Tethys Oil Sustainability Report

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Tethys Oil Sustainability Report
Tethys Oil
Sustainability Report
2020
Tethys Oil Sustainability Report
Contents
Letter from the Managing Director                              3
Mission, Vision & Values                                       4
Our business model                                             5
Tethys Oil Policy Framework                                    6
2020 in Brief: Production, Reserves and Financials             7
An evolving sustainability strategy                            8
  Establishing the ESG framework                              10
  Setting the baseline                                        10
  Materiality assessment                                      11
  Stakeholder engagement                                      11
Sustainable operations                                        12
Performance metrics                                           14
Environment and emissions                                     16
  Air emissions                                               17
  Water use                                                   19
  Spill prevention                                            19
People and society                                            20
  Our people                                                  21
  Human rights                                                21
  Community engagement                                        22
  CSR activities                                              22
Health and safety                                             24
Governance and ethics                                         26
  Anti-corruption                                             27
  Anti-fraud and protection of Group assets                   27
  Whistle blower                                              27
Key sustainability risks                                      28
Auditor’s report                                              31
Address                                                       32

 This sustainability report is produced in accordance with the
 Annual Accounts act (ÅRL chapter 6, §10-14) and encom-
 passes Tethys Oil AB (publ) and its subsidiaries. The board
 of directors is responsible for the preparation of the report.
Tethys Oil Sustainability Report
Letter from the Managing Director

In this year of the Pandemic, the question    profit and growth, but said nothing of          remained unchanged planning for reduced
of sustainability broadened its reach and     the implicit cost to the environment, the       flaring and reduced emissions has con-
increased its urgency. The drop in eco-       health and well-being of our employees          tinued unabated. As we have increased
nomic activity decreased levels of pollu-     and our impact on society. As this report so    our operated acreage, Tethys Oil has and
tion and traffic congestion. We welcomed      aptly illustrates, focus is now also directed   will rise to the opportunity of expanding
the increase in air quality and return to     at the other side of the equation – the costs   our brand of sustainability to all operated
nature offered by the lock downs. But the     that are not immediately obvious.               areas including community relations, low
response to fight the Pandemic could not                                                      emission vehicles and all health and safety
have been mustered without strong econo-      We provide a product for energy genera-         related areas. All in line with our Mission,
mies. The need for concerted action and       tion that when used has an impact on the        Vision and Values.
resources to fight the Pandemic under-        overall environment that is measurable
scored the importance to society of resil-    and sustainable in the short to medium          So please take some time to at least browse
ience, economic reserves and not least -      term. There are any number of energy            through our sustainability report for 2020.
access to energy.                             generating technologies, but they all have      And if you read it in detail and have com-
                                              trade-offs. In the longer term though the       ments so much the better. Tethys is in the
Access to energy is an absolutely essen-      continued growth in oil consumption is          oil business to stay and we will welcome
tial part of economic activity, which in      unlikely to be sustainable by any counts        any feedback to make our presence more
turn is crucial for progress, affluence and   and more long-term sustainable ways of          sustainable.
good health. But unfettered use of natu-      generating energy must be applied. For
ral resources, unlimited pollution of the     Tethys Oil as a Company and for you as
environment where we live and decreasing      investors in an oil producer the task is
biodiversity because of human expansion       twofold: supply the product as long as
will counteract any progress achieved. The    there is demand and do this in an opti-                                 Magnus Nordin
paradox of 2020 illustrated so well the two   mally sustainable way.                                                  Managing Director
sides of this equation.
                                              As this report shows, in 2020 the effects
Previously we measured and accounted          of the pandemic resulted in a lower car-
only the economic activity with focus on      bon footprint and while carbon intensity

                                                                  3
Tethys Oil Sustainability Report
Mission                                        Vision                                            Values

 Tethys Oil AB (publ) (“the Company”)           Tethys Oil’s vision is that growth continues      Tethys Oil’s corporate culture emanates
 and the entirety of its group (together,       through the Group's exploration success.          from the Company's Scandinavian roots.
 “Tethys Oil” or the “Group”) is an oil and     Tethys Oil seeks to build, maintain and           It is the responsibility of Tethys Oil’s man-
 gas exploration and production company         expand a well-balanced and self-financed          agement to foster a corporate culture that
 with a primary objective of creating share-    portfolio of oil assets, offering a measured      promotes the values and principles out-
 holder value working across the whole          exposure to onshore production, develop-          lined in Tethys Oil’s Code of Conduct.
 upstream industry lifecycle of exploration,    ment, appraisal and exploration potential.        Tethys Oil aims to act in all respects in a
 appraisal, development and production.         The focus today and tomorrow is on geog-          responsible, fair, accountable and ethical
 A central belief in Tethys Oil's business      raphies with proven petroleum systems,            manner towards all aspects of the environ-
 model is to explore for and produce oil and    existing infrastructure, established institu-     ment and to all individuals and entities
 gas in an economically, socially, and envi-    tional frameworks and low political risk. In      that the Group encounters in its course of
 ronmentally responsible way. The Group         all its activities, Tethys Oil seeks a balanced   doing business. Tethys Oil aims to apply
 applies the same standards to its activities   approach to risk.                                 the same standards to all its activities wher-
 worldwide to satisfy both its commercial                                                         ever they are carried out.
 and ethical requirements as per Tethys
 Oil's Code of Conduct.                                                                           It is of vital importance to Tethys Oil that
                                                                                                  the Group maintains and further builds on
 Tethys Oil seeks to be a sustainable and                                                         its reputation as a responsible and forward-
 profitable business long-term. Sustain-                                                          looking corporate citizen in all countries
 ability means running a business that is                                                         where Tethys Oil has a presence and in
 not only profitable but is aligned with the                                                      relation to all stakeholders, may they be
 requirements and expectations of stake-                                                          shareholders, employees, contractors, part-
                                                                License
 holders both within and outside the Group.                    acquisition                        ners or someone else.

                                         Production                                    Exploration

                                                                                      Exploratory
                                        Development
                                                                                        drilling

                                                                Appraisal

Mission
Vision
Values
Tethys Oil Sustainability Report
Our business model

Tethys Oil’s business model is to be active   In all its activities Tethys Oil seeks a bal-   particularly in harsh environments. The
in the onshore exploration, appraisal and     anced approach to risk. The strategic deci-     strategic decision to focus on geographies
production stages of the upstream oil and     sion to focus purely on onshore explora-        with proven hydrocarbons allows Tethys
gas business cycle in geographies with        tion and production of oil is a function        Oil to reduce subsurface risk by seeking
proven hydrocarbon deposits, existing         of this approach. Onshore oil exploration       to explore in areas with previously over-
infrastructure and an established institu-    involves a lower financial exposure due         looked discoveries and plays using modern
tional framework.                             to lower drilling and development cost.         techniques and with proven, conventional
                                              It also involves lower environmental and        technology.
                                              safety risks compared to offshore drilling,

                                                                  5
Tethys Oil Sustainability Report
Tethys Oil Policy Framework

Tethys Oil holds itself to a high standard of ethical, moral and legal       Tethys Oil’s management integrates sustainability and social
business conduct and expects its staff to act honestly, with integrity       responsibility considerations in its decision making: during the
and in accordance with the Group’s Code of Conduct.                          year there was a focus on adapting the Group’s policy framework
                                                                             and operating systems in light of increased operational activities.

