Tethys Petroleum Limited
LSE : TPL

July 01, 2015 02:45 ET

Tethys Petroleum Limited Press Release: Strategic Collaboration with AGR Energy and US$47.7 Million Financing

FOR:  TETHYS PETROLEUM LIMITED

TSX, LSE SYMBOL:  TPL

July 1, 2015

Tethys Petroleum Limited Press Release: Strategic Collaboration with AGR Energy and US$47.7 Million Financing

GRAND CAYMAN, CAYMAN ISLANDS--(Marketwired - July 1, 2015) -

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UNLAWFUL TO DO SO. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF THE SECURITIES LAWS OF SUCH
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SECURITIES ACT OF 1933 AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION UNDER THE SECURITIES ACT
OR AN EXEMPTION FROM SUCH REGISTRATION.

Tethys Petroleum Limited ("Tethys" or the "Company" (TSX:TPL)(LSE:TPL)) is pleased to announce that it has signed an
agreement for a US$47.7 million(1) private placement of 318,003,951 new ordinary shares at a price of C$0.19(2) per
ordinary share (the "Placing") with AGR Energy Holdings Limited ("AGR Energy Holdings"). In connection with the Placing,
the Company has also entered into a convertible loan for up to US$5 million (the "Convertible Loan") with AGR Energy
Holding's parent company, AGR Energy Limited No. 1 ("AGR Energy No. 1"), where Tethys can draw down an advance on the
Placing proceeds before closing to support short-term liquidity, subject to certain conditions. In this press release,
AGR Energy No. 1 and AGR Energy Holdings are referred to together as "AGR Energy".

Summary

--  US$47.7 million(1) private placement with AGR Energy at a price of
    C$0.19(2) per ordinary share representing a premium of 23% to the 30
    trading day volume weighted average price on the TSX(3) and 108% to the
    closing middle market price of an ordinary share on the TSX of C$0.09 on
    May 14th, 2015, the day prior to the announcement of the recent
    convertible loan financing with AGR Energy No. 1.
--  AGR Energy Holdings to subscribe for up to 318,003,951 new ordinary
    shares in Tethys.
--  Tethys has the ability to invite certain of its substantial shareholders
    to subscribe for new ordinary shares on similar terms to AGR Energy,
    with any subscription by such existing substantial shareholders reducing
    by a corresponding number the ordinary shares for which AGR Energy will
    subscribe for under the Placing.
--  The Placing is subject to TSX approval, approval from shareholders of
    Tethys and receipt of Kazakh regulatory approvals and consents; AGR
    Energy will work closely with Tethys with a view to obtaining such
    approvals and consents as soon as practicable.
--  If the Placing is completed:
    --  Tethys and AGR Energy will establish a strategic collaboration
        within Tethys; and
    --  the Placing will recapitalise Tethys, which will provide greater
        stability and certainty for the Company going forward.
--  Convertible Loan of up to US$5 million to be provided by AGR Energy No.
    1 as an advance on Placing proceeds to support short-term liquidity
    during the period before closing, to be made available in two tranches
    of US$2.5 million, with drawdown of each tranche being subject to the
    satisfaction or waiver of certain conditions.
--  Our alliance with AGR Energy has the potential to add significant value
    to Tethys given AGR Energy's local knowledge and in-country support in
    key areas of operation.
--  Funds to be used to help unlock the potential of Tethys' significant
    undeveloped reserve base in Kazakhstan and the Company's portfolio
    exploration, and in particular the Klymene prospect in Kazakhstan and
    Tajikistan, as well as to reduce Tethys' debt.
--  Following the Placing, the Board of Directors of Tethys (the "Board")
    will consist of nine individuals, three of whom will be nominated by AGR
    Energy, including two executive roles.
--  AGR Energy and the Company have agreed the form of a relationship
    agreement that will be entered into by them on closing of the Placing
    (the "Relationship Agreement") with the intention of allowing Tethys to
    continue to operate as an independent company in the interests of all
    its shareholders.
--  Agreement has been reached on the proposed strategic collaboration with
    AGR Energy, the Placing and the Convertible Loan after an extensive and
    wide ranging strategic review of many different funding options and
    strategic alternatives, and has the unanimous support of the Board.
--  If this financing does not proceed, there can be no assurance that
    management will be successful in securing alternative funding or have
    sufficient time to implement any alternative transaction to the proposed
    Placing and Convertible Loan, which would be required for the Company to
    continue as a going concern.

