Terraco Gold Intersects 68.4 Meters of 1.3 gpt Gold and Reports the First Results From its 2012 Drilling at its Idaho Project

VANCOUVER, BRITISH COLUMBIA--(Marketwire - June 27, 2012) - Terraco Gold Corp. ("Terraco" or the "Company") (TSX VENTURE:TEN) is pleased to announce assay results from the first 10 core holes of the 2012 drill program completed at its Almaden (Nutmeg Mountain Gold) Project in Washington County, Idaho. In-fill core drilling continues to encounter significant intercepts, including some longer intervals of higher grade gold mineralization than the average resource grade, from surface to 91 meters ("m") or (300 feet ("ft")).

Drill Highlights include:

• Hole MET-1 intersected 68.4 m averaging 1.301 grams per tonne ("gpt") gold from 1.4 to 69.8 m (224.5 ft averaging 0.038 Troy ounces per short ton ("opt") gold from 4.5 to 229.0 ft), including 27.4 m averaging 1.820 gpt gold to 35.4 m (90 ft of 0.053 opt gold to 116.0 ft) and 3.2 m averaging 1.905 gpt gold to 63.6 m (10.5 ft of 0.056 opt gold to 208.5 ft);

• Hole TAL-775C intersected 61.6 m averaging 1.223 gpt gold from surface to 61.6 m (202 ft of 0.036 opt gold from surface to 202 ft), including: 39.7 m averaging 1.503 gpt gold to 48.8 m (130 ft of 0.044 opt gold to 160 ft);

A drill table summarizing results to date may be found at the conclusion of this release.

The 2012 drill program includes close-spaced in-fill core drilling designed to better define resources in areas of older conventional or rotary air blast ("RAB") and reverse circulation ("RC") drilling and to continue to test the hypothesis that new core drilling may increase the average grade of the resource over the historical RAB and RC drill results. Additionally, large diameter core drilling was conducted to obtain sufficient material for metallurgical testwork. The first metallurgical hole (MET-1) of large diameter core returned the best intercept.

Todd Hilditch, President and CEO of Terraco, said: "We are very pleased with this first set of 2012 drill results and believe the program we designed for the Almaden (Nutmeg Mountain Gold) Project is on the right track. We look forward to the remaining results in the weeks to come."

Drill and Program Summary

The 2012 exploration program was designed to accomplish three goals:

1. Continue to increase the grade of the deposit internally by obtaining better, more representative samples through the use of core drilling instead of reverse circulation drilling;

2. Obtain large diameter core samples for metallurgical testwork that will address specific questions unanswered in prior metallurgical studies; and

3. Explore for high grade feeder zones below and laterally away from the known resource.

In 2012, much of Terraco's core drilling is targeted at improving grade within the resource, by using close-spaced HQ3 core drilling in four different areas of the deposit in the attempt to quantify the degree to which there may be a beneficiation of average resource grade. Shallow core holes in these areas will replace older RAB and RC drilling in deposit modeling to measure the difference in grades between the various drill techniques. MET-1 and TAL-775C are good examples. (A table of all the drill intercepts returned to date for the 2011-2012 Almaden (Nutmeg Mountain Gold) programs can be found on Terraco's website.)

So far in this year's program, Terraco has drilled 28 HQ3 holes for a total of 2,462.3 m (8,078 ft) and 4 large diameter (4 inch) core holes amounting to 298.7 m (980 ft) for metallurgical purposes. Most of the HQ3 holes were drilled to target depths of 90 m (300 ft) or less. A few holes, drilled as deep as 610 m (2,002 ft), tested for gold mineralization down dip along structures, and explored for deeper feeder zones.

Metallurgical Test Work Underway

Terraco has engaged McClelland Laboratories in Sparks, Nevada to complete multiple column leach and other metallurgical testwork. Large diameter core was used to provide larger particle size fractions to McClelland for column testwork. Testing will focus on leach recoveries by ore type and size fractions. Even though previous metallurgical studies have been performed on a number of samples from the Almaden (Nutmeg Mountain Gold) deposit, few focused on specific mineralization types or left questions about recoveries at larger particle sizes. Metallurgical results are expected in calendar Q3/4.

Assay results are summarized in the table below.

