VANCOUVER, BC, Oct. 15, 2024 /CNW/ - TAG Oil Ltd. (TSXV: TAO) (OTCQX: TAOIF) ("TAG Oil" or the "Company") would like to provide the following updates:
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CURRENT OPERATIONS - Badr Oil Field ("BED-1 Concession")
Production from the BED4-T100 ("T100") horizontal well is averaging 200 barrels of fluid per day and 35 percent water. Operation of the T100 well has been intermittent for the last two months as the reservoir extent was assessed through pressure build-up analysis and the lift system optimized. The T100 well initially produced under natural flow and subsequently with a jet pump to recover the large volumes of fracture fluid containing sand. The T100 well is now equipped with a sucker rod pump for long term stable production. Cumulative oil production of the T100 well to date is in excess of 15,000 barrels and shipments have commenced to third party facilities. Further evaluation by the Company is also underway of fluid samples, drill cuttings, and tracers as they flow back, to inform performance of stimulated sections along the horizontal lateral and further optimization potential on the T100 well.
With the successful proof of concept of producing commercial oil volumes from the unconventional Abu Roash "F" reservoir ("ARF") in the BED-1 Concession, current development plans include returning the previously completed and produced BED1-7 vertical well to production following an extended pressure build-up analysis. The well will be set up with a sucker rod pumping system, similar to the T100 well, during the fourth quarter. In addition, several new drilling locations have been identified for an additional one or two vertical wells in Q1-2025 targeting high intensity natural fractured areas that can potentially produce at good initial oil volumes. Planning of a second horizontal well is also underway and is planned for drilling in Q2-2025. Please refer to the Company's updated corporate presentation at www.tagoil.com.
NEW EGYPT ACQUISITION - Significantly Expanding TAG Oil's Acreage Footprint
TAG Oil is pleased to announce that it has received a "No Objection Letter" approval from an industry operator in Egypt to the Company's proposal to acquire a significant interest in their sizable concession in the Western Desert, Egypt (the "Concession"). TAG Oil engaged in evaluating the Concession earlier this year and submitted a binding proposal in the second quarter. The farm-in agreement contemplates standard farm-in terms and is subject to certain conditions and other regulatory approvals.
The target Concession covers an area of approximately 2,000 km2 (512,000 acres) in the Western Desert, nearly 20 times larger than the 26,000-acre BED-1 Concession. Of specific interest is the unconventional ARF oil formation that is present covering a large portion of the targeted Concession with indications of very good ARF reservoir properties, similar to the BED-1 Concession, which has estimated oil-initially-in-place of 532 MMbbl assigned to the ARF unconventional resource play1. Completing this acquisition will expand TAG Oil's footprint on this significant unconventional resource play in Egypt, as well as adding immediate conventional production and upside in proven reservoirs.
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1 Source: Independent resource evaluation of the ARF formation in BED-1 Concession dated November 21, 2022, prepared by independent qualified reserves evaluator, RPS Energy Canada Ltd., with an effective date of March 31, 2022.
The area has excellent coverage of 2-D and 3-D seismic and contains several producing and available oil wells with upside potential for completion and production optimization in conventional light oil reservoirs. Several prospective drilling locations and side-track opportunities have also been identified on 3-D seismic.
The Company will continue to provide updates on the approval process and details of the final definitive agreement as they become available.
About TAG Oil Ltd.
TAG Oil (https://www.tagoil.com/) is a Canadian based international oil and gas exploration company with a focus on operations and opportunities in the Middle East and North Africa.
Neither the TSX-V nor its Regulation Services Provider (as that term is defined in the policies of the TSX-V) accepts responsibility for the adequacy or accuracy of this release.
Forward-Looking Statements
Statements contained in this release that are not historical facts are forward-looking statements that involve various risks and uncertainty affecting the business of TAG Oil. All estimates and statements that describe the Company's operations acquisition are forward-looking statements under applicable securities laws and necessarily involve risks and uncertainties. Actual results may vary materially from the information provided in this release, and there is no representation by TAG Oil that the actual results realized in the future will be the same in whole or in part as those presented herein. TAG Oil undertakes no obligation, except as otherwise required by law, to update these forward-looking statements if management's beliefs, estimates or opinions, or other factors change.The Company shall not be liable or responsible for any claim or damage, direct or indirect, special or consequential, incurred by the user arising out of the interpretation, reliance upon or other use of the information contained in the pages of this release.
Exploration for hydrocarbons is a speculative venture necessarily involving substantial risk. The Company's future success in exploiting and increasing its current resource base will depend on its ability to develop its current properties and on its ability to discover and acquire properties or prospects that are capable of commercial production. However, there is no assurance that the Company's future exploration and development efforts will result in the discovery or development of additional commercial accumulations of oil and natural gas. In addition, even if further hydrocarbons are discovered, the costs of extracting and delivering the hydrocarbons to market and variations in the market price may render uneconomic any discovered deposit. Geological conditions are variable and unpredictable. Even if production is commenced from a well, the quantity of hydrocarbons produced inevitably will decline over time, and production may be adversely affected or may have to be terminated altogether if the Company encounters unforeseen geological conditions. The Company is subject to uncertainties related to the proximity of any resources that it may discover to pipelines and processing facilities. It expects that its operational costs will increase proportionally to the remoteness of, and any restrictions on access to, the properties on which any such resources may be found. Adverse climatic conditions at such properties may also hinder the Company's ability to carry on exploration or production activities continuously throughout any given year.
Certain information in this presentation may constitute "analogous information" as defined in NI 51-101, including, but not limited to, information relating to the areas in geographical proximity to the lands held by TAG Oil. Such information is derived from a variety of publicly available information from government sources, regulatory agencies, public databases or other industry participants (as at the date stated therein) that TAG Oil believes are predominantly independent in nature. TAG Oil believes this information is relevant as it helps to define the reservoir characteristics in which TAG Oil may hold an interest. TAG Oil is unable to confirm that the analogous information was prepared by a qualified reserves evaluator or auditor or in accordance with the Canadian Oil and Gas Evaluator Handbook.
References to "oil" in this release include crude oil and field condensate.