Overview of Tethys Oil Group Policy Framework
                                                Vision, Mission, Goals and Strategy

                                                                  Code of Conduct

             HSE policy                        Diversity policy                    Whistleblower policy                      IT policy

        Anti-corruption policy                Anti-fraud policy                Information and insider policy

                                                                             The scope of Tethys Oil’s 2020 Sustainability Report
                                                                             Tethys Oil’s 2020 Sustainability Report covers its operations as con-
                                                                             solidated in the 2020 Annual Report. This includes its operated
                                                                             interests in Block 49 and Block 58 (a new licence acquired in 2020)
                                                                             as well as the non-operated interests in Blocks 3&4 and Block 56.
                                                                             Due to its limited exposure, the report does not include Tethys Oil’s
                                                                             associated interest in the Lithuanian company Minijos Nafta.

                                                                             All aspects of Tethys Oil’s operations are subject to its Environ-
                                                                             mental, Social and Governance (ESG) policies and procedures.
                                                                             Depending on the nature of the activity, the corresponding impact
                                                                             and exposure will vary. One such key determinant is whether the
                                                                             licence is in a production or exploration phase. Another is whether
                                                                             Tethys Oil is operator or non-operator. Where Tethys Oil is opera-
                                                                             tor the Group has direct control over the decision making of day-
                                                                             to-day operations, whereas as non-operator the Group must work
                                                                             indirectly to influence the operator in the desired way.

                                                                         6
Tethys Oil Sustainability Report
2020 in Brief: Production, Reserves and Financials

For all the challenges of 2020, Tethys Oil   Group produced an average of 11,336        At the end of the year, Tethys Oil reported
came through the year very well. Tethys      barrels of oil per day with lower opex     2P reserves of 26.9 million barrels, a
Oil’s asset mix improved with the addi-      and a positive cash flow. Revenues and     reserve replacement ratio (RRR) of 120%
tions of one new block and one farm in,      other income reached MUSD 101.1, and       – the ninth consecutive year with positive
and one farm out. Block 3&4 operations       EBITDA MUSD 50.4 with an end of year       reserves growth. The increasing reserves
showed remarkable resilience and robust-     net cash balance of MUSD 55.1.             and reserve life underlines the economic
ness. Despite production limitations, the                                               sustainability of Tethys Oil’s asset base.

    Net daily production from Oman, Blocks 3&4                                  Revenue and other income
              before government take
    bbl                                                            MUSD
15,000                                                               200
                    12,832
                                             11,336
12,000                                                                                 150.8
                                                                     150

 9,000
                                                                                                                  101.1
                                                                     100
 6,000

                                                                      50
 3,000

      0                                                                 0
                     2019                    2020                                      2019                       2020

                             EBITDA                                                   2P Reserves in Oman
                                                                                       (million barrels of oil)
 MUSD                                                                mbo
   100                                                                30
                     92.9
                                                                                                                  26.9
                                                                                       26.1
                                                                      25
     80

                                                                      20
     60
                                              50.4
                                                                      15
     40
                                                                      10

     20
                                                                        5

      0                                                                 0
                     2019                    2020                                      2019                       2020

                                                              7
Tethys Oil Sustainability Report
An Evolving
Sustainability
Strategy

       8
Tethys Oil Sustainability Report
As global awareness of the environmen-          that demand in an economically, socially,        tial efforts are therefore not only focused
tal impact of modern society increases,         and environmentally responsible and sus-         on understanding external stakeholders’
companies across a variety of industries        tainable way, being both a respected cor-        demands and expectations on the Group
face increasing demands to adapt their          porate citizen and an attractive investment.     but also on mapping and understanding
business models to become more sustain-                                                          the Group’s unique circumstances in rela-
able. The oil and gas industry is one of the    Tethys Oil is committed to continue devel-       tion to those expectations.
focal points of the ongoing energy transi-      oping its sustainability strategy to keep up
tion that aims to meet the challenge of the     with the rapidly evolving demands of soci-       The development of an effective sustain-
world’s increasing energy needs in an envi-     ety and its increased responsibilities stem-     ability strategy is a long-term effort. For it
ronmentally and socially sustainable way.       ming from the Group’s expanding opera-           to be relevant and applicable solid founda-
                                                tions and license portfolio.                     tions are critical. Nonetheless, as of 2021,
Tethys Oil has the stated objective of creat-                                                    ESG (Environment, Social and Govern-
ing shareholder value by operating across       For the strategy to be effective it has to       ance) is key performance indicator (KPI)
the entire oil and gas upstream lifecycle. As   stem from the Group’s unique circum-             included in the objectives for executive
long as there is demand for oil, Tethys Oil     stances – there is no universal solution for     management forming the basis for variable
intends to contribute to the satisfaction of    upstream oil and gas companies. The ini-         remuneration.

Tethys Oil’s pursuit for strategy
                                                                                          Evaluate the materiality of different
                                                          Materiality                     environmental or social issues and prioritise
                                                                                          them according to their impact on the business

                                                                                               Set certain ESG targets to clearly define what it
                                                             Target and                        strives to achieve within a certain time frame,
                                                            metric setting                     closely monitoring performance, and disclosing
                                                                                               the relevant performance metrics

                                                                                          Adopt commonly used reporting frameworks such as
                                                                                          GRI, TCFD and SASB to enhance the comparability
                                                                                          of the Company’s Sustainability Reports from year to
                                                        Comparability                     year. Creating comparable reports makes it easier for
                                                                                          stakeholders to evaluate the Company and to create a
                                                                                          common framework for the industry over time

Looking ahead – strategic commitments
• Achieve robust ESG baseline assessments   The Tethys Oil sustainability strategy is an
  and data across all (material) ESG issues evolving one that calls on us to be a pro-
• Define metrics that will demonstrate      gressive energy partner working towards a
  ESG performance and progress              sustainable future.
• Provide training and develop the inter-
  nal capacity to effectively implement
  the ESG framework and deliver on our
  commitments

                                                                    9
Tethys Oil Sustainability Report
Establishing the ESG framework

Tethys Oil’s ESG framework is inspired          and reviewing of applicable sustainabil-        Understanding the value of stretch tar-
by the insight and example of several           ity initiatives undertaken by peers will be     gets, Tethys Oil has intentionally created
international and industry best practice        undertaken and where relevant integrated        an ambitious framework that focuses on
codes, principles and frameworks for iden-      into the framework.                             practical milestones including efficient
tifying and managing issues and report-                                                         responses to ESG challenges and being in
ing with the intent of being aligned with       To be able to adapt our reporting with the      keeping with best industry practice in ESG
good international industry practice and        Global Reporting Initiative (GRI), a mate-      governance.
concentrating efforts where the biggest         riality assessment and process of defining
impact can be made. Ongoing scanning            ESG metrics have been initiated.

