TAG Drills A Duster at Cheal A6

TAG Oil Ltd. has reported that the drilling of the Cheal A6 well reached a total depth of 1930 meters on June 26th, 2008. The well intercepted an oil bearing MM3 Formation as planned at approximately 1818 meters measured depth, but the net sand interval was interpreted as thinner than prognosed and would be uneconomic to complete.

The Cheal Joint Venture (Austral Pacific Energy Ltd. 69.5% and TAG Oil Ltd. 30.5%) agreed to plug and abandon the MM3 zone in this well bore, set a whipstock plug at 1359 meters and kick off a side track well to a targeted location approximately 150 meters to the south of the original A6 penetration.
This location was interpreted from the Brecon 3-D seismic data set to have thicker net sands, although slightly closer to the regional oil/water contact. Cheal A6ST was drilled to a total depth of 1936 meters on July 2nd, 2008 and intercepted the targeted MM3 sands as prognosed, well above the regional oil/water contact.
After evaluation of all subsurface data the Joint Venture has agreed to plug and abandon the A6ST well as a sub-commercial hydrocarbon discovery. A new whipstock plug will be set in the wellbore and the rig will now commence drilling the Cheal A7 well from the same surface location. The Cheal A6 and A6ST wells were targeting a separate lobe of sand from the main Cheal "A" Pool while Cheal A7 is a step-out well targeting an extension of the same pool containing the successful Cheal A3 and A4 wells.
"Although we are encouraged that we encountered oil bearing sands in Cheal A6 and A6ST, we were disappointed that net pay thicknesses in this separate lobe of sand were materially thinner than the "A" Pool and that completion operations were not justified. We look forward to better results at Cheal A7 where we are targeting the same Mt. Messenger sand body as the A3 and A4 wells," said TAG Oil CEO Garth Johnson.