TAG Oil Updates on Taranaki Basin Activities

TAG Oil Ltd. (TSX:TAO,OTCQX:TAOIF) released an update on oil and gas production, operations and upcoming drilling at its Taranaki Basin exploration and development acreage.

In terms of production, the company said:

Average production (primarily from the Cheal oil field) for the first 15 days of April, 2015, was 2,252-BOE/d (gross) or 1,970 BOE/d (net), an increase of 116-BOE/d (gross) and 127 BOE/d (net) over March production. Fiscal year-to-date, up to March 31, 2015 production is estimated to have averaged 2,118 BOE/d (gross) or 1,856 BOE/d (net). TAG’s average per barrel operating cost is approximately US$26 per BOE, and the Company’s oil is sold on the premium Brent oil index.

Looking more closely at the Cheal oil field, TAG noted:

The Cheal oil field continues to provide TAG with a stable, high-netback production base and long-life reserves, with revenue capable of funding drilling costs while building production and reserves.

TAG plans to fully develop the 100%-controlled Cheal oil and gas field, which has been substantially de-risked by the 36 wells drilled to date across the field. Permit-wide 3D seismic coverage indicates the entire Cheal permit area is target rich, with more than 70 development drilling locations that have been identified and high graded. Encouraging results continue to be achieved at Cheal including in the Cheal East area, where the naturally free flowing Cheal-E1 well (TAG: 70%) has been producing gross volumes of 500 to 600 boe/d (82% oil) on choke for 16 months. With drilling and completion costs of under US$3 million per well, it gives an indication of the unrecognized upside and robust economic potential that exists within TAG’s acreage.

Click here to read the full TAG Oil Ltd. (TSX:TAO,OTCQX:TAOIF) press release.