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  Economics : Type Curve

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STS Olmos Well Economics Typical Development Well CharacterisLcs CumulaLve Oil ProducLon vs Time FormaLon Depth: 8,900 Lateral Lengths: 4,200 Frac Stages: 12- 16 IniLal ProducLon Rate: 1,000 Boe/d Spacing: 800 lateral displacement Project Type Curve Analysis* Well Costs: 5.8 million EUR: 390 MBoe PV 10%: 3.9 MMUSD Internal ROR: 46% Field Level Economic Parameters Product Mix: Oil: 61% NGL: 22% Gas: 16% EecLve Wellhead Prices : Oil: 102.26 / Bbl Gas: 3.05 / MMBtu NGL: 0.68 / gallon EecLve Realized Price: 71.65/ Boe Direct OperaLng Expense: 9.00 / Boe Cash Margin: 62.65/ Boe * Management es3mate based on type curve from NI 51-101 report eec3ve 1/31/13. www.terraceenergy.net 13
Terrace Energy Corp.
March 2014

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