Frontera Resources Corporation (London Stock Exchange, AIM Market – Symbol: FRR), an independent oil and gas exploration and production company, today announces an update on operations at its Taribani Field Unit and Basin Edge Play Unit, Block 12, Georgia.
- Operations at the Dino #2 well, the first of an extensive Zone 9 development program at the Taribani Field Unit, will commence during the first half of August. The unexpected duration of planned rig inspections and required upgrades has delayed initiation of work for a short period.
- Construction of a new drilling location for the second of three planned Zone 9 development wells this year at Taribani Field (T-#45) is now complete.
- Construction of the drill site location for the Lloyd #1 well, as well as 6.5 kilometers of new road leading to it at the Basin Edge Play Unit “C” Prospect, is now complete. A drilling rig is being mobilized and drilling operations are expected to commence during the second half of August.
Steve C. Nicandros, President and Chief Executive Officer, commented:
“During the month of July, we continued to responsibly progress towards the imminent commencement of new drilling operations at both the Basin Edge ‘C’ Prospect and the Taribani Field Unit. While we have been very eager to commence down-hole operations as soon as possible at the Taribani Field Unit, we found it necessary to take additional time to conduct appropriate inspections and require associated repairs to the mobilized drilling equipment prior to accepting it for our operations. The high demand for equipment in today’s marketplace is such that proper diligence is necessary to ensure that Frontera will have safe and uninterrupted development operations in the months ahead.
At the Basin Edge ‘C’ prospect, important milestones have been achieved with the completion of the Lloyd #1 drill site location as well as a new road to the location that is situated in a relatively remote area of Block 12. A second drilling rig is currently enroute to the site and drilling is expected to commence during the second half of August. With two rigs running simultaneously in these very prospective business units, the rest of this year will be a very exciting time for our company.”
Frontera Resources Corporation
Vice President, Investor Relations and Corporate Communications
Brunswick Group LLP
Patrick Handley / Mark Antelme
+44 207 4045959
Taribani Field Unit
The ARAR Ideco Dynamic #1 drilling rig arrived on location in June to primarily undertake the planned development program of Zone 9 over the next 36 months. After a series of planned mechanical inspections prior to accepting the rig for operations from the drilling contractor, it was determined that putting the rig immediately to work should be delayed in favor of making a variety of necessary repairs and upgrades prior to the start of extensive development drilling operations. Over the past month, these repairs and upgrades have been addressed and operations at the Dino #2 well will commence in the first half of August.
The Dynamic #1 rig (center) on location at the Dino #2 well at Frontera Resources’ Taribani Field Unit in preparation for the commencement of operations.
Once operations begin, completion in the Zone 9 interval within the Dino #2 well is expected to take approximately 30 days. After perforation, the well will be put on controlled production until late October when specialized equipment is mobilized from Eastern Europe to apply frac-pack completions to this well and the next well to be drilled, Taribani #45.
When operations are completed at the Dino #2 well, the Dynamic #1 rig will immediately move a short distance within the field to commence drilling the next Zone 9 development well at the Taribani #45 location. Construction of this location was completed during the past month and the well is scheduled to commence in September. It will take approximately fifty days to reach total depth and complete in Zone 9. A third well, the Taribani South #1, is scheduled to commence in November. Eight new wells are planned for 2008 as part of the ongoing Zone 9 development plan.
The re-entry of the Dino #2 well and drilling of the Taribani #45 and Taribani South #1 wells are part of the Zone 9 development program, a 36-month, 20-well program representing approximately 17 percent of the reserves attributed to Zones 9, 14, 15 and 19 within the field.
The Taribani Field is a large, undeveloped oil field covering an area of approximately 80 square kilometers with productive horizons situated in Miocene and Pliocene age reservoirs. These reservoirs are situated at depths between 2,200 meters and 3,500 meters. The independent consulting firm of Netherland, Sewell & Associates has assigned 118 million barrels of P3 reserves from Zones 9, 14, 15 and 19 within the field. Additionally, Netherland, Sewell & Associates has assigned as much as 36 million barrels of unrisked resource potential associated with five deeper horizons in the field.
Basin Edge Play Unit
Preparations for the commencement of drilling operations at the Basin Edge Play Unit “C” Prospect have progressed well in July. Drillsite construction and 6.5 kilometers of new road construction that leads to the Lloyd #1 location are now complete. The Lapidoth Ideco Super 7-11/II drilling rig is being mobilized to the location and, after experiencing transportation delays associated with shipping the rig to Georgia during July, it will now be ready to commence drilling operations during the second half of August.
The Lloyd #1 well site at Frontera Resources’ Basin Edge Play Unit in eastern Block 12.
Designed to evaluate multiple horizons, this well will target completion in primary reservoir objectives at a total depth of approximately 2,700 meters. The Lloyd #1 well is expected to take approximately 50 days to reach total depth.
Frontera’s objectives within the Basin Edge Play Unit remain focused on accessing the resource potential that is estimated by the independent consulting firm of Netherland, Sewell and Associates to be in excess of one billion barrels of recoverable oil for the “B” and “C” Prospects. Of this total, prior to the acquisition of new seismic data, the “C” prospect was estimated to contain as much as 500 million barrels of recoverable oil. The Basin Edge “B” and “C” Prospects are situated along the northern border of Block 12 and represent one of the newest and potentially most prolific exploration plays in the Upper Kura Basin. Frontera’s primary reservoir targets are located in the Cretaceous age carbonate rocks, with secondary reservoir targets in the Jurassic, Miocene and Pliocene age clastic rocks.
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 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, 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.