Terra Energy Corp. provided Capital Expenditure for the year 2010. The 2010 Capex Plan contemplates a minimum of $65 Million of capital expenditures targeting a strategic push into the Montney Fairway in Northeast British Columbia, by advancing the level of geotechnical/engineering science, on a 'field-by-field' basis, in respect of each block or field of prospective undeveloped Montney land, to the 'decision-point' stage for major commercial development and proving-up significant reserves in the process and Drilling projects designed to at minimum maintain production or increase it beyond the current base level of 7,100 boed. Cash flow from operations has been forecasted by the Company at approximately $49 million for 2010.

Terra Energy Corp. has entered into a farm-in and option agreement with a producer, whereby the company has committed to drill two test wells and will have the option to drill a third test well, all with a view towards earning a 100% interest in 13 sections of prospective land within the Montney Fairway in northeast British Columbia. The first test well is required to be spud on or before July 30, 2010. The second test well must reportedly be spud on or before September 30, 2010. The test wells will primarily be targeting the Montney formation and other deeper formations, but may also have secondary targets. Under the terms of the farm-in agreement, the farmor will reportedly retain a nonconvertible 10% gross overriding royalty on production from the earned lands.

Terra Energy Corp. announced that it has signed a commitment letter outlining an arrangement with a large producer, whereby Terra Energy will, upon closing, significantly expand the Company's presence within the Montney 'Fairway' in British Columbia. In accordance with the terms of the Commitment Letter, Terra Energy will acquire approximately 91 gross (66 net) sections of land. In addition to the Montney Fairway, Terra Energy will acquire certain additional lands in Northeastern British Columbia having identified potential for multi-frac horizontal development. Upon completion of the Arrangement, Terra Energy will be one of the largest holders of prospective Montney rights in British Columbia, with approximately 122 gross (100 net) sections within the prospective Montney 'Fairway'. Under the terms of the Arrangement, Terra Energy will acquire a 100% working interest in approximately 14 net sections of land located in the Altares/Farrell Creek area. Upon closing, Terra Energy anticipates licensing up to three vertical Montney tests and one recompletion in the area. Drilling and testing, including the application of micro-seismic technology, is anticipated to commence early in 2010 with a view towards assessing the potential for a multi-well horizontal development program. As of October 1, 2009, there were approximately 21 horizontal and 10 vertical Montney wells either drilled or licensed by various operators in areas adjacent to Farrell Creek, including a vertical Montney test well reported to have initial production of more than four million cubic feef (mmcf) per day. In addition, Terra Energy will significantly increase its current interests in the Wilder area through the addition of approximately 17.5 gross (16.25 net) sections of land. Terra Energy currently owns approximately 60 gross (30 net) sections of prospective Montney in the Wilder area. Terra Energy expects to undertake four to six vertical Montney tests and one potential horizontal well in the area during 2010 in order to preserve title and test the Montney potential in the area. Terra Energy has initiated preliminary engineering for a 30 mmcf per day gas processing plant in the Monias/Wilder area to support anticipated production from a multi-well horizontal development program. Under the Arrangement, Terra Energy will further receive varied interests in approximately 12 gross (3.75 net) sections (together with overriding royalties) in the Groundbirch area, located proximal to a recent horizontal Montney test that achieved a reported initial production rate of nine mmcf per day following 48 hours of continuous production testing.