TEN Terraco Gold Corp

THIS NEWS RELEASE IS NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR
FOR DISSEMINATION IN THE UNITED STATES


Terraco Gold Corp. (TSX VENTURE:TEN) ("Terraco" or the "Company") is pleased to
announce a warrant exercise incentive program (the "Program") designed to
encourage the early exercise of up to 16,350,000 of its outstanding unlisted
warrants (the "Warrants"), which excludes any Warrants held by insiders of the
Company. The Warrants are currently exercisable at a price of CAN$0.20 per
common share of Terraco (a "Share") until October 6, 2012. The Warrants were
originally issued by the Company as part of a unit private placement financing
originally announced on September 9, 2010, which closed on October 6, 2010.


Pursuant to the Program, the Company is offering an inducement to each Warrant
holder that exercises their Warrants during a 30 calendar day early exercise
period (the "Early Exercise Period"), consisting of an additional one-half of
one non-transferable share purchase warrant, with each whole warrant (the
"Incentive Warrant") entitling the holder to purchase one additional Share for a
period of 18 months from the date of issuance of such Incentive Warrant at a
price of CAN$0.40. The Early Exercise Period will commence tomorrow, Wednesday,
July 13, 2011, at 9:00 a.m. (Vancouver time) and expire on Thursday, August 11,
2011 at 4:30 p.m. (Vancouver time) (the "Early Exercise Expiry Date"). The
Incentive Warrants will be subject to a four-month hold period from the date of
issuance.


"Warrant holders who take advantage of the opportunity to exercise their
Warrants early will strengthen Terraco's current cash position and provide the
Company with additional working capital to accelerate the continued exploration
of its Almaden Project (Idaho) and its Moonlight Project (Nevada). In
particular, based on the positive drilling results from Almaden announced by the
Company on June 29, 2011, additional exploration activities are expected to
continue aggressively," commented Todd Hilditch, Terraco's President and CEO.


Depending upon the number of Warrants exercised during the Early Exercise
Period, Terraco expects to:




--  receive gross proceeds of up to CAN$3.27 million on or before the Early
    Exercise Expiry Date; 

--  issue up to 16,350,000 Shares pursuant to the exercise of Warrants by
    holders in accordance with the original terms of the Warrants; and 

--  issue up to 8,175,000 Incentive Warrants to Warrant holders pursuant to
    the early exercise of the Warrants on or before the Early Exercise
    Expiry Date. 



The terms and conditions of the Program and the method of exercising Warrants
pursuant to the Program are set forth in a letter which is being delivered to
the registered address of each eligible Warrant holder along with a form of
subscription agreement (the "Subscription Agreement") to be completed by Warrant
holders in relation to the issuance of the Incentive Warrants. Under the terms
of the Subscription Agreement, Warrant holders who wish to participate in the
Program will agree to exercise their Warrants and deliver the other necessary
documents in consideration of the issuance by the Company of the Incentive
Warrants. The form of letter and Subscription Agreement will be posted on the
Company's profile on SEDAR at www.sedar.com and available on the Company's
website at www.terracogold.com.


Holders of Warrants who elect to participate in the Program will be required to
deliver to the Company at Suite 960, 1055 West Hastings Street, Vancouver,
British Columbia, Canada, V6E 2E9, by 4:30 p.m. (Vancouver time) on or before
the Early Exercise Expiry Date, the following:




1.  a duly completed and executed Subscription Agreement in the form to be
    provided to Warrant holders by the Company;
    
2.  a duly completed and executed Share Purchase Warrant Subscription Form
    attached as Schedule "A" to their Warrant certificate; 
    
3.  the original Warrant certificate; and 
    
4.  the applicable aggregate exercise price payable to the Company in
    Canadian Dollars by way of certified cheque, money order, bank draft or
    wire transfer. 



Any Warrants that are not exercised prior to the Early Exercise Expiry Date will
remain outstanding and continue to be exercisable for Shares of the Company on
their current terms. The Company will not be offering Incentive Warrants to
holders of Warrants who have previously exercised their Warrants (an aggregate
of 200,000 Warrants).


The Program is subject to the receipt of all final regulatory approvals,
including the final approval of the TSX Venture Exchange.


The Incentive Warrants to be issued pursuant to the exercise of the Warrants
have not been and will not be registered under the United States Securities Act
of 1933, as amended (the "U.S. Securities Act") or any state securities laws and
may not be offered or sold within the United States or to, or for the account or
benefit of, U.S. Persons (as defined in Regulation S promulgated under the U.S.
Securities Act) unless registered under the U.S. Securities Act and any
applicable state securities laws or an exemption therefrom is available. A U.S.
Warrant holder may not exercise Warrants during the Early Exercise Period, or
otherwise, unless such person provides either (i) a written certification that
the holder is an "accredited investor" (as defined in Rule 501(a) of Regulation
D under the U.S. Securities Act, and delivers a duly completed and executed
Warrant exercise form as required by the Warrant certificate to the Company by
the Early Exercise Expiry Date in order for such U.S. Warrant holder to exercise
its Warrants and receive underlying common shares and Incentive Warrants; or
(ii) a written opinion of counsel reasonably satisfactory to the Company to the
effect that an exemption from the registration requirements of the U.S.
Securities Act and applicable state securities laws is available for the
issuance of the Incentive Warrants upon the exercise of the Warrants. Any U.S.
Warrant holder who does not comply with such requirements will not be permitted
to exercise its Warrants and obtain the Incentive Warrants, and such Warrants
will remain outstanding following the completion of the Program. No Warrants
owned by a Warrant holder (A) who is in the United States, or (B) who is a U.S.
Person who holds a Warrant for the account or benefit of a U.S. Person or a
person in the United States may be exercised through the facilities of CDS
Clearing and Depository Services Inc. ("CDS") and no Underlying Shares and
Incentive Shares will be exchanged for Warrants beneficially owned by such
persons in CDS. All Warrants owned by such Warrant holders must be immediately
withdrawn from CDS.


Terraco is a mineral exploration company, listed on the TSX Venture Exchange
under the symbol "TEN". Please visit Terraco's website at www.terracogold.com
for additional information.


Forward-Looking Statements

This news release contains forward-looking statements. More particularly, this
news release contains statements concerning the anticipated Program. Although
Terraco believes that the expectations reflected in these forward-looking
statements are reasonable, undue reliance should not be placed on them because
Terraco 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 Program could be
delayed if Terraco is not able to obtain the necessary regulatory and stock
exchange approvals on the timelines it has planned. The Program will not be
completed at all if these approvals are not obtained or some other condition to
the Program is not satisfied. Accordingly, there is a risk that the Program will
not be completed within the anticipated time or at all. Additional information
on these and other factors that could affect Terraco's operations and financial
results are included in reports on file with Canadian securities regulatory
authorities and may be accessed through the SEDAR website at (www.sedar.com).

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