Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


TAG Oil earnings improve on shift to oil over gas

TAG Oil earnings improve on shift to oil over gas

By Pattrick Smellie

Aug. 18 (BusinessDesk) - Onshore Taranaki oil and gas producer TAG Oil has shifted production heavily in favour of oil and away from natural gas between the first quarters of the current and the previous financial years, substantially improving its earnings per barrel of oil equivalent in the process.

Operating results for the three months to June 30, filed with the Toronto Stock Exchange, show "netback" per barrel of oil equivalent has improved from C$43.72 per boe in the first quarter of last year to C$72.16 per boe in the first quarter of the current financial year.

The change appears primarily driven by the fact that oil, worth US$118 per boe in the quarter, has moved to be 74 percent of production, compared with 46 percent in the first quarter last year. Gas is said to be worth US$5.60 per thousand cubic feet, the measure Canadian-based TAG uses for gas quantities.

That shift meant that net oil and gas revenues totalled C$13.1 million for the quarter under review on production of 1,750boe, compared with C$12.1 million in the first quarter of last year, which had a higher rate of boe production, at 2,354 boe, of which more than half was natural gas.

Chief executive Garth Jonson said in a statement that TAG was "considering a number of business growth opportunities", now that it had stabilised production results from two new wells in its Cheal prospect, which have taken production to an average 1,977 boe daily this month, in line with the company's 2,000 boe daily target.

"One such opportunity may include contracting with additional drilling services required to expedite drilling operations, with a view to further grow shallow production within the Cheal and Sidewinder fields", both of which are onshore Taranaki.

The company has also shifted the Nova-1 drilling rig from Taranaki to the East Coast of the North Island to drill an exploratory well at Watangi Valley, targeting so-called "unconventional" shale deposits in the Waipawa black shale and Whangai source rocks. A second East Coast well is planned at Boar-1, later in the current financial year.

However, that won't be drilled until after another five shallow wells, including two step-outs at the producing Sidewinder field, have been completed. TAG will also participate in a wildcat exploration well in the lightly explored Canterbury Basin during the year.

During the quarter, average daily production increased by 18 percent to 1,750 boe, compared with the last quarter of the previous financial year, ended March 31. Total revenue was up 11 percent on the March quarter at C$15.6 million, and increased 6 percent on the C$14.7 million sales recorded in the first quarter of the last financial year.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Trade: NZ Trade Deficit Widens To A Record In September

Oct. 27 (BusinessDesk) - New Zealand's monthly trade deficit widened to a record in September as meat exports dropped to their lowest level in more than three years. More>>


Animal Welfare: Cruel Practices Condemned By DairyNZ Chief

DairyNZ chief executive Tim Mackle says cruel and illegal practices are not in any way condoned or accepted by the industry as part of dairy farming.

Tim says the video released today by Farmwatch shows some footage of transport companies and their workers, as well as some unacceptable behaviour by farmers of dragging calves. More>>


Postnatal Depression: 'The Thief That Steals Motherhood' - Alison McCulloch

Post-natal depression is a sly and cruel illness, described by one expert as ‘the thief that steals motherhood’, it creeps up on its victims, hiding behind the stress and exhaustion of being a new parent, catching many women unaware and unprepared. More>>


DIY: Kiwi Ingenuity And Masking Tape Saves Chick

Kiwi ingenuity and masking tape has saved a Kiwi chick after its egg was badly damaged endangering the chick's life. The egg was delivered to Kiwi Encounter at Rainbow Springs in Rotorua 14 days ago by a DOC worker with a large hole in its shell and against all odds has just successfully hatched. More>>


International Trade: Key To Lead Mission To India; ASEAN FTA Review Announced

Prime Minister John Key will lead a trade delegation to India next week, saying the pursuit of a free trade agreement with the protectionist giant is "the primary reason we're going" but playing down the likelihood of early progress. More>>



MYOB: Digital Signatures Go Live

From today, Inland Revenue will begin accepting “digital signatures”, saving businesses and their accountants a huge amount of administration time and further reducing the need for pen and paper in the workplace. More>>

Oil Searches: Norway's Statoil Quits Reinga Basin

Statoil, the Norwegian state-owned oil company, has given up oil and gas exploration in Northland's Reinga Basin, saying the probably of a find was 'too low'. More>>


Modern Living: Auckland Development Blowouts Reminiscent Of Run Up To GFC

The collapse of property developments in Auckland is "almost groundhog day" to the run-up of the global financial crisis in 2007/2008 as banks refuse to fund projects due to blowouts in construction and labour costs, says John Kensington, the author of KPMG's Financial Institutions Performance Survey. More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news