TAG Begins Drilling Arakamu-1 Oil Well in New Zealand's Taranaki Basin

TAG Oil has commenced drilling of the Arakamu-1 (formerly known as the Eltham-1) well, with Ensign Rig # 19 in New Zealand's Taranaki Basin on the North Island.

The well was renamed after consultation with local Maori representatives, who blessed the site in preparation for drilling. According to Mr. Cadenhead, "TAG was happy to honor this request as a gesture of respect and cooperation with the Maori people of Taranaki."

In close proximity (4km) to the recent 3 million bbl Cheal discovery, Arakamu-1 is 100% owned by TAG Oil. The well will be drilled directionally to a measured depth of 2387m with a true vertical depth of 2250m over a period of approximately two weeks, and will test multiple Miocene-aged targets including the proven producing horizons at the nearby Cheal oil and gas field.

TAG currently has several drillable exploration prospects in its portfolio, and anticipates drilling four wells in the Taranaki Basin and one in the Canterbury Basin over the next 12 months, in addition to flow-testing of the Supplejack wells in PEP's 38741 and 38765.

"We are continuing to acquire seismic over our large land base, adding new prospects in lightly explored areas," Cadenhead said. "We shot 3-D seismic over our permit last year and Arakamu-1 is the first of at least two wells we plan to drill on PEP 38757."

As for the oil and gas prospects in New Zealand, Mr. Cadenhead stated: "New Zealand is under-explored compared with most other notable gas producing regions of the world. The high percentage of large discoveries resulting from the few wells that have been drilled confirm that there is plenty of potential."