(1) Before costs, rounded to three significant figures

(2) Based on a price of US$0.15 per ordinary share using a CAD to USD exchange rate of 0.80, rounded to the nearest cent

(3) As at, and including 30 June 2015

Strategic Collaboration

The Placing will result in a strategic collaboration between Tethys and AGR Energy. AGR Energy is a group owned by the
Assaubayev family, a long-term investor in the resources sector with a track record of effective investment and support
of enterprises, particularly in Central Asia.

AGR Energy's intention is to utilise its local knowledge and expertise in the resources sector to support the Company's
growth, both operationally and financially. In particular, AGR Energy's experience and on the ground presence in
Kazakhstan is anticipated to add significant value to the Company.

The Board believes that this strategic collaboration as a result of the Placing represents a transformational
transaction for Tethys. It provides business stability and necessary foundations from which to pursue a potential
acceleration of operations, production and cash flow and to enable all shareholders to potentially benefit from new gas
marketing opportunities (including the potential "gas to China" opportunity that will arise once current infrastructure
developments are complete) in late 2016 onwards and expected oil export opportunities from 2017.

Upon closing of the Placing, AGR Energy Holdings and the Company will enter into an agreed form of Relationship
Agreement with the intention of allowing Tethys to continue to operate as an independent company in the interests of all
of its shareholders. AGR Energy is committed to supporting Tethys in its growth plans such that all shareholders can
participate in the future success of the Company.

John Bell, Executive Chairman said:

"We are delighted to have secured this strategic collaboration with AGR Energy. Completion of the Placing will address
the funding issues that Tethys has faced since before I became Chairman in November of last year. It allows management
to focus on maximising growth and value creation for all shareholders, working with its new partner AGR Energy. It also
provides us with a platform to exploit the potential significant growth and earnings opportunities as we can invest to
seek to accelerate production and potentially benefit from future higher gas prices achieved in China. We believe this
represents a truly transformational deal for Tethys and we look forward to the future collaboration with AGR Energy."

Alastair Murray, Managing Director of AGR Energy said:

"We are very pleased to participate in this transformational deal with Tethys which we believe can unlock significant
value for all shareholders over the medium and longer term. We believe that there is great synergy between Tethys' asset
base and existing operational expertise combined with AGR Energy's substantive track record of value creation in
emerging markets (both within Central Asia and elsewhere). We see great opportunity in the evolving Central Asian Gas
market (including exploring potential gas to China) where Tethys can participate through increased gas production (via
targeted placement funded drilling activity). AGR Energy, like Tethys, believes that investment in technology can reduce
exploration risks and help create shareholder value through both reserves and production growth and price realisation.
We very much look forward to working within the Tethys team to develop a strong and commercially focussed business."

Placing and Convertible Loan Key Terms

Placing:

A US$ 47.7(4) million private placement with AGR Energy at a price of C$0.19(5) per ordinary share, a premium of 23% to
the 30 trading day volume weighted average price on the TSX(6), and a premium of 108% to the closing middle market price
of an ordinary share on the TSX of C$0.09 on 14 May 2015, the day prior to the announcement of the recent convertible
loan financing with AGR Energy No. 1.

