Reduces FY'23 production guidance by ~5%In the Q2 report, Tethys Oil reduces its FY'23 production guidance by ~5% (mid-range) to 9.0kboe/d (+/-200boe/d), from the previous level of 9.0-10.0kboe/d due to soft performance on Block 3&4. Because of lower production, opex guidance is revised up to USD 17/bbl (+/-0.5/bbl), from USD 14/bbl (+/- 1.0/bbl) previously. Although negative with the lowered production guidance, we argue some of this was already expected given the production numbers already announced for H1'23. Also, FY'23 capex guidance is lowered to USD 81-86m (USD 85-95m). On the other blocks, Tethys expresses a positive view on the production tests at Al Jumbd (Block 56) which produced 35kboe of gross oil in the quarter. Furthermore, Tethys announces that it is exploring a potential farmout on Block 58 ahead of exploration drilling which is now planned for early 2024.
Negative estimate changes expectedWe evaluate Tethys Oil's Q2'23 report to be somewhat soft compared to our expectations due the EBITDA miss in the quarter and the reduced production guidance. Consensus will likely make a...
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