NewswireToday - /newswire/ -
Vancouver, British Columbia, Canada, 2011/04/05 - TAG Oil Ltd. (TSX-V: TAO) and (OTCQX: TAOIF) is pleased to report that the Sidewinder-3 exploration well is confirmed as a light oil and gas discovery. TSE: TAO
TAG Oil Ltd. is pleased to report that the Sidewinder-3 exploration well is confirmed as a light oil and gas discovery, the third discovery made in TAG Oil's 100%-controlled Petroleum Exploration Permit 38748 in the onshore Taranaki Basin, North Island, New Zealand, and the Company's fourth new oil and gas discovery in five months.
The Sidewinder-3 exploration well was drilled to a total depth of 2160 meters (7087 feet), targeting a large anomaly identified on 3-D seismic, approximately 1.1 km to the south of the recent Sidewinder-1 and Sidewinder-2 discoveries. Sidewinder-3 encountered 15.4 meters (50 feet) of net oil-and-gas-bearing sandstones in the primary Sidewinder zone, including "free oil" observed over the shakers during the drilling operation.
"This is our third successful Sidewinder well, with each new well helping us to more accurately calibrate our 3-D data set, and further understand the geology in this lightly-explored acreage," Sidewinder-3 Drew Cadenhead, TAG Oil COO commented. "Of particular interest, the Sidewinder-3 well has shown the Mt. Messenger Formation reservoir sands extend significantly to the south of the original Sidewinder discoveries, and hydrocarbons appear to have migrated into all potentially producing sands encountered to date. The size and scope of the discovery area is potentially much larger than originally anticipated, and bodes well for both near-term development and future exploration."
The three Sidewinder discovery wells are part of TAG Oil's ongoing exploration drilling campaign that commenced in Petroleum Exploration Permit 38748 in February 2011 following the Sidewinder-1 discovery. Sidewinder-1 flow tested at stabilized rates of 8.5 million cubic feet of gas plus 44 barrels of oil per day for a total of 1461 barrels of oil equivalent ("BOE") per day with no water. Please view TAG's previous news for more information on the Sidewinder discoveries.
Garth Johnson, TAG Oil CEO commented,"Once flow testing of all new Sidewinder wells is complete, we can better assess the magnitude of these discoveries. Given the encouraging results achieved to date we are expanding the throughput capabilities of the Sidewinder Production Station to accommodate more production than we initially anticipated. Our immediate focus remains on building cash flow and reserves associated with these discoveries."
TAG Oil will immediately proceed to drill the Sidewinder-4 exploration well, which will also target the Mt. Messenger Formation sandstones approximately 1 km to the east of the Sidewinder-1 well.
TAG Oil Ltd
TAG Oil Ltd. (tagoil.com) is a Canadian-based production and exploration company with operations focused exclusively in New Zealand. With 100% control over all its core assets, including oil and gas production infrastructure, TAG is anticipating substantial oil and gas production and reserve growth through development of several light oil and gas discoveries. TAG is also actively drilling high-impact exploration prospects identified across 3,500 sections of land onshore in the lightly explored Taranaki and East Coast Basins of New Zealand's North Island.
In the East Coast Basin, TAG Oil has demonstrated and is pursuing the significant unconventional resource potential estimated in the fractured shale source-rock formations that are widespread over the Company's acreage. These oil-rich, naturally fractured and thermally mature source-rock formations have many similarities to North America's Bakken Shale source-rock formation in the successful Williston Basin.
"BOE"s may be misleading, particularly if used in isolation. A BOE conversion ratio of 6Mcf: 1 Bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
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 Oil. These statements are based on certain factors and assumptions including those related to the exploration and development of TAG Oil's Sidewinder-1, Sidewinder-2, and Sidewinder-3 light oil and gas discoveries in the Taranaki Basin of New Zealand. Actual results may vary materially from the information provided in this release and there is no representation by TAG Oil that actual results realized in the future would be the same in whole or in part as those presented herein.
Factors that could cause actual results to differ from those contained in the forward-looking statements are set forth in, but are not limited to, filings that the Company and its independent evaluator have made, including the Company's most recent reports in Canada under National Instrument 51-101.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.