TAG Oil : MD&A for the period ended December 31, 2023

MANAGEMENT'S DISCUSSION AND ANALYSIS

The following Management's Discussion and Analysis ("MD&A") is dated April 29, 2024, for the nine month period ended December 31, 2023 and should be read in conjunction with the audited consolidated financial statements for the nine month period ended December 31, 2023 and the year ended March 31, 2023.

The audited consolidated financial statements for the nine month period ended December 31, 2023, have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board, and its interpretations. Results for the nine month period ended December 31, 2023, are not necessarily indicative of future results. All figures are expressed in thousands of Canadian dollars unless otherwise stated.

ABOUT TAG OIL LTD.

TAG Oil Ltd. (the "Company" or "TAG") is a Canadian international upstream oil and gas exploration and production company listed on the TSX Venture Exchange under the trading symbol "TAO". The Company is focused on oil and gas exploration and development opportunities in the Middle East and North Africa ("MENA"). TAG holds an interest in the Badr Oil Field ("BED-1"), a 26,000 acres concession located in the Western Desert, Egypt, through a production services agreement (the "PSA") with Badr Petroleum Company ("BPCO"). The Company also is entitled to a 2.5% royalty on gross revenue produced from the New Zealand assets previous sold and 3.0% gross overriding royalty on potential future gas production from its former Australian assets.

The Company has changed its year end from March 31 to December 31 to align it with its subsidiary, which operates on a calendar fiscal year end in Egypt. Accordingly, the current consolidated financials are prepared for 9 months from April 1 to December 31, 2023, and as a result, the comparative figures stated in the income statement, statement of changes in equity, cash flow statement and the related notes might not be comparable.

TAG's long-term plan is to deliver sustainable shareholder value through the evaluation of new acquisitions and joint venture opportunities primarily in Egypt and the broader MENA region, with the aim of expanding and identifying suitable additions to the Company's portfolio.

TAG will maintain its primary focus on the BED-1 field and continue to work on optimizing and unlocking shareholder value in other assets.

TAG CORPORATE

On November 17, 2023, the Company was approved for a reduction in the performance letter of guarantee (the "Letter of Guarantee") in the amount of US$2,562,595 based on expenditures reviewed by Egyptian General Petroleum Corporation for fulfilling a portion of the commitments outlined in the PSA.

On September 1, 2023, the Company issued 1,450,000 shares for stock options exercised at a price of $0.25 per share.

On September 1, 2023, the Company issued 2,343,750 shares for warrants exercised at a price of $0.16 per share.

On August 24, 2023, and September 22, 2023, the Company issued 21,126,542 common shares for public offering and over-allotment option at a price of $0.58 per common share for aggregate gross proceeds of $12.3 million. The aggregate underwriters' fee paid to the underwriters in connection with the offering was $1.0 million and $0.1 million in other costs relating to the issuance.

On July 19, 2023, the Company issued 1,562,500 shares for warrants exercised at a price of $0.16 per share.

On July 11, 2023, the Company granted 1,800,000 stock options that are exercisable for a period of five years from the date of grant at a price of $0.70 per share.

On June 26, 2023, the Company issued 2,187,500 common shares for warrants exercised at a price of $0.16 per share.

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Between May 10, 2023, to May 24, 2023, the Company issued 770,000 common shares for stock options exercised at a price of $0.50 per share.

On February 27, 2023, the Company granted 200,000 stock options that are exercisable for a period of five years from the date of grant at a price of $0.70 per share.

On February 21, 2023, the Company issued 125,000 common shares for stock options exercised at a price of $0.50 per share.

On February 9, 2023, the Company granted 3,600,000 stock options that are exercisable for a period of five years from the date of grant at a price of $0.70 per share.

On February 1, 2023, the Company issued 249,999 common shares for stock options exercised at a price of $0.25, $0.45, and $0.70 per share. The Company also issued 156,250 common shares for warrants exercised at a price of $0.16 per share.

On January 6, 2023, the Company issued 130,000 common shares for stock options exercised at a price of $0.50 per share.

On December 15, 2022, the Company granted 1,150,000 stock options that are exercisable for a period of five years from the date of grant at a price of $0.70 per share.

On November 4, 2022, the Company completed a public offering of 63,250,000 common shares of the Company, at a price of $0.40 per common share for aggregate gross proceeds of $25.3 million. The aggregate fees paid in connection with the offering was $1.9 million.