Setting the baseline

For any meaningful change to take place,           Scoping Report
the fundamental structure must first be in
place. In the past few years Tethys Oil has
managed to establish a reasonable knowl-                                                Consideration of alternatives
edge of the Group baseline with the help
of external advisors and internal measure-
                                                      Project associated activities
ment exercises. This analysis has helped
determine gaps requiring further attention.
                                                                                                           Environmental and social baseline
With each new exploration, seismic or
development project the Company in con-
junction with an environmental services
                                                   Environmental impact and mitigation measures
agency conducts a feasibility scoping report.
If the report’s conclusion is positive and
other parameters are satisfied, a compre-
hensive Environmental Impact Assessment
(EIA) is conducted.

The purpose of an EIA is to ensure the
protection and conservation of the envi-        define existing biodiversity, environmental               Our baseline footprint
ronment and natural resources including         and other conditions near the activity sites,
human health aspects against uncontrolled       using a range of analytical techniques rang-
development and enables the Company to          ing from sampling to photography.

                                                                   10
Materiality assessment

To identify focused issues in sustainability     Material assessment through a four-step process:
efforts, a materiality assessment is con-
ducted. Evaluation of potential ESG issues                                                                      Definition: What is a
                                                                                                                Material Issue?
based on their significant economic, envi-                             1 – Identify
                                                                                                                A material issue is any
ronmental and social impact, in determin-                                 issues
                                                                                                                topic that – in the view of
ing what matters to report upon, Tethys                                                                         management or stakeholders
Oil has conducted an initial assessment                                                                         – affects a company’s
that will in a second step make sure it                                                                         performance significantly and
                                                                                                                informs external opinion. They
reflects changes in our business and the
                                                   4 – Determine                        2 – Prioritise          tend to be issues that most
external environment. The issues identified        report content                          issues               affect value creation and the
will be evaluated and ranked according to                                                                       economic and reputational
importance from the perspective’s external                                                                      resilience of a company in a
stakeholders. This will be done through                                                                         positive or negative way.
correspondence with external stakeholders                                                                       Source: IPIECA/API/IOGP

to further prioritize the topics.                                       3 – Review                              Sustainability reporting guidance
                                                                                                                for the oil and gas industry, 4th
                                                                        and revise                              edition 2020.

Stakeholder engagement

Tethys Oil endeavours to promote a              tion and to effectively disclose information   • a global culture of social responsibil-
framework of stakeholder relations              regarding the activities and businesses of       ity within the Group, which will help
through:                                        the Group, building relationships of trust       improve the well-being of people,
• two-way communication                         on an ongoing basis.                           • the economic and social development
• engagement                                                                                     of the communities in which the Group
• collaboration                                 Principles of Stakeholders Relations             has a presence and to create sustain-
• transparency                                  Among the corporate policies, sustainable        able value for employees, shareholders
• active listening                              development policies, of which the Stake-        and investors, customers, suppliers and
• equal treatment                               holder Relations Policy is one, are intended     other stakeholders, in line with the Sus-
                                                to promote:                                      tainable Development Goals (SDGs)
This approach allows for all parties’ legiti-                                                    approved by the United Nations.
mate interests to be taken into considera-

                                                                  11
Sustainable
Operations
 ESG considerations exist at all stages of the   engaged in, and funded certain CSR activi-      Due to the high aridity of the area water is
 Company’s activities in varying ways. For       ties to endeavour that local communities        considered a valuable resource in the area,
 example, environmental impact during            benefit from the presence of Tethys Oil in      as the ground water resources are highly
 exploration and appraisal activities, such      their region.                                   saline and is the principal water source.
 as on Blocks 49, 56 and 58, is minimal                                                          Biodiversity is typically poor but certain
 as operations are sparse, targeted and spo-     During the exploration phase the main           plant and animal species are regionally
 radic, whereas more detailed and broader-       ESG challenges are mainly related to the        endemic, with few small fishing villages
 spectrum analyses are customarily required      risks and disruptions caused by the seismic     in the southern coastal tip of the Block.
 on areas undergoing production activities,      acquisition and drilling operations. Seismic    The end of 2020 Tethys Oil entered into
 such as on Blocks 3&4.                          is performed using vibrator trucks driving      agreement to acquire a further 45 percent
                                                 offroad – this can cause disruption to the      interest, whereby assumed operatorship of
 Exploration & Appraisal                         surface environment and habitats. Explo-        Block 56 in the Sultanate of Oman.
 Block 49                                        ration drilling presents risks to both sur-
 The Block 49 licence covers an area of          face and subsurface environment with risk       The principal work conducted in 2020 on
 15,439 km2 located in the Dhofar Gover-         of spills, water pollution, noise pollution     the block was a well test programme per-
 norate in the south of Oman. The block          and disruption to the surface environment       formed on three previously drilled wells
 is sparsely populated with a majority of        and natural habitats of animals. From the       during the first quarter 2020.
 the environment covered by gravel desert.       human perspective the increase in traffic
 The north western part of the Block sees        the use of potential grazing and agricul-       Block 58
 the edge of the Rub Al-Khali desert, also       tural land can present to be a threat to the    Tethys Oil was awarded the licence, in July
 known as the Empty Quarter where the            local community’s livelihood. Based on          2020 as operator holding 100 percent.
 desert is largely made up of sand dunes.        EIA recommendations, Tethys Oil strive to       Block 58 is located in the Dhofar Gov-
 Tethys Oil entered into the licence for the     minimize potential impact by identifying        ernorate in the southern part of Oman
 block at the end of 2017 as operator and        and implementing suitable measures at all       adjacent to Tethys Oil’s operated explora-
 100 percent interest holder.                    stages of the Company’s activities.             tion licence Block 49 and covers an area
                                                                                                 of 4,557 km2.
 Since entering into the licence on-block        In November 2020, Tethys Oil reached
 operations have included field studies by       an agreement with EOG Resources Inc.            Block 58 straddles the western flank of the
 Tethys Oil’s G&G team, planning and             (“EOG”) to farm out 50 percent of the           South Oman Salt Basin and the Western
 execution of seismic acquisition and in         working interest in the EPSA. The transac-      Deformation Front, as the area is normally
 2020 preparations ahead of spudding the         tion was finalised and completed in March       characterised by vacant desert. The physi-
 Thameen-1 exploration well. The main            2021.                                           cal environment is typical of south-west
 activities in 2020 involved civil works in                                                      Oman and comprises rocky desert with
 the preparation of the drill site including     The work programme for 2021 includes            varying areas of sandy dunes. These areas
 drilling of water supply wells, construction    completion of drilling and testing opera-       are sparsely vegetated and land use is lim-
 of roads, drill pad, and camp site. Drilling    tions of the Thameen-1 well.                    ited to dispersed agricultural activities and
 operations on the Thameen-1 exploration                                                         livestock farming.
 well commenced on the 31 December               Block 56
 2020.                                           Tethys Oil entered into the licence at the      A review of legacy seismic 3D data was
                                                 end of 2019 as a non-operator with a 20         conducted in the fourth quarter 2020. No
 ESG-related activities on the block have        percent interest. Block 56 covers an area       other on-block operations were conducted
 throughout the years included two sepa-         of 5,808 km2 in the south-eastern part of       during 2020.
 rate EIAs ahead of the seismic acquisi-         Oman some 200 km south of Blocks 3&4.
 tion in 2018 and the exploration well in        The block lies at the intersection of differ-   The 2021 work programme consists mainly
 2020. The Company has also developed            ent geological provinces including the pro-     of reprocessing of legacy 3D seismic data
 community relations on both the local           lific South Oman Salt Basin and is charac-      and conducting a new 3D seismic acquisi-
 and regional level as outlined on page 22,      terised by flat rocky, sandy and salt plains.   tion. In 2021 Tethys Oil plans to expand

