TAG Oil, a Canadian listed independent, at the weekend said Cheal-B2, in petroleum mining licence PMP 38156, had reached a total depth of 1866m in the targeted Miocene-aged Mount Messenger sands.

After evaluating the wireline logs, the joint venture had agreed to run production casing and start a program of completion testing.

“We’re pleased by the indications of oil and we’re looking forward to moving the rig to spud Cheal-B3,” said TAG president Drew Cadenhead.

Last month, Austral said that four years after oil was first discovered at the Cheal A wellsite, the confirmation of oil in the prospect’s northern end ensured commerciality of the whole field.

Cheal-B1 intersected oil-bearing Mt Messenger sands over a 27m gross pay interval.

The Cheal-B1 and B2 wells are the first of four step-out wells from the Cheal B wellsite, being directionally drilled to target the Mt Messenger formation that has already proven productive at the Cheal-A3X and A4 wells. After the completion of the B wells, the Ensign International Rig 19 will move to the A site to drill two more development wells.

First oil from permanent production facilities is expected to be about 1000 barrels of oil per day from early 2007, with full production of about 1900bopd achieved during the second quarter.