Under the terms of the subscription agreement relating to the Placing (the "Subscription Agreement"), the Company has
the ability to invite certain of its existing substantial shareholders to subscribe for ordinary shares on similar terms
to AGR Energy. Any subscription by such substantial shareholders will reduce, by a corresponding number, the ordinary
shares for which AGR Energy will subscribe under the Subscription Agreement. If existing substantial shareholders of the
Company do not subscribe for any ordinary shares, AGR Energy will subscribe to the full amount of the Placing and, as a
result, may hold up to 51%(7) of the enlarged issued share capital of the Company immediately following closing of the
Placing. This calculation assumes conversion of the pre-existing convertible loans held by AGR Energy and Annuity and
Life Reassurance Ltd ("ALR", an investor controlled by Pope Asset Management, LLC) and the exercise of 23,333,333
warrants held by ALR, but disregarding all other outstanding options and warrants. If certain existing substantial
shareholders subscribe for the full portion of the Placing, AGR Energy would hold 32%(7) of the enlarged issued shares
capital under the same assumptions.

Under the Subscription Agreement, the Company has also agreed to extend the period of exclusivity previously granted to
AGR Energy on terms similar to those announced on May 14th 2015. This period of exclusivity will not prevent the Company
from offering certain existing shareholders the opportunity to participate in the Placing, and will expire on closing of
the Placing or, if earlier, termination of the Subscription Agreement (including as a result of the failure of Tethys
shareholders to approve the Placing).

(4) Before costs, rounded to 3 significant figures

(5) Based on a price of US$0.15 per ordinary share using a CAD to USD exchange rate of 0.80, rounded to the nearest cent

(6) As at, and including 30 June 2015

(7) Based on Tethys current issued capital of 336,712,385 ordinary shares, plus the conversion of the convertible loans
issued in May 2015 to AGR Energy and ALR, and the exercise of 23,333,333 warrants held by ALR

Convertible Loan:

In addition to the Placing, AGR Energy No. 1 has extended a convertible loan of up to US$5 million to provide short-term
working capital funding during the period leading to closing the Placing. The conversion price of the Convertible Loan
is the lower of the subscription price for the Placing and a price which is 115% of the volume weighted average price of
the ordinary shares on the TSX and the LSE (or the LSE only in the event that the Company's ordinary shares are no
longer traded on the TSX) calculated for the 30 trading day period ending on the trading day immediately preceding the
date of the conversion notice, subject to an overall minimum conversion price of US$0.10 and subject to any adjustments
pursuant to the terms of the debenture. The interest rate on outstanding principal under the first US$2.5 million
tranche of the Convertible Loan is 9% per annum; the interest on the second tranche is 12% per annum. The exercise of
any right of conversion by AGR Energy No. 1 under the Convertible Loan is subject to TSX approval and the approval of
Tethys' shareholders at an extraordinary general meeting to be convened for the purpose (the "EGM").

 Under the terms of the Convertible Loan, AGR Energy No. 1 has agreed to make available:

--  US$2.5million to the Company on or after August 1st, 2015, subject to a
    circular and notice of extraordinary general meeting (the "Shareholder
    Circular") including details of shareholder resolutions required to
    implement the Placing and permit AGR Energy No. 1 to exercise its right
    to convert the Convertible Loan and its pre-existing convertible loan to
    the Company into ordinary shares (the "Shareholder Resolutions") having
    being sent to shareholders of the Company; and
--  a further US$2.5 million on or after September 1st, 2015, conditional
    upon the Shareholder Resolutions having been approved by Tethys'
    shareholders at the EGM.

Drawdown of each tranche of the Convertible Loan is also subject to the Placing not having closed and to the
satisfaction of certain other conditions. The Convertible Loan is subject to customary terms and conditions for an
instrument of this type.

