International oil and gas producer and explorer TAG Oil has filed its unaudited consolidated interim financial statements and the accompanying management's discussion and analysis for the period ending June 30, 2009.
Summary of selected financial results:
For the three months ended June 30, 2009, TAG reported production revenue of $588,818 from the Company's 30.5% interest in the Cheal oil field, compared to $2,060,824 in revenue for the same quarter last year. Production and royalty costs amounted to $191,009, compared to $437,866 in costs for the same quarter last year. The net loss recorded for the quarter was $170,055, compared to net income of $790,954 for the three months ended June 30, 2008.
Revenue was affected by reductions in the oil price and a decrease in production rates. The average oil price for the current quarter was $64 per barrel (June 30, 2008: $131 per barrel) and the number of gross barrels of oil sold during the quarter was 30,468 (June 30, 2008: 51,340 barrels sold).
Royalty and production costs for the quarter averaged under $20 per barrel (June 30, 2008: $33 per barrel), resulting in a netback per barrel of approximately $44 (June 30, 2008: $98 per barrel).
The Company ended the first quarter of the 2010 fiscal year debt-free, with $6.9 million in cash and $7.72 million in working capital.
TAG Oil CEO Garth Johnson commented, "TAG is continuing to work towards closing the acquisition of the remaining 69.5% interest in the Cheal Mining License and Petroleum Exploration Permit 38748. In the meantime, TAG is working closely with the receiver of Austral Pacific Energy Ltd. to further reduce production costs and improve operational efficiencies of the field. Following the official transfer of operatorship, the Company plans to implement an optimization program on existing producing wells that could improve field productivity. Currently the Cheal oil field is producing 380 barrels of light oil per day."
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