TAG Oil Increases Cheal Reserves

Independent Canadian oil and gas production and exploration company TAG Oil Ltd. announced that an independent reserve evaluation prepared for Austral Pacific Energy Ltd., the operator of the Cheal oil field in New Zealand (TAG 30.5%), reports a significant increase in Net Present Value discounted at 10% as of December 31, 2007. Based on the parameters used in the report (reviewable at www.sedar.com, under Austral's profile), TAG's share of proved and probable ("2P") NPV(10) has increased from US$17.68 million reported in the Company's independent evaluation dated March 31, 2007 to US$31.71 million. TAG is presently updating the Company's independent year-end reserve evaluation as of March 31, 2008.

TAG Oil Chief Executive Officer, Garth Johnson commented, "Although we are encouraged by the operator's December 31 report relating to an increase in value of Cheal oil field reserves, any estimate of future value requires successful implementation of a field development plan, which has yet to be agreed upon. The report shows that TAG's reserve values have benefitted from higher world oil prices and that the Cheal field's 2P reserves have remained materially consistent from our last reporting period."