TAG Oil Reports 2013 Fiscal Year End Financial Results and 2014 Drilling Program

TAG Oil Reports 2013 Fiscal Year End Financial Results and 2014 Drilling 
Program 
VANCOUVER, June 28, 2013 /CNW/ - TAG Oil Ltd. (TSX: TAO) and (OTCQX: TAOIF), 
reports the Company has filed its consolidated, audited financial statements, 
management discussion and analysis and annual information form with the 
Canadian Securities Administrators for the Company's March 31, 2013 fiscal 
year-end. Copies of these documents can be obtained electronically at 
http://www.sedar.com, or for additional information please visit TAG Oil's 
website at http://www.tagoil.com/. 
Poised for Many Years of Growth
During FY2012 and 2013, TAG Oil conducted an extensive Taranaki drilling 
campaign consisting of wells averaging approximately 2,000 meters depth, 
commonly referred to as TAG's shallow drilling program. This program, which 
targeted the Urenui and Mt. Messenger formations within the Company's 100% 
owned Cheal and Sidewinder fields, now provides TAG with ongoing high netback 
production and steady cash flow. 
Decline rates from new wells tied in are now stable and in line with other 
typical Cheal wells on long term production. Some wells from the drilling 
campaign came onstream with record flow rates, however did not maintain these 
high rates and declined to production levels in line with other profitable 
wells in the field. The resulting long-term cash flow has positioned TAG to 
execute the Company's most diverse and active drilling campaign in the 
Company's history, including high-impact drilling in the East Coast Basin, 
while maintaining a very strong debt free balance sheet. Furthermore, control 
of extensive Taranaki production and delivery infrastructure ensures rapid 
commerciality of new wells. 
FY2013 TAG Oil Highlights 


    --  At March 31, 2013, the Company had cash of $68.9 million,
        working capital of $68.1 million and no debt.
    --  Daily average production increased 23% for the year, from 1,433
        BOE to 1,756 BOE.
    --  Income of $10.69 million was recorded for fiscal 2013 before
        the deduction of non-cash share-based compensation, and
        production revenue increased 4% to $44.59 million.
    --  Operations generated  $34.21 million in cashflow, compared to
        $15.56 million in 2012.
    --  Total production for the year was 641,142 BOE's.
    --  Sproule International assigned 1p, 2p and 3p reserves of
        2,216,000 BOE (85% oil), 6,112,000 BOE (88% oil) and 8,268,000
        BOE (86% oil), respectively.
    --  Successfully drilled, completed and placed on permanent
        production at the Cheal field: Cheal-A11, Cheal-A12 and
        Cheal-B8 wells.
    --  Successfully drilled, completed and placed on permanent
        production at the Sidewinder field: Sidewinder-A5 and
        Sidewinder-A6, and drilled the Sidewinder-A7 well.
    --  Successfully drilled and cased the Ngapaeruru-1 well and
        encountered excellent mud gas shows indicating the presence of
        gas zones or soluble gas in oil between the intervals within a
        155m gross hydrocarbon column.
    --  Infrastructure expansion program completed by March 31, 2013 as
        planned, allowing increased production capacity, processing of
        natural gas including liquid stripping capabilities, and export
        of natural gas to the open-access pipeline infrastructure.
    --  In May 2012, TAG closed a bought deal financing at $10.45 per
        share, issuing 4,435,000 common shares for net proceeds of
        $43,365,746.
    --  The Company acquired a 90% interest in a New Zealand
        electricity generation and retailing company, Opunake Hydro
        Limited ("OHL") through the investment of approximately $5.0
        million, with all funds being used to acquire new gas-fired
        generation equipment to be located at the Company's Cheal site.
    --  Acquired 40% in Coronado Resources Ltd. (TSXV: CRD) and will
        acquire an additional 10% of Coronado's common shares as a
        result of selling OHL. The deal is subject to the terms and
        conditions of the Share Purchase Agreement that has been
        executed by all parties involved.
    --  Acquired three New Zealand exploration permits in the East
        Coast and Canterbury basins: PEP 52589, PEP 52676 and PEP
        53674, comprised of approximately two-million acres in
        favourable geological areas offering high-impact exploration
        opportunities.
    --  Awarded four new onshore Taranaki exploration blocks in New
        Zealand's 2012 Block Offer adding at least 10 drilling
        prospects plus numerous leads identified on 3D seismic in close
        proximity to TAG's producing Cheal oil field. A Joint Venture
        created with East West Petroleum Ltd. on three of the new
        permits carries TAG through $10 million in exploration costs
        while maintaining operatorship.