RESULTS FROM OPERATIONS

On September 22, 2022, the Company was awarded the PSA for the development of the unconventional Abu Roash "F" ("ARF") reservoir in BED-1, Western Desert, Egypt, by BPCO, subject to various conditions. The two financial conditions being a signature bonus of US$3.0 million ($4.0 million) paid to BPCO and the Letter of Guarantee (of US$6.0 million ($8.3 million) in favor of BPCO for work commitments to be completed. The PSA was formally signed on October 13, 2022.

On January 26, 2023, the Company commenced at BED-1 the re-completion and evaluation operations of the BED 1-7 vertical well. These initial operations are part of TAG's phase 1 development program of ARF reservoir in BED-1. On May 19, 2023, the BED 1-7 well started oil production from the ARF reservoir. The performance of the BED 1-7 well test has achieved the Company's objectives for the well, and data collected from the well along with geomechanical and 3D seismic review will be implemented for the first horizontal well.

On June 19, 2023, the Company announced that it was successful in securing a suitable drilling rig for the first horizontal well, BED4-T100 ("T100"), designed with a multi-stage fracture stimulation completion of the ARF reservoir. Mobilization of the rig was subsequently completed and the T100 well commenced drilling in August 2023. Commencing the T100 drilling program marks a significant milestone in the Company's operations and ongoing commitment to unlocking the ARF reservoir's potential in BED-1.

On November 4, 2022, the Company completed an offering of 63,250,000 common shares at a price of $0.40 per common share for aggregate net proceeds to the Company of $23,782,000.

The following table outlines the proposed use of the proceeds of the offering completed on November 4, 2022, along with the amounts expended:

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The Company is part way through the program laid out in the November offering and is showing a variance of $0.3 million as at December 31, 2023. The timing of the programs has been pushed out due to the availability of suitable rigs, material and service providers, and fishing and other activities in the executed portion of the program. Most of the variance in expenditures is slated for the T100 well with vertical pilot hole of $11.0 million, which was spudded in August of 2023 and completed the vertical pilot portion of the well, open-hole logging, formation imaging, pressure measurement and fluid sampling, and cement plug-back of lower vertical pilot hole. The drilling of build and lateral horizontal sections in the ARF reservoir was completed in March of 2024, and hydraulic fracture stimulation operations are underway.

The horizontal side-track well may be planned and executed by information obtained in drilling the T100 well. The

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expected cost of the horizontal sidetrack should be in the range of the $5.5 million indicated but could be revised after the results of the T100 are known. Other potential acquisition opportunities are ongoing and will continue to be funded, but no definite prospect has been accepted. Equipment orders for the 2024 program have been placed and currently exceed the $0.3 million allocated but are within the amounts allocated in the current financing. The Company hopes that it will be able to complete the activities or expenditures as outlined in the offering completed on November 4, 2022, but may require additional financing.

The following table outlines the proposed use of the proceeds of the offering completed on August 24, 2023, and the over-allotment on September 22, 2023:

Operational and Drilling Budget for third quarter of 2023 and year ended 2024 (comprised of exploration wells)

The Company is continuing to work through the program laid out in the August and September offering and is showing a variance with $11.6 million remaining as at December 31, 2023. As we move through 2024, we will use the results of the T100 to evaluate and inform the future design and development of our program. It is anticipated that the above funds of $11.6 million will be used as indicated in calendar 2024.

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FINANCIAL SNAPSHOT

1. Operating netback is a non-GAAP measure. Operating netback is the operating margin the company receives from each boe sold. See non-GAAP measures for further explanation.

ANNUAL FINANCIAL

The Company concluded its negotiation of the PSA during the fiscal year for the development of the unconventional ARF reservoir in BED-1, Western Desert, Egypt. This marked the completion of theprocess that began in fiscal 2020 of

transitioning from an exploration andproduction company focused on New Zealand and Australia to one focused on the MENA region. The fiscal years 2021 and 2022 were spent finalizing the sale of theAustralian assets, reviewing new opportunities, and negotiating terms for the PSA.

The Company was able to complete its transition despite disruption of the world economic climate, first by COVID-19 and then by the Russia/Ukraine conflict. The Company has since completed the BED 1-7 recompletion activities, established an office, and hired staff in Egypt to support further development and production at BED-1.

