Tag Oil is planning to "immediately" develop and commercialise its onshore Taranaki Sidewinder-1 well.A 10-day production test at the well recorded stabilised flow rates of 1461 barrels of oil equivalent per day, consisting of 8.5 million cubic
Tag Oil is planning to "immediately" develop and commercialise its onshore Taranaki Sidewinder-1 well.
A 10-day production test at the well recorded stabilised flow rates of 1461 barrels of oil equivalent per day, consisting of 8.5 million cubic feet of gas and 44 barrels of oil per day, the company said.
Production forecast modelling results indicated initial gas flow rates from Sidewinder-1 to be greater than 10 million cubic feet of gas per day, declining over 36 months to rates of more than 5m cubic feet per day.
Production profiles and facility plans also anticipated oil contributing more significantly to daily flow rates over time, Tag said.
"With Sidewinder's close proximity to existing gas and oil infrastructure, combined with New Zealand's low royalties and oil and gas prices that are substantially higher than in North America, development of the Sidewinder discovery will be cost-effective, efficient and commercially attractive."
Tag said it was also planning to drill up to 10 prospects at its onshore Taranaki permit areas, starting early next year.
The programme included development and step-out wells within the Cheal prospect, and further exploration wells in the Sidewinder project area, Tag said.
The Cheal field produced an average of about 364 barrels of oil per day during the quarter to the end of September, although that had risen to 492 barrels of oil and 475m cubic feet of gas.
"The company believes that maximum value of the Cheal field will be realised through the implementation of further optimisation operations and additional successful drilling that will enhance recovery rates and reserves while also increasing daily production."
Tag reported production revenue of $C2.4 million ($NZ3.1m) in the September quarter, up from $C670,000 a year earlier, with a net loss for the latest period of $C508,800, compared to a net loss of $C1.9m in the September 2009 quarter.
