The Maikop / Upper Eocene shale oil play is potentially analogous to both the Bakken and Eagle Ford plays in the USA according to the Gustavson Associates report, and therefore these plays were used for parameters for the shale resource calculation. The shales are organic rich and geochemical studies indicate good total organic carbon and thermal maturity. The Maikop gross shale thickness is estimated to be up to 2,000 metres (significantly thicker than that reported for the Bakken Formation) with porosities ranging from 5 to 14%, commercial recovery from most likely 50% of the section and with recovery factors of 5 to 10% being applied. Most of the shale oil potential is currently identified in the Blocks XIM and XIN areas.
The conventional target zones in Block XIA are Eocene clastic reservoirs and Cretaceous carbonate reservoirs as well as unconventional Maikop potential. Several multi-level prospective leads have been mapped on older seismic lines as rollovers and thrusted anticlines. As well as the unconventional Maikop and Upper Eocene potential in Block XIM the conventional targets are primarily the clastic Miocene and Middle Eocene age horizons that are productive in the Norio and Satskhenisi fields to the north and in the Samgori oifield to the south-east. These plays appear to extend into Block XIG to the south. Block XIN currently has less data but is mapped as having thick Maikop potential as well as possible Eocene and Cretaceous plays.
Blocks VIII and XIG also exhibit Middle Eocene and Cretaceous potential as well as potential in the Jurassic. There are numerous seeps and oil shows in wells in Block VIII and encouragement seen from the Akhalakalki and East Kavtiskhevi wells especially where reports indicate oil was tested in the past from Cretaceous carbonates and fractured volcanic tuffaceous sandstones. These may have the potential for early oil production. Thrusted anticlines have been identified on seismic data.
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.
The references in this press release to "Prospective Recoverable Resources" means those quantities of petroleum estimated, as of July 1, 2013, to be potentially recoverable from undiscovered accumulations by application of future 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.
These are Unrisked Prospective Resources as of July 1, 2013 that have not been risked for chance of discovery or chance of development. If a discovery is made, there is no certainty that it will be developed or, if it is developed, there is no certainty as to the timing of such development.
The resources 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 the Company's properties. 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 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.
This press release contains "forward-looking information" which may include, but is not limited to, statements with respect to the completion of either acquisition or acquisitions, prospective resource estimates, the potential for successful discoveries and their commercialization, and our exploration targets. Such forward-looking statements reflect our current views with respect to future events and are subject to certain assumptions, including receipt of required approvals and a satisfaction of applicable conditions for the completion of either acquisition or acquisitions, the fact that the Company will be successful in confirming the existence of the accumulations of petroleum in respect of its exploration targets, and subject to certain risks and uncertainties, including the risk that approvals for completion of either acquisition or acquisitions may be delayed, the risk that limited discoveries will result from exploration wells and as a result the risk that any or all of the prospective resources will not become recoverable, as further explained above in this press release. See our Annual Information Form for the year ended December 31, 2012 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.
A barrel of oil equivalent ("boe") conversion ratio of 6,000 cubic feet (169.9 cubic metres) of natural gas = 1 barrel of oil has been used and is based on the standard energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. The use of the word "Gross" means 100% of the PSC.
North America & Europe
Tethys Petroleum Limited
Vice President Investor Relations
Tethys Petroleum Limited
Communications Manager - Asia
FTI Consulting - London
Ben Brewerton / Natalia Erikssen
+44 207 831 3113
Tethys Petroleum Limited
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