VANCOUVER, March 26, 2014 /CNW/ - Terrace Energy
Corp. (the "Company" or "Terrace") (TSXV: TZR, OTCQX:
TCRRF; Germany: 2TR) is
pleased to announce it has reached an agreement to develop
significant new acreage in Zavalla
and Dimmit Counties on trend with
recent, highly successful wells in the emerging Buda Limestone
formation in South Texas.
On February 24,
2014, the Company announced it had entered into an agreement
(the "Farm-in Agreement") to acquire a 75% working interest and a
56.25% net revenue interest in several leases, that cover
approximately 10,000 gross (6,700 net) mineral acres, by drilling a
series of wells. The Company has now reached an agreement to
develop the remaining 3,300 net mineral acres on the same terms and
conditions as the Farm-in Agreement. With this agreement, the
Company now has the right to test and develop the Buda Limestone
over approximately 10,000 net mineral acres.
The project acreage is located in the core of
the Eagle Ford Trend in South
Texas and in close proximity to a number of prolific
horizontal wells drilled into the naturally fractured Buda
Limestone, including the publicized Hughes Heitz 302 3H, which
produced over 250,000 barrels of light sweet crude oil in its first
18 months of reported production, according to the Texas Railroad
Commission. Utilizing leading edge underbalanced drilling
techniques and recently available 3D seismic data, operators have
reported achieving production results comparable to or exceeding
Eagle Ford Shale wells in the area at significantly lower capital
costs. Typical horizontal Buda
wells in the area are being drilled and completed for capital costs
in the range of $3.0 - $4.0 million
as compared to Eagle Ford Shale wells, which typically cost in the
range of $6.0 - $8.5 million.
Dave Gibbs, the
Company's President and Chief Executive Officer commented: "We are
pleased we were able to secure the remaining net acreage in this
project on the same terms as the Farm-in Agreement previously
disclosed. We are confident the Buda Limestone formation, which is
also present on our 147,000 gross acre Maverick County Project, is highly prospective
and will be a core focus for our Company along with the development
of our STS Olmos Project and other significant Cretaceous pay
intervals that are present on each of our acreage holdings. This
acquisition gives us control over the project's development pace,
which will be begin on or before August
1 of this year, and allows us to consider its development in
partnership with strategic industry participants."
About Terrace Energy
Terrace Energy is an oil & gas development
stage company that is focused on unconventional oil extraction in
onshore areas of the United States
with a particular focus on South
Texas.
ON BEHALF OF THE BOARD OF DIRECTORS
"Dave Gibbs"
Dave Gibbs, President and Chief
Executive Officer
NEITHER THE TSX VENTURE EXCHANGE NOR ITS
REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE
POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR
THE ADEQUACY OR ACCURACY OF THIS RELEASE.
Forward-Looking Information:
This press release includes "forward-looking
information" within the meaning of applicable Canadian securities
laws, including information regarding the costs to develop and
complete wells in the Buda Limestone formation and their expected
performance. Users of forward-looking information are
cautioned that actual results may vary from the forward-looking
information disclosed in this press release. The material
risk factors that could cause actual results to differ materially
from the forward-looking information contained in this press
release include, changes to production rates , changes to the
Company's ability to access infrastructure in the vicinity of the
project at a reasonable price, costs for and availability of
required goods and contract services, regulatory changes and all of
the other risks and uncertainties normally associated with the
exploration for and development and production of oil and
gas. The forward-looking information contained in this press
release represents management's best judgment of future events
based on information currently available. The material
assumptions used to develop the forward-looking information
include: that future costs and performance of Buda Limestone
wells will approximate historical costs and past performance,
that the Company will be able to access infrastructure in the
vicinity of the project on reasonable terms, that the Company will
be able to access the goods and contract services necessary in
order to conduct further exploration, development and production on
reasonable terms, that regulatory requirements will not change in
any material respect and that other aspects of the Company's
operations will not be affected by unforeseen events. The
Company does not assume the obligation to update any
forward-looking information, except as required by applicable
law.
SOURCE Terrace Energy Corp.