TAG Oil Ltd (TAOIF)

[ariadndndough]

post from stockhouse
oilandgas1112
12/5/2011 12:10:35 PM |  | 89 reads  | Post #30429964
 
Risk country : almost 0
Fiscal term : One of the best in the world
NG price : pretty good compare to US. 2 times average US price
Technical team : very experienced
But what about the asset :
East coast : 
Cheal seem massive. I spoke to Garth few months ago and he thinks they have north 20 million reco of very good quality of oil
Sidewinder he thinks we are north of 15 million equivalent of NG.
With this very busy drilling campaign I expect to begin the new year with 5000bpd of oil and 30MMcf of NG. This will give a Free Cash Flow of around  $150 million equivalent for 2012. I am here conservative because I don't take into account all the others wells they will connect in 2012. So would not be surprised that we have a FCF of around $200 millions in 2012.
today TAG has a market value of $250 millions.  So we would be priced at only 1.25 times FCF of 2012. This is very ridiculous...... 
West coast
What cosmicpump is saying about the risk is uncorrect I think. I don't think Apache would signed if the risk was only 10% to crack the code on the shale. They would not invest $100 millions if their chance was less than 40%. This is just my opinion but with all the technology we have now and with the experience of apache I think we have big chance to crack the code.
Now let's give some number on the shale oil. TAG has net 850'000 acres. They compute than they have 14 billion OIP oil per 150'000 acres. So we should have let's say 80 billion OIIP on the net 850k acres tag have. Don't forget we have 15 times better net pay than in a typical bakken well and 2 times better porosity and permeability than a typical bakken well. That is why we have huge number.
With the last EOR techno they can recover close to 20% of the oil in the bakken.
If you put the same number it give 80 billion OIIP *0.2 = 16 billion barrel of oil reco net to tag. Potential is MASSIVE.
even beeing conservative and dividing the number by 2 it is 9 billion barrel reco. At $20 per barrels this is $180 billions.
for the east coast considering $20 per barrel we should be valued at MIN $7 per share. On top of that we have $1.5 of cash......
This is a very STRONG BUY I think
I bought 80'000 stocks over the past 2 weeks at an average price of $4.96. I will keep them for the very longterm. At least 4 to 5 years. 
GLTA