Terraco Gold Corp.
TSX VENTURE : TEN

Terraco Gold Corp.

January 17, 2007 08:00 ET

Terraco Gold Reports Surface Sampling Results of Up to 4 GPT Gold and 2,500 GPT Silver at Moonlight

Terraco Also Announces Warrant Exercise for Proceeds of $965,000

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Jan. 17, 2007) -

NOT FOR DISTRIBUTION IN THE UNITED STATES OR TO A UNITED STATES NEWS WIRE SERVICE.

Terraco Gold Corp. ("Terraco") (TSX VENTURE:TEN) is pleased to announce that the preliminary geologic mapping and rock sampling program this past fall have returned results as high as 4 grams per ton ("gpt") (0.116 Troy ounces per ton ("opt")) gold and greater than 2,500 gpt (72.92 opt) silver. While Terraco conducted ongoing mapping and sampling within the Moonlight Basin, much of the program focused on the recently expanded property position of more than 4,400 acres (1,780 hectares), or nearly 7 square miles. The program included the collection of more than 190 rock samples primarily from surface outcrop, prospects, and dumps. A few float samples were also taken in areas of little or no outcrop.

Sampling of existing mines and prospects, such as the historic Moonlight Mine, confirmed geochemically anomalous to high-grade gold, silver, and base metal values. Within Moonlight Basin, dump and outcrop sampling of quartz and quartz-tourmaline veins yielded values as high as 3.75 gpt gold ("Au") (0.109 opt Au) and 257 gpt silver ("Ag") (7.5 opt Ag). Chip sampling at the Moonlight Mine yielded results up to 2,510 gpt silver across 1 meter ("m") (73 opt Ag across 3 feet) and 1,045 gpt silver across 1.5 m (30.5 opt Ag across 5 feet) in adjacent samples from outcrop at the entrance to a short adit. The samples consisted of fractured, ferruginous, altered Permian Limerick Greenstone adjacent to the primary Moonlight fault/shear zone that juxtaposes Limerick Greenstone with Permian Rochester Rhyolite. Additionally, select dump samples of quartz-barite-calcite vein material returned values as high as 1,050 gpt silver (30.6 opt Ag). At many of the old mines and prospects of the Moonlight area, copper and antimony are the base metals most often associated with silver, probably occurring originally as tetrahedrite. Gold and silver do not appear to be strongly correlated in sample results suggesting that gold and silver originated from different mineralizing systems.

Sampling also revealed previously unidentified, anomalous gold, silver and base metals in outcrop and float elsewhere on Terraco's property. Gold values ranged from trace levels up to 4 gpt (0.116 opt Au) and 187 gpt silver (5.47 opt Ag). The 4 gpt sample was collected from float more than a mile outside of the Moonlight Basin and consisted of sheared, locally brecciated, strongly altered, Permian volcanic rocks. Another sample cut from outcrop approximately 290 meters (950 feet) away contained 0.50 gpt gold (0.015 opt Au) and 11.5 gpt silver (0.34 opt Ag). No prior workings were noted in the area of these samples. Detailed follow-up sampling is required within this area as well as other areas of the property.

Todd Hilditch, President of Terraco, stated, "We are extremely pleased with the sampling results and particularly those gold results from samples away from the Moonlight Basin, including the 4 gpt sample. This gives us indication that the mineralization in the new property package is more extensive than originally thought rather than concentrated only at the primary targets under the alluvium covered basin."

Combined with the promising aeromagnetic survey, local resistivity and SPG surveys, and geological mapping, the geochemical results are helping to define areas for more detailed exploration and drilling.

Terraco management has been using GIS (Geographic Information System) software to combine results of geophysics work completed to date with a geological review of the Moonlight property. The GIS is up-to-date and is being utilized to spot specific drill holes within identified target zones for a Phase I drill program. Drilling is expected to begin within the next few months depending on permitting and drill rig availability.

Charles Sulfrian, Vice-President Exploration of Terraco, conducted the program and personally submitted to the independent laboratories of ALS Chemex, Elko, and Sparks, NV for precious metals and geochemical analyses. A representative suite of samples was check-assayed by independent laboratory American Assay Laboratories, Sparks, NV for confirmation. Gold analyses were by fire assay with either AA or gravimetric finish. Silver analyses were either by multi-acid digestion MS, ICP and/or fire assay with gravimetric finish. Geochemical analyses were via multi-acid digestion MS.

The technical information in this release has been reviewed and approved by Charles Sulfrian, P.Geo., Vice President, Exploration of Terraco and a 'qualified person', as defined by NI 43-101.

Warrant Exercise

Terraco is also pleased to report that all warrants issued in connection with both the July, 2005 first and second tranches of a brokered private placement led by Pacific International Securities Inc. ("PI"), and the July, 2005 non-brokered private placement, have been exercised, raising proceeds of $965,000. Terraco has issued 3,918,301 common shares in connection with the warrant exercises.

Todd Hilditch stated, "We appreciate the support of PI and their efforts in regards to the financing and warrant exercise. This additional funding will help support the exploration and advancement of Terraco's projects. Current efforts are focused on finalizing a first phase drill plan for Moonlight."

Moonlight is located 21 miles northeast of Lovelock, in Pershing County, Nevada in the Humboldt Range and 5 miles north of Coeur d'Alene Mining Company's Rochester Mine. Midway Gold Corp.'s (TSX VENTURE:MDW) ("Midway") Spring Valley Project adjoins Moonlight to the south. There, Midway has reported drill intercepts that include highlights of 105 feet ("ft") of 0.325 opt gold (11.21 gpt Au), 215 ft of 0.137 opt gold (4.72 gpt Au), and 123 ft of 0.169 opt gold (5.83 gpt Au). The statements made in this News Release may contain certain forward-looking statements. Actual events or results may differ from Terraco's expectations. Certain risk factors may also affect the actual results achieved by Terraco.

Terraco Gold Corp. 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.

ON BEHALF OF THE BOARD

Todd Hilditch, President

This news release does not constitute an offer to sell or a solicitation of an offer to sell any of the securities in the United States. The securities 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 U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

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

Contact Information

  • Terraco Gold Corp.
    Todd Hilditch
    President
    (604) 639-3199 or Toll Free: 1-877-792-6688
    (604) 639-3197 (FAX)
    Website: www.terracogold.com