Conditions to Closing of the Placing:

Completion of the Placing and receipt of funds is conditional, inter alia, upon each of the following conditions being
satisfied on or before November 1st, 2015 (the "Long Stop Date"), or such later date as may be agreed:

--  The passing of the Shareholder Resolutions at the EGM;
--  The Placing shares being approved for issue and admitted to trading by
    the TSX;
--  Receipt of certain Kazakh regulatory approvals and consents;
--  The Relationship Agreement having been entered into by the Company and
    AGR Energy, the key terms of which are summarised below;
--  The appointment to the Board of three Directors nominated by AGR Energy
    (or, in the event of any delay in such appointment, the implementation
    of interim arrangements to allow such individuals to act as observers);
    and
--  Certain other customary conditions precedent for a private placement of
    this type, including there having been no prior termination as a
    consequence of a material breach of warranty or event or circumstance
    constituting a material adverse change, as defined in the Subscription
    Agreement.


A change of control event affecting the Company before closing would also entitle AGR Energy to withdraw from the
Subscription Agreement.

Given AGR Energy's existing in-country presence and track record in Kazakhstan, AGR Energy has agreed to use all
reasonable efforts to support Tethys with obtaining any required Kazakh regulatory approval and consents as soon as
practicable. However, Tethys notes that there can be no assurance that such third party regulatory approvals and
consents for the transaction will be received prior to the Long Stop Date. In the event that such regulatory consents
and approvals are not received or any of those other conditions to the Placing are not satisfied or waived prior to the
Long Stop Date, then the transaction may not proceed, in which case the additional funding will not be received by the
Company. Due to Tethys' current financial situation, the Company does not believe that it would have sufficient time to
execute an alternative transaction to the proposed Placing and Convertible Loan without experiencing serious funding and
liquidity issues, the implications of which are described further below.

Further details of the Subscription Agreement, the Convertible Loan and the Relationship Agreement will be set out in
the circular to be issued in connection with the EGM to consider the Shareholder Resolutions. A copy of the Subscription
Agreement, Relationship Agreement and Convertible Loan instrument will be filed on SEDAR in a timely manner.

Background to and reasons for the Placing and Convertible Loan

As announced on April 10th, 2015, Tethys had actively developed contingency plans in the event that the SinoHan
transaction did not proceed. In the months preceding May 1st, 2015, the Company had adopted a twin strategy of seeking
the timely completion of the potential sale of 50% of Tethys' Kazakhstan assets to SinoHan while simultaneously
initiating a strategic review process to explore alternative paths to value realization should the SinoHan transaction
not complete. Macquarie Capital was appointed to work with the Company to assist on the strategic review process. The
Company announced on May 1st, 2015 that the sale to SinoHan would not proceed and the Company would therefore retain its
100% interest in its Kazakh assets.

During the strategic review process, the Company conducted an extensive and wide ranging review of many different
funding options and strategic alternatives. These include a further scale down of the business, equity financing, debt
refinancing, sale or farm down of certain assets, possible business combinations and a sale of the Company.

Although the Company has continued to reduce its cost base significantly and has secured additional loan financing, the
Company has needed to seek additional funding in order to meet its full contractual obligations and maintain a positive
cash position going forward.

Following this extensive review, with the assistance of Macquarie Capital, the Board and management of Tethys believe
that this proposed strategic collaboration with AGR Energy, the Placing and the Convertible Loan to be in the best
interests of all shareholders. The strategic collaboration with AGR Energy has the potential to add significant value to
Tethys and the completion of the Placing will recapitalise the Company. In addition the Convertible Loan will provide
additional short-term funding to mitigate liquidity risk during the period before closing of the Placing and the receipt
of additional funds.

The Board considers it important to explain to shareholders the consequences for the Company should this financing not
proceed. The Company currently does not have sufficient funding to meet its funding obligations in the next twelve
months and therefore, without this additional funding, there is significant doubt about the Company's ability to
continue as a going concern. If this transaction does not proceed, there can be no assurance that management will be
successful in securing alternative funding or that management would have sufficient time to implement any alternative
transaction to the proposed Placing and Convertible Loan, which would be required to enable the Company to continue as a
going concern.

