Source - MKW


September 16, 2016

Tethys Petroleum Press Release: Corporate Update

GRAND CAYMAN, CAYMAN ISLANDS--(Marketwired - Sept. 16, 2016) - Tethys Petroleum Limited ("Tethys" or the
"Company") (TSX:TPL)(LSE:TPL) today announces a corporate update.

Olisol Transaction

As previously announced on September 2, 2016 the Company continues to work with Olisol to complete the private
placement of 181,240,793 shares at C$0.054 per share for proceeds of C$9.8 million whilst at the same time
evaluating other funding arrangements. At present Olisol owns 15.76% of Tethys' ordinary shares and if the
private placement is completed would own 42.03% of the enlarged share capital.

On September 9, 2016 Olisol provided US$2.94 million working capital funds to the Company in addition to the
previously announced US$452,000 provided during the week ended September 2, 2016. The total working capital
loan from Olisol now stands at US$5.70 million and Olisol has indicated that it wishes to use the proceeds from
the repayment of the loan to satisfy a portion of the C$9.8 million subscription price due for the private
placement. The Company plans to complete the private placement with Olisol once the remaining funds due have
been received and all other conditions of closing have been met. These conditions include compliance with the
offering and placement requirements of the Kazakhstan Stock Exchange in accordance with Republic of Kazakhstan
legislation. The Investment Agreement has an outside date of October 27, 2016 unless extended.

Kazakhstan legal proceedings

As previously announced on August 24, 2016 the Court dismissed the claim brought against the Company and its
subsidiaries in Kazakhstan and ordered the lifting of the seizure order over the Company's assets. The claimant
lodged an appeal on August 29, 2016 which is scheduled to be heard on September 26, 2016. Until the claimant's
appeal is heard restrictions remain in place over the operation of the Company's bank accounts in Kazakhstan.

Tajikistan arbitration proceedings

As previously announced, Total and CNPC, the Company's partners in Tajikistan, filed for arbitration
proceedings at the International Court of Arbitration in relation to the Company's cash call defaults and the
partners' notice to the Company to withdraw. The partners are seeking to enforce the withdrawal notice and
their claim for damages of US$9.0 million (and continuing) plus costs. The Company has submitted its response
to the request for arbitration and has made a counter-claim against the partners of US$10.1 million.

At the present time the partners and the Company have appointed their respective arbitrators and are in the
process of jointly agreeing the third independent arbitrator who needs to be appointed before arbitration
proceedings can commence.

About Tethys

Tethys is focused on oil and gas exploration and production activities in Central Asia and the Caspian Region.
This highly prolific oil and gas area is rapidly developing and Tethys believes that significant potential
exists in both exploration and in discovered deposits.

About Olisol

Olisol is headquartered in Almaty, Kazakhstan and its subsidiaries and affiliates have investments in energy
and oil and gas operations in the Russian Federation and Kazakhstan. Olisol has worked with Tethys in
Kazakhstan for over seven years, is joint owner of the Aral Oil Terminal with Tethys and has its own fleet of
special oil trucks involved in oil transportation from Tethys' oil field. Olisol, through its affiliates, is
engaged in railroad transportation, processing of oil, storage and sale of oil products.


Some of the statements in this document are forward-looking. Forward-looking statements include statements
regarding the intent, belief and current expectations of the Company or its officers with respect to Olisol's
access to funds, the placing to Olisol, advances under the working capital facility, potential alternatives to
the transactions with Olisol and related transactions. When used in this document, the words "expects,"
"believes," "anticipates," "plans," "may," "will," "should" and similar expressions, and the negatives thereof,
are intended to identify forward-looking statements. Such statements are not promises or guarantees, and are
subject to risks and uncertainties that could cause actual outcomes to differ materially from those suggested
by any such statements including risks and uncertainties with respect to completion of the placing, advances
under the working capital facility and related transactions. In addition, certain regulatory approvals lapsed
on September 3, 2016, and there is no certainty that the Company will be able to obtain an extension. Should
the Company be unable to obtain an extension, it may not be able to complete the placing even if Olisol
proposes to do so. Moreover, there is a risk that the Company's counter-claim against Total and CNPC will not
be successful and that the Company will be required to compensate Total and CNPC. There is also a risk that
restrictions on the Company's bank accounts in Kazakhstan will be extended.

No part of this announcement constitutes, or shall be taken to constitute, an invitation or inducement to
invest in the Company or any other entity, and shareholders of the Company are cautioned not to place undue
reliance on the forward-looking statements. Save as required by the Listing Rules and applicable law, the
Company does not undertake to update or change any forward-looking statements to reflect events occurring after
the date of this announcement.


Tethys Petroleum
[email protected]

Tethys Petroleum Limited