VANCOUVER, Nov. 4, 2013 /CNW/ - TAG Oil Ltd. (the "Company") (TSX: TAO)
and (OTCQX: TAOIF), reports that new wells in the Company's drilling
program underway in the Taranaki Basin of New Zealand are showing
encouraging results. These wells are part of an extensive New Zealand
drilling campaign targeting significant hydrocarbon potential in lower
risk shallow oil prospects and deeper high-impact gas-condensate
prospects in the Taranaki Basin, and unconventional prospects in the
East Coast Basin targeting naturally fractured source rocks.
Petroleum Mining Permit 38156 - Cardiff-3 (TAG 100%)
The deep Cardiff-3 well targeting the Eocene-aged Kapuni Formation is
drilling ahead at approximately 4,113 meters after some delays due to
the well encountering a high-permeability, hydrocarbon-bearing zone in
the McKee Sands, at approximately 4,100 meters depth.
After drilling through the McKee Sands and into the second target zone,
the K1A zone, TAG has encountered additional encouraging gas kicks of
up to 20 times background levels. The Company expects to drill through
the remainder of the main Kapuni Formation target zones in November
and, at that time, will make a decision whether to complete and
production test the well, if supported by data acquired as expected.
For further information regarding TAG Oil's deep drilling program please
Petroleum Exploration Permit 54877 - Cheal-E Site (TAG 70%)
TAG continues to drill step out locations in the Cheal area. Wells
recently drilled from the Cheal North East site have now significantly
extended the known oil and gas saturated area from the initial Cheal
TAG recently completed the third of five consecutive wells to be drilled
within Petroleum Exploration Permit 54877: Cheal-E1, E2 and E3 wells
have all encountered oil-and-gas bearing sands in the Urenui and/or Mt.
Messenger Formations. These wells have now been completed in
preparation for production testing, which we anticipate will commence
in a few days' time.
To ensure more reliable long-term production forecasting on future wells
in this emerging play, the Cheal-E1, E2 and E3 wells will be initially
rotated, so that each well will be individually tested for
approximately 15 days, and then shut-in temporarily to conduct pressure
and temperature analysis. Following this initial test period, all wells
will then be placed into permanent production.
Based on these encouraging results in the Cheal-E site, TAG will now
drill the Cheal-E4 and E5 wells, followed shortly by three new step out
wells in Petroleum Exploration Permit 54879 (Cheal South, TAG 50%) with
joint venture partner East West Petroleum Corp.
TAG Oil CEO, Garth Johnson commented, "I would like to thank our team
for their continuing hard work and dedication to a very busy
operational program that has been conducted to date without
compromising safety. Not only are we seeing some very encouraging
results via the drill bit at Cardiff and at our Cheal-E site, our team
has managed to simultaneously build a cost-effective permanent
production facility at the Cheal-E site that has the capability to test
and place successful wells into permanent production, at a fraction of
the time normally experienced. We're excited with the program we have
underway, TAG's most active ever, and results to date have us looking
forward to establishing new production and reserves in New Zealand for
many years to come."
For further information regarding TAG Oil's production and drilling
program please visit: http://www.tagoil.com/20130814-TAG-Oil-Reports-Strong-Q12014-Financials.asp
TAG Oil Ltd.
TAG Oil Ltd. (http://www.tagoil.com/) is a Canadian-based production and exploration company with operations
focused exclusively in New Zealand. With 100% ownership over all its
core assets, including extensive oil and gas production infrastructure,
TAG is enjoying significant organic value creation through development
and appraisal drilling of several light oil and gas discoveries and
through prospect generation across an extensive acreage position. As
New Zealand's leading explorer, TAG actively drills high-impact
conventional and unconventional exploration prospects identified in the
Taranaki Basin, East Coast Basin and Canterbury Basin that covers more
than 2,669,780 net acres of land, prospective for major discovery in
The resource estimates in this news release were prepared with an
effective date of July 31, 2013. The estimates for Cardiff have been
externally prepared by Sproule International Limited and the remaining
estimates were prepared internally by TAG professionals, both of which
are qualified reserves evaluators in accordance with NI 51-101 and the
Canadian Oil and Gas Evaluations Handbook.
Prospective resources are defined as those quantities of petroleum
estimated, as of a given date, to be potentially recoverable from
undiscovered accumulations by application of future development
projects. Prospective resources have both an associated chance of
discovery and a chance of development.
Exploration for hydrocarbons is a speculative venture necessarily
involving substantial risk. TAG's future success in exploiting and
increasing its current reserve base will depend on its ability to
develop its current properties and on its ability to discover and
acquire properties or prospects that are capable of commercial
production. However, there is no assurance that TAG's future
exploration and development efforts will result in the discovery or
development of additional commercial accumulations of oil and natural
gas. In addition, even if further hydrocarbons are discovered, the
costs of extracting and delivering the hydrocarbons to market and
variations in the market price may render uneconomic any discovered
deposit. Geological conditions are variable and unpredictable. Even if
production is commenced from a well, the quantity of hydrocarbons
produced inevitably will decline over time, and production may be
adversely affected or may have to be terminated altogether if TAG
encounters unforeseen geological conditions. TAG is subject to
uncertainties related to the proximity of any reserves that it may
discover to pipelines and processing facilities. It expects that its
operational costs will increase proportionally to the remoteness of,
and any restrictions on access to, the properties on which any such
reserves may be found. Adverse climatic conditions at such properties
may also hinder TAG's ability to carry on exploration or production
activities continuously throughout any given year.
The significant positive factors that are relevant to the resource
Proven production in close proximity;
Proven commercial quality reservoirs in close proximity; and
Oil and gas shows while drilling wells nearby.
The significant negative factors that are relevant to the resource
Tectonically complex geology could compromise seal potential; and
Seismic attribute mapping in the two, deep, liquids'-rich gas plays can
be indicative but not certain in identifying proven resource.
Cautionary Note Regarding Forward-Looking Statements:
Statements contained in this news release that are not historical facts
are forward-looking statements that involve various risks and
uncertainty affecting the business of TAG. Such statements can be
generally, but not always, identified by words such as "expects",
"plans", "anticipates", "intends", "estimates", "forecasts",
"schedules", "prepares", "potential" and similar expressions, or that
events or conditions "will", "would", "may", "could" or "should" occur.
All estimates and statements that describe the Company's objectives,
goals, production rates, optimization, infrastructure capacity and or
future plans with respect to the drilling in the Taranaki Basin are
forward-looking statements under applicable securities laws and
necessarily involve risks and uncertainties including, without
limitation: risks associated with oil and gas exploration, development,
exploitation and production, geological risks, marketing and
transportation, the risk associated with estimating undiscovered
original initially-in-place described above, availability of adequate
funding, volatility of commodity prices, imprecision of reserve
estimates, environmental risks, competition from other producers, and
changes in the regulatory and taxation environment. Actual results may
vary materially from the information provided in this release, and
there is no representation by TAG Oil that the actual results realized
in the future will be the same in whole or in part as those presented
Other factors that could cause actual results to differ from those
contained in the forward-looking statements are also set forth in
filings that TAG and its independent evaluator have made, including
TAG's most recently filed reports in Canada under NI 51-101, which can
be found under TAG's SEDAR profile at www.sedar.com.
TAG undertakes no obligation, except as otherwise required by law, to
update these forward-looking statements in the event that management's
beliefs, estimates or opinions, or other factors change.
SOURCE: TAG Oil Ltd.
For further information:
Dan Brown or Garth Johnson