TAOIF TAG Oil Ltd New (QX)

VANCOUVER, April 4, 2013 /PRNewswire/ - TAG Oil Ltd. (TSX: TAO) and (OTCQX:
TAOIF), is pleased to report that the Company's Cheal infrastructure
expansion project in the Taranaki region of New Zealand has been
completed. Together with TAG's existing production infrastructure and
pipeline network, the Company now has the capacity to fully
commercialize the successes (past and future) of its onshore Taranaki
Basin assets.

This major expansion establishes TAG Oil as a completely independent
processor, transporter, and marketer of the gas the Company discovers,
extracts and produces, opening significant new opportunities to supply
the thriving Taranaki natural gas market.

Shut-in wells now being placed into long-term production

With this completed infrastructure expansion, previously shut-in wells
from TAG's successful 2012 shallow drilling program are now being
placed into long term production. The Company will continue to identify
areas of the new infrastructure that requires optimization, as final
commissioning work continues in the coming weeks. TAG's total
production capability from tested shallow wells and the new liquids
potential of the expanded gas plant is in excess of 5000 barrels of oil
equivalent per day.

TAG Oil CEO, Garth Johnson commented, "I congratulate our entire team
who have worked tirelessly to finish this project on time and on budget
and they've done so to the highest safety and environmental standards.
Even more impressive is the fact that during this complex
infrastructure project, the team continued our unprecedented rate of
successful new well drilling in Taranaki. With control of this critical
infrastructure, TAG Oil is poised to grow even stronger, including new
opportunities to leverage our natural gas assets."

New Zealand market drives value of TAG's oil up to 30% and gas up to
100% higher than Q1 2013 North American prices.

One component of the Company's strategic focus on New Zealand - and a
driver of the Cheal infrastructure expansion - is the high relative
value of the oil and gas TAG produces. In addition to enjoying oil
prices which, in February 2013, averaged CDN$30/bbl higher than West
Texas Intermediate, TAG's contracted gas price (NZ$5.40/mcf) is more
than double the 2012 Canadian gas price average.

In contrast to the oversupply of natural gas in North America, the
Taranaki region of New Zealand is undersupplied, with further imbalance
between gas supply and demand (http://www.tagoil.com/production.asp#) forecasted for the long term.

March 27^th, 2013 was a milestone day for TAG Oil as the valve connecting the newly
expanded Cheal Processing Facility to New Zealand's primary natural gas
transmission pipeline was opened for the first time, providing the
Company the ability to market and sell Cheal gas to interested parties
looking for a long-term supply of gas.

TAG's $100 million state-of-the-art infrastructure expands processing
capacity with a focus on safely producing oil and gas for years to
come.

The original Cheal facility, which was constructed at a cost of
approximately $25 million by the previous operator, now has expanded
oil processing capability, gas-liquids' extraction capabilities, and a
new 11km pipeline to New Zealand's primary gas transmission pipeline,
all at an additional cost of ~$30 million. Including the Sidewinder
Production Facility, TAG now controls approximately $100 million in
critical infrastructure, which positions TAG as a prominent New Zealand
producer with a strong competitive edge to pursue the attractive
opportunities identified within the Company's Taranaki portfolio.

This expansion ensures future wells - including high deliverability gas
condensate wells - can be quickly commercialized. In addition, it
delivers:

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  Increased oil lifting capacity;
  
  
  
  
  
  
  
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  Increased gas compression capacity;
  
  
  
  
  
  
  
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  Increased electricity generation capability;
  
  
  
  
  
  
  
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  A new gas plant capable of stripping liquid hydrocarbons for sales and
  creating New Zealand spec gas from solution gas;
  
  
  
  
  
  
  
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  Maximized marketability of TAG's gas production via new pipelines tying
  the Cheal-C site to the Cheal-A site, and a new 11km pipeline from
  Cheal to New Zealand's open-access gas transmission line.
  
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"Over the coming months," said TAG Chief Operating Officer Drew
Cadenhead, "we'll be monitoring initial flush production rates and
analyzing plant performance. Where necessary, we'll optimize production
configuration to ensure we're operating at maximum efficiency while
still following oilfield production best-practices. We're very pleased
to have completed this major project slightly ahead of schedule: This
was a very complex program using a variety of skills, and since we kept
drilling while construction proceeded, an immense amount of planning
and communication was required to insure these concurrent operations
were completed safely and efficiently. Our team did a great job."

