Terra Energy Corp.
TSX VENTURE : TTR

Terra Energy Corp.

May 13, 2008 09:00 ET

Terra Energy Announces Completion of Montney Sale

CALGARY, ALBERTA--(Marketwire - May 13, 2008) - Terra Energy Corp. ("Terra Energy" or the "Company") (TSX VENTURE:TTR) is pleased to announce that the sale of its Montney asset in British Columbia has now been substantially completed. On April 14, 2008, the Company announced that it had entered into agreements for the sale of all of its Montney mineral rights in approximately 110 gross sections of land, for aggregate consideration of $67.1 million. These Montney mineral rights are located within the Company's Fort St. John Core Operating Area, located in northeast British Columbia. The sale was restricted to the mineral rights in the Montney formation alone, leaving any rights above and below the Montney formation in the hands of Terra Energy.

"This is an exciting day for Terra Energy shareholders, as the transaction entirely eliminates the Company's debt", said Cas H. Morel, President and CEO of Terra Energy. "The recent turnaround in natural gas prices in Canada and the higher cash flows which are anticipated will help fuel an acceleration of the Company's development plans for the current year. This sale transaction now positions the Company to consider strategies for growth on an even broader scale."

The recent Montney sale transactions which have been completed by the Company represent $65.2 million in aggregate proceeds, leaving the Company to close on Montney rights in one remaining section of land. The Company's current production levels are unaffected by the sale transactions, as no production from the Montney formation was included. Furthermore, the Company's total proved and probable reserves will remain largely unaffected by this sale transaction.

The Company anticipates release of its 2008 - Q1 financial and operating results on or about May 23, 2008.

READER ADVISORY

This media release may contain forward-looking statements including expectations of future production, cash flow and earnings. These statements are based on current expectations that involve a number of risks and uncertainties, which could cause actual results to differ from those anticipated. These risks include, but are not limited to: the risks associated with the oil and gas industry (eg., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses, and health, safety and environmental risks), commodity price, price and exchange rate fluctuation and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. Additional information on these and other factors that could affect Terra Energy's operations or financial results are included in Terra Energy's reports on file with Canadian securities regulatory authorities.

Terra Energy is a junior oil and gas company engaged in the exploration for, and development and production of, natural gas and oil in Western Canada. Terra Energy's common shares trade on the TSX Venture Exchange under the symbol 'TTR'.

The TSX Venture exchange does not accept responsibility for the adequacy or accuracy of this media release.

Contact Information

  • Terra Energy Corp.
    Mr. Bud Love
    Vice President of Finance and Chief Financial Officer
    (403) 699-7777