January 28, 2010
TAG OIL LTD. (V-TAO) $2.50 -0.13
has gone and done it...appealed toone’s sense of greed! The editor of
The Oil and Gas In- vestments Bulletin
has had a good track record over thelast while with such picks as Bankers Petroleum, Wave-front Energy, Bellatrix and a few others. Mind you, thatwas in the good old days when oil prices were going upand oil stocks seemed to be leading the way.Yesterday, Schaefer comes out with a new pick andwrites, “I have only watched two oil and gas stocks gofrom $1—$100 a shares—Niko and Ultra Petroleum. Thiscould seriously be the third…” It’s
, “An independ-ent report suggests they could have somewhere between4-20 BILLION barrels of oil on their New Zealand (northisland) oil shale play. It’s very thick, quite porous andvery, very large. There are actually two shale beds. Itlooks very similar to the Bakken in North Dakota/Saskatchewan. Tag owns 2.4 million acres of this play.”Schaefer continues, “Three wells have shown theshales are there, but chemistry is still not certain. It mightnot be economic; as keen as I am on this company, it isnot a slam dunk. But it is one great exploration play withunbelievable upside.”Schaefer points out, “It also has 350 bopd of light oilfrom its Cheal property in New Zealand, but the reason Iam buying the stock is because the valuation on the po-tential reserves of this company lead me to believe itcould be 10-30 bagger in two years.”Schaefer also points out one of the key ingredients ofthis company in that there are only 30 million shares out-standing and management owns 11 million and there is$10 million in the bank.He also adds however, “The stock has already runhard, up from $0.80 three months ago, so I’m not the firstto discover this story. It’s a tough chart to buy. But I amgetting long here because the stock looks like it wants totrade higher.”Schaefer’s comments appeal to one’s sense of greedand I suspect following his newsletter for information onthis play is going to be very important over the comingmonths. Some things must be remembered: He pointsout that this is still a high risk/high reward play and if forwhatever reason the shale play doesn’t work, this will be abig owie!The other thing to be aware of is that it is going to be along time before we get results to find out whether thisplay deserves the attention it’s probably going to get inthe coming months...or not.