Financial and Production Review
                                               2013                2012

Production revenue                  $    44,591,201     $    42,908,655

Net income prior to share-based                            
compensation                             10,694,371          18,924,540

Net income                                5,073,359          12,376,019

Earnings per share                             0.09                0.24

Working capital                          68,073,376          65,371,541

Total assets                            210,937,314         148,883,278

Long term debt                                    -                   -

Shareholder's equity                $   191,190,601     $   133,368,183

TAG currently has 59,344,052 common shares outstanding and 63,052,386 common 
shares outstanding on a fully diluted basis.

Oil and Natural Gas Production, Pricing and Revenue
                        Three months ended          Year ended March 31
                                  March 31
                          2013        2012          2013           2012

Daily                                                                  
production
volumes(1)


Oil                   1,013       1,405           959            918 
(bbls/d) 
Natural gas             678         752           797            515 
(BOE/d) 
Combined              1,691       2,157         1,756          1,433 
(BOE/d) 
                                                                    
Daily sales                                                            
volumes((1)) 
Oil                   1,007       1,407           957            925 
(bbls/d) 
Natural gas             436         496           548            413 
(BOE/d) 
Combined              1,443       1,903         1,505          1,338 
(BOE/d) 
                                                                    
Natural Gas           2,618       2,977         3,287          2,480 
(Mmcf/d) 


                                                                       

Product                                                                
pricing
    Oil ($/bbl)          116.59      119.54        110.87         115.57
                                                             


Natural gas            4.94        4.48          4.63           4.16 
($/Mmcf) 
Sales                                                                   
Oil and            $11,993,143 $16,701,663   $44,286,567    $42,908,655
natural gas
revenue -
gross 
Other revenue          304,634           -       304,634              -
- gross(2) 
Total revenue       12,297,777  16,701,663    44,591,201     42,908,655
- gross 
Oil and            (1,376,561) (2,973,964)   (5,036,005)    (9,706,513)
natural gas
royalties(3) 
Revenue - net      $10,921,216 $13,727,699   $39,555,196    $33,202,142 
(1)   Natural gas production converted at 6 Mcf:1BOE (for BOE figures) 
(2)   Other revenue is electricity revenue related to OHL. 
(3)   Includes a 25% royalty related to the acquisition of a 69.5% 


      interest in the Cheal field that was reduced to 7.5% during the
      fourth quarter of fiscal 2012.
                                                                      



A summary of TAG's drilling program over the next 12 months:

 ___________________________________________________________________
|Permit Number|Well Name        |TAG     |# of Wells|Target Depth   |
|             |                 |Interest|          |               |
|_____________|_________________|________|__________|_______________|
|PEP 54877    |Cheal D & E-Sites|70%     |5         |Miocene <2,500m|
|_____________|_________________|________|__________|_______________|
|PEP 54876    |Southern Cross   |50%     |1         |Miocene <2,500m|
|_____________|_________________|________|__________|_______________|
|PEP 54879    |Cheal F & G-Sites|50%     |3         |Miocene <2,500m|
|_____________|_________________|________|__________|_______________|
|PMP 38156    |Cardiff          |100%    |1         |Eocene > 4,000m|
|_____________|_________________|________|__________|_______________|
|PEP 54873    |Heatseeker       |100%    |1         |Eocene > 4,000m|
|_____________|_________________|________|__________|_______________|
|PEP 38348    |Waitangi         |100%    |1         |Unconventional |
|_____________|_________________|________|__________|_______________|

Shallow-Well Program
The program will consist of nine shallow Taranaki wells with permit interests 
between 50% to 70%. The Company will apply what it has learned from the 
extensive new drilling data acquired in the last three years to target the 
low-risk step out prospects, and build the Company's net proved and probable 
reserves of 6,112,000 BOE's (88% oil) estimated by Sproule as of March 31, 
2013. The intention of this drilling program is to continue to exploit the 
shallow play potential and further maximize the value of the Cheal and 
Sidewinder fields which remain lightly explored.

Deep Gas and Condensate Program
TAG will step up its efforts in the Taranaki Basin to drill larger, 
seismically defined, prospects which have the potential to materially bolster 
the Company's long-term production and reserve growth profiles.

The Company will drill at least two of its 100% owned deep Kapuni 
gas/condensate prospects in FY2014.

