Tethys Closes Acquisition, Becomes No. 2 Oman Land Holder

Tethys Oil AB has acquired 50% interest in Blocks 3 and 4 onshore Oman from Norwegian Energy Company (Noreco) affiliate Altinex.

Blocks 3 and 4 onshore Oman cover a combined area of more than 30,000 square kilometers. Block 3 contains the South Farha oil discovery, originally made in 1986, with an estimated 4-6 million barrels of recoverable oil from thin sandstone layers. More than 30,000 kilometers of 2D seismic has been collected, and 27 wells have been drilled on the blocks, of which 18 wells have encountered oil shows. A large number of prospects have been identified on the blocks. The remaining 50% of the blocks is held by Encana International Oman Ltd, who is the operator.

The consideration for the acquisition amounts to U.S. $2 million , which has been paid through the placement of 226,000 Tethys shares at SEK 56. In order to strengthen the liquidity with MSEK 7 for anticipated investments in the acquired blocks during 2008, Tethys has issued an additional 125 000 shares also at SEK 56. The new share issues are done in line with authorizations from the AGM in May 2007.

"Through the acquisition, Tethys will be the second largest onshore land holder in Oman," Magnus Nordin, Tethys Oil AB managing director, said.