Tethys Oil

Capital/Financing Update • Aug 18, 2015

Press release 2015-08-18

Tethys Oil sets new capital structure target

In light of Tethys Oil's strong operational and financial performance as well as the strong balance sheet, Tethys Oil's board of directors has set a new capital structure target for the company:

"Tethys Oil's primary objective is to create shareholder value and in doing so the company will have a balanced approach to growth and shareholder distributions, with a long term capital structure target of a zero net cash position."

"We expect the production and the reserves in our core area, Blocks 3 and 4 onshore Oman, to continue to grow. The strong cash flows we expect in combination with the strong balance sheet, will give ample room for both continued investments in our core area and for other growth opportunities as well as for cash distributions to shareholders and share buy-backs" comments Tethys Oil's managing director Magnus Nordin.

The new capital structure target replaces the previous targets:

• Debt/equity ratio of 30–40%
• Net debt /EBITDA of up to 2x

For further information, please contact

Magnus Nordin, Managing director, phone +46 8 505 947 00

The information in this press release has been made public by the Company in accordance with the Securities Market Act and/or the Financial Instruments Trading Act.

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Tethys Oil AB (publ)

Tethys Oil is a Swedish energy company focused on exploration and production of oil. Tethys Oil's core area is the Sultanate of Oman, where the company is one of the largest onshore oil concession holders with a current net production in excess of 9,000 barrels of oil per day. Tethys Oil also has exploration and production assets onshore Lithuania and France. The shares are listed on Nasdaq Stockholm (TETY).

Website: www.tethysoil.com