TER Terrex Energy

CALGARY, March 7 /CNW/ -- CALGARY, March 7 /CNW/ - Terrex Energy Inc. ("Terrex" or the "Company") (TSX-V - TER) announces that the Company has entered into a Purchase and Sale agreement with an arms length party for the acquisition of certain producing oil and natural gas properties in the Two Creek area of central Alberta which acquisition was previously announced by the Company on February 8, 2011. This acquisition is subject to approval by TSX Venture Exchange ("TSXV"). On March 4, 2011 pursuant to their review, the TSX Venture Exchange has advised that the Company's common shares are expected to resume trading on the TSXV effective March 7, 2010. The acquisition price for the properties has been reduced to $13 million from the $16.1 million, referred to in the Company's previous news release, primarily as a result of revisions of certain non-producing natural gas reserves. The properties are characterized by large original oil-in-place reservoirs with relatively low recoveries to date. Terrex management believes optimization and enhanced oil recovery programs, consistent with the Company's overall business plan, can significantly increase production and recoverable reserves. The Company intends to commence the planning, evaluation and development of such programs immediately following closing. The properties consist of a 100% working interest in 4,320 acres of land, including related production infrastructure, in the Two Creek area of west central Alberta. December 2010 production from the property was approximately 250 boe/d comprised of 210 barrels of oil and natural gas liquids, and 300 mcf/d of natural gas. GLJ Petroleum Consultants Ltd. ("GLJ") completed an independent reserves assessment and evaluation of the Two Creek property, in accordance with National Instrument 51-101, having an effective date as at December 31, 2010. The following provides a summary of the GLJ reserve assessment. _____________________________________________________________________ |Reserves | Oil |Natural Gas | NGls |Oil Equivalent | | |Mbbl((1))| MMcf((2)) |Mbbl((1))| MBoe((3)) | |____________________|_________|____________|_________|_______________| |Proved Producing | 397 | 371 | 5.3 | 464 | |____________________|_________|____________|_________|_______________| |Proved Plus Probable| | | 6.6 | | |Producing | 506 | 462 | | 589 | |____________________|_________|____________|_________|_______________| Notes: (1) Mbbl means thousand barrels. (2) MMcf means million cubic feet. (3) MBoe means thousand barrels of oil equivalent. The acquisition will be effective as of January 1, 2011 and is expected to close on March 31, 2011. Terrex is completing financing arrangements for the acquisition which may initially consist of a combination of working capital and debt. Terrex Energy Inc. is a Calgary-based junior oil company that specializes in the application of proven Enhanced Oil Recovery (EOR) methods to improve oil production from mature pools. Terrex targets underexploited and undercapitalized light-to-medium oil reservoirs in Western Canada. Terrex shares are listed on the TSX Venture Exchange under the symbol 'TER' Neither the TSV Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. Reserve Information and Barrels of Oil Equivalent Information relating to reserves of petroleum and natural gas contained herein represent estimates, which were prepared by the vendor's independent reserve evaluators in accordance with National Instrument 51-101. Estimating quantities of proved petroleum and natural gas reserves is a subjective, complex process that is dependent on a number of assumptions and variable factors. Estimates of proved plus probable reserves are made assuming the development of the property, without consideration as to the availability of funding necessary for that development. Production volumes and reserve information are commonly expressed on a barrel of oil equivalent ("Boe') basis whereby natural gas volumes are converted at the ratio of six thousand cubic feet of natural gas to one barrel of oil based on an energy equivalency at the burner tip and does not represent a value equivalency at the well head. Used in isolation, barrels of oil equivalent may be misleading. Forward-Looking Statements This news release contains certain forward-looking statements and forward-looking information (collectively referred to herein as "forward-looking statements") within the meaning of Canadian securities laws. All statements other than statements of historical fact are forward-looking statements. In particular, this press release contains forward-looking statements pertaining to expectations of management regarding the proposed acquisition, including; the closing date of the acquisition; financing activities to be conducted by Terrex to finance the acquisition, including the assumption of debt and the use of proceeds thereof; the characteristics of the property, including the expectation that the property will be a good candidate for Improved and Enhanced Oil Recovery programs; the expected timing of the planning, evaluation and development of the programs, and the success of such programs. In addition, statements relating to "reserves" are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions, that the reserves described exist in the quantities predicted or estimated and can be profitably produced in the future.  Undue reliance should not be placed on forward-looking statements, which are inherently uncertain, are based on estimates and assumptions, and are subject to known and unknown risks and uncertainties (both general and specific) that contribute to the possibility that the future events or circumstances contemplated by the forward-looking statements will not occur. Assumptions include, among other things: future capital expenditure levels; the ability to secure regulatory approval, the ability to obtain financing on acceptable terms to finance the acquisition; future oil and natural gas prices; future oil and natural gas production levels; the success of IOR and EOR programs; the ability to obtain equipment in a timely manner to carry out development activities; the ability to market oil and natural gas successfully; and the impact of increasing competition.  Although Terrex believes that the expectations reflected in the forward looking statements contained in this press release, and the assumptions on which such forward-looking statements are made, are reasonable, there can be no assurance that such expectations will prove to be correct. Readers are cautioned not to place undue reliance on forward-looking statements included in this document, as there can be no assurance that the plans, intentions or expectations upon which the forward-looking statements are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur, which may cause Terrex's actual performance and results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward-looking statements. These risks and uncertainties include, among other things, the following: that the acquisition may not close when planned or at all or on the terms and conditions set forth herein; the failure of Terrex to obtain the necessary regulatory approval required in order to proceed with the acquisition; volatility in market prices for oil and natural gas; failure to complete planned financing activities; incorrect assessment of the value of the acquisition; failure to realize the anticipated benefits of the acquisition; general economic conditions in Canada; and the other factors.  Readers are cautioned that this list of risk factors should not be construed as exhaustive. The forward-looking statements contained in this news release are made as of the date hereof and Terrex does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, except as required by applicable law. The forward-looking statements contained herein are expressly qualified by this cautionary statement To view this news release in HTML formatting, please use the following URL: http://www.newswire.ca/en/releases/archive/March2011/07/c8418.html pFor additional information please contact Kim Davies, President & CEO, or Norm Knecht, VP Finance & CFO, at (403) 264-4430, or visit Terrex's website at a href="http://www.terrexenergy.ca"terrexenergy.ca/a./p

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