Use of Funds

If the Placing is completed, receipt of the proceeds should provide a solid foundation from which to pursue the
Company's growth objectives and shareholder value creation. The Board believes that Tethys' assets and operational
expertise, coupled with AGR Energy's expertise in the Kazakh natural resources industry will enable the group to seek to
exploit its undeveloped gas reserves in Kazakhstan and the potential "Gas to China" opportunity through:

--  A forecasted increase in gas production from a programme of shallow gas
    wells; and
--  Positive gas pricing differentials between local prices, currently
    $75/Mcm net, and gas prices at the border to China, reportedly
    significantly higher than current domestic; Tethys currently understands
    that gas is planned to be exported from Kazakhstan via the newly built
    pipeline to China as early as H2 2016.

Consequently, part of the proceeds of the Placing are also expected to undertake activities to support gas growth and
international export when feasible, namely by:

--  Drilling 4 gas development/appraisal wells and gas well tie-
    ins/workovers at Kyzyloi and Akkulka which have potential to increase
    short to medium term cash flow generation;
--  Investing in infrastructure to reduce operating costs and/or improve
    operational efficiency; including water injection, gas utilisation and
    compression upgrades;
--  Drilling six planned relatively low-risk and low cost gas exploration
    wells in Kazakhstan to support and increase medium term gas production
    into the future when export to China may be realised;
--  Providing substantial potential new revenue opportunities; and
--  Reducing the risk of exploration prospects through a planned 3D seismic
    programme.

The proceeds of the Placing are also expected to provide the necessary funds to allow Tethys to target unlocking the
potential of its significant oil reserve base in Kazakhstan and exploration potential in Kazakhstan and Tajikistan.
Activities that funds will be used for are anticipated to include:

--  Drilling Klymene, an oil prospect with up to 422 mmbbl un-risked
    (106mmbbl risked) mean prospective resources after additional investment
    to reduce drilling risks (assuming contract extension for Kul-Bas
    Exploration and Production Contract which currently expires in November
    2015);
--  Potential further oil production development through high graded
    projects, pending oil price improvement and/or Production Contract
    procurement enabling oil export;
--  Implementing necessary infrastructure requirements (such as the
    requirement for a gas utilisation facility) to obtain a Production
    Contract, thus realising an export price premium to domestic oil prices
    (expected from 2017); and
--  Providing near term funding for the Bokhtar PSC in Tajikistan to run a
    timely farm-out process, while also seeking to maintain a material
    interest post farm out.

Part of the proceeds of the Placing will also be used to reduce existing debt and provide a more consistent and
sustainable level of working capital. In addition, and as noted above, any part of the US$5 million Convertible Loan
drawn down by the Company before closing of the Placing will be repaid from the proceeds of the Placing (if it is
approved and consummated).

Board Changes and Relationship Agreement

Following the Placing, the Board will consist of nine individuals, three of whom will be nominated by AGR Energy. Two of
those nominees will assume executive roles as Executive Co-Chairman and Chief Executive, and the remaining nominee will
be appointed as a non-executive director.

In addition, the Company and AGR Energy have agreed the form of a Relationship Agreement that will be entered into by
them on closing of the Placing. The Relationship Agreement will provide inter alia that, for so long as AGR Energy and
its group companies together hold more than 30% (in certain cases 15%) or more of the issued ordinary shares in the
Company:

--  The Board shall be governed as follows:
    --  All Board committees will comprise a majority of non-AGR Energy
        directors, with AGR Energy nominees only entitled to sit on such
        committees if permitted to do so by applicable securities laws and
        regulations; and
    --  Potential conflicts of interest of AGR Energy directors disqualify
        them from voting on relevant board resolution(s).


--  Transactions will have the following specific controls:
    --  All transactions between Tethys and AGR Energy will be at arm's
        length and on normal commercial terms; and
    --  AGR Energy and their director nominees to abstain from voting on
        related party transactions involving AGR Energy's affiliates.


