Tethys Oil Raises Stake in Oman Block 56
Stockholm-based Tethys Oil AB, through its wholly-owned subsidiary Tethys Oil Oman Onshore Ltd., has entered into an agreement with a wholly-owned subsidiary of PT Medco Energi Internasional Tbk to acquire an additional 45% interest in and operatorship of Block 56 in the South Oman Salt Basin.
Under the terms of the deal, Tethys will acquire the additional interest in exchange for an initial cash payment of US$5 million, plus carry Medco Energi against its future share of block expenditures, capped at US$2 million. In addition, Medco Energi will also be entitled to receive additional consideration upon declaration of commerciality. Upon completion of the deal, Tethys Oil will hold an increased 65% interest in the block. The other partners in the block include Intaj LLC and Biyaq Oil Field Services LLC.
Block 56 covers an area of 5,808 sq. km in the South Oman Salt Basin, located across Al Wusta and Dohar Governorates in Oman. The block includes three wells drilled in 2017 and 2018, which fulfilled the initial phase commitments. The planned flow test for the wells was completed in Q1-2020, which confirmed the presence of an active petroleum system in one of the wells, although its commercial viability is yet to be determined. The block also includes potential leads in several different play concepts, and Tethys Oil has started the initial planning of a possible new seismic campaign to test the play concepts.
NASDAQ Stockholm-listed Tethys Oil is an upstream oil & gas company engaged in exploration, development, and production operations in Oman, Lithuania, and France.
Jakarta-based Medco Energi is a publicly-quoted integrated energy and mining company, and is currently engaged in oil & gas exploration and production operations in Indonesia, Oman, Yemen, Libya, and the United States. The company also operates in the power generation, gas distribution & trading, and copper & gold mining segments in Indonesia.
The transaction completion is subject to customary closing conditions, including the receipt of government and regulatory approvals.