kazakhstan Stock Exchange.

It also said it is not raising any funds or issuing new shares related to its listing on the London Stock Exchange and the interests of existing shareholders will not be diluted as a result of admission.

Chief Executive of Tethys, David Robson, commented: "Listing on the main London Stock Exchange represents a major stage in the development of our company and will, we believe, draw attention to our progress to U.K. and international investors."

Tethys Petroleum is an oil and gas company focused on the exploration and development of oil and natural gas resources in Central Asia, currently in Kazakhstan, Tajikistan and Uzbekistan.

The company will trade under the ticker symbol “TPL” once markets open on Monday, subject to approval from the Financial Services Authority and the London Stock Exchange.

The oil and gas company said its main listing for ordinary shares will remain on the Toronto Stock Exchange, and the company will continue to retain its secondary listing on the Kazakhstan Stock Exchange.

The company also said it is not raising any funds or issuing new shares related to its listing on the London Stock Exchange, and the interests of existing shareholders will not be diluted as a result of admission.

Tethys Petroleum is an oil and gas company focused on the exploration and development of oil and natural gas resources in Central Asia, currently in Kazakhstan, Tajikistan and Uzbekistan.

The Cretaceous interval, at 1,630 metres, tested 40 degrees API oil from a six metre normally pressured sand.

However, the company said that the previous injection of drilling fluids to safely stabilize the well for drilling deeper resulted in some formation damage, leading to minor flow to date on the initial test.

The company said it is looking to source additional equipment that would bypass this formation damage, and achieve production from the unaffected part of the reservoir. Currently, such equipment is not available and operations have thus been suspended until likely this August. Production rates are expected to improve with the removal of the formation damage.

The Dione well, which reached a total depth of 3,975 metres in the Triassic formation, tested oil at a rate of some 400 barrels of oil per day from Jurassic sands and now has also tested oil from the Cretaceous sandstones.

"This well has achieved several of the objectives which were set prior to drilling," said vice president of exploration, Rosemary Johnson-Sabine.

"The fact that we have tested oil from two horizons in this well, with the potential for more, shows that an active oil migration system exists along the southern flank of the Akkulka high."

The company said the structures appear somewhat more complex in the Dione well area, but with the help of new 3D seismic data, Tethys is expected to better understand the potential of the zone for future well locations.

Elsewhere in Kazakhstan, Tethys is continuing to appraise its Doris discovery, with the well expected to be at total depth shortly. Meanwhile, the AKD04 Dero well is currently being prepared for testing while awaiting final permits from the Kazak authorities, expected in the middle of next month.

Tethys is focused on oil and gas exploration and production in Central Asia, with specifically in the Republics of Kazakhstan, Tajikistan and Uzbekistan.