Tethys Oil (TETY) Q2 2024 earnings summary

Executive summary

• Strategic portfolio review ongoing with significant interest from multiple parties, considering options such as divestments, farm-outs, and new partnerships.

• Block 56 Field Development Plan submitted; commerciality expected soon, with government approval anticipated in weeks and first production from Al Jumd targeted.

• Block 58 drilling (Kunooz-1) to spud in August, targeting 123 million barrels unrisked prospective resources.

• Gas-to-Power project on Blocks 3 & 4 fully operational, reducing emissions and operating costs.

• Heads of Agreement signed with Sonatrach for potential entry into Algeria, with exclusive negotiations ongoing.

Financial highlights

• Q2-24 revenue and other income: $30.8M, up from $30.1M in Q1, driven by higher oil prices despite lower production.

• EBITDA increased to $15.7M from $13.0M sequentially.

• Cash flow from operations improved to $19.9M from $6.2M; free cash flow positive at $3.1M.

• Cash and cash equivalents at quarter-end were $18.1M, up from $14.9M.

• Achieved oil price was $84.3/bbl, up from $79.5/bbl in Q1.

Outlook and guidance

• Full-year 2024 production guidance set at 8,000 ± 200 bopd, revised due to weather-related disruptions.

• Operating expenditure expected at $17.5 per barrel, with further cost savings anticipated.

• Full-year capital expenditure now expected at $77M, reduced from previous guidance.

• All investments to be financed by cash flow, cash on hand, and the new $60M loan facility.

• Block 56 commerciality and Block 58 drilling are key near-term milestones.