Q4 2015 9 February 2016 Q4 Highlights Production increase - PowerPoint PPT Presentation

Q4 2015 9 February 2016

Q4 Highlights • Production increase continues: new production record with 10,956 BOPD in Q4-15 – up 9% compared to Q3-15 • Revenue of MSEK 222, down 13% compared to Q3-15 • EBITDA of MSEK 113, down 26% compared to Q3-15 • Net result MSEK 27, down 65% compared to Q3-15 • Earnings per share SEK 0.78 for Q4-15 • Net cash of MSEK 436, down 10% compared to Q3-15 • SEK 1.00 per share dividend proposed • 7 wells drilled on Block 3 and 4 in Oman • New reservoir layer boosts production • Long term production testing of Lithuanian well continues 2

Tethys’ assets Country Licence Area, Tethys Partners* 2P reserves Production km2 share 31 Dec 2014 Q3 2015 (mmbo) ** (bopd) Producing Oman Block 3 & 4 34,610 30% CC Energy, Mitsui 18.2 10,847 Assets Lithuania Gargzdai 884 25% Odin Energi, - 109 Geonafta Oman Block 3 & 4 34,610 30% CC Energy, Mitsui Lithuania Rietavas 1,594 30% Odin Energi, Private investors Exploration Lithuania Raseiniai 1,535 30% Odin Energi, Private assets investors France Attila 1,986 40% Galli Coz France Alès 215 37.5% Private investors * Operator in bold ** Reserves in Oman audited by DeGolyer and MacNaughton 3

Average daily production in Oman 14 000 11 606 12 000 10 000 8 000 6 000 4 000 2 000 0 October November December January February March April May June July August September October November December Q4-14 Q1-15 Q2-15 Q3-15 Q4-15 • New layer boosts production – 12,630 bopd in January 2016 • Production expected to continue to increase in 2016 with month on month volatility 4

Reserves, December 31, 2015 Reserves Block 3&4 Oman Development of reserves (31 Dec 2015, mmbo) mmbo 1P 2P 3P mmbo 1P 2P 3P Farha South Total 31 Dec 2014 7.6 10.2 12.7 11.8 17.8 25.1 Shahd Production 2015 4.9 6.8 12.0 -3.5 -3.5 -3.5 Saiwan East Revisions 0.4 1.2 3.2 4.7 4.0 6.3 Total Total 31 Dec 2015 12,9 18.2 27.9 12.9 18.2 27.9 Independent petroleum consultant DeGolyer and MacNaughton Canada Limited (“DMCL”) reviews Tethys Oil’s reserves in Oman annually. 5

Cash flow • Blocks 3 and 4 investments for 2016 will be closely monitored and subject to on-going revisions. The target is to fund investments on Blocks 3 and 4 primarily from cash flow from operations • During the financial year 2016, the cash flow from operations amounted to MSEK 503 and investments in oil and gas amounted to MSEK 324 • Including the dividend received from Lithuanian assets, the cash flow from operations after investments in the financial year 2015 amounted to MSEK 179 • Lithuania operations are expected to be financed from oil production and available cash in the associated Lithuanian companies 6

Production Barrels BOPD Barrels BOPD 4 000 000 12 000 1 200 000 12 000 1 007 782 928 047 3 500 000 10 000 1 000 000 10 000 768 226 858 453 3 000 000 784 207 8 000 800 000 8 000 2 500 000 2 000 000 6 000 600 000 6 000 1 500 000 4 000 400 000 4 000 1 000 000 2 000 200 000 2 000 500 000 0 0 0 0 2013 2014 2015 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Total production Ave daily production Total production Ave daily production • Average daily production in Q4 2015 increased 9% compared with Q3-15 • 31% increase in average daily production compared with Q4-14 7

Revenues MSEK MSEK MSEK 1 200 300 281 1 027 255 1 000 250 905 223 222 205 800 200 602 600 150 400 100 200 50 0 0 2013 2014 2015 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Revenue Revenue • Q4-15 revenue is down 13% compared to Q3-15 revenue due to decline in oil prices • Accounting principles have been changed to better align revenue with production development 8

Sold barrels Barrels Barrels 2 000 000 700 000 1 805 056 1 800 000 584 399 600 000 545 019 1 600 000 1 464 228 500 000 1 400 000 434 035 1 200 000 366 746 400 000 1 000 000 308 892 850 926 300 000 800 000 600 000 200 000 400 000 100 000 200 000 0 0 2013 2014 2015 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Sold volumes Sold volumes • Significant anticipated reduction in overlift in Q4 2015 (increase in overlift in Q2 and Q3 2015) • The total underlift position as per 31 December 2015 is 22,725 barrels 9

