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Tethys Petroleum (LON:TPL, TSE:TPL) revealed average production rates of 5,408 barrels oil equivalent per day (boepd) for May, which it highlighted was the highest monthly figure since June 2013.
Production in 2015 has thus far averaged 4,585 boepd, the company added.
Operationally, well AKK14 was brought into production and work is now underway for AKK15.
Elsewhere, in Tajikistan, a 2D seismic programme partnered with CNPC and Total is said to be progressing well, with the first phase ‘on track’ to complete in the third quarter.
Tethys also today told investors it had reached an amicable agreement with SinoHan, which will see the company repay an escrow loan and certain agreed costs.
It comes after time ran out in May to complete a proposed funding deal.
The Kazakhstan based oil and gas group also reminded investors that it remains in an exclusivity period with Kazkh investor AGR Energy. As agreed last month Tethys and AGR have until the end of June 12 (tomorrow) to negotiate a larger financing.
In May, Tethys secured a US$$7.5mln convertible loan facility with AGR.
Sam Wahab, analyst at Cantor Fitzgerald, said it was overall a positive update from Tethys, though he highlights that the company needs to secure the additional finance.
“In a challenging oil price environment globally, and especially in Kazakhstan (where the selling price at the well head of oil fell to US$13/bbl), the company’s financial position is precarious in our view, notwithstanding its recent recapitalisation,” Wahab said.
“Whilst our forecasts recognise increased revenue from higher gas prices and volumes (current production c.5,4500 boepd), and reduced G&A expenditure, we believe Tethys’ financial flexibility will come under increasing pressure in the absence of material funding.”
The Cantor analyst said he will keep his recommendation and price target for Tethys under review, whilst there is the current lack of visibility of the funding situation.