The Company's assets increased in the nine month ended December 31, 2023 by $12.8 million from $41.1 million to $53.9 million from the year ended March 31, 2023. The increase in assets in the current period is mainly a result of the financing completed by the Company on August 24, 2023, and the over-allotment on September 22, 2023: a public offering of 21,126,542 common shares of the Company, at a price of $0.58 per common share for aggregate gross proceeds of $12.3 million. The aggregate fees paid in connection with the offering were $1.1 million. The other main increase in assets is from exploration and evaluation of the ARF formation of $24.1 million compared to $6.6 million in the prior year. The increase in assets from March 31, 2023 to December 31, 2023 of $12.8 million resulted mainly from capital expenditures incurred on the property in Egypt.

During the nine months ended December 31, 2023 the Company has had production costs of $1.3 million and revenue of $0.6 million. During the year ended March 31, 2023, the Company had no production and no revenue. The net loss for the nine month period ended December 31, 2023 is $6.1 million, mostly consisted of G&A of the Company while it is working on developing the production, which consist of office and administration of $0.7 million, professional fees of

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$0.5 million, shareholder relations and communications of $0.8 million, travel of $0.6 million and wages and salaries of $1.2 million. The net loss for the year ended March 31, 2023 is $3.0m, largely due to the G&A of the Company, which consist of office and administration of $0.4 million, professional fees of $0.5 million, shareholder relations and communications of $0.9 million, travel of $0.5 million and wages and salaries of $2.4 million. The increase in net loss is a result of the company's continued expansion of activities in Egypt, including the hiring of consultants and salaried staff to manage the increased workload.

OPERATING HIGHLIGHTS

• At December 31, 2023, the Company had $16.4 million in cash and cash equivalents and $12.2 million in working capital.
• Oil sales in the amount of $0.6 million for the nine month period ended December 31, 2023.
• Capital expenditures totaled $18.1 million for the nine month period ended December 31, 2023. The amount consists of exploration and evaluation, capital leases, computer and office equipment and leasehold improvements.

QUARTERLY FINANCIAL AND OPERATING HIGHLIGHTS

• At December 31, 2023, the Company had $16.4 million in cash and cash equivalents and $12.2 million in working capital.
• Capital expenditures totaled $10.1 million for the quarter ended December 31, 2023.

BUSINESS ENVIRONMENT

OPEC Monthly Oil Report April 2024 reported: Crude oil futures prices continued their upward trajectory in March, driven by increasingly positive sentiments regarding oil market fundamentals, amid an elevated risk premium. This prompted money managers to sharply increase their bullish positions, particularly in the third week of the month, which added to oil price momentum, alongside higher financial flows in both futures contracts for ICE Brent and NYMEX WTI.

In the first week of March, oil futures prices were under pressure amid risk-averse market sentiment. This included mixed economic indicators and geopolitical worries, as well as uncertainty regarding the Federal Reserve's monetary policy decisions. Concerns about China's economic prospects following the announcement of its growth targets for 2024, combined with varying US economic data ahead of the Federal Reserve Chair's congressional testimony, contributed to the market volatility. Nonetheless, oil futures remained buoyed by robust supply and demand fundamentals, as evidenced by the futures forward curves of major crude benchmarks, and a drawdown in US oil product inventories, indicating healthy demand.

During the second week of March, oil futures traded within a narrow range as market participants awaited key economic data releases and given caution amid geopolitical uncertainties. Concerns persisted about the strength of oil demand in China, with reports suggesting a softening of utilization rates and weakening margins among Chinese independent refiners. Furthermore, the release of US consumer price index data, indicating ongoing inflation, tempered oil price gains.

In the second half of March, however, crude oil futures prices rallied to their highest levels since October 2023, supported by bullish market sentiment regarding oil market fundamentals, at a time of elevated risk premiums. Several reports highlighted robust global oil market fundamentals, especially for 3Q24, which conveyed confidence among traders. This positive outlook was further supported by expectations of increased demand, coupled with data indicating tighter US oil supply conditions, as reported by the EIA. Easing concerns about China's economy after the release of encouraging economic data, including higher than expected factory output, as well as a 3% y-o-y increase in crude oil refinery throughput for January and February, underscored strong Chinese demand in China.

