What Two Experts Said About Oil Co. Prior to New Leadership

TAG Oil Ltd. (TAO:TSX.V; TAOIF:OTCQX) achieved its first oil production in the Badr oil field in the Western Desert, Egypt, last month and has now announced its senior leadership for operations in Egypt.

Two highly-experienced Vice Presidents with backgrounds in operations (Samir Abady and Kevin Baxter) join the company's newly promoted country manager, Gamal Rezk, who is now Vice President and general manager of TAG Petroleum Egypt Ltd. 

Mr. Abady is now Vice President and operations manager, and Mr. Baxter is Vice President and technical manager. 

CEO Toby Pierce said of the appointments, "As our operations progress in Egypt, I am excited that Mr. Rezk, Mr. Abady, and Mr. Baxter will form the backbone of TAG Oil's management team in Egypt.

They are a significant addition to our company, and all have strong backgrounds, established industry relationships, and proven track records of increasing corporate and operational performance, and are highly motivated, detail and goal-oriented, and are focused on results."

Stephane Foucaud of Auctus Advisors reported in its May 12 update that TAG Oil had "unloaded to surface under natural flow and cleaned up ~40% of the injected fracture fluid with a significant presence of 23 deg APIoil' in its BED 1-7 well."

They have a combined total of almost 90 years of experience in oil and gas management. 

According to its website, TAG Oil is a "Canadian-based and listed oil and gas exploration company pursuing acquisitions, exploration, and production in the Middle East and North African (MENA) region."

The company's Executive Chairman is Abby Badwi, a "geologist and petroleum industry executive" with more than 40 years of experience. Suneel Gupta is Vice President and Chief Operating Officer, and Barry MacNeil is Chief Financial Officer. 

The management team has a history of building companies to sell, including Bankers Petroleum, Rally Energy, and Kuwait Energy.

TAG Oil focuses on the exploitation and development of later-life conventional assets. It uses advanced technologies and the varied, unconventional experience of its team to drive production. While it considers itself an exploration company, its focus currently is on producing oil and generating cash flow from bigger, more complex assets. 

The Latest on Oil

Markets Insider reported on May 30 that oil prices have dropped by 5%, with West Texas Intermediate crude falling to US$69.02 a barrel. The drop was caused by concerns over raising the US$31 trillion U.S. debt ceiling. If passed, the Fiscal Responsibility Act would limit baseline spending in the United States until 2025.

On May 2, Reuters reported a decrease in output in Iran and outages in Nigeria. The Organization of the Petroleum Exporting Countries (OPEC) pumped 28.62 million barrels per day (bpd) in April, a figure down by 190,000 bpd from March. Total output is down by 1 million bpd from September 2022.

Chen Lin of What is Chen Buying? What is Chen Selling? noted that TAG Oil is "working hard to acquire additional land positions nearby" and included a link to an interview with CEO Toby Pierce in its May 16 report.

Stephane Foucaud of Auctus Advisors reported in its May 12 update that TAG Oil had "unloaded to surface under natural flow and cleaned up ~40% of the injected fracture fluid with a significant presence of 23 deg APIoil' in its BED 1-7 well."

Chen Lin of What is Chen Buying? What is Chen Selling? noted that TAG Oil is "working hard to acquire additional land positions nearby" and included a link to an interview with CEO Toby Pierce in its May 16 report.

According to the company, the industry has been under-invested for eight years, meaning an increase in demand. The U.S. Energy Information Administration expects the 'seasonal rise in oil consumption and a drop in OPEC crude oil production to put some upward pressure on crude oil prices in the coming months.'

Multiple Catalysts

TAG Oil is currently looking to target a large international oil play that has substantial upside. 

The company received a valuation of US$340 million in November 2022 and was trading at approximately 30% of that valuation, and hopes that the recent updates and catalysts will cause its stock to re-rate substantially. 

There is also the potential for a second horizontal well to be worked on in December 2023/January 2024.

Ownership and Share Structure

Management and insiders own 13.2% of the company, including the Chairman, board members, CEO, and CFO. According to Reuters, Askar Alshinbayev owns 10.94% of the company, while Abby Badwi, the Executive Chairman, owns 2.05%; Director Shawn Reynolds owns 1.53%; Suneel Gupta, the vice president and chief operating officer, owns 1.02%; Barry MacNeil, the chief financial officer, owns 0.95%; Toby Pierce, the chief executive officer, owns 0.81%; and Director Gavin Wilson owns 0.74%.

As for institutions, YF Finance Ltd. Owns 8.38%, Novum Asset Management AG owns 0.65%, and Palos Management Inc. owns 0.26%. YF Finance represents a strategic investor and acquired its shares through placements and open market buying.

Headquartered in Vancouver, Canada, TAG Oil Ltd. has 155,146,252 shares and 169,916,252 fully diluted. It has 6,250,000 warrants and 8,520,000 options.

The company has a market cap of CA$100 million and trades at a 52-week range of CA$0.32 and CA$0.66. It has around CA$34 million in the bank and a monthly burn rate of approximately CA$400,000. 

Important Disclosures:

1) Tag Oil Ltd. is a billboard sponsor(s) of Streetwise Reports and has paid SWR a sponsorship fee between US$3,000 and US$5,000.

2) As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Tag Oil Ltd. 

3) Lauren Rickard wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor.

4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.

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