Average achieved selling price per barrel USD/bbl USD/bbl 110,0 110,0 106,6 103,9 100,0 100,0 97,1 90,0 90,0 80,0 80,0 70,0 70,0 63,8 61,8 60,0 60,0 58,1 57,8 50,0 50,0 47,9 40,0 40,0 2013 2014 2015 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Ave selling price Ave selling price • Average achieved selling price down 22% compared with Q3-15 • 2 months lag in future price 10

EBITDA MSEK MSEK % 800 743 200 70% 181 64% 60% 700 180 58% 60% 51% 160 600 153 48% 496 50% 488 130 140 500 113 120 40% 99 400 100 30% 300 80 60 200 20% 40 100 10% 20 0 0 0% 2013 2014 2015 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 EBITDA EBITDA EBITDA Margin • EBITDA of MSEK 105 in Q4-15, down 26% compared with Q3-15 • Lower EBITDA and EBITDA margin following lower oil prices 11

Expenses MSEK MSEK 450 120 400 10 44 100 7 9 8 350 18 300 80 31 250 60 200 102 362 94 92 92 31 40 150 74 255 100 20 153 50 0 0 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 2013 2014 2015 Operating expenses Administrative expenses Administrative expenses Operating expenses • Increase in OPEX is in line with the increased levels of production 12

Opex and Net back per barrel (USD/bbl) USD/bbl USD/bbl 60,0 60 50,0 50 40,0 40 41,3 40,6 33,6 30,0 30 18,8 20,0 18,1 20,0 20 19,7 13,0 10 10,0 16,9 14,3 14,1 13,4 12,1 11,9 12,1 10,3 0 0,0 Q4 2013 Q1 2015 Q2 2015 Q3 2015 Q4 2015 2013 2014 2015 Operating expenses Net back Operating expenses Net back • OPEX per barrel is decreasing with higher production • Costs starting to come down following lower oil prices • Opex between USD 10.3 and 14.3 per barrel during 2015, of which direct lifting cost accounts for 50-60% * After current government take 13

Net result after tax MSEK MSEK 400 90 78 340 80 350 70 300 63 249 60 250 50 198 200 40 30 150 27 30 100 20 50 10 -1 0 0 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 2013 2014 2015 -10 • Net result decrease by 65% Q-o-Q explained mainly by lower oil prices 14

Balance Sheet Q4 2015 ( MSEK ) 2015-12-31 2015-09-30 2014-12-31 Net cash 436 485 372 Total assets 2,165 2,142 1,816 Shareholders’ 1,864 1,838 1,675 equity • Strong net cash position of MSEK 436 • Net cash affected by movement of over 150,000 barrels from overlift to underlift in Q4-15 • MSEK 106 distributed to shareholders (dividend SEK 1 per share) and share redemption SEK 2 per share), the share repurchase programme added MSEK 42 to the distribution of capital to shareholders. • A large part of cash and cash equivalents are held in USD which has appreciated against SEK during the full year 2015 • Exchange rate as per balance sheet day: 8.51 SEK per USD. 15

Oil and gas investments MSEK MSEK 400 140 131 324 120 290 101 300 100 259 85 79 80 200 60 50 40 100 20 0 0 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 2013 2014 2015 Oil and Gas Investments 2013 2014 2015 • Tethys’ investments in Blocks 3 and 4 amounted to MSEK 79 in Q4 16 * Adjusted investments

Wells in Oman 14 45 13 40 39 40 12 11 35 35 10 9 30 8 25 7 20 6 4 15 4 10 2 5 0 0 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 2013 2014 2015 Wells drilled Wells drilled • 7 wells drilled in Q3 2015, all on Shahd oil field • Five rigs in operation, including one work over rig 17

Block 3 and 4 overview 18

Farha South field, 31 December 2015 19

Shahd Oil field New reservoir - Lower Khufai Carbonates - successfully brought on stream The water injection programme in the Buah layer showing signs of working Producing areas Prospects / prospective areas 20

Block 3 and 4, Oman - Stratigraphy • Barik, Khufai, Lower Buah and Lower Al Bashir currently producing 21

Stratigraphic Column with producing reservoirs Block 3 & 4 Producing Reservoirs Barik - Farha South Lower Al Bashair – Farha South & Shahd Lower Buah - Shahd Khufai – Shahd & Saiwan east ــــــــــــــــــــــــــــــــــــــــــــــــــ Carbonate Clastic 22

Conclusion • Tethys Oil continues to yield positive financial results: – Revenues MSEK 222 – EBITDA MSEK 113 – Net result MSEK 27 • Tethys will be able to continue to generate a positive gross profit also at prices below 30 dollars per barrel • New reservoir - Lower Khufai Carbonate - brought in production • The water injection programme in the Buah reservoir layer continues following initial encouragement • Production expected to continue to increase in 2016, however with monthly fluctuations 23

Q1 2016 Will be published 3 May 2016!