VANCOUVER --TAG Oil Ltd. (Toronto: TAO) is pleased to announce that it has increased the size of its previously-announced bought deal offering. The Company has entered into a revised agreement with Bookrunner and Co-Lead Underwriter Dundee Securities Ltd., whereby Dundee and Co-Lead Underwriter Casimir Capital Ltd., and agents Cormark Securities Inc., GMP Securities L.P., Mackie Research Capital Corporation and M Partners Inc. have now agreed to purchase, on a bought deal basis 4,170,000 common shares of the Company at a price of $10.45 per Common Share, for aggregate gross proceeds of $43,576,500. The company has granted the Underwriters an option to purchase up to an additional 615,000 Common Shares, at a price of $10.45 per Common Share, exercisable in whole or in part at any time prior to 30 days after the Closing Date. In the event that the option is exercised in its entirety, the aggregate gross proceeds of the offering will be $50,003,250.

The Company plans to use the net proceeds from the offering as follows: accelerate exploration and development program in the Taranaki Basin; pursue new opportunities, increase TAG's land position in the Taranaki Basin, New Zealand and for general corporate purposes.

The offering is scheduled to close on or about May 15, 2012 and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the TSX and the securities regulatory authorities.