As reported in OPEC's OMOR April 2024 report the world economic growth forecasts for 2024 and 2025 remain unchanged at 2.8% and 2.9%, respectively. In the United States, economic growth for 2024 is revised up slightly to 2.1%, as the healthy momentum from 2H23 is expected to carry into 2024, while the forecast for 2025 remains at 1.7%. The economic growth forecast for the Eurozone remains at 0.5% for 2024 and 1.2% for 2025. Japan's economic growth forecast is also unchanged at 0.8% in 2024 and 1% in 2025. Meanwhile, China's economic growth forecast remains at

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4.8% in 2024 and 4.6% in 2025. India's economic growth forecast is unchanged at 6.6% for 2024 and 6.3% for 2025. Brazil's economic growth forecast remains at 1.6% for 2024, and 1.9% for 2025. The ongoing robust performance of Russia's economy leads to upward revisions for both the 2024 and 2025 growth forecasts, now standing at 2% and 1.4%, respectively. The world oil demand according to OPEC's OMOR April 2024 the global oil demand growth forecast for 2024 remains broadly unchanged from last month's assessment of 2.2 mb/d. Slight adjustments were made to the 1Q24 data, with a slight upward revision in OECD Europe and some non-OECD data, reflecting better-than-expected performance in oil demand data. This increase was offset by a downward revision to Africa in 1Q24 and the Middle East in the first three quarters. Accordingly, the OECD is projected to expand by around 0.3 mb/d and the non-OECD by about 2.0 mb/d. In 2025, global oil demand is expected to see robust growth of 1.8 mb/d, y-o-y. The OECD is expected to grow by 0.1 mb/d, y-o-y, while demand in the non-OECD is forecast to increase by 1.7 mb/d.

As reported in the OPEC OMOR Apri 2024 report, non-DoC liquids supply (i.e. liquids supply from countries not participating in the Declaration of Cooperation) is expected to grow by 1.2 mb/d in 2024, revised down from the previous month's assessment by about 0.1 mb/d. In 2024, the main drivers for liquids supply growth are expected to be the US, Canada, Brazil and Norway. The non-DoC liquids supply growth in 2025 is expected at 1.1 mb/d, revised down by 0.1 mb/d from the previous month's assessment. The growth is mainly driven by the US, Brazil, Canada and Norway. The term "non-DoC liquids supply" is established to better reflect the current breakdown of global liquids supply into DoC and non-DoC. The non-OPEC liquids supply (including the 10 non-OPEC countries participating in DoC) in 2024 is expected to grow by 1.0 mb/d, revised down from the previous month's assessment by about 0.1 mb/d. The main drivers for liquids supply growth are expected to be the US, Canada, Brazil and Norway. The forecast for non-OPEC liquids supply growth in 2025 stands at 1.3 mb/d, revised down by 0.1 mb/d from the previous month's assessment. The growth is mainly driven by the US, Brazil, Canada, Russia, Kazakhstan and Norway. Indeed, crude production levels/growths for countries participating in DoC (including Azerbaijan, Bahrain, Brunei Darussalam, Kazakhstan, Malaysia, Mexico, Oman, Russia, Sudan, and South Sudan) are subject to their DoC production adjustments in 2024 and 2025. Separately, OPEC natural gas liquids (NGLs) and non-conventional liquids are forecast to grow by around 64 tb/d to average 5.5 mb/d this year, followed by a growth of 110 tb/d to average 5.6 mb/d in 2025. OPEC-12 crude oil production in March increased by 3 tb/d, m-o-m, averaging 26.60 mb/d, as reported by available secondary sources.

OUTLOOK AND RESPONSE TO COVID-19

The British Columbia and Alberta work environments have returned to pre-pandemic conditions. Travel restriction and increased precautions have been removed and progress and timing of most activities are normal. TAG has commenced exploration and evaluation operations in BED-1, Western Desert, Egypt, pursuant to the PSA and has established an Egyptian branch office.

The company-initiatedre-completion and evaluation operations at BED-1 for the BED 1-7 vertical well. These initial operations are part of TAG's phase 1 development program for the ARF reservoir at BED-1. On May 19, 2023, the BED 1-7 well began producing oil from the ARF reservoir. The performance of the BED 1-7 well test met the company's objectives, and the data collected, along with geomechanical and 3D seismic reviews, will inform the drilling of the first horizontal well. The well is currently undergoing a build-upassessment of the reservoir pressure to determine the depletion and potential of the well and possible workover in combination with T100 completion works.

