Taranaki Basin, North Island

Basin Background: A Perspective
The Taranaki Basin is an emerging oil, gas and condensate province located on the North Island of New Zealand. The Basin remains under-explored compared to many comparable rift complex basins of its size and potential. Although the Taranaki Basin covers an area of about 100,000 sq. km., only 125 wildcats have been drilled since 1955. To date, proven oil reserves of 528 million barrels and proven gas reserves of 6.9 trillion cubic feet have been discovered. Last year 433 million cubic feet / day gas was produced and oil production from Taranaki averaged 58,400 barrels of oil per day. This extremely high quality oil is sold primarily to Japan, Korea and Australia at a premium to West Texas Intermediate.

(Source: New Zealand Ministry of Economic Development http://www.crownminerals.govt.nz/cms/petroleum/facts-and-figures. The source of the information was independent; however, the Company was unable to confirm that this information was prepared by a qualified reserves evaluator or auditor in accordance with the COGE Handbook.)

Focus on Proven Producing Miocene Reservoirs
TAG Oil's exploration efforts are focused on shallow oil and gas pools in these proven Miocene reservoirs. Though the Miocene is the proven producer in this area, potential also exists in Oligocene and Eocene strata. The company's geoscientists have developed a stringent set of criteria to identify new exploration targets based on analysis of Cheal data, modeled on comparison to proven, producing pools. Future exploration targets will be drilled only if all criteria are in place, significantly increasing the likelihood of acceptable success rates.

Taranaki Basin Discoveries
Tui (oil), Karewa (oil), Goldie (2001, oil), Cheal (oil and gas) Surrey (oil and gas), Kahili (gas-condensate). Maui (gas-condensate and oil). Onshore: Kapuni (gas-condensate), McKee (oil and gas), Tariki/Ahuroa (gas-condensate), Waihapa/Ngaere (oil and gas), Ngatoro (oil and gas), Kaimiro (oil and gas), Mangahewa (gas-condensate), Rimu (oil and gas), Motoroa (oil).