                                                                    12
its ESG programme and commitments to            as the consumption of diesel for power         The impact assessment methodology is
include Block 58 including conducting           generation. More of this is outlined in the    determined using five main components:
an EIA ahead of seismic acquisition and         Section Environment and Emissions on
establishing relations with the relevant        page 16.                                       • Size & severity (geographical scale and
regional and local stakeholders.                                                                 pathway of disturbance)
                                                During the year, the rigorous testing and      • Importance & value (ability to disrupt
Production                                      quarantining procedures to mitigate the          environmental and social function);
Blocks 3&4 (non-operated interest)              spread of the coronavirus at operating         • Sensitivity (degree that environmental
Blocks 3&4 in south-eastern part of Oman        facilities have been in place.                   and social functions change);
covers an area of 29,130 km2. The Com-                                                         • Timeframe (period that is directly and/
pany holds a 30 percent non-operated            Focus has primarily been on reducing             or indirectly affected); and
interest. Tethys Oil has held an interest       emission by gas utilization projects, a wide   • Reversibility (ability to be undone so
in the blocks since 2007, and production        range of community engagement activities         that the pre-existing conditions are
operations have been ongoing since 2010.        and implementing measures to ensure staff        restored).
                                                health and safety. The work programme
The oil in Blocks 3&4 is produced from          for 2021 includes continuing development       Block 49 has previously undergone explo-
several fields; Farha South, Saiwan East,       drilling, upgrading infrastructure with        ration drilling; including the first well
Shahd, Ulfa, Samha and Erfan. The major-        focus on asset integrity, continuing the       drilled in Oman (Dauka-1 in 1955).
ity has been developed with water injected      gas utilization project and the drilling of
into the reservoir via injection wells to       exploration wells.                             Potential project emissions could arise
maintain pressure and thereby stimulate                                                        from the following sources:
production. Full production facilities have     Main exploration activity during
been constructed both on Farha South            2020                                           • Diesel fuel consumption by the genera-
field and on Saiwan East field. At these        Insight Case – Thameen Exploratory               tors at the drilling and camp sites for
facilities, reservoir fluids are processed in   Drilling, Block 49                               power generation and by mobile sources
separators and heater treaters to remove        The project area, which is located within        (e.g. construction equipment, trucks
water, gas and impurities in order to make      the northern portion of Block 49, is 6,188       delivering equipment/materials to the
the oil ready for export. The facilities also   km2 and the landscape is typically arid and      site, trucks collecting wastes/sewage
include large storage tanks, pumps and          homogenous with areas of small to rela-          wastewater from the site);
other necessary infrastructure, including       tively large dunes.                            • Down-hole gas from the drilled forma-
field camps for the oil field workers.                                                           tions coming to the surface with return-
                                                The near-term aim of the project is to           ing drilling mud;
In addition, Early Production Facilities        determine hydrocarbon presence, reservoir      • Fugitive emissions from mud materials
(EPF) have been constructed on Shahd            performance and productivity to define           breakdown and evaporation, which may
and on Ulfa fields. An EPF is a smaller         and maximize recovery of the hydrocarbon         lead to odors;
production facility, which, to some extent      resources present within the project area.     • Other fugitive emissions from cooling
relies on the infrastructure at the Saiwan      Anticipated activities include:                  systems, handling and storage of chemi-
East field to process the oil to be ready                                                        cals (e.g. paints, solvents), fuel loading
for export. All production is transported       • Drilling of one (1) exploratory well           and storage systems (tanks, pipes); and
through pipelines to the main exporting         • Well testing                                 • Flaring – (If required)
point at the Saiwan East facility. From Sai-
wan East, the oil is pumped through an 83       The development of a hydrocarbon well          Project controls for avoiding, reducing,
km long 16-inch pipeline to Alam Station        typically follows a logical sequence of        and restoring potential negative impacts
just west of Blocks 3&4, for further trans-     events that starts with the drilling of the    and ensuring that positive impact materials
portation through the national pipeline         exploration well, testing and appraising       are maximized and inherent to the basis of
system to the export port in Muscat, the        the reservoir formation or formations, and     the impact assessment. All mitigation and
Mina Al Fahal Terminal.                         ultimately being “hooked up” and put into      management measures recommended by
                                                production or suspended until a later date.    the EIA have been accepted by Tethys Oil
Blocks 3&4 have an active Health, Safety                                                       and are integrated into the project design.
and Environment (HSE) programme man-            The environmental, social and health
aged by the operator focused on health and      baseline condition of the Project Area was     The preparation work for the exploratory
safety issues as well as emission reduction     determined through field investigations as     drill was conducted during 2020. The Tha-
and spill prevention plans. One of the pri-     well as through the review of available lit-   meen-1 well was spudded on 31 December
mary environmental challenges for Blocks        erature and past data collection from previ-   and on 1 March 2021 it was announced
3&4 is the reduction of emissions resulting     ous assessments conducted for the seismic      that the well had reached its final depth.
from the flaring of associated gas as well      acquisition in 2018.

                                                                  13
Performance
Metrics

     14
Climate-related performance metrics have                       continues to improve both the reduction                        Metrics Overview
been included in the Company’s reporting                       of emissions intensity and the transpar-                       This framework centers around five key
since it began reporting on sustainability                     ency of reporting. The data is recorded                        metrics groupings in promoting more
matters. Measuring the emissions profile                       by third party Environmental Monitoring                        consistent reporting – Greenhouse Gas
provides visibility into which cost-efficient                  & Auditing Agency for Environmental                            (GHG), Flaring, Spills, Water Use, and
measures are most effective in reducing                        Performance.                                                   Safety.
the Company footprint. The Company

The following provides a high-level overview of each of these metrics' groupings.

