TETHYS OIL IN MAJOR BALTIC INVESTMENT – ACQUIRES OIL PRODUCING ASSETS IN LITHUANIA


Tethys Oil AB ("Tethys") has agreed with Odin Energi A/S ("Odin") to acquire
interests in Lithuanian oil companies UAB Minijos Nafta ("MN") and UAB LL
Investicos ("LLI"). MN holds the Gargzdai license with proven and probable
reserves in excess of 6 million barrels and with a daily oil production of more
than 700 barrels. LLI holds the Rietavas and Raiseiniai licenses with known oil
deposits as well as significant exploration upside. All licenses are onshore
and cover some 4,000 square kilometres of the Baltic Sedimentary Basin (see
map). The interests will be held through Odin group companies giving Tethys a
net indirect interest of 25% in MN and 20% in LLI in consideration for
approximately MSEK 140.


Tethys will receive newly issued shares in Odin group companies in exchange for
the consideration of approximately MSEK 140 which will be met primarily by
converting MEUR 13 (about MSEK 116) from a loan provided to Odin by Tethys,
under a strategic investment agreement entered into previously. In addition,
Tethys will pay MUSD 3.5 (about MSEK 24) in cash. Together Tethys and Odin will
have 50% of the shares in both MN and LLI. The remaining 50% of MN is owned by
Lithuanian company Geonafta which is part of the Polish Lotos group. The
remaining 50% of LLI is owned by private interests. Under the investment
agreement a balance of MEUR 2 will remain, which can be used for other
investments or will be repaid to Tethys through share dividends.

The Gargzdai license covers an area of 900 square kilometres in western
Lithuania. The daily production amounts to more than 700 barrels of around 42
degree API oil. In total, 15 million barrels of oil have been produced from
Cambrian sandstone reservoirs. MN's proven and probable oil reserves are in
excess of 6 million barrels according to independent petroleum consultant
Miller Lents' estimate from May 2011. Proven, probable and possible reserves
amount to more than 12 million barrels. A reservoir study made on the license
area suggests that the reserves could be significantly increased with the use
of modern alternative oil recovery techniques. The license also holds
significant unconventional hydrocarbon potential, including exposure to
Silurian/Ordovician shale sections.

The Rietavas license covering some 1,600 square kilometres is located close to
the Gargzdai license, with a known oil discovery in the Cambrian sandstones
which is the reservoir layer which is in production in Gargzdai. The Rietavas
license is however quite unexplored. The Raiseiniai license, with an areal
extension just over 1,500 square kilometres, covers a so far unexplored trend
of Silurian reefs similar to, but expected to be of larger size, compared to
the Ordovician reefs found on Gotland. The Silurian/Ordovician shale section is
present also in the Rietavas and Raiseiniai licenses.

"The Lithuanian licenses strengthen a ‘second leg’ focused on Europe as a
strategic complement to our Omani assets. They give exposure to production,
appraisal opportunities and exploration. All three licenses are within the
geologically highly interesting Baltic Basin and are covered by attractive
fiscal terms." comments Tethys’ Managing Director Magnus Nordin.

 

For further information, please contact

Magnus Nordin, Managing Director, phone +46 70 576 6555; magnus@tethysoil.com

 

(For picture, see attached file)

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Tethys Oil AB (publ)

Tethys Oil is a Swedish energy company focused on identification and
development for production of oil and natural gas assets. Tethys’ core area is
the Sultanate of Oman, where the company is the second largest onshore oil and
gas concession-holder with licence interests in three onshore blocks. Tethys
also has licences onshore France and Sweden. Tethys’ strategy is to invest in
projects in areas with known oil and natural gas discoveries that have not been
properly appraised using modern technology. In this way, high returns can be
achieved with limited risk.

The shares are listed on First North (TETY) in Stockholm. Remium AB is
Certified Adviser.

Website: www.tethysoil.com

About Tethys Oil

Tethys Oil is a Swedish oil company with focus on onshore areas with known oil discoveries. Tethys Oil's core area is Oman, where the company holds 2P Reserves of 25 mmbo and 2C Contingent Resources of 13 mmbo and had an average oil production of 11,767 barrels per day from Blocks 3&4 during 2018. Tethys Oil also has onshore exploration licences in Lithuania and France and some production in Lithuania. The shares are listed on Nasdaq Stockholm (TETY).