TAG adds three more production wells with Urenui find

Wednesday 4th April 2012

TAG Oil, the Canadian oil and gas producer, continues its string of commercial discoveries, announcing three recently drilled wells to explore the onshore Taranaki Urenui Formation will go into production in the next three months.

“Strong initial flow test results were achieved, with each individual well having the capability to initially produce approximately 200 barrels of light oil per day, plus associated gas from high-quality reservoir sands,” TAG said in a statement to the Toronto Stock Exchange overnight.

The successful wells are Cheal-B6, Cheal-A9 and Cheal-A10, and found oil at a depth of approximately 1,400 metres.

TAG will place the wells on full-time production, along with other established production, once the enhancements to Cheal’s artificial lift capabilities have been completed, the company said.

“These upgrades will allow TAG Oil to produce all existing and future wells simultaneously, and are expected to be complete within the next three months.”

TAG said permit-wide 3-D seismic data indicate the Urenui Formation “is prospective for oil discovery across the Cheal permit.”

“These results continue to demonstrate the significant upside potential at Cheal,” said chief executive Garth Johnson. “They open a new widespread oil play across the permit. Based on these consistent results, we will now integrate the Urenui oil play into our overall development and exploration strategy, which will also include Mt. Messenger wells and the deeper liquids-rich Kapuni Formation gas play.”

The company has also mobilised a new drill rig to drill the Cheal-C3 and Cheal-C4 wells.

These follow on from discoveries at the Cheal C site discoveries, including the Cheal-C2 gas condensate discovery well, primarily targeting the Mt. Messenger Formation, which has achieved stabilised flow rates of approximately 14 million cubic feet gas per day (about 2,333 barrels of oil equivalent per day), which was increasing during the 10-day flow test.

BusinessDesk.co.nz

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