Mr. Jonathan Lexier of Terrex reports

TERREX ENERGY INC. PROVIDES UPDATE REGARDING HYDROCARBON PURCHASE AGREEMENT

Terrex Energy Inc. has received written notice from Sandstorm Metals & Energy Ltd. indicating that Terrex is in default under the terms of the hydrocarbon purchase agreement dated as of March 18, 2011, among Terrex, Sandstorm and an affiliate of Sandstorm (a copy of which has been filed on SEDAR under the company's SEDAR profile), due to Terrex's failure to fulfill certain drilling obligations by the date contemplated by the purchase agreement. Pursuant to the purchase agreement, if Terrex does not remedy the default to Sandstorm's reasonable satisfaction or refund $1.5-million to Sandstorm within the applicable cure period, Sandstorm will have the right to, among other things, realize on its security interest in all of Terrex's assets. Terrex continues to actively pursue various strategic alternatives including potential financing, merger, and/or joint venture arrangements in order to continue the development of its properties and meet its obligations, including those contained in the purchase agreement.

Terrex recently entered into a non-binding letter of intent with an arm's-length public company providing for a potential business combination, which if consummated in accordance with its proposed terms, would allow Terrex to cure the default under the purchase agreement. However there is no assurance that the proposed business combination will be completed and the letter of intent remains subject to a number of conditions, including approval by the boards of directors of both parties, approval by Sandstorm, the negotiation of a definitive agreement, as well as TSX Venture Exchange and shareholder approval.

We seek Safe Harbor.