Kazakhstan producer Tethys has agreed terms of a $15mn financing deal with investment company Oilsol.
Tethys said it will use the money to repay $5mn it owes to fellow Kazakhstan producer Nostrum Oil and Gas, which pulled out of a proposed takeover deal for Tethys in October, and potentially to repay $7.5mn owed to AGR Energy, an investment vehicle owned by Kazakhstan's Assaubayev family.
Tethys had earlier warned a failure to agree the financing deal would mean it would not have sufficient funding to meet its obligations in the next 12 months. Oilsol, a private company headquartered in Kazakhstan, will also potentially subscribe to a proposed C$25.5mn ($19.2mn)private placement. It has worked with Tethys in Kazakhstan since 2009 — the two companies invest in the Aral oil terminal, and Olisol owns the railway company that transports crude from Aral to refineries.
Tethys has been seeking extra funding since the collapse of a planned sale of half of its Kazakhstan assets in May. Since then, it has received notice to withdraw from the Bokhtar project in Tajikistan from partners Total and China's CNPC, after missing two monthly payments. The devaluation of the Kazakhstan tenge in August has also had a deleterious effect — the company's realised price for crude was just $12.24/bl in the third quarter, meaning a 16pc year-on-year increase in production in the period, to 4,823 b/d of oil equivalent (boe/d), didn't translate into a revenue increase. Revenues fell to $5.7mn from $7.3mn, over the same period.
