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Near Term Catalysts Bode Well For Tag Oil

|Includes: TAG Oil Ltd. (TAOIF)

Tag Oil and Gas (TAO.T) (OTCQX:TAOIF)is a Canadian based oil and gas explorer operating in New Zealand. From the company website:

TAG Oil Ltd. is a rapidly growing, profitable oil and gas producer with high impact exploration activities in New Zealand. Not only do shareholders enjoy the benefits of a stable economic and political environment, New Zealand is a lightly explored oil and gas frontier with highly profitable oil and gas discoveries, a modern, under-utilized infrastructure, and one of the most favorable fiscal regimes for oil and gas production in the world.

I have been following the company for a couple of years and have owned it off and on. The company has had a string of good exploration luck which it is nearly ready to monetize. The current production is 1929 BOE/day as of 2/15/13. The company is in the process of a big infrastructure build out in its gathering and processing infrastructure (est. completion 3/31/13) which will lead the company to bring on production that is being held behind pipe. The company management is saying that after completion and commissioning of the new processing equipment that production could nearly double from where it is today.

The company continues to experience 100% success in its step out drilling and has a multi well program underway for this year. In addition the company has large prospect on the east coast of New Zealand that has many similarities with shale plays in the US and presents definite blue sky potential going forward in the multi-billion barrel range.

In the near term we have a highly successful oil and gas producer that is debt free, profitable, growing, and set to double production in the next month or so. I think it is a good speculation at the current price of $4.40 per share. The company traded as high as $11.00 per share this time last year. I own shares and have been accumulating on recent weakness.

Disclosure: I am long OTCQX:TAOIF.