This facility allows Tethys to initially double production to around 4,000 barrels of oil per day because of the halving of the road trucking distance.

Chief executive and president Dr David Robson told investors the milestone would enable higher production levels and “significantly transform the cash flow of the company”.

The AOT, which is to be constructed in three phases, is a purpose built oil storage and rail loading facility and is owned and operated jointly through a 50:50 joint venture with Tethys and its Kazakh oil trading partner’s company, Olisol Investment Ltd.

It lies around 230 kms from the Doris oil field – significantly reducing the distance oil is currently trucked by road from the field. The increased efficiency and reduction in transport costs will result in a higher realised oil price, Tethys said.

It also highlighted that a long-term contract has been signed with Kazakh railways to allocate up to 13,500 bpd (barrels per day) of railcar capacity to AOT giving significant flexibility in the future.

So far, more than 13,000 bopd have been tested from exploration and appraisal wells in and around the Doris field and it is believed that a sustainable production level of between 5 and 6,000 bopd can realistically be achieved from these wells.

Once the second phase of AOT has been completed, plans will be implemented to increase production up to this level in the second half of 2012, said the firm.

Production from future wells will run through the new terminal, including any production realised from the next AKD07 well, planned to spud this summer, said Tethys.

This well will be drilled to the south-east of the original AKD01 well and target 3P reserves, it added.

The prospective resource for this and other prospects will be released following a new independent resource report for Kazakhstan, expected in the second quarter of this year.

Under the first phase of the AOT, the facility has a loading capacity of 4,200 bopd and a storage capacity of 1,300 barrels.

In the second phase, operations will run 24 hours a day and have a loading capacity of 6,300 bopd and a storage capacity of 12,580 barrels. It will be able to unload 10 road tankers and simultaneously load five rail tankers.

When phase 3 is completed, it will have an estimated loading capacity of 12,000 bopd and a storage capacity of 125,800 barrels of crude. It will be able to unload 10 road tankers and simultaneously load 10 rail tankers.

Tethys is focused on central Asia and has production in Kazakhstan, Tajikistan and Uzbekistan. Earlier this month it revealed that it more than doubled revenues to US $30.3 million in 2011, producing on average 5,730 barrels of oil equivalent per day. In the latter part of the year as production continued to increase it was producing 6,584 barrels a day. Operationally, it said much of the focus had been on exploration and appraisal work in both Kazakhstan and Tajikistan. And it is in the process of acquiring new projects in Uzbekistan. It ended the year with US $11.63 million in cash.