TAG�s first NZ solo well is dry

CANADIAN listed explorer TAG Oil has plugged and abandoned its first sole-risk New Zealand well – the shallow onshore Taranaki Arakamu-1 well. But it has also farmed-in to three more onshore Taranaki licences.

TAG chief executive Drew Cadenhead said Arakamu-1, in licence PEP 38757 (100% TAG interest), had reached the scheduled deviated depth, of approximately 2360m, but had failed to find commercial quantities of hydrocarbons in the targeted Miocene-aged Mount Messenger-Moki sands.

“Although good quality oil and gas shows were recorded in the wellbore, no significant reservoir zones were encountered. The well, therefore, has been plugged and abandoned,” he said.

However, TAG had been encouraged by the high-quality oil shows struck while drilling and believed encountering thicker sandstones in the area would have proved successful, according to Cadenhead.

In addition, TAG had signed agreements with Denver-based Westech Energy, Auckland-based Bridge Petroleum and Sydney-headquartered Roc Oil to assume all of their respective working interests in three separate onshore Taranaki licences – an PEP 38732 (Westech, 100%), PEP 38745 (Westech 33.33%, Bridge 16.67%) and PEP 38767 (ROC 40%, Westech 30% and Bridge 30%).

The agreements were signed in exchange for granting a gross over-riding royalty position to each company in the respective permits.

Cadenhead said TAG would take over as operator of all the new permits, allowing it to control the pace of operations and assume all technical work.

The new permits adjoined or were very close to existing TAG acreage, including land offsetting the recent Supplejack-Supplejack South discovery in licences PEP 38741-765.

TAG is presently testing Supplejack South-1A, which targeted a 'sweet spot' roughly 700m from Supplejack-1, on a sole-risk basis and is expected to announce results of that program soon.

”We are pleased to continue to build our land base within the core of our focus areas, following on the heels of our Supplejack discovery," Cadenhead added.

Once arrangements have been completed, working interests in the three permits will be: PEP 38732 operator TAG (100%); PEP 38745 operator TAG (66.67%), Tap Oil (33.33%); PEP 38767 operator TAG (100%).

According to the Crown Minerals website, the Ministry of Economic Development unit expects TAG to drill wildcat wells in each of the licences over the next few months – by next month in PEP 38767, by July in PEP 38732, and by August in PEP 38745.

Typical targets in these small onshore permits are the shallow Miocene-aged Mt Messenger-Moki sands, but PEP 38767 also contains the Totara prospect which Fletcher Challenge Energy drilled more than a decade ago, targeting a deep gas Eocene-aged play.