Tethys Oil's net share of Blocks 3&4 in Oman
Metric 1: Greenhouse Gas Emissions (Scope 1)*                                                                                                             2020                   2019

GHG Emissions (metrics tons CO2e)                                                                                                                     154,987                177,188

GHG Intensity – (GHG Emissions / Gross Annual Production (boe)) Kg per bbl produce                                                                        37.5                    37.8

Methane Emissions (Metric tons CH4)                                                                                                                      149.9                     4.3

Methane Intensity – (Methane Emissions (Metric tons CH4)/Gross Annual Production (Mboe)) Kg per bbl produced                                              0.04                    0.00

Nitrous Oxide (Metric Tons N2O)                                                                                                                           0.48                    0.40

Metric 2: Flaring

Gross Annual Volume of Flared or Vented Gas (Mcf)                                                                                                  2,260,944               2,721,274

Volume of gas flared per barrel of oil equivalent produced
(Gross Annual Volume of Flared Gas (Mcf)/Gross Annual Production (boe))                                                                                   0.50                    0.53

Metric 3: Liquid Hydrocarbon Spills

Number of Spills > 1 Barrel                                                                                                                                   8                       4

Spill Intensity (Produced Liquids Spilled (bbl)/Total Produced Liquids (Mbbl))                                                                            0.02                    0.06

Metric 4: Water Use

Utility Water Use (m³)                                                                                                                                   2,156                  1,152

Non-Fresh Water consumption intensity bbl/boe                                                                                                             0.93                    0.99

Fresh Water Intensity (bbl/boe)                                                                                                                           0.3%                   0.3%

Total Produced Water (m³)                                                                                                                             665,784                807,264

Water Recycle Rate (Recycled Water (bbl)/Total Produced Water (bbl))                                                                                       84%                    86%

Metric 5: Safety

Fatalities                                                                                                                                                     –                      –

Lost Time Incidents                                                                                                                                           3                       2

Traffic Accidents                                                                                                                                             1                       3

Total Recordable Cases                                                                                                                                        4                       4

Total Recordable Cases Frequency (#/mm Hrs)                                                                                                               0.63                    0.49

Lost Time Incident Frequency (#/mm Hrs)                                                                                                                   0.47                    0.24

Road Traffic Accident Frequency (#/mm km)                                                                                                                 0.07                    0.15

* Scope 1 – Greenhouse Gas (GHG) Protocol refers to emissions that are directly emitted by or controlled by the company at the non-operated producing fields in Oman. Emissions related
  to purchased electricity are Scope 2 emissions and are not included. Emissions from company owned or leased fleet vehicles are not included.

                                                                                       15
Environment
and
Emissions

     16
Tethys Oil has a stated ambition to explore for and produce oil and gas with minimal
environmental impact. This ambition is intermeshed with the Company’s operations on
exploration licenses Blocks 49, 56 and 58. With respect to its non-operated licence for
Blocks 3&4, Tethys Oil has supported the operator’s efforts in improving its environ-
mental focus in operations and proactive work to minimise environmental impact, not
least the risks for spills and damage.

Air emissions

In 2020 all of the Group’s material atmospheric emissions were generated by its inter-
est in the production operations on Blocks 3&4 where the main sources of emissions
arise from the flaring of associated gas produced in conjunction with the recovery of
oil and the use of diesel-run power generators used to power production facilities,
camps, downhole pumps and drilling rigs. In addition to flaring the produced gas, gas
has been, on a smaller scale, been used for power generation within the facility camps
replacing some diesel generated power.

Tethys Oil’s share of atmospheric emissions from its 30 percent interest in Blocks 3&4:

Total Emission (tonnes)                         2020      2019           2018          2017

Carbon Dioxide CO2                         151,096      176,959        93,302       101,700

Methane CH4                                     149.9       4.3          892.0         982.0

Nitrous Oxide N2O                                 0.5       0.4               2.0        2.0

Total GHG Emission CO2e                    154,987      177,186       116,198       126,846

GHG Intensity (kg per bbl produced)              37.5      37.8           27.1          28.6

Carbon Intensity (kg per bbl produced)           37.5      37.8           21.7          22.9

Methane Intensity (kg per bbl produced)         0.036     0.001          0.207         0.221

                                2%

                                          18%

                                                                  GHG Emission
                                                                  by source

                        80%                                       ■ Diesel fuel stationary
                                                                    and mobile sources
                                                                  ■ Flaring
                                                                  ■ Cold venting

Total atmospheric emissions decreased in 2020 as a result of reduced production fol-
lowing OPEC+ mandated production limitation guidelines. Total carbon intensity
(37.5kg per bbl produced) remained at the same level year over year due to continued
significant production from fields with high gas to oil ratio (GOR).

               17
CO2 Emissions declined with
14.6% in 2020 compared with the                                                          1 x – carbon dioxide (CO2)
previous year
The main GHGs included in the GHG
inventory calculations are carbon dioxide
(CO2), methane (CH4) and nitrous oxide
(N2O). Each of the GHG components
has a global warming potential (GWP)
assigned to it by the United Nations Frame-                                     25 x                                        298 x
work Convention on Climate Change                                       – methane (CH4) –                         – nitrous oxide (N2O) –
(UNFCCC) for use in its GHG reporting                                  Releasing 1 kg of CH4                        Releasing 1 kg of N2O
                                                                      into the atmosphere is                       into the atmosphere is
programs. The volume of each component
                                                                      equivalent to releasing                      equivalent to releasing
gas — multiplied by its GWP — results in                                about 25 kg of CO2                           about 298 kg of CO2
a calculated value of carbon dioxide equiva-
lents (CO2e) for that component.

Gas Flaring Mitigation Technology
and Solutions                                                              0.48 tonnes N2O x 298 GWP = 143 Tonnes CO2e
Flaring and venting are a substantial source                               149.9 tonnes CH4 x 25 GWP = 3,748 tonnes CO2e
                                                                           151,096 tonnes CO2 x 1 GWP = 151,096 tonnes CO2e
of GHG emissions from oil fields. Flaring
                                                                           Total GHG Emissions = 154,987 Tonnes CO2e
refers to disposal of associated gas produced
during extraction through burning. Venting
refers to intentional releases of gas, includ-    operators coordinate their efforts in find-              gas by exporting it to the Omani gas net-
ing the amount of gas unburned in flaring.        ing solutions to reduce flaring. Tethys Oil              work for commercial use. However, in
                                                  has been a participant in the task force                 light of the volumes available, current mar-
The Sultanate of Oman is committed to             since its inception in 2018.                             ket prices, and the significant investments
the World Bank initiative Global Gas Flar-                                                                 involved this is not viewed as a viable
ing Reduction Partnership (GGFR) and its          In the past few years, the Blocks 3&4 part-              option. A more cost-efficient option would
goal of “Zero routine flaring by 2030”. As        nership has been studying several alterna-               be to utilize the gas for local power gen-
part of this effort the Ministry of Energy        tives for reducing the routine flaring and               eration with permanent facilities and thus
and Minerals (MEM) hosts the Oman Gas             related emissions. One of the alternatives               reducing the dependence on diesel genera-
Flaring Reduction Task Force in which             considered has included monetising the                   tors and decreasing the related emissions.