Cardiff and Heatseeker are scheduled to commence in the third quarter of 
calendar 2013. A third prospect, the Hellfire deep prospect, may be drilled 
contingent on the results of Cardiff and Heatseeker. These deep Eocene-aged 
targets are materially larger in reserve size and deliverability potential 
than what TAG has been targeting in the shallow Miocene formations. Drilling 
of TAG's Kapuni prospects will use a large seismic database to target prospect 
depths of approximately 3,500 to 4,000 meters. TAG's Kapuni targets are on 
trend and similar to the large deep gas/condensate plays in Taranaki such as 
the Kapuni Field that has produced 1.5 TCF and 65 mmbls of condensate to date 
and 800 BCF Mangahewa field operated by Shell and Todd Petroleum.

In a report dated February 28, 2011, Sproule International Limited estimates 
the gross undiscovered resource potential associated with TAG's Cardiff 
Prospect as follows:

 ____________________________________________________________________
|      Resources   |Low Estimate |Best Estimate |High Estimate |Mean |
|       Category   |    (p90)    |    (p50)     |    (p10)     |     |
|__________________|_____________|______________|______________|_____|
|Undiscovered Gas  |      137.3  |      214.5   |      341.4   |230.7|
|Initially-in-Place|             |              |              |     |
|(BCF)             |             |              |              |     |
|__________________|_____________|______________|______________|_____|
|Undiscovered      |         8   |       12.8   |       21.5   |  14 |
|Condensate        |             |              |              |     |
|Initially-        |             |              |              |     |
|in-place          |             |              |              |     |
|(Million Barrels) |             |              |              |     |
|__________________|_____________|______________|______________|_____|

East Coast Basin Tight Oil
In April of 2013, the Company drilled and cased its first unconventional test 
well, Ngapaeruru-1. The Ngapaeruru-1 well reached a total depth of 1,417 
meters after successfully drilling through the Waipawa and Whangai source rock 
formations, the main objective of the well. Initial results are very 
encouraging with 155 meters of potential tight oil and gas pay. TAG cut and 
recovered sidewall cores over 14 separate intervals within the 155 meters of 
potential tight pay, sampled total organic content (TOC) and acquired in-situ 
gas analysis at depth. Detailed petrophysical evaluation is now underway with 
a full suite of unconventional logs to ascertain source rock quality, fracture 
identification, geochemistry, and rock moduli data. This data will be used to 
determine the most suitable completion method for production testing the 
Ngapaeruru-1 well.

TAG plans to drill at least three more exploration wells in the East Coast 
Basin over the next 18 months, to achieve the Company's goal of converting a 
potentially major undiscovered unconventional resource into proven reserves.

Canterbury Basin
After some encouraging early stage results, further resource potential is 
being assessed after processing and interpreting 80km's of recently acquired 
seismic data. TAG's new 2D seismic, acquired over leads initially identified 
using geochemical surface data, has resulted in a clearly imaged subsurface, 
resulting in four newly mapped features within the permit. TAG intends to 
acquire additional seismic over these specific leads to confirm aerial extent 
of the anomalies as well as closure prior to making a commitment to drill.

The Canterbury Basin is an underexplored oil and gas frontier that is 
recognized to have major discovery potential. Large energy companies such as 
US-based Anadarko Petroleum and Australian-based Origin Energy are exploring 
the offshore region in the immediate vicinity to TAG's 1.17 million acres 
under permit.

Conference Call Information
TAG Oil will host a discussion of its 2014 forward program as well as fourth 
quarter 2013 results conference call on Friday June 28, 2013 at 1:00 pm 
Pacific Time. Please call in ten minutes before the conference call starts and 
stay on the line (an operator will be available to assist you should you have 
questions of management during the call). In addition, questions can be 
forwarded by e-mail in advance to info@tagoil.com.

Interested parties may access the conference call using the information below:

Date               June 28(th), 2013

Time               1:00pm  Pacific Time

Toll-Free          1-866-318-8614
Dial-in #

Secondary          1-617-399-5133
Dial-in # 
                    

Conference         51004241
Passcode 
                    

E-mail questions   info@tagoil.com
to:
                    

TAG Oil Ltd. TAG Oil Ltd. (http://www.tagoil.com/) is a Canadian-based 
production and exploration company with operations focused exclusively in New 
Zealand. With 100% ownership over all its core assets, including extensive oil 
and gas production infrastructure, TAG is enjoying substantial oil and gas 
production and reserve growth through development of several light oil and gas 
discoveries. TAG is also actively drilling high-impact exploration prospects 
identified across more than 2,984,171 net acres of land in New Zealand.

