Terrace currently has two active development projects, The South Texas Syndicate - Olmos Sandstone Development and The Cutlass - Eagle Ford Development, both located in the oil window of the South Texas Cretaceous play.
South Texas Syndicate - Olmos Project
Terrace holds an average 27% working interest in approximately 14,000 acres located in McMullen and LaSalle Counties, Texas. The project is a southwesterly extension of the prolific AWP Field which has produced nearly 500 MMBOE from the Olmos Sandstone since its discovery in the early 1980's. Our first well into the project, the STS 1-667H encountered the Olmos "C" sand at approximately 8900' and drilled approximately 4,100' of horizontal section. The well was fracture stimulated in 14 stages with 3 million pounds of proppant and 101,975 barrels of slickwater in early February and tested at sustained rates above 600 BOPD. Permanent facilities are installed and that well is on commercial production. The two subsequent wells recently IP'd at over 765 BOEPD and 1020 BOEPD respectively. The next phase of the program will focus on optimizing capital efficiency by systematically drilling development wells on a grid pattern beginning the first quarter of 2013. Based on existing spacing, the project has the potential for up to 72 additional locations.
Cutlass - Eagle Ford Project
Terrace holds a 30% working interest in 3395 acres in Dimmitt and LaSalle Counties, Texas. The project is surrounded by active development in the Eagle Ford oil window by several major oil companies. Recent developments in the immediate vicinity (less than 5 miles) have resulted in multiple horizontal completions in excess of 1000 BOEPD. In addition to the obvious Eagle Ford potential, previous drilling on the acreage dating back to the 1960's indicates the entire Cretaceous section from the Austin Chalk through the Edwards Lime is prospective. The company has drilled two strategically placed evaluation wells which tested the entire Cretaceous section. The initial two-well evaluation program is currently underway with production expected in early 2013.