--  Further controls to be adopted including that:
    --  AGR Energy will undertake to vote in favour of an amendment to
        Tethys' Articles of Association to incorporate pre-emption rights
        for shareholders comparable to those applicable to UK public
        companies under the Companies Act 2006, to the extent that such
        amendment is not approved by the Company at the EGM;
    --  AGR Energy will not be permitted to use voting control to circumvent
        requirements of, or prevent Tethys complying with, applicable
        securities laws, regulations, or stock exchange rules;
    --  AGR Energy will not be permitted to use voting control to pass or
        force through a resolution that would result in Tethys ceasing to be
        listed or traded on at least one of the Toronto Stock Exchange and
        the London Stock Exchange; and
    --  In the initial six month period after closing of the Placing, AGR
        Energy shall not be entitled to sell or dispose any ordinary shares
        in the Company without the Company's consent, other than pursuant to
        certain permitted exceptions (such as pursuant to a general offer
        made to all shareholders of the Company).

Under the Relationship Agreement AGR Energy will acquire:


    --  The right to appoint at least one director to the Board and
        committees of the Board for so long as AGR Energy and its group
        companies together hold 15% or more of the issued ordinary shares in
        the Company; and
    --  The right to participate pro rata in any future equity issue to be
        made or proposed to be made by the Company (subject to certain
        exceptions) even in cases where general pre-emption rights do not
        apply, for so long as AGR Energy and its group companies together
        hold 20% or more of the issue ordinary shares in the Company.

AGR Energy has emphasised that it is committed to Tethys remaining an independent company. The Relationship Agreement is
designed to ensure that Tethys continues to operate autonomously and in the interests of all shareholders.

Recommendation

The Board considers the proposed strategic collaboration with AGR Energy and the associated Placing and Convertible Loan
to be in the best interests of the Company and its shareholders as a whole. Accordingly, the proposed transaction has
the unanimous support of the Board and each Tethys Director intends to vote in favour of all those resolutions required
to implement the transaction in relation to shares held or controlled by them.

Extraordinary General Meeting

The Company will prepare a circular that will be sent to all shareholders in due course, including details of those
resolutions relating to the Placing and Convertible Loan to be voted on at the EGM. It is currently anticipated that the
EGM will be held at The Old Government House Hotel, St. Peter Port, Guernsey, on or around August 31st, 2015.

Note to Editors

The references in this press release to resources are to "Prospective Recoverable Resources" which means those
quantities of petroleum estimated as of January 15th, 2014, to be potentially recoverable from undiscovered
accumulations by application of future exploration and development projects. Prospective resources have both an
associated chance of discovery and a chance of development. There is no certainty that any portion of these resources
will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of
these resources. The product types that may reasonably be expected from potential production consist of oil, condensate,
natural gas and associated gas.

The resource estimates contained or referred to are estimates only and are not meant to provide a determination as to
the volume or value of hydrocarbons attributable to Klymene Prospect.

There are numerous uncertainties inherent in estimating quantities of resources and cash flows that may be derived,
including many factors that are beyond the control of the Company. The following is a non-exhaustive list of factors
which may have a significant impact on the above estimates of prospective resources: despite the classification that
they are as yet undiscovered but may be potentially recoverable the Company may be unable to carry out the development
or their potential recovery; the activity may not be economically viable; the Company may not have sufficient capital or
time to develop them; there may be no market or transportation routes for the potential production; legal, contractual,
environmental and governmental concerns might not allow for the recovery being undertaken; reservoir characteristics
might prevent recovery. The recovery of the resources is subject to the following risks and uncertainties: market
fluctuations, the proximity and capacity of oil and gas pipelines and processing equipment, government regulation,
political issues, export issues, competing suppliers, operational issues (exploration, production, pricing, marketing
and transportation), extensive controls and regulations imposed by various levels of government, lack of capital or
income, the ability to drill productive wells at acceptable costs, the uncertainty of drilling operations, factors such
as delays, accidents, adverse weather conditions, and the availability of drilling rigs and the delivery of equipment.
The Klymene exploration well is within the Kul-Bas Exploration and Production Contract which expires in November 2015.
The Company believes that it can extend this Contract term but this is by no means guaranteed and should the Contract
not be granted an extension then the Contract area, including the Klymene well, will be forfeited.