TAG Oil Ltd.

TAG Oil Ltd. http://www.tagoil.com/) is a Canadian-based production and exploration company with operations
focused exclusively in New Zealand. With 100% ownership over all its
core assets, including extensive oil and gas production infrastructure,
TAG is enjoying substantial oil and gas production and reserve growth
through development of several light oil and gas discoveries. TAG is
also actively drilling high-impact exploration prospects identified
across more than 2,984,171 net acres of land in New Zealand.

In the East Coast Basin, TAG will explore and potentially develop the
major unconventional resource potential believed to exist in the tight
oil source-rock formations that are widespread over the Company's
acreage. These oil-rich and naturally fractured formations have many
similarities to North America's Bakken source-rock formation in the
successful Williston Basin.

TAG Oil has adopted the standard of six thousand cubic feet of gas to
equal one barrel of oil when converting natural gas to "BOE's". BOEs
may be misleading, particularly if used in isolation. A BOE conversion
ratio of 6Mcf: 1 Bbl is based on an energy equivalency conversion
method primarily applicable at the burner tip and does not represent a
value equivalency at the wellhead.

Cautionary Note Regarding Forward-Looking Statements:

Statements contained in this news release that are not historical facts
are forward-looking statements that involve various risks and
uncertainty affecting the business of TAG. Such statements can be
generally, but not always, identified by words such as "expects",
"plans", "anticipates", "intends", "estimates", "forecasts",
"schedules", "prepares", "potential" and similar expressions, or that
events or conditions "will", "would", "may", "could" or "should" occur.
These statements are based on certain factors and assumptions
including:

A. All estimates and statements that describe the Company's objectives,
goals, production rates, optimization, infrastructure capacity and or
future plans relating to the seismic, testing, work over and drilling
programs in Taranaki are forward-looking statements under applicable
securities laws and necessarily involve risks and uncertainties
including, without limitation: risks associated with oil and gas
exploration, development, exploitation, production, marketing and
transportation, volatility of commodity prices, imprecision of reserve
estimates, environmental risks, competition from other producers, and
changes in the regulatory and taxation environment. These
forward-looking statements are based on certain factors and
assumptions, including factors and assumptions regarding the
management's views on the oil and gas potential in the Permits, well
performance, the success of any operations, completing infrastructure
and the costs necessary to complete the operations; and

B. Those relating to TAG Oil's exploration and development of its oil
and gas properties within the Cheal and Sidewinder project areas, the
production and establishment of additional production of oil and gas in
accordance with TAG Oil's expectations at Cheal and Sidewinder, well
performance, drilling, the completion of new infrastructure at Cheal
and Sidewinder, optimization, the increase of cash flow from new
production, expected growth, results of operations, performance,
prospects, evaluations and opportunities. While TAG Oil considers these
factors and assumptions to be reasonable based on information currently
available, they may prove to be incorrect. Actual results may vary
materially from the information provided in this release, and there is
no representation by TAG Oil that the actual results realized in the
future will be the same in whole or in part as those presented herein.

TAG Oil is involved in the exploration for and production of
hydrocarbons, and its property holdings with the exception of the Cheal
and Sidewinder project areas are in the grass roots or primary
exploration stage. Exploration for hydrocarbons is a speculative
venture necessarily involving substantial risk. There is no certainty
that the expenditures incurred on TAG Oil's exploration properties will
result in discoveries of commercial quantities of hydrocarbons. TAG
Oil's future success in exploiting and increasing its current reserve
base will depend on TAG Oil's ability to develop its current properties
and on its ability to discover and acquire properties or prospects that
are producing. There is no assurance that TAG Oil's future exploration
and development efforts will result in the discovery or development of
additional commercial accumulations of oil and natural gas. Other
factors that could cause actual results to differ from those contained
in the forward-looking statements are also set forth in filings that
TAG and its independent evaluator have made, including TAG's most
recently filed reports in Canada under National Instrument 51-101,
which can be found under TAG's SEDAR profile at www.sedar.com.

TAG undertakes no obligation, except as otherwise required by law, to
update these forward-looking statements in the event that management's
beliefs, estimates or opinions, or other factors change.

SOURCE TAG Oil Ltd.