Tethys Doubles Gas Price in Kazakhstan Press Release: Tethys Petroleum Limited – 3 hours ago
ALMATY, KAZAKHSTAN--(Marketwire - Jan 31, 2013) - Tethys Petroleum Limited ("Tethys") (TPL.TO)(TPL.L), the oil and gas exploration and production company focused on Central Asia, today announced that it has effectively doubled the net price of the gas which it is selling in Kazakhstan.
- New gas price after marketing and distribution costs USD65 (USD72.8 including VAT) per 1,000 cubic metres (previously USD32.5 including VAT for the Kyzyloi and Akkulka Fields)
- Current total production 430,000 cubic metres (15.2 million cubic feet or 2,530 barrels oil equivalent) per day
- Further production increases achievable through the tie-in of other already drilled wells, and targeting shallow gas prospective resources
- Net Proved + Probable gas reserves from the fields are 2.1 billion cubic metres (bcm) or 73.8 billion cubic feet (bcf) (Gustavson & Associates, December 31, 2011)
- Net mean unrisked prospective gas resources of 18 billion cubic metres (bcm) 634 billion cubic feet (bcf) (Gustavson & Associates, April 30, 2012)
- New Kazakhstan-China gas trunkline under construction (passes through Tethys'' contract areas) should provide further upside upon completion in addition to the existing pipeline through which Tethys currently sells its gas.
Two gas supply contracts have been signed by Tethys'' wholly owned Kazakh subsidiary, TethysAralGas LLP, with Intergas Central Asia JSC, a wholly owned subsidiary of the Kazakh State company KazTransGas JSC, for the Kyzyloi and Akkulka natural gas fields. The contract is for annual volumes up to 150 million cubic meters at an increased net price of USD65 per 1,000 cubic metres (USD 1.84 per 1,000 cubic feet) of gas (USD72.8 per 1,000 cubic metres or USD2.06 per 1,000 cubic feet including VAT) net of marketing and distribution costs, and runs through to December 31, 2013.
A number of additional shallow gas prospects and leads have been identified based on seismic data as well as deeper potential. It is forecast that production can be significantly increased through the tie-in of already drilled wells that have not been produced to date, and through exploring for more gas. Of the last 13 shallow exploration wells drilled by Tethys in the Akkulka Block, 11 tested commercial gas. Tethys then suspended any further investment into gas development pending the realisation of a higher gas price which it has now achieved.