Terrace Energy Corp.
TSX VENTURE : TZR
OTCQX : TCRRF
FRANKFURT : 2TR

Terrace Energy Corp.

October 03, 2013 08:00 ET

Terrace Energy Announces First Half Results

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Oct. 3, 2013) - Terrace Energy Corp. (TSX VENTURE:TZR)(OTCQX:TCRRF)(FRANKFURT:2TR) (the "Company") is pleased to announce its financial and operating results for the six and three months ended July 31, 2013.

The Company's interim financial statements and management discussion and analysis for the six and three months ended July 31, 2013 is available for viewing at www.sedar.com and on the Company's website at www.terraceenergy.net.

All dollar amounts are expressed in United States dollars unless otherwise stated.

First Half Achievements

  • Finalized transactions to organize the Black Brush Terrace LP and acquire an interest in a 147,000 acre project in South Texas from an affiliate of Shell Oil.
  • Completed non-brokered private placements of convertible notes in the aggregate amount of CDN$40,000,000.
  • Drilled the first well on the Black Brush Terrace LP property to a total measured depth of approximately 12,000 feet including an approximate 4,000 foot horizontal lateral section in the Pearsall Shale. The well is in the completion stage of development.
  • Successfully re-entered and placed into production a previously drilled Eagle Ford Shale well on the Black Brush Terrace LP property.
  • Drilled four additional wells on the STS Olmos project. Two of the wells were subsequently placed into production and the remaining two are in the completion stage of development.

First Half Highlights

  • Total revenues from oil and gas sales for the six and three months ended July 31, 2013 were $1,621,660 and $765,958 respectively compared to $759,958 and $202,868 for the six and three months ended July 31, 2012 respectively.
  • The Company's aggregate share of production from the STS Olmos wells and the Cutlass well for the six months ended July 31, 2013 was approximately 17,877 barrels of oil and liquids at an aggregate average price of $83.60 per barrel of oil equivalent and 28,308 thousand cubic feet of natural gas at an average price of $4.05 per million cubic feet.

Financial Summary

Results of operations (unaudited) for the six and three months ended July 31:

Six
Months
2013
Six
Months
2012
Three
Months
2013
Three
Months
2012
Oil & Gas revenues $ 1,621,660 $ 759,958 $ 765,649 $ 202,868
Direct operating expenses 248,839 120,824 60,510 55,382
Depreciation, depletion and accretion 493,531 18,468 220,773 12,949
742,370 139,292 281,283 68,331
Operating income 879,290 620,666 484,366 134,537
Equity income in Black Brush Terrace LP 35,909 - 35,909 -
915,199 620,666 520,275 134,537
General and administrative expenses 1,301,344 595,336 778,838 366,648
Interest expense 1,033,125 - 833,938 -
Foreign exchange gain (761,051) (92,687) (794,843) (61,644)
Share-based payments 304,194 146,020 231,077 70,289
Impairment of exploration and evaluation assets 73,983 - - -
Recovery of exploration and evaluation assets - - (30,167) -
1,951,595 648,669 1,018,843 375,293
Net loss for the period $ (1,036,396) $ (28,003) $ (498,568) $ (240,756)
Loss per share $ (0.02) $ (0.00) $ (0.01) $ (0.00)

Summary Balance Sheet
July 31,
2013
January 31,
2013
Current assets $ 17,715,920 $ 3,050,989
Operators bond 25,000 25,000
Investment in Black Brush Terrace LP 12,900,434 -
Advances for future exploration 1,890,819 459,008
Exploration and evaluation assets 10,878,981 6,737,039
Property and equipment 9,615,819 6,047,528
Total assets 53,026,973 16,319,564
Total liabilities 35,700,161 579,601
Total equity $ 17,326,812 $ 15,739,963

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, particularly in South Texas.

ON BEHALF OF THE BOARD OF DIRECTORS

Eric Boehnke, Chief Executive Officer

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.

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