Sidewinder, Petroleum Exploration Permit 38748

100% Interest: 7,910 Acres
PEP 38748 is a highly prospective exploration acreage located in the onshore Taranaki Basin discovery fairway. In September 2010, TAG announced the first discovery in PEP 38748 with the Sidewinder-1 exploration well, which was drilled to 1601m. The well encountered 14m of net (22m gross) oil-and-gas-bearing sandstones with excellent reservoir porosities and permeability. A 10-day production test recorded stabilized flow rates of 1461 barrels of oil equivalent (“BOE”) per day, consisting of 8.5 million cubic feet of gas and 44 barrels of oil per day.

Subsequent interpretation of bottom hole pressure build-up data indicated no measurable pressure depletion, and the extended unrestricted flow rate was calculated at 30 million cubic feet of gas per day.

Production forecast modeling indicate initial flow rates anticipated from Sidewinder-1 to be greater than 10 million cubic feet of gas per day declining over 36 months to rates still in excess of 5 million cubic feet of gas per day. It is anticipated that oil production will contribute more significantly to production over time, which would be consistent to analogous oil and gas fields nearby Sidewinder.

With close proximity to existing gas and oil infrastructure, combined with New Zealand’s low royalties and oil and gas prices that are substantially higher than in North America, development of the Sidewinder discovery and any future discovery in PEP 38748 will be cost-effective, efficient and commercially attractive.