Pegasus Oil & Gas Inc. announces closing of bought deal private placement financing



    /NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN
    THE UNITED STATES./

    (Stock Symbol "POG.A & POG.B" - TSX Venture Exchange)

    CALGARY, Feb. 28 /CNW/ - Pegasus Oil & Gas Inc. ("Pegasus" or the
"Company") is pleased to announce that it has closed its previously announced
bought deal private placement financing of 6.85 million flow-through Class A
shares at an issue price of $2.05 per share. The offering, led by FirstEnergy
Capital Corp. with a syndicate including Blackmont Capital Inc. and GMP
Securities L.P., resulted in aggregate gross proceeds of $14,042,500.
    The shares will be subject to a four-month hold period. Proceeds from
this offering will be used to finance the Company's ongoing exploration
activities.

    Pegasus' Class A and Class B shares trade on the TSX Venture Exchange
under the symbols, "POG.A" and "POG.B" respectively. The Company has
34,485,000 Class A shares and 1,012,000 Class B shares outstanding after the
closing of the financing.

    This news release shall not constitute an offer to sell or the
solicitation of an offer to buy securities in any jurisdiction. The common
shares offered will not be and have not been registered under the United
States Securities Act of 1933 and may not be offered or sold in the United
States absent registration or an applicable exemption from the registration
requirement.

    The TSX Venture Exchange does not accept responsibility for the adequacy
    or accuracy of this release.

    Forward Looking Statements

    This document contains forward-looking statements. More particularly,
this document contains statements concerning the anticipated use of the net
proceeds of the offering. Although Pegasus believes that the expectations
reflected in these forward-looking statements are reasonable, undue reliance
should not be placed on them because Pegasus can give no assurance that they
will prove to be correct. Since forward-looking statements address future
events and conditions, by their very nature they involve inherent risks and
uncertainties.
    The intended use of the net proceeds of the offering by Pegasus might
change if the board of directors of Pegasus determines that it would be in the
best interests of Pegasus to deploy the proceeds for other purposes.
    The forward-looking statements contained in this press release are made
as of the date hereof and Pegasus undertakes no obligations to update publicly
or revise any forward-looking statements or information, whether as a result
of new information, future events or otherwise, unless so required by
applicable securities laws.

    %SEDAR: 00005637E




For further information:

For further information: Patrick Mills, President and Chief Executive
Officer, (403) 521-6307; Darcy Anderson, Chief Financial Officer, (403)
521-6302; Kevin Angus, Executive Vice President, (403) 521-6306; Corporate
website: www.pegasusoilgas.com

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Pegasus Oil & Gas Inc.

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