Mr. Casey McCandless reports

CORPORATE UPDATE

Tethys Petroleum Ltd. is providing an update on the company's operations in the Republic of Kazakhstan.

Deferred payment obligation adjustment

The company had previously recognized in its interim financial statements a deferred payment obligation for historical costs incurred by the government on geological investigation of the Kul-Bas exploration area of approximately $28.8-million to be paid quarterly over a period of up to 10 years.

After a further examination of the nature of acquired geological information, involving communication with the State Geology Committee, the company determined that certain costs amounting to $25.6-million do not qualify as historical costs and, therefore, are not due for reimbursement to the government. Subsequently, the company communicated its findings to the Aktobe Tax Department and requested confirmation for the exclusion of these costs from its obligations.

On Feb. 12, 2024, the Aktobe Tax Department responded, affirming the company's position that approximately $25.6-million of the obligation is not owed. As a result, the company will be making an adjustment to the balance sheet that will result in a reduction of the present value of the previously reported liabilities of approximately $18.7-million.

About Tethys

Tethys is focused on oil and gas exploration and production activities in Central Asia and the Caspian region.

We seek Safe Harbor.