Frontera Resources Regulatory News (FRR)

17 Mar 2006 07:02

Frontera Resources Corporation17 March 2006 Operations News Update March 17, 2006 FRONTERA RESOURCES ANNOUNCES AN UPDATE ON DRILLING OPERATIONS AND COMMENCEMENT OF A NEW 3D SEISMIC PROGRAM IN GEORGIA Houston, Texas U.S.A. (March 17, 2006): Frontera Resources Corporation (LondonStock Exchange, AIM Market - Symbol: FRR), an independent oil & gas explorationand production company, today announces an update on drilling operations as wellas the commencement of an extensive 3D seismic survey within its onshoreexploration and production license in eastern Georgia known as Block XII. Taribani Field Unit - Drilling Operations Since drilling began on February 10, 2006 in the Taribani Field Unit, the Dino #2 well has been successfully drilled and cased to an intermediate depth of 2,373meters. The Dino #2 well is designed to evaluate multiple horizons within thefield, with a primary objective of a final horizontal completion into horizon 15at a total depth of approximately 2,700 meters. Operations to drill out from the existing Dino #2 well bore commenced in earlyFebruary with the opening of a window in the casing of the existing well at adepth of approximately 1,553 meters and continuing to drill to a vertical depthof 2,381 meters. Prior to reaching this depth, extensive coring and loggingdata was acquired for further evaluation of horizon 9. Although the Dino#2 wellhas a primary objective of horizon 15, the well was also designed to efficientlycapture reservoir data for horizon 9 in order to enhance understanding of thishorizon for future drilling in subsequently planned wells. Drilling has thus far encountered 20 meters of gross pay sands. As expected,the Pliocene age oil bearing reservoir interval, horizon 9, was encountered from2,300 meters to 2,311 meters. In addition, a previously unmapped oil bearingreservoir interval was encountered above horizon 9 from 2,275 meters to 2,285meters. Operations now continue with an objective of drilling ahead to horizon 15 tocore and log the pay sands, followed by a final horizontal completion into thishorizon at a total depth of approximately 2,700 meters within the next threeweeks. 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. Basin Edge Play Unit - Seismic Operations Frontera has commenced operations to acquire a new 80 square kilometer 3Dseismic survey over its Basin Edge Play Unit's 'C' prospect. Processing andinterpretation of approximately 165 kilometers of 2D seismic data that wasrecently acquired over the 'C' prospect has revealed an independent four-waystructural closure of approximately 55 square kilometres in size. As a result,the company has chosen to prioritize and focus on this large prospect within itsbroader Basin Edge Play Unit that is located in the northeastern portion ofBlock 12. Acquisition of the new 3D survey is expected to be complete by Juneand will be followed by a processing and interpretation effort that will beintegrated into existing mapping prior to the end of this year. Drillingoperations are planned for 2007. The objective of the new 3D seismic program is to determine the exact lateraland vertical limits of this large structure, evaluate the extensions of faultblocks and fracture systems contained within it, and identify reservoirs on thebasis of seismic attributes. Global Geophysical Services, Inc. of Houston, Texaswill acquire the survey over this prospect for Frontera. Frontera also recently acquired approximately 170 kilometers of 2D seismic dataacquired over a second prospect within the Basin Edge Play Unit, known as the 'B' prospect. Interpretation of this data is currently underway. The 'C' and 'B' prospects are two large exploration prospects that Frontera hasmapped with Jurassic, Cretaceous and Tertiary age reservoir objectives. Targetedreservoirs are anticipated to be situated at depths of between 2,000 meters and2,500 meters. The reservoir engineering firm of Netherland, Sewell andAssociates, Inc. has assigned unrisked resource potential in excess of 1 billionbarrels of recoverable reserve potential to these two exploration prospects. Steve C. Nicandros, Frontera's Chairman and Chief Executive Officer, commented: "Subsequent to initial start-up delays that we experienced in the commencementof drilling operations at the Taribani Field Unit, progress has been good.Successfully encountering horizon 9 as predicted was an important validation ofour field mapping for this horizon. Moreover, encountering an unexpected andpreviously unmapped reservoir section above horizon 9 was a welcome bonus.Together with the associated cores and logs that were obtained, this informationwill be valuable in undertaking future drilling operations to determine thecommercial viability of horizon 9. Now that we have successfully set casingbelow these secondary objectives in the well, drilling operations are continuingtoward the well's primary objective of horizon 15. At our Basin Edge Play Unit, we are very encouraged by what the results from ourwork to date have revealed. Having now confirmed the existence of such asizable structure, we are very motivated to aggressively focus on furtherevaluating the 'C' prospect this year in order to enhance the explorationdrilling of this opportunity next year." 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 was admitted to the Alternative Investment Market, operated by theLondon Stock Exchange, on March 14, 2005. 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 Global Geophysical Services, Inc., please seewww.globalgeophysical.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. Enquiries Citigate Dewe Rogerson (+44 20 7638 9571) Martin Jackson This information is provided by RNS The company news service from the London Stock Exchange