Flare to power

  The challenge
                                                 The Solution
The biggest technical challenge would be
the treatment of the gas. The flare held    Diesel decentralised power that was
                                                                                                  The Impact
condensates and was too hot to be fed       replaced with centralised power with
directly into a gas engine, so a bespoke    bespoke gas treatment and custom                    Reduced environmental impact,
engineered solution was required.           designed central control system                     significant cost savings

Instead of flaring gas, a small-scale gas-        owing to the reduction in diesel consump-                sions, reduced related noise and reduce the
to-power project was set up in one of the         tion for power generation.                               operational footprint by replacing diesel-
fields to generate electricity for the camps,                                                              only engines with dual fuel motors that
the electric submersible pumps of some of         Another project has been to reduce the                   run on diesel or gas. By assessing each oil
the wells, and other facilities. This initia-     use of diesel-powered generators to drive                field’s asset integrity, the Company is striv-
tive is making a significant environmental        drilling rigs, which can be a significant                ing to find solutions which aim to reduce
contribution, as well as a financial impact       source of emissions. Actions have been                   its environ­mental footprint.
                                                  taken in a pilot project to cut those emis-

                                                                        18
Water use

Water is both a key aspect of the business                    salinity water, making it not even suitable                       • Discharged to lined evaporation ponds
and critical to the communities where                         for agricultural purposes. All water used in                        permitted by EA, to evaporate; or
the Company operates. Groundwater                             the operations are non-fresh water. How-                          • Treated and reinject into the ground res-
resources are scarce in Oman and in par-                      ever, the produced water is handled under                           ervoir to enhance the oil field production.
ticular in the concession area. The ground-                   environmental authority (EA) permits
water resources are primarily high-level                      through:

Total water usage on Blocks 3&4:
(cubic meters)                                                                               2020                           2019                         2018                      2017

Total Produced Water                                                                   2,219,280                     2,690,881                    2,182,474                  1,465,208

Produced Water – reinjected                                                            1,864,280                     2,304,675                    1,900,904                  1,313,289

Produced Water – evaporated                                                              346,219                       343,451                        303,008                  154,088

Regular lab sample analysis is conducted
on the produced water from the discharge
end of disposal pumps. The produced
water contains in average within the
concession area roughly 250 times more                                                                              84%
Total Dissolved Solids than what is con-
sidered by the U.S. Geological Survey or                                                                                                          Water Recycle Rate
IPIECA defines as “Fresh Water”. Due to                                                                                                           ■ Produced water – reinjected
the extreme high salinity levels of the brine                                                                                                     ■ Produced water – evaporated
water, the treatment for other application
areas is limited, therefore the main volume
of the produced water is re-injected into                                         16%
the reservoir via injection wells to maintain
reservoir pressure and thereby stimulate
oil well production. However, the Group
is further exploring if there are advance-
ments in water treatment and desalination
technology to find other applicable usages.                   Note: Recycled Water includes water that was produced in the oil field and reused in the oil field

Fresh Water                                    Non-fresh Water                               Produced Water                                   Recycled Water

Water sources with a total dissolved           Water sources not meeting the                 Non-fresh water found in                         Produced water that has been treated
solids concentration of up to 2,000            definition of fresh water. These              hydrocarbon formations that is                   for reuse in subsequent operations,
milligrams per litre.* These sources           sources could include produced                brought to the surface during the                including well completions or
can include drinking water, potable            water and saline groundwater.                 oil and gas production process                   secondary recovery
water and water used in agriculture.

* Based on IPIECA’s Oil and Gas Industry Guidance on Voluntary Sustainability Reporting (2015).

Spill prevention

While most of recorded incidents of                           of leaks. All oil spills are recorded, and                        * Calculation: Produced Liquid Spills (bbls) /
                                                                                                                                               Total Produced Liquid (1,000 bbls)
unplanned hydrocarbon releases in 2020                        regular site surveys are conducted by third
                                                                                                                                  Produced Liquid Spilled (bbls): crude oil, condensate
are considered minor, the number of Tier                      party environmental service agency, that                              and/or produced water spills ≥ 1 bbl which are not
                                                                                                                                    confined to impermeable secondary containment
1 hydrocarbon releases (more than 1 bar-                      provides recommendations on how these
                                                                                                                                  Total Produced Liquid (1,000 bbls): crude oil,
rel of oil spilled) was 8 recorded incidents.                 issues might be mitigated.                                            condensate and produced water generated from
                                                                                                                                    exploration and production activities (does not
The minor releases have been identified
                                                                                                                                      include gas).
in relations to the facility plants in terms                  The spill ratio* is less than 0.2 per mille (‰)

                                                                                        19
People
and Society

     20
Our people

Tethys Oil recognises that its performance     Tethys Oil’s Position on Diversity               Tethys Oil’s employees shall always act
as a company is dependent upon the per-        and Discrimination                               with the utmost integrity and respect
formance of its employees as individuals.      • Tethys Oil seeks to recruit and retain the     when dealing with colleagues, partners and
The Group’s employees are its principle           best possible candidates for all positions    society.
asset and therefore aims to achieve high          on the basis of merit regardless of gen-
employee satisfaction and high standards          der, sexual orientation, age, disability,     During 2020, Tethys Oil had an average
of performance. Tethys Oil shall respect          nationality, race or religion.                of 23 full-time employees of seven nation-
and promote its employee’s rights, includ-     • The cultural diversity of the Group’s          alities, in a broad age range, of which 36
ing freedom of association and the right          employees is an asset and shall be            percent were female and 64 percent male.
to collective bargaining. Tethys Oil shall        respected. Furthermore, Tethys Oil will       A majority of the staff have graduated
offer rewarding working conditions and            not accept any form of harassment or          from universities and colleges, primarily
realise each employee’s individual potential      discrimination of its employees for any       with geosciences, engineering or business
through training and job promotion. The           reason.                                       administration.
use of underaged bonded or forced labour,      • Tethys Oil’s staff shall always act with the
direct or indirect should never occur.            utmost integrity and respect when deal-
                                                  ing with colleagues, partners and society.
Tethys Oil has implemented a diversity         • Tethys Oil’s employees, partners and
and non-discrimination policy to ensure           contractors should feel free to voice
that the diversity of its staff is respected      concern or report instances of discrimi-
and that all forms of discrimination are          nation without fear of recrimination or
prevented.                                        harassment.

Human rights

Tethys Oil has committed firmly to the         The Group recognises the importance of           labour or bonded and forced labour is lim-
United Nations Global Compact (stated          respecting the rights of local communi-          ited. There are potential risks in the use of
further in the Code of Conduct), and           ties, and thus prior to any new investment       subcontractors in some cases but Tethys
adheres to the United Nations Guiding          or operational activity, it analyses poten-      Oil’s stringent policies and the transparent
Principles on Business and Human Rights.       tial impacts on human rights. While the          process for procurement minimises any
                                               Group respects all human rights, it focuses      such risks.
The Group has made a commitment to             primarily on those human rights that
support internationally recognised human       potentially may be most impacted by its          From a wider perspective, Tethys Oil seeks
rights wherever it operates. Human Rights      operations. Typically, those most impacted       to minimise the risk of Human Rights vio-
are to be understood as those referred to      are the populations and communities in           lations as a result of its business by strictly
in the Universal Declaration of Human          the countries where Tethys Oil is active or      implementing its code of conduct in all
Rights (UDHR), the International Cov-          within its license areas where it operates.      aspects of its dealings.
enant on Civil and Political Rights and
the International Covenant on Eco-             The Group furthermore expects all its            No human rights-related grievances were
nomic, Social and Cultural Rights and in       affiliated partners to respect human rights      filed against the Company in 2020. There
the International Labour Organisation’s        and to observe highest standards of profes-      were no recorded incidents of discrimina-
(ILO) Conventions, and in relations to         sional integrity.                                tion at Tethys Oil’s operations during the
business activities, in the Global Com-                                                         reporting period.
pact, the OECD Guidelines for Multina-         The nature of Tethys Oil’s operations as a
tional Enterprises, and the UN Guiding         highly skilled upstream oil and gas opera-
Principles.                                    tor in Oman means that the risk for child

