Terra Energy Corp.
TSX VENTURE : TTR

Terra Energy Corp.

March 26, 2009 17:15 ET

Terra Energy Announces Record Results for 2008

CALGARY, ALBERTA--(Marketwire - March 26, 2009) - Terra Energy Corp. (TSX VENTURE:TTR) ("Terra Energy" or the "Corporation") is pleased to release its 2008 audited financial statements and management discussion and analysis ("MD&A") and information relating to its 4th quarter - 2008. Access to Terra Energy's 2008 year end results may be obtained at www.sedar.com or www.terraenergy.ca.

Fourth Quarter Highlights:

- Average production per day increased 33.1% year over year to 5,132 boe/day

- Gross revenue increased 37% year over year to $19,442,227

- Cash flow from operations increased 112% year over year to $10,670,333

- Operating expense decreased 19.3% year over year to $9.78 per boe

- Net Income increased to $4.5 million in Q4-08 from $0.9 million in Q4-07

Highlights of the full year 2008:

- The Corporation sold approximately 110 sections of Montney P&NG rights for net proceeds of approximately $66.5 million

- The Tower Compression and Dehydration facility was expanded to 20 mmcf per day and the Eight Mile/Sunrise Pipeline (25.8 km) was constructed

- Average daily production increased 35% year over year to 4,399 boe/day

- Cash flow from operations increased 151% year over year to $42,115,374

- Operating expense decreased 18% year over year to $10.63 per boe

- Proved plus probable reserves increased 15% to 18,769, 000 boe in 2008

- Finding and Development Costs on a P + P basis (inclusive of future capital) for the previous five years were $10.07 per boe

- 23 million of Net Income was generated

2009 Guidance

During the last quarter of 2008 and the first quarter of 2009, Terra Energy has continued with its development projects in the Fort St. John Core Area, with a view towards increasing production levels and cash flows. The Corporation has added significantly to its undeveloped land position during the past two quarters and has also repurchased some of its own shares under the Normal Course Issuer Bid process. The Corporation continues to have a strong balance sheet.

Our preliminary 2009 Capital Expenditure Plan and Budget was designed to keep production rates at about 6,000 boed, while the Corporation explores other opportunities for growth. Terra Energy expects 2009 - Q1 production to average 5,700 boe/day. New wells and additional tie-ins are expected to offset declines and result in average production rates above 5,900 boed during the second quarter of 2009.

Terra Energy will continue to position itself for future growth and consider opportunities for value creation in the current economic environment.

READER ADVISORY

A boe conversion ratio of six thousand cubic feet per barrel (6mcf/bbl) of natural gas to barrels of oil equivalence is based upon an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency for the individual products at the wellhead. Such disclosure of boe's may be misleading, particularly if used in isolation.

This media release contains certain statements which constitute forward-looking statements or information, including the production and cash flow expectations, financial position, capital expenditures and budget, the impact of new wells and tie-ins and the positioning of the Corporation for future growth and value creation. Although Terra Energy believes that the expectations reflected in our forward-looking statements are reasonable, our forward-looking statements have been based on factors and assumptions concerning future events which may prove to be inaccurate. Those factors and assumptions are based upon currently available information. Such statements are subject to known and unknown risks, uncertainties and other factors that could influence actual results or events and cause actual results or events to differ materially from those stated, anticipated or implied in the forward looking information. As such, readers are cautioned not to place undue reliance on the forward looking information, as no assurance can be provided as to future results, levels of activity or achievements. 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. The risks, uncertainties, material assumptions and other factors that could affect actual results are discussed in more detail in our Annual Information Form and other documents available at www.sedar.com. Furthermore, the forward-looking statements contained in this document are made as of the date of this document and, except as required by applicable law, Terra Energy does not undertake any obligation to publicly update or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this document are expressly qualified by this cautionary statement.

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'.

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.

Contact Information

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