About Tethys

Tethys is focused on oil and gas exploration and production activities in Central Asia and the Caspian Region. This
highly prolific oil and gas area is rapidly developing and Tethys believes that significant potential exists in both
exploration and in discovered deposits.

About AGR Energy

AGR Energy is a company owned by the Assaubayev family, who are long-term investors in natural resources and metals and
mining, and have a track record of effective investment and support of enterprises, particularly in Central Asia and
other emerging markets.

Disclaimer

This press release contains "forward-looking information". Such forward-looking statements, inter alia, reflect our
current views with respect to future events and the transactions referred to in this press release, including with
respect to completion of the Placing and receipt of proceeds, shareholder approval and regulatory approvals, use of
proceeds, successful collaboration with AGR Energy, fulfilment of conditions and receipt of funds pursuant to the
Convertible Loan within anticipated timeframes, effective implementation of the agreed form Relationship Agreement,
drilling program, reduction of operating costs, running a farm out process for the Bokhtar PSC, an increase in short-
medium term cash flow and gas and/or oil production, the export of gas to China at higher prices from the second half of
2016, and future oil export opportunities from 2017.
The forward-looking statements are based on the following assumptions: that the Placing will be completed and all
shareholder approvals will be obtained by the Long Stop Date and proceeds received, that the proceeds will be applied
for the uses noted in this release, that the collaboration with AGR Energy will be successful, that conditions will be
fulfilled and funds received under the Convertible Loan within anticipated timeframes, that the agreed form Relationship
Agreement will be effectively implemented, that the drilling program will result in a material increase in short-medium
term cash flow and gas and/or oil production, that gas produced by Tethys will be exported to China in the future from
the second half of 2016 and at higher prices to current domestic prices, that oil produced by Tethys will be exported
from 2017, that capital projects undertaken will reduce operating costs, and that the Company will be successful in
running a farm out process for the Bokhtar PSC. These forward-looking statements are subject to a number of risks and
uncertainties, including the risk that the Placing and/or shareholder and regulatory approvals will not be completed or
obtained by the Long Stop Date and proceeds are not received, the risk that the collaboration with AGR Energy will be
unsuccessful, the risk that conditions to the Convertible Loan will not be fulfilled and funds not received within
anticipated timeframes or at all, the risk that the agreed form Relationship Agreement will not be effectively
implemented, the risk that the Company will not be able to apply the proceeds as described in this press release, the
risk that the drilling program will not result in an increase in gas/or oil production or cash flow, the risk that gas
produced by Tethys will not be exported to China in the future or that any gas exported will realise a higher price than
current domestic prices, the risk that oil produced by Tethys will not be exported by 2017, the risk that the Company
will not successfully reduce operating costs and the risk that the Company will not be successful in running a farm out
for the Bokhtar PSC.

See also our Annual Information Form for the year ended December 31, 2014 for a description of risks and uncertainties
relevant to our business, including our exploration activities. The "forward looking statements" contained herein speak
only as of the date of this press release and, unless required by applicable law, the Company undertakes no obligation
to publicly update or revise such information, whether as a result of new information, future events or otherwise.


FOR FURTHER INFORMATION PLEASE CONTACT:

CAMARCO (Financial PR)
Billy Clegg / Georgia Mann
+44(0)203 757 4983

OR

Tethys Petroleum Limited
info@tethyspetroleum.com
www.tethyspetroleum.com

Contact Information

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