                                                                  21
Community engagement

Tethys Oil’s activities shall strive to create   that the Group’s operations disrupt the          Corporate Social Responsibility
shared prosperity between stakeholders.          livelihood of the local population and has       process
It seeks to respect and gain the respect of      a detrimental effect on their quality of life.   To meet the need for Tethys Oil to main-
the people and governments of countries                                                           tain and further build on its reputation as
in which it operates. Good relations with        Local people and their traditions are            a responsible corporate citizen in Oman
host countries are prerequisites to Tethys       respected. Tethys Oil strives to encourage       among stakeholders at national and local
Oil’s business. Wherever operations are          local employment and, where appropriate,         community levels, the Company adheres
conducted, the sovereignty of the state          work with local communities to improve           to the following:
is respected and the rule of law is to be        their health, skills and welfare. Tethys Oil
observed and promoted.                           endeavours, where appropriate, to engage         • Seek to avoid or minimise the negative
                                                 in capacity building, through the transfer         impacts of our activities
The Group aims to optimise local content         of skills and technologies. Tethys Oil shall     • Endeavour to ensure neighbouring com-
in all aspects of its business and to promote    refrain from any implications in tribal,           munities benefit from our presence
the creation of in-country value.                internal, or other armed conflicts or acts       • Strive to create and deliver opportunities
                                                 of violence.                                       that maximise benefits to society
The Group is committed to achieving a                                                             • Listen to and engage with communi-
beneficial impact on its host communities        Tethys Oil’s Corporate Social Respon-              ties in the area of operation through the
by engaging in a dialogue with the Group’s       sibility (CSR) activities are focused and          Government representatives in area in
stakeholders, whether these are local com-       conducted in-country. In Oman they                 order to comply with rules and regula-
munities or relevant interest groups, such as    are headed by the Director of Corporate            tions adopted in the tribal system
local governments and civil society. Tethys      Affairs.
Oil engages in an active relationship with
stakeholders in order to understand the          In addition to non-profit partnerships,
concerns surrounding the Group’s opera-          Tethys Oil has dedicated local team mem-
tions and to set mutually beneficial goals.      bers focused on listening and responding
This is to ensure local stakeholders needs       to community concerns in the operating
and priorities are considered and avoid          areas.

CSR activities

Tethys Oil’s CSR activities in 2020 were         Going forward CSR activities will be             Academic scholarships
principally focused on Oman, as it is the        organised from a national, regional and          During 2020 Tethys Oil sponsored MSc
core area of operations and with the addi-       local perspectives in order to work effi-        thesis in Geoscience for three students at
tion of license interests in Blocks 56 and       ciently across the whole portfolio of blocks     the Sultan Qaboos University. Two stu-
58 the need for systematic community             and leverage on recent years’ experience.        dents successfully graduated during the
engagement has only grown.                                                                        year. The third student will continue her
                                                 The main activities in 2020 were:                MSc thesis in Geoscience throughout
In 2020 Tethys Oil’s CSR activities were         • Continued Block 49 stakeholder                 2021.
organized around executing CSR initia-             engagement
tives on Block 49, as well as its participa-     • The execution of a comprehensive CSR           Additionally, a two-year scholarship pro-
tion in the CSR program for Blocks 3&4.            program for Block 49                           gram was created for two students from
Due to the Covid 19 pandemic and its             • Continued engagement in the govern-            the Wilayets of Maqshin and Thumraite in
resulting restrictions on meetings and             ance of Block 3&4 CSR activities               the Governorate of Dhofar who belong to
movement, community engagement was               • Selective CSR Projects                         families on Social Security or Low-income
more limited than planned and unfortu-           • Master in Geoscience Scholarships              schemes to obtain diploma in Business
nately some of the scheduled activities had                                                       from University of Dhofar.
to be postponed.

                                                                    22
Block 49                                                                                         Blocks 3&4
The Company has been included in a con-              students, teachers and staff during the     The Blocks 3&4 joint venture partnership
tinuous dialogue with all key stakeholders           academic year of 2020 in line with the      has an active Corporate Social Responsi-
relating to Block 49 on a national, regional         measures adopted to limit and con-          bility (CSR) programme. Its CSR expendi-
and local level. This includes several minis-        trol the impact of Covid-19. Students       ture in 2020 was just over MUSD 1.
tries, the Royal Omani Police, the military,         from grades 5 to 12 in the Wilayat of
the Governorate of Dhofar and the Wilay-             Maqshin were provided with 97 Tablets       The following details some of the com-
ats of Maqshin and Thumrait.                         to facilitate distance learning             munity engagement projects collectively
                                                 •   Sponsored several competitions at Dho-      undertaken with or by the partners in
The Block 49 CSR program was developed               far University under the themes: Vol-       Blocks 3&4:
and established with focus areas on provid-          unteerism During Covid-19 Pandemic,
ing education and training opportunities             Arabic Language and Computer Coding         Community Development projects
for the local population through scholar-        •   Sponsored several civil works at the        contributions
ships, contributing to sustainable develop-          village of Marsudad related to safety       • Fruits and Vegetable Market in Adam
ment of the local economy and minimis-               at RO-tank supplying the village with       • Livestock market in Adam
ing any potential negative effects of Tethys         water                                       • Job Security Fund
Oil’s operations. It is of vital importance to   •   Sponsored a follow-up on an archaeo-        • Fish Market in Mahout
maintain support from the local commu-               logical assessment in Block 49 to explore
nity in order for Tethys Oil and its subcon-         the lithic typological and technological    Other national HSE related contribu-
tractors to operate efficiently and safely. If       characteristics of the surface assem-       tions was undertaken in collaboration
Tethys Oil is to operate with the support of         blages, as well as to assess the archaeo-   with:
the local community, the community must              logical sensitivity of the landscape        • Muscat University – Social Impact cam-
also perceive to benefit from Tethys Oil’s       •   Honoured 240 students from four                paign “Building Awareness of Digital
investments. Below outlines a selection of           Wilayats in Dhofar region for their            Benefits”
the CSR activities Tethys Oil was engaged            outstanding academic achievements           • Ministry of Health – Covid-19 Fund
in during 2020:                                      and performance in school competition       • Ministry of Health – Oman Cancer
                                                     events                                         Association
• Assisted the village of Marsudadin the         •   Sponsored a multimedia design com-          • Ministry of Higher Education – Study
  Wilayat of Maqshin to build a play-                petition for students during Arab and          on “Convalescent plasma in the treat-
  ground for children with appropriate               International Water Days which was             ment of Coronavirus Disease
  HSE requirements                                   planned to be held in Salalah in March
• Supported the Ministry of Education                2020 but postponed until 2021 due to
  in their efforts to ensure the safety of           Covid-19 situation