In the East Coast Basin, TAG is exploring the major unconventional resource 
potential believed to exist in the source-rock formations that are widespread 
over the Company's acreage. These oil-rich and naturally fractured formations 
have many similarities to North America's Bakken source-rock formation in the 
successful Williston Basin.

TAG Oil has adopted the standard of six thousand cubic feet of gas to equal 
one barrel of oil when converting natural gas to "BOEs". BOEs may be 
misleading, particularly if used in isolation. A BOE conversion ratio of 6Mcf: 
1 Bbl is based on an energy equivalency conversion method primarily applicable 
at the burner tip and does not represent a value equivalency at the wellhead.

Cautionary Note Regarding Forward-Looking Statements:
Statements contained in this news release that are not historical facts are 
forward-looking statements that involve various risks and uncertainty 
affecting the business of TAG. Such statements can be generally, but not 
always, identified by words such as "expects", "plans", "anticipates", 
"intends", "estimates", "forecasts", "schedules", "prepares", "potential" and 
similar expressions, or that events or conditions "will", "would", "may", 
"could" or "should" occur. These statements are based on certain factors and 
assumptions including:

A. All estimates and statements that describe the Company's objectives, goals, 
production rates, optimization, infrastructure capacity and or future plans 
relating to the seismic, testing, work over and drilling programs in the 
Taranaki, Canterbury and East Coast Basins are forward-looking statements 
under applicable securities laws and necessarily involve risks and 
uncertainties including, without limitation: risks associated with oil and gas 
exploration, development, exploitation, production, marketing and 
transportation, volatility of commodity prices, imprecision of reserve 
estimates, environmental risks, competition from other producers, and changes 
in the regulatory and taxation environment. These forward-looking statements 
are based on certain factors and assumptions, including factors and 
assumptions regarding the management's views on the oil and gas potential in 
TAG's permits, well performance, the success of any operations, completing 
infrastructure and the costs necessary to complete the operations; and

B. Those relating to TAG Oil's exploration and development of its oil and gas 
properties within the Cheal and Sidewinder project areas, the production and 
establishment of additional production of oil and gas in accordance with TAG 
Oil's expectations at Cheal and Sidewinder, well performance, drilling, the 
completion of new infrastructure at Cheal and Sidewinder, optimization, the 
increase of cash flow from new production, expected growth, results of 
operations, performance, prospects, evaluations and opportunities. While TAG 
Oil considers these factors and assumptions to be reasonable based on 
information currently available, they may prove to be incorrect. Actual 
results may vary materially from the information provided in this release, and 
there is no representation by TAG Oil that the actual results realized in the 
future will be the same in whole or in part as those presented herein.

TAG Oil is involved in the exploration for and production of hydrocarbons, and 
its property holdings with the exception of the Cheal and Sidewinder project 
areas are in the grass roots or primary exploration stage. Exploration for 
hydrocarbons is a speculative venture necessarily involving substantial risk. 
There is no certainty that the expenditures incurred on TAG Oil's exploration 
properties will result in discoveries of commercial quantities of 
hydrocarbons. TAG Oil's future success in exploiting and increasing its 
current reserve base will depend on TAG Oil's ability to develop its current 
properties and on its ability to discover and acquire properties or prospects 
that are producing. There is no assurance that TAG Oil's future exploration 
and development efforts will result in the discovery or development of 
additional commercial accumulations of oil and natural gas. Other factors that 
could cause actual results to differ from those contained in the 
forward-looking statements are also set forth in filings that TAG and its 
independent evaluator have made, including TAG's most recently filed reports 
in Canada under National Instrument 51-101, which can be found under TAG's 
SEDAR profile at www.sedar.com.

TAG undertakes no obligation, except as otherwise required by law, to update 
these forward-looking statements in the event that management's beliefs, 
estimates or opinions, or other factors change.

Dan Brown or Garth Johnson Phone: 1-604-682-6496 Email:info@tagoil.com 
Website:http://www.tagoil.com/ Blog:http://blog.tagoil.com/

SOURCE: TAG Oil Ltd.

To view this news release in HTML formatting, please use the following URL: 
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CO: TAG Oil Ltd.
ST: British Columbia
NI: OIL ERN CONF 

-0- Jun/28/2013 12:00 GMT


 
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