Frontera Resources Regulatory News (FRR)

27 Apr 2006 07:02

Frontera Resources Corporation27 April 2006 Operations News Update. April 27, 2006 FRONTERA RESOURCES ("FRONTERA" OR "THE COMPANY") ANNOUNCES COMPLETION OF DRILLING OPERATIONS AND PLANS FOR TESTING AT THE DINO#2 WELL IN GEORGIA Houston, Texas U.S.A. (April 27, 2006): Frontera Resources Corporation (LondonStock Exchange, AIM Market - Symbol: FRR), an independent oil and gasexploration and production company, today announces the completion of horizontaldrilling operations at the Dino#2 well within its Taribani Field Unit.Production testing of Zones 14 and 15 will shortly commence and continue forapproximately 90 days in order to establish the commercial viability of thewell. The Taribani Field Unit is located within Frontera's onshore explorationand production license in eastern Georgia known as Block XII. Since commencement of operations at the Dino#2 well on February 10th, drillingof the vertical pilot hole encountered the Pliocene age reservoir Zones 9, 14and 15 at expected depths, with hydrocarbon shows from each while drilling.Extensive coring and logging operations were completed throughout key portionsof the vertical pilot hole. The main Zone 9 reservoir was encountered from2,300 meters to 2,311 meters. In addition, a previously unmapped reservoirinterval also encountered oil shows above Zone 9 from 2,275 meters to 2,285meters. Deeper in the well, oil and gas shows were encountered in the Zone 14and 15 intervals between 2,560 meters and 2,700 meters, true vertical depth(TVD). The results from coring and logging operations confirmed original plans to drillthe well horizontally into Zone 15. As a result, a 6 1/4 inch, 668 meterlateral hole was successfully drilled to the southeast from the base of thevertical pilot hole casing shoe. The lateral hole consisted of a 493 meterbuild-up section to achieve the proper angle of entry into Zone 15 and 175meters of new horizontal hole into the objective sandstone section at a TVD of2,655 meters. Total measured depth of the well reached a length of 3,040meters. The lateral well drilled through Zone 14 at an angle of approximately 51 degreesand into Zone 15 at a final horizontal angle of approximately 86 degrees.Drilling mud weights that were used to drill the lateral section of the holewere between 15.5 and 16.9 pounds per gallon. During drilling operationsthrough Zones 14 and 15, high pressure oil and gas bearing intervals wereencountered with oil and gas flowing to the surface. At several instancesduring the drilling of the lateral hole, well flow cut the mud weight to below 9pounds per gallon requiring oil and gas to be diverted to the mud pit and flareline. The main objective of Frontera's horizontal drilling program at the undevelopedTaribani Field this year is to test whether or not the reservoirs within thefield are fractured. By drilling horizontal wells into these reservoirs tofavorably encounter fracture systems, it is hoped that sustainable commercialproduction can be achieved. Analysis of recent coring, logging and drillingoperations at the Dino#2 well has confirmed the presence of fractures and thecompany will now test the well over the next 90 days to determine its commercialviability. In addition, results have revealed a better-than-expected reservoirsection at Zone 14 such that plans have been modified to add this zone to theplanned testing program. Zones 14 and 15 will therefore be tested separatelyand, if successful, final production from the well will be commingled andsimultaneously produced from both zones. Over the next few days, casing will be run, production tubing set and a XmasTree will be installed at the Dino#2 well before the commencement of testingoperations. The F-200 rig will then move to well #23 within the Taribani Field,where the next re-entry is planned to commence drilling within three weeks. AZone 9 horizontal completion is the planned objective for this well. The Taribani Field is a large, undeveloped oil field covering an area ofapproximately 80 square kilometers with productive horizons situated in Mioceneand Pliocene age reservoirs. These reservoirs are situated at depths of between2,200 meters and 3,500 meters. The independent consulting firm of Netherland,Sewell & Associates has assigned 118 million barrels of P3 reserves from four oftwelve identified horizons within the field. Steve C. Nicandros, Frontera's Chairman and Chief Executive Officer, commented: "We are encouraged thus far by the results of our work at the Dino#2 well.Encountering oil and gas shows in Zones 9, 14 and 15; confirming the presence offractures; and, physically seeing oil and gas flow to the surface despite heavydrilling mud weights has provided important information that continues tosupport our hypothesis for a potential commercial development of the TaribaniField. Moreover, encountering a better-than-expected sand interval in Zone 14was a welcome addition to our testing plans. Based on this, we look forward tothe testing phase of our work at the Dino#2 well. We are also encouraged to commence new drilling operations at well #23. In theDino#2 well, extensive coring and logging data was acquired for furtherevaluation of Zone 9 even though deeper zones were the primary objective of thewell. We will now use this data as the basis for our work at well #23 in orderto drill and test Zone 9 since it is expected that it will not be possible tocommingle production from this zone with that of deeper zones in the field dueto reservoir pressure differentials. Overall, Frontera remains on track with its plans to this year evaluate thecommercial viability of Zones 9, 14, 15 and 19 with its planned drilling programat the Taribani Field. " Enquiries Citigate Dewe Rogerson (+44 20 7638 9571) Martin Jackson / George Cazenove About Frontera Frontera Resources Corporation is an independent Houston, Texas, U.S.A.- basedinternational oil and gas exploration and production company whose strategy isto identify and operate opportunities in emerging markets around the world. Frontera has operated in Georgia since 1997 where it holds a 100 per centworking interest in a production sharing agreement with the government ofGeorgia. This gives Frontera the exclusive right to explore for, develop andproduce oil and gas from a 5,060 square kilometer area in eastern Georgia knownas Block 12. For more information, please see www.fronteraresources.com . For more information regarding Netherland, Sewell and Associates, please seewww.netherlandsewell.com This release contains certain forward-looking statements, including, withoutlimitation, expectations, beliefs, plans and objectives regarding the potentialtransactions, potential drilling schedule and ventures discussed in thisrelease, as well as reserves and future production. Among the important factorsthat could cause actual results to differ materially from those indicated bysuch forward-looking statements are future exploration and development results,availability and performance of needed equipment and personnel, the finalresults of the processing of seismic data, fluctuations in oil and gas prices,weather conditions, general economic conditions and the political situation inGeorgia and neighboring countries. There is no assurance that Frontera'sexpectations will be realized, and actual results may differ materially fromthose expressed in the forward-looking statements. This information is provided by RNS The company news service from the London Stock Exchange