Operations News Update

27 Jan 2006 07:01

Frontera Resources Corporation27 January 2006 Operations News Update. January 27, 2006 FRONTERA RESOURCES ANNOUNCES AN UPDATE ON DRILLING OPERATIONS AND COMPLETION OF EXTENSIVE SEISMIC PROGRAM IN GEORGIA Houston, Texas U.S.A. (January 27, 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 successful completion of an extensive seismic acquisition program withinits onshore exploration and production license in eastern Georgia known as BlockXII. Drilling Operations Frontera has now completed mobilization of the TPIC F-200 rig to the Dino #2location at the Taribani Field Unit in eastern Georgia. With the rig onlocation, together with all necessary associated materials and equipment,Frontera expects to commence the next phase of its drilling operations at thislocation within the next two weeks. The Dino #2 well is the first of three wells to be drilled in succession withinthe Taribani field and is designed to evaluate multiple horizons within thefield, with a primary objective of a final horizontal completion into horizon 15at a total depth (TD) of approximately 2,700 meters. Once drilling begins at theDino #2 well, Frontera anticipates that it will take approximately 40 days toreach total depth (TD). The Taribani Field is a large, undeveloped oil field covering an area ofapproximately 80 km. sq. with productive horizons situated in Miocene andPliocene 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. Seismic Program The recently completed seismic program involved the acquisition of approximately500 km of 2D seismic across Frontera's Basin Edge Play Unit, Mirzaani Field AreaExploration Unit, and Taribani Field Unit. The newly acquired data will enhanceunderstanding of existing mapped prospects and provide the basis for futuredrilling operations in each of these areas. Frontera acquired the majority of the 500km program over its Basin Edge PlayUnit where it has mapped two large exploration prospects with Jurassic,Cretaceous and Tertiary age reservoir objectives. Targeted reservoirs areanticipated to be situated at depths of between 2,000 meters and 2,500 meters.The reservoir engineering firm of Netherland, Sewell and Associates, Inc. hasassigned unrisked resource potential in excess of 1 billion barrels ofrecoverable reserve potential to these two exploration prospects. At the Taribani Field Unit, new seismic data was acquired in order to confirmthe up-dip southwestern limits of the field in anticipation of future drillingin this undeveloped portion of the field. At the Mirzaani Field Area Exploration Unit, new seismic was acquired to enhanceunderstanding of existing mapped prospects that are situated below the currentlyproducing Mirzaani Field. The field's producing reservoirs are situated atdepths of between 900 meters and 1,300 meters and have historically producedapproximately seven million barrels of oil. Below this existing field, Fronterahas identified a new geologic play, characterized by Miocene-age, Sarmatianreservoirs that are similar to those found in the Taribani Field. Thesereservoirs are situated at relatively shallow depths of 1,800 meters to 2,500meters. Frontera believes these deeper reservoirs could represent a new trendof significant potential within Block 12. Processing of the recently completed seismic program is currently underway atthe laboratories of Tricon Geophysics, Inc., a Houston-based company.Processing and interpretation of the new seismic data is scheduled to becompleted over the next several months. Steve C. Nicandros, Frontera's Chairman and Chief Executive Officer, commented: "After experiencing unanticipated delays associated with the delivery ofmaterials and harsh winter weather conditions along the mobilization route ofTPIC's rig from southeastern Turkey, we are now glad to see all of our equipmenton location at the Taribani Field Unit and ready to commence drilling operationson our planned three well program. Separately, the completion of our seismicprogram over the three important business units within our extensive Georgiaportfolio represents a significant step forward in our planned progress forunlocking the potential we believe to be contained within these areas. Earlyresults of the seismic processing are encouraging and we look forward toproducing final interpretations over the next few months." 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 Tricon Geophysics, Inc., please seewww.tricongeophysics.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