New Zealand and Australia-focused TAG Oil Ltd (TSE:TAO) said it had a busy second quarter, which saw it increase revenues by 11% and lay the groundwork for an oil price recovery.
Revenues from its oil and gas sales were $6mln for the three months to end September versus $5.4mln in the June quarter this year - an increase of 11%.
This was due to a 19% increase in average Brent oil prices and less than 1% increase in average net daily oil production.
Average daily production decreased by 2% for the quarter ended September 30, 2017 to 1,151 boe/d (78% oil) from 1,169 boe/d (77% oil) for the June quarter.
Operating netback at the company increased by 34% for the quarter to $30.95 per boe (barrel of oil equivalent) compared with $23.09 per boe for the preceding quarter.
"The company had a busy fiscal quarter in which we continued to lay the ground work for growth with the recovery in oil prices," said Toby Pierce, TAG Oil's chief executive.
"We are eagerly awaiting results from our 3D seismic acquisition at PL17 and increased production from our ongoing waterflood program.
"Assuming a continued improvement in Brent oil prices, we expect that our revenue operating cashflow and netbacks will continue to grow into calendar 2018.
"Finally, our focus for the remainder of the year will be on increasing our production and continuing to prepare for drilling opportunities."
As at September 30, Tag had $2.7 million in cash and equivalents compared to $12.2 million at the end of June this year.
It also had $8.7mln in working capital versus $15.2 on June 30.