Frontera Resources Corporation provides a review and update of its operations in Block 12, Georgia.

The company commenced development drilling program at the Mtsare Khevi Field in August, with 10 wells completed to date and an 11th currently underway associated with a rolling 20-well drilling campaign. Development drilling at Mtsare Khevi Field has been very successful thus far, with 100 percent of the wells finding and testing hydrocarbons. Since the start of the drilling campaign, eight wells have come on stream as oil wells and two have found gas.

Steve C. Nicandros, Chairman and Chief Executive Officer, said, "Despite unanticipated challenges presented by Russia's invasion of Georgia in August, Frontera's operations since mid-year have marked a continued period of progress and growth.

Development drilling operations within the Shallow Fields Production Unit have successfully provided the basis for an increasing oil production profile. This work has also defined opportunity for developments that are generally larger than originally anticipated and has revealed the new possibility to add gas reservoir development to our commercialization agenda. As a result, we are optimistic that this business unit will continue to add important near-term value to our company.

At the Taribani Field Unit, analysis of production and reservoir performance data over the past several months has permitted us to reach important new milestones in evolving the technical efficiency and resulting commercial strength of our ongoing development program. Based on investments to date related to frac-stimulation of Zone 9 reservoirs, we now understand that we can improve the efficiency of future fracs as well as add additional reservoirs to individual frac-stimulation well completions. These advancements now provide us with confidence in our ability to frac and produce Zones 9, 14 and 15 from a single wellbore in future development wells, thereby allowing us to more cost effectively accelerate development of this large field. While recent geopolitical events in Georgia contributed to a delay in commencing planned drilling operations at the Taribani South #1 well in September, this provided an opportunity to incorporate ongoing technical analysis into current development plans such that we have altered our planned drilling schedule in favor of implementing a more efficient program.

Overall, amidst the current international economic environment, we remain encouraged with respect to the results we have seen from operations in each of our business units. Accordingly, as we move forward to the end of this year and into 2009, we will continue to responsibly manage our growth with a focus on increasing near-term production from development drilling while ensuring that associated costs are in line with current market conditions."

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