Terra Energy Corp.
TSX VENTURE : TTR

Terra Energy Corp.

December 12, 2008 19:00 ET

Terra Energy Provides Market Update

CALGARY, ALBERTA--(Marketwire - Dec. 12, 2008) - Terra Energy Corp. ("Terra Energy" or the "Company") (TSX VENTURE:TTR) is pleased to provide this update to the market concerning the strategic process which was undertaken by the Company in September, 2008 and the Company's final capital budget for 2008.

Scotia Waterous Marketing Process

The process undertaken by the Company in September 2008, wherein the Company retained the services of Scotia Waterous Inc., has resulted in the receipt of several non-binding proposals on December 9, 2008. The Board of Directors of Terra Energy wishes to announce that none of the 'cash' proposals received were viewed as being compelling.

With our growing production base and our strong balance sheet, the Company will continue to investigate opportunities for transactions which are accretive to Terra Energy shareholders.

Capital Budget

The Board of Directors of Terra Energy has approved a final Capital Expenditure Budget for 2008 of up to $60 Million. The increase in capital spending above the $51.9 Million 'risked case' capital budget previously approved by the Board, is attributable to additional completions carried out on wells drilled during the second half of 2008, together with the drilling of two additional development wells. In addition, the Company has been actively acquiring new mineral interests in the greater Peace River arch area. The expanded budget will also allow for further purchases of the Company's shares pursuant to the Normal Course Issuer Bid, which was suspended during internal corporate 'blackout periods' being observed by the Company during the recent process.

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 investigation of transactions and the acquisition of Company shares pursuant to the Normal Course Issuer Bid. These statements are based on current expectations that involve a number of assumptions, risks and uncertainties, which could cause actual results to differ from those anticipated. These assumptions, risks and uncertainties 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 Annual Information Form and other documents are on file with Canadian securities regulatory authorities 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'.

The TSX Venture Exchange does not accept 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