Drill Hole Table
Drill Hole Number	Area		Interval (m)	Gold (gpt)	From (m)	To (m)	Interval (ft)	Gold (opt)	From (ft)	To (ft)
MET-1	Main Zone		68.4	1.301	1.4	69.8	224.5	0.038	4.5	229
		Including	27.4	1.820	7.9	35.4	90	0.053	26	116
		and	3.2	1.905	60.4	63.6	10.5	0.056	198	208.5
TAL-767C	Main		12.0	0.820	33.5	45.7	40	0.024	110	150
		Including	3.0	1.250	35.1	38.1	10	0.037	115	125
			4.5	0.281	59.5	64.0	15	0.013	195	210
			3.0	0.492	67.1	70.1	10	0.014	220	230
			4.5	0.633	82.3	86.9	15	0.018	270	285
			3.0	0.374	97.6	100.6	10	0.011	320	330
			3.0	0.365	118.9	122.0	10	0.011	390	400
TAL-768C	North Zone		3.0	0.902	4.6	7.6	10	0.026	15	25
			9.0	0.785	10.6	20.7	30	0.023	35	65
TAL-769C	Main		12.2	0.802	64.0	76.2	40	0.023	210	250
TAL-770C	Main		3.0	0.459	29.0	32.0	10	0.013	95	105
TAL-771C	Main		12.0	1.124	10.7	22.9	40	0.033	35	75
		Including	6.0	1.595	16.8	22.9	20	0.047	55	75
TAL-772C	Main		45.0	0.582	19.8	65.6	150	0.017	65	215
			6.7	0.679	70.1	76.8	22	0.020	230	252
TAL-773C	Main		12.2	0.776	21.3	33.5	40	0.022	70	110
		Including	4.5	1.182	22.9	27.4	15	0.034	75	90
			3.0	0.542	48.8	51.8	10	0.016	160	170
			4.5	0.955	54.9	59.5	15	0.028	180	195
			5.2	0.629	71.6	76.8	17	0.018	235	252
TAL-774C	North Zone		27.0	0.818	6.1	33.5	90	0.024	20	110
		Including	12.0	1.191	7.6	21.3	45	0.035	25	70
TAL775C	Main Zone		61.6	1.223	0.0	61.6	202	0.036	0	202
		Including	39.7	1.503	9.1	48.8	130	0.044	30	160

Intersections were composited using a 0.34 gpt (0.010 opt) gold cut-off and may include short intervals of values below the cut-off grade.

Assay determinations for gold were made by 50 gram fire assay, using an AA finish. Analyses were performed by ALS Minerals USA, Inc. in Reno, Nevada.

Click below for a map of drilling to date which is also available at www.terracogold.com.

http://www.terracogold.com/i/misc/25june2012_drill_collars_pr.jpg

The 2012 Drilling at the Almaden (Nutmeg Mountain Gold) Project was conducted by Marcus and Marcus Exploration of Coeur d'Alene, Idaho.

The exploration and drill program for the Almaden (Nutmeg Mountain Gold) Project was designed by Charles Sulfrian, CPG, Vice President, Exploration for Terraco and William Snoddy, Almaden Project Manager. The technical information in this release has been reviewed and approved by Charles Sulfrian, C.P.G., Vice President, Exploration of Terraco and a 'qualified person', as defined by NI 43-101, unless otherwise noted.

Terraco 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.

Forward-Looking Statements

Certain of the statements made and information contained herein are "forward-looking statements" within the meaning of Canadian securities legislation or "forward-looking information" within the meaning of the Ontario Securities Act and the Alberta Securities Act. This includes statements concerning the Company's plans at its mineral properties, which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements or forward-looking information. Forward-looking statements and forward-looking information are subject to a variety of risks and uncertainties which could cause actual events or results to differ from those reflected in the forward-looking statements or forward-looking information, including, without limitation, the availability of financing for activities, risks and uncertainties relating to the interpretation of drill results and the estimation of mineral resources and reserves, the geology, grade and continuity of mineral deposits, the possibility that future exploration, development or mining results will not be consistent with the Company's expectations, metal price fluctuations, environmental and regulatory requirements, availability of permits, escalating costs of remediation and mitigation, risk of title loss, the effects of accidents, equipment breakdowns, labour disputes or other unanticipated difficulties with or interruptions in exploration or development, the potential for delays in exploration or development activities, the inherent uncertainty of production and cost estimates and the potential for unexpected costs and expenses, commodity price fluctuations, currency fluctuations, expectations and beliefs of management and other risks and uncertainties. In addition, forward-looking statements and forward-looking information is based on various assumptions. Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in forward-looking information or forward-looking statements. Accordingly, readers are advised not to place undue reliance on forward-looking statements or forward-looking information. Except as required under applicable securities legislation, the Company undertakes no obligation to publicly update or revise forward-looking statements or forward-looking information, whether as a result of new information, future events or otherwise.