                                                                     23
Health
and
Safety

     24
Tethys Oil’s activities are subject to the                     to people, no accidents, no spills and to                       Blocks 3&4 Health and Safety
health, safety and environmental (HSE)                         strive for minimum impact on the envi-                          2020 saw the same number of Total
risks inherent in the oil industry. The                        ronment, thereby contributing to sustain-                       Recordable Cases (TRC) as in 2019, how-
Group recognises that the prevention of                        able development.                                               ever the frequency in relation to worked
accidents and ill health is critical to the                                                                                    hours increased which requires further
efficient operation of its business and                        Tethys Oil is committed to ensuring that                        investigation and action. On a positive
therefore has established an HSE policy                        all operations that the Group conducts                          note there was a substantial decrease in
with accompanying corporate procedures.                        are done in a safe manner with genuine                          Road Traffic Accidents(RTA), both in
The ultimate responsibility for HSE lies                       regard for the wellbeing of the staff, con-                     absolute terms and in frequency, which is
with the Managing Director. It is, however,                    tractors and third parties. Through foster-                     very positive.
the responsibility of all Tethys Oil staff to                  ing a culture of transparent decision mak-
ensure compliance with the Group’s stand-                      ing, responsibility and thorough planning,                      The Company works with concepts such
ards for safe operations.                                      Tethys Oil strives to create a safe, accident-                  as Behavioural Based Safety to improve
                                                               free work environment. This applies not                         attitudes and encourage hazard recogni-
Tethys Oil has a responsibility for all                        only to Tethys Oil’s operations, but Group                      tion and incident reporting. This has been
activities that are a consequence of its                       representatives should work to ensure that                      done by increased training, monitoring,
operations.                                                    the same standards are applied in all pro-                      and review as well as improved incentives.
                                                               jects and joint ventures where the Group                        This form of training development is a top
At a minimum, it is Tethys Oil’s duty to                       has an interest.                                                priority to further improve the health and
ensure compliance with all relevant laws                                                                                       safety culture and awareness beyond its
and governmental regulations and direc-                        In 2020, Tethys Oil continued to                                operations.
tions concerning HSE.                                          strengthen its HSE capabilities and pre-
                                                               paredness by executing risk assessments                         Regarding Lost Time Incidents (LTI) the
The genuine care for HSE is a core value                       and risk mitigation plans for the ongoing                       joint venture had 3 minor incidents of
for the Group and shall be transparent                         activities in Block 49. In preparation for                      which one of them required medical treat-
through all Tethys Oil’s plans and actions.                    the exploration drilling, an emergency                          ment during the last months of the year.
It is the Group’s objective to provide a                       response plan was prepared in case of acci-                     Due to the Covid-19 social restriction and
healthy and safe working environment for                       dents. One Tethys Oil HSE staff member                          physical interaction recommendations,
employees, contract personnel and mem-                         has been seconded to CCED during the                            there were limited safety training courses
bers of the general public who might be                        year to both learn from and follow the                          this year. As the pandemic situation
affected by its activities. The Group is                       operator’s HSE work, both in the office                         improves, Tethys Oil will seek to maintain
implementing a systematic approach to                          and the field. General HSE training and                         an overriding focus on occupational health
HSE-management to achieve continuous                           awareness sessions have been conducted                          and safety.
improvement toward the goal of no harm                         during the year for all staff in Oman.

Blocks 3&4
Unit of measure                                                                               2020                         2019                        2018                        2017

Fatalities                                                 (Number)                                0                            0                           0                            1

Lost Time Incidents                                        (Number)                                3                            2                           2                            5

Lost Time Incident Frequency                            (#/mm Hrs)                             0.47                         0.24                        0.28                           0.94

Total Recordable Cases                                     (Number)                                4                            4                         10                             8

Total Recordable Cases Frequency                        (#/mm Hrs)                             0.63                         0.49                        1.42                           1.51

Total Traffic Accidents                                    (Number)                                1                            3                           4                            4

Total Traffic Accidents Frequency                        (#/mm km)                             0.07                         0.15                        0.25                           0.34

#/mm Hrs – number of cases/incidents per million worked hours
#/mm Km – number of accidents per million kilometres driven
Lost time incidents – The sum of fatalities and injuries where the impacted person is unable to return to work the day (or days) after the injury.
Total Recordable Cases – The Total number of incidents reported including Lost Time Incidents and more minor incidents which include restricted work capacity and medical treatment.

                                                                                        25
Governance
and
Ethics

     26
Anti-corruption

Tethys Oil has zero tolerance for corrup-         power in relation to business, Tethys Oil        local business practice in the region that it
tion. It is strictly prohibited for Tethys Oil    has adopted an anti-corruption policy and        operates. As a result of this, Tethys Oil has
staff or contractors to give, authorise, offer,   clear procedures for employees to report         implemented a policy requiring all staff, or
promise, request, agree or receive gifts,         suspected cases of corruption. The policy        contractors who receive or offer gifts on
hospitality and entertainment to improp-          and procedures have been drawn up in             behalf of Tethys Oil should seek approval
erly influence or reward acts or decisions,       accordance with Transparency Interna-            from their supervising manager and that a
or as an actual or intended compensation          tional’s Business Principles for Countering      record is kept of donor, recipient as well
for any improper benefit.                         Bribery.                                         as value.

In order to prevent the misuse of pub-            Tethys Oil recognises that accepting or          To date, Tethys Oil has not had any reports
lic office or company position or power           offering gifts or hospitality of moderate        of involvement in corruption or suspected
for private gain, or the misuse of private        value is customary and in accordance with        corrupt activity.

Anti-fraud and protection of Group assets

Tethys Oil has strict anti-fraud policies,        the misstatement of financial records to         ing an atmosphere of openness and trust
aimed at safeguarding the Group and its           conceal theft or misuse.”                        where staff feel comfortable and able to
staff from fraud and dishonest behaviour.                                                          raise concerns openly and without the risk
For the purposes of the policy Tethys Oil         The policy is aimed at improving all Tethys      of repercussions.
has defined fraud as:                             Oil staff’s knowledge and understanding
                                                  of what constitutes fraud, how to prevent,       No suspected cases of fraud have been
“The theft or misuse of Tethys Oil’s funds        detect and report suspected fraud and            reported in 2020.
or other resources, by an employee or a           where the responsibilities for investigation
third party which may or may not involve          lies. The policy also aims to assist in creat-

Whistle blower

Employees are encouraged to report sus-           function is to provide an avenue for staff       There have been no incidents or activities
pected or known cases, which they believe         to raise concerns about improper, unethi-        reported through the whistle blower func-
may be illegal or a violation of the Group’s      cal or illegal conduct and to obtain reas-       tion during 2020.
Code of Conduct or any Group policies             surance that they will be protected from
and as a result Tethys Oil has implemented        reprisals or victimisation for whistleblow-
a Whistle blower Policy. The aim of the           ing in good faith.

                                                                     27
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