VANCOUVER, Oct. 7, 2013 /CNW/ - Terrace Energy Corp. (the "Company") (TSXV:TZR, OTCQX:TCRRF, FRANKFURT:2TR) is pleased to announce the acquisition of a significant additional acreage package to its STS Olmos Project in South Texas, USA. The Company has acquired a 100% working interest / 75% net revenue interest in 1,230.37 net mineral acres directly adjacent to its current leasehold position. This acquisition brings the Company's net mineral acreage position from 3,875 net acres to 5,105 net acres.
The Company acquired this acreage from Nortex Corporation and Kent Production, LLC for US$492,148.00 or $400.00 per net mineral acre. The Company is required to drill three wells (the "earning wells") into the Olmos Formation over the next three years in order to fully secure its acreage position. The Company will also pay a success bonus of US$123,037.00 ($300 per acre) upon the successful completion of each of these three earning wells.
In addition to the earning wells, the Company expects that this acreage position will support at least 9 additional drilling locations (12 total) in the Olmos formation. To date, the Company and its partner have drilled 8 successful wells in this project and have identified approximately 64 gross additional locations on the existing leasehold. The Company owns approximately a 30% working interest in the current project acreage.
Dave Gibbs, the Company's President, commented: "This acquisition is the first step in our program to expand our acreage in this project. This is a core focus area for our Company and we are extremely pleased with the results achieved to date. We are planning an aggressive expansion of our drilling program in 2014 and look forward to continuing success."
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.
ON BEHALF OF THE BOARD OF DIRECTORS
Eric Boehnke, CEO
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.
This press release includes forward-looking information and forward-looking statements (together, "forward-looking information") within the meaning of applicable Canadian and United States securities laws. Forward-looking information includes, but is not limited to: information regarding the development of the STS Olmos project and the timing thereof. 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 the Company's ability to access infrastructure in the vicinity of STS Olmos Project at a reasonable price, costs for and availability of required goods and 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, including geologic uncertainties, unforeseen drilling hazards, accidents and adverse weather conditions. 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 production from the wells at the STS Olmos Project will continue as projected, that the Company will be able to access infrastructure in the vicinity of the STS Olmos Project on reasonable terms, that the Company will be able to access the goods and services necessary in order to conduct further exploration, development and production at the STS Olmos Project 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. Statements regarding future drilling locations are based on geologic interpretations which are subject to revision as further data is developed. The Company does not assume the obligation to update any forward-looking information, except as required by applicable law.
SOURCE Terrace Energy Corp.