Frontera Resources Releases 2016 Annual Results

Houston, Texas, U.S.A. – 29 June 2017

FRONTERA RESOURCES RELEASES 2016 ANNUAL RESULTS

Frontera Resources Corporation (London Stock Exchange, AIM Market – Symbol: FRR), an independent oil and gas exploration and production company (“Frontera” or the “Company”), today releases its audited final results for the year ended 31 December 2016. The audited final results are posted here.

2016 Annual Results: Highlights

– Revenues from crude oil and gas sales for 2016 totaled $3.1 million.

– Net loss of $23.6 million, or $0.004 per share on a fully diluted basis. Of this total, approximately $2.6 million is reflected in one-time charges associated with recorded impairment and inventory related accounting due to significant decrease of crude oil prices, and $1 million in connection to restructuring of 2016 Convertible Notes.

– Since the end of 2016, the Company has significantly restructured its balance sheet such that $32.2 million of debt and associated debt service has been, or shortly will be, eliminated and the remaining $30.1 million associated with 2016 convertible notes has been restructured at the end of last year as non-convertible with a maturity date of 2020. Elimination of debt this year was achieved as follows:

– Approximately $26 million related to loans advanced by directors converted into equity at a premium to the current market price. Mr. Steve Nicandros and Mr. Zaza Mamulaishvili entered into note exchange agreements to eliminate approximately US$26 million related to loans advanced by them to the Company. These loans were previously provided to the Company to support the Company’s on-going operational and working capital requirements. The conversion has been made at a fixed conversion price of 1 pence per share and, pursuant to the terms of the note exchange, there will be a 12-month lock-in period on the sale of the new ordinary shares that Mr. Nicandros and Mr. Mamulaishvili will receive at as a result of the conversion. This conversion will take place within the next week;

– The Company reached an agreement with YA II PN, Ltd whereby approximately US$6.2 million was eliminated by way of conversion into equity via the issuance of 7,200 Series A convertible, preferred, redeemable shares in the Company with par value of US$0.00004 and with liquidation amount of $1,000 per share. Under the terms of the agreement, conversion is limited in order to permit the Company to build value from its planned programs. YA II PN, Ltd. has also indicted that it will permit the company to redeem any future conversion requests in cash versus equity if it so desires. The above transactions practically result in elimination of the Company’s short term debt, cleaning the balance sheet and significantly improving the financial position of the Company.

Steve C. Nicandros, Chairman and Chief Executive Officer commented:

“The combination of significantly restructuring our balance sheet since Q4 of last year and advancing our current plans for growth will serve to materially accelerate value creation from our holdings. Eliminating approximately US$32.2 million of debt this year together with the restructuring of $30.1 million at the end of last year into long term, non-convertible debt has enabled us to create a new and improved financial foundation on which to build material value from our holdings.
As this year’s debt elimination has included conversion to equity of approximately US$26 million of management loans at a premium conversion price of 1 pence per share, we strongly believe in our company’s ability to harvest transformational value for all of our stakeholders from the giant oil and gas resources that have been successfully identified by Frontera’s historical work.

Finally, as we move forward, we are working diligently to efficiently fund ongoing operational plans outlined at our recent AGM in a manner that serves to support and enhance the value of our company’s shares and avoid erosion of value. . With these objectives, we look forward to continuing to report on our progress in the weeks and months ahead, including a previously announced shareholder update in London during the month of July.”

Enquiries:

Frontera Resources Corporation
Jesse Jefferies
+1 (713) 585-3216
info@fronteraresources.com

Financial PR/IR
Abchurch
Tim Thompson
+44 (0) 20 7398 7700
fronterainfo@abchurch-group.com

Nominated Adviser
Cairn Financial Advisers LLP
Jo Turner/ Liam Murray
+44 (0) 20 7213 0880

Broker
Cornhill Capital Limited
Nick Bealer
+44 (0) 20 3700 2512