The company commenced drilling the BED4-T100 ("T100") horizontal well in the Badr Oil Field ("BED-1") in Egypt's Western Desert, successfully drilling the vertical pilot hole to a depth of 3,290 meters. TAG Oil conducted open-hole logging, formation imaging, and pressure measurement before cementing a plug-back in the lower vertical pilot hole. The company then immediately began whip-stock drilling of the build and lateral horizontal sections in the Abu Roash "F" ("ARF") reservoir. Mechanical issues with the directional drilling tools and a minor fault fracture feature during the lateral drilling prompted TAG Oil to drill higher within the 50-meter ARF pay zone to bypass the faulted section and potentially extend the well's final lateral length.

Following additional mechanical and geo-mechanical challenges in the Abu Roash "E" ("ARE") formation, drilling resumed from 2,650 meters with an oil-based mud system, successfully landing the casing liner in the ARF carbonate reservoir at 3,238 meters. The drilling of the planned 1,000-meter horizontal section commenced, revealing significant oil flow and high gas readings, indicating strong production potential. Due to high pressures, the lateral length was

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adjusted to 308 meters. The completion equipment and personnel were mobilized, fracture stimulation was started and completed by April 23. TAG Oil expects to announce initial production results by May.

The Company is continuing to seek out and evaluate other new opportunities in the MENA region.

The Company has sufficient liquidity to operate beyond the next twelve months. The Company completed an offering for aggregate gross proceeds of $12.3 million on August 24, 2023, and September 22, 2023 and continues to receive royalty payments, stemming from the sale of substantially all of TAG's Taranaki Basin assets and operations in New Zealand (the "NZ Transaction").

SUMMARY OF QUARTERLY INFORMATION

1. Adjusted net loss and cash flow used in operating activities are non-GAAP measure. Adjusted net loss represents earnings before impairment expense and write-offs. Cash flow used in operating activities represents cash flow from operating activities before changes in working capital. See non-GAAP measures for further explanation.

For the quarter ended December 31, 2023, the company reported revenue of $0.0 million, a decrease from $0.3 million in the previous quarter and no revenue in the quarter ended March 31, 2023. During this period, the company was engaged in exploration and preliminary evaluation work on properties in Egypt. Operating costs for the latest quarter were $0.5 million, down from $0.9 million in the quarter ended September 30, 2023, and no costs in March 2023.

The net loss before tax for the quarter ended December 31, 2023, was $3.4 million, an increase from $1.3 million in the September 2023 quarter and a significant rise from a net loss of $0.9 million in March 2023. The adjusted net loss for December 2023 was $2.7 million, higher than the $1.8 million in September 2023 and $1.9 million in March 2023. The increase in net loss is attributed primarily to a rise in general and administrative expenses to $2.0 million, up from $1.4 million in March, and changes in other financial metrics. Specifically, there was a decrease in stock-based compensation to $0.3 million from $0.6 million in September and an increase in foreign exchange losses to $0.1 million from a gain of $0.3 million. Additionally, compared to March, stock-based compensation decreased from $0.7 million, with an increase in foreign exchange losses of $0.1 million, up from no loss.

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General and Administrative Expenses ("G&A")

General and administrative costs increased to $2.0 million for the quarter ended December 31, 2023, from $1.4 million for the quarter ended March 31, 2023. The increase is due to additional office and administration of $0.1 million, which is partly from the increased activity in the operations in Egypt, additional shareholder relations and communications of $0.2 million which includes a business development on a new project in Egypt, additional wages and salaries of $0.2 million.

Stock-based Compensation

Stock-based compensation costs are non-cash charges, which reflect the theoretical estimated value of stock options granted. The Company applies the Black-Scholes option pricing model using the closing market prices on the grant dates and to date the Company has calculated option benefits using a volatility ratio and a risk-free interest rate. The theoretical fair value of the option benefit is amortized on a diminishing basis over the vesting period of the options, generally being a minimum of two years.

In the quarter ended December 31, 2023, the Company did not grant or exercise any stock options.

Stock-based compensation decreased to $0.3 million in the quarter ended December 31, 2023, compared $0.7 million for the quarter ended March 31, 2023. The decrease in total stock-based compensation costs is due to no options granted in the current period.

Depletion, Depreciation and Accretion ("DD&A")