Tethys to Spud Omani Re-entry Well in Early April

Tethys Oil AB, through its wholly owned subsidiary Tethys Oil Oman Limited, has signed a Deed of Assignment for a drilling rig, with Thai oil company PTTEP Oman Company Limited. Under the contract, Tethys will be able to use the Dalma Rig #3, operated by Abu Dhabi drilling contractor Dalma Energy Ltd, for 50 days. The rig is currently finishing off work for PTTEP in the nearby Block 44 and will be released to Tethys later this month. Tethys will use the rig to drill the Jebel Aswad re-entry well on block 15, Oman. Preparations of the drilling site are ongoing. Drilling operations are expected to begin in on or about April 2 and last for some 40 days.

The Jebel Aswad well was originally drilled in 1994 and encountered oil in two limestone intervals, the Natih and Shuaiba, ranging from depths of 2,977-3,108 meters and 3,448-3,550 m., respectively.

The re-entry of the Jebel Aswad well will be designed to appraise both the Natih and the Shuaiba reservoir sections in order to determine reserves in place and a likely recovery factor. Two horizontal legs will be drilled at the respective horizons using underbalanced drilling fluids in order to minimize damage to the reservoir and maximize oil production.

The outcome of the geological and geophysical work carried out to date have confirmed the integrity of the Jebel Aswad/Wadi Saylah (JAWS) structure, thought to hold approximately 50 mmbbl oil in place. The new maps show that the Wadi Saylah well was drilled on a part of the structure which is separated from the main structure by a fault. The extent of the Wadi Saylah area will be determined later and focus will be on the main structure as defined by seismic and the Jebel Aswad well.

Anticipated reserves are based on the Natih limestone section. The Natih flowed over 200 bbls of 40 degree oil during a production test in 1995. In addition, detailed log analysis has suggested that the Shuaiba reservoir rock also is oil saturated. The Shuaiba is the main producing rock in the region, but was not re-tested in 1995. It is thus less certain as a producer than is the Natih. However should the Shuaiba produce, reserves in the field would increase significantly.

"We are extremely pleased to have been able to secure a rig in this tight rig market. We are now looking forward to appraise a 1990's oil discovery with new modern horizontal underbalanced drilling techniques," comments Tethys Oil Managing Director Magnus Nordin.

Tethys Oil has 40-percent interest in Block 15 and is operator

Tethys Oil AB is a Swedish company focused on exploration for and production of oil and natural gas. Tethys aims to maintain a well-balanced portfolio of high risk/high reward exploration opportunities coupled with lower-risk exploration and appraisal development assets.