FRONTERA RESOURCES CORPORATION
Houston, Texas, U.S.A. – 8 October 2015
FRONTERA RESOURCES UPGRADES GAS POTENTIAL IN GEORGIA OPERATIONS
Frontera Resources Corporation (London Stock Exchange, AIM Market – Symbol: FRR), an independent oil and gas exploration and production company (“Frontera” or the “Company”), today provided an announcement of a significant upgrade to gas resources associated with its ongoing exploration and production efforts in the country of Georgia.
The Company recently announced that it had continued to advance its natural gas focus within its eastern Georgia holdings by combining the technical focus of its Mtsare Kheve Gas Complex and Taribani Field Complex into one integrated 2,000 square kilometer geologic unit called the South Kakheti Gas Complex. In addition to gas resources previously identified for subsets of this combined area, Frontera’s ongoing work recently concluded new estimation of as much as 135 trillion cubic feet (3.8 trillion cubic meters) of gas in place from reservoir targets found between 300 metres and 5,000 metres in depth. An independent assessment of Frontera’s new internal estimates is now underway.
Earlier this year, during the month of April, Frontera announced results of a report it commissioned by the U.S.-based independent consulting firm of Netherland, Sewell & Associates that confirmed combined prospective natural gas resources of as much as 12.9 trillion cubic feet (365 billion cubic meters) of gas-in-place, with as much as 9.4 trillion cubic feet (266 billion cubic meters) of recoverable prospective natural gas resources at the Mtsare Khevi Gas Complex and Taribani Field Complex.
Following on from this assessment, extensive geologic and geophysical studies continued within and between the Mtsare Khevi Gas Complex and the Taribani Field Complex areas as the Company has believed that these areas are part of a common geologic complex. As a result, ongoing exploration studies have confirmed an extensive integrated gas resource potential that is much larger than previously identified.
In 2014, Frontera’s installation of a 14-kilometer network of gathering, processing and pipeline transportation facilities culminated in the initiation of gas production operations from the Company’s ongoing drilling operations. Since commencing gas production operations in April of last year from its operations in eastern Georgia, Frontera has successfully marked eighteen months of gas production operations. Continuous gas sales from the area have represented the first time domestically produced non-associated gas has been continuously marketed to Georgia’s national consumption market. Together with extensive technical analysis associated with the greater South Kakheti Gas Complex, this work has opened a historic new chapter in Georgia’s move towards energy independence as well as providing gas to markets beyond its borders.
Frontera is advancing evaluation of commercialization options to expand and accelerate efforts to bring this resource to not only Georgia’s domestic market, but also to nearby regional markets in Turkey and Europe. In this context, during the month of July, Frontera entered into to a strategic Memorandum of Understanding with Ukraine’s national energy company, National Joint Stock Company Naftogaz of Ukraine whereby an engineering FEED study is underway related to the possibility of bringing liquefied natural gas (LNG) to Ukraine from Frontera’s ongoing upstream gas work in Georgia. Similar studies are in progress related to other trans-Black Sea markets as well as contemplated regional pipeline routes.
Steve C. Nicandros, Chairman and Chief Executive Officer commented:
“Our ongoing investments in Georgia have continued to reveal the emergence of what we believe to be a world class gas play with the identification of the South Kakheti Gas Complex. Much like the recent evolution of similarly prolific gas plays in the United States that have transformed the U.S.A.’s energy independence trajectory, our results continue to indicate that Georgia has the natural gas resources to follow a similar path. We believe that our ongoing work will further serve to establish Georgia’s domestic energy independence in the years to come and also make it a strategic supplier of gas to Turkish and European consumption markets.”
Frontera Resources Corporation:
Vice President, Investor Relations and Corporate Communications
+1 713 585 3216
+44 (0) 20 7466 5000
Notes to Editors:
About Frontera Resources Corporation
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 in Eastern Europe around the Black Sea. Frontera Resources Corporation shares are traded on the London Stock Exchange, AIM Market – Symbol: FRR. For more information, please visit www.fronteraresources.com.
2. The Mtsare Khevi Gas Complex is an area of approximately 140 square kilometers and encompasses gas reservoir targets found between 300 meters and 5,000 meters in depth. Based on Frontera’s internal estimates, analysis has revealed significant gas potential throughout this area of up to approximately 11 TCF of gas-in-place and up to approximately 9 TCF of recoverable gas resources. An April 2015 report by the independent consulting firm of Netherland, Sewell & Associates confirms prospective resources of as much as 8.29 TCF of gas-in-place for the Mtsare Khevi Gas Complex, with as much as 6.15 TCF of recoverable prospective resources.
3. The Taribani Field Complex is an area that encompasses approximately 1,400 square kilometers and includes the discovered yet undeveloped Taribani, Kila Kupra, Bayda and Iori fields within Block 12. Internal preliminary analysis suggests that there could be as much as 18 billion barrels of oil in place throughout this complex. Ongoing work continues to study and assess the viability of this analysis and larger scale development potential. Situated within the Taribani Field Complex, the Taribani Field’s oil potential consists of 788 million barrels of original oil in place (“OOIP”) at depths between 2,000 meters and 3,300 meters, independently assessed by Netherland, Sewell & Associates (“NSA”) in 2005. In addition, Frontera estimates gas-in-place resources associated with deeper horizons at the Taribani Field to be as much as approximately 9 tcf from reservoir targets found between 3,400 meters and 5,000 meters in depth. An April 2015 report by NSA confirms prospective resources of as much as 4.62 TCF of gas-in-place associated with deeper gas bearing sands at the Taribani Field, with as much as 3.23 TCF of recoverable prospective resources from horizons situated between 3,400 meters and 5,400 meters in depth.
4. Information on Resource Estimates: The contingent and prospective resources estimates contained in this announcement were determined by the independent consulting firm of Netherland, Sewell & Associates (NSA) in accordance with the definitions and guidelines set forth in the 2007 Petroleum Resources Management System (PRMS) adopted by the Society of Petroleum Engineers (SPE). Gerard Bono, Frontera’s Vice President and Chief Reservoir Engineer, who is a member of the SPE, is the qualified person who reviewed and approved the statements in this announcement.
5. This release may contain certain forward-looking statements, including, without limitation, expectations, beliefs, plans and objectives regarding the transactions, work programs and other matters discussed in this release. Exploration for oil is a speculative business that involves a high degree of risk. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are: risks inherent in oil and gas production operations; availability and performance of needed equipment and personnel; the Company’s ability to raise capital to fund its exploration and development programs; seismic data; evaluation of logs, cores and other data from wells drilled; inherent uncertainty in estimation of oil and gas resources; fluctuations in oil and gas prices; weather conditions; general economic conditions; the political situation in Georgia and relations with neighboring countries; and other factors listed in Frontera’s financial reports, which are available at www.fronteraresources.com. 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.
6. Glossary of Terms: BCF – means Billion Cubic Feet of gas. TCF – means Trillion Cubic Feet of gas. Mcf – means Thousand Cubic Feet of gas. OOIP – means Original Oil in Place. Bopd – means Barrels of Oil Per Day.