Frontera Resources Corporation (London Stock Exchange, AIM Market – Symbol: FRR; Over-the-Counter Market, U.S.A. – Symbol: FRTA), an independent oil and gas exploration and production company, today announced that drilling operations at the Lloyd #1 well are continuing at its Basin Edge Play Unit, Block 12, Georgia.
At this time, the well has been drilled to a depth of approximately 2,720 meters, and initial wireline logging operations have been completed. Drilling operations to date have revealed multiple hydrocarbon shows based on analysis of cuttings and mud logs through this depth in the Tertiary age section of the wellbore, which contains the secondary objectives of the Basin Edge “C” Prospect.
As previously stated, our analysis of the 3D seismic data related to the “C” Prospect prior to commencement of drilling indicated that the primary target reservoir objectives, identified on the basis of seismic attributes, could occur at depths from 2,000 meters to 3,700 meters. We believe the data gathered from the well thus far supports this model, but also suggests that additional secondary objectives, as well as the primary target objectives, are likely to be encountered from the current depth to as much as 3,700 meters.
The Lloyd #1 well was originally planned to be drilled to a depth of 2,700 meters. However, on the basis of data gathered from drilling operations to date plans are now to continue drilling the well to a maximum depth of as much as 3,700 meters. We expect this will allow us to fully evaluate all potential objectives within the encountered and anticipated geological sequences. These operations are expected to be completed in December.
Steve C. Nicandros, President and Chief Executive Officer, commented:
“We are very encouraged by results that we have so far encountered at the Lloyd #1 well. We believe the data gathered from this important exploration well calibrates our geologic model for the ‘C’ Prospect, and having hydrocarbon shows thus far in this wildcat well is very significant. The hydrocarbon shows that we have seen in the Tertiary age sections of the well appear to be from the same age sections that have been historically prolific throughout the Kura Basin and are associated with a significant portion of the recoverable resource potential that we have attributed to the ‘C’ Prospect. We look forward to continuing our drilling operations as we progress our planned program to evaluate the enormous potential of the Basin Edge ‘C’ Prospect.”
Frontera’s Basin Edge Play Unit is located along the northern border of Block 12 and represents what the company believes is one of the newest and potentially most prolific exploration plays in the Upper Kura Basin. Netherland, Sewell and Associates estimate total unrisked resource potential to be in excess of one billion barrels of recoverable oil within the unit’s two major prospects (“B” and “C”). Of this total, prior to the acquisition of new seismic data suggesting an even larger structure, the “C” Prospect was estimated to contain as much as 300 million barrels of recoverable oil from primary reservoir targets and as much as 250 million barrels from secondary reservoir objectives. Frontera’s primary reservoir targets are located in the Cretaceous age carbonate rocks, with secondary reservoir targets in the Tertiary age clastic rocks as well as Jurassic carbonates.
Frontera Resources Corporation
Vice President, Investor Relations and Corporate Communications
Brunswick Group LLP
Patrick Handley / Mark Antelme
+44 207 4045959
Notes to editors:
1. Frontera Resources Corporation is an independent Houston, Texas, U.S.A.-based international oil and gas exploration and production company whose strategy is to identify opportunities and operate in emerging markets around the world. Frontera has operated in Georgia since 1997 where it holds a 100 percent working interest in a production sharing agreement with the government of Georgia. This gives Frontera the exclusive right to explore for, develop and produce oil and gas from a 5,060 square kilometer area in eastern Georgia known as Block 12.
2. The reserve information herein was determined by the independent consulting firm of Netherland, Sewell & Associates in accordance with the petroleum resource definitions adopted by the Society of Petroleum Engineers (SPE), World Petroleum Council (WPC) and the American Association of Petroleum Geologists (AAPG) in 2000.
3. This release contains certain forward-looking statements, including, without limitation, expectations, beliefs, plans and objectives regarding the potential transactions, potential drilling schedule, well results and ventures discussed in this release, as well as reserves, future drilling, development and production. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are: future exploration and development results; availability and performance of needed equipment and personnel; seismic data; evaluation of logs and cores from wells drilled; fluctuations in oil and gas prices; weather conditions, general economic conditions; and the political situation in Georgia and neighboring countries. There is no assurance that Frontera’s expectations will be realized, and actual results may differ materially from those expressed in the forward-looking statements.