NORTH LAS VEGAS, Nev., April 21, 2009 (GLOBE NEWSWIRE) -- Frontier Energy Corporation ("Frontier" or "the Company") (Pink Sheets:FRGY) is pleased to announce the signing of a Letter of Intent to form a joint venture with RJ Oil & Gas LLC ("RJ"), a private corporation located in Denver, CO. The objective of the joint venture is rehabilitation, exploitation, optimization and further development of certain oil and gas properties located in Callahan County, Texas, in the vicinity of Abilene. For an investment of $250,000, Frontier has the right to earn a 49% working interest in three leases containing some 450 acres, 10 producing wells, 32 additional wells available to be returned to production, 4 injection wells and ancillary facilities and equipment. The property also has potential for additional drilling in which Frontier will participate for its proportionate share. RJ will operate the leases. A key element of the transaction -- immediately upon execution of formal agreement(s), Frontier will earn a proportionate share of any production in the joint venture.
Subject to Frontier's satisfactory due diligence, expected to be completed by the end of April 2009, the first stage of investment is the optimization of existing producing wells and the rehabilitation of another 10 wells. The drilling of one well, targeted for new oil, is planned as the second stage. Subsequent investments and developments will be based on results of the initial investment programs. Frontier is negotiating with certain funding sources to finance the $250,000 it is required to commit to earn in the joint venture, all of which are subject to certain terms and conditions including completion of satisfactory due diligence. Frontier intends to disclose details as developments occur.
Richard Shykora, CEO of Frontier, commented, "With this transaction, Frontier has a tremendous opportunity to return to its primary objective of oil and gas exploration, development and production, particularly in an established, prolific West Texas oil and gas basin. This joint venture has the potential for immediate revenue, NAV and upside for the Company on value-added terms. We enthusiastically look forward to our business association with RJ and consider this to be Frontier's first small step in expanding its participation in West Texas oil and gas. We anticipate the support and satisfaction of our shareholders in this endeavor."
About Frontier Energy Corporation
Frontier Energy Corporation is a crude oil and natural gas exploration, development and production company with headquarters in North Las Vegas, Nevada. Our goal is enhancing shareholder confidence and value, via the implementation of exemplary management of a solid portfolio of oil and gas assets.
Except for the historical information presented, the above statements are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 or regulations there under. These forward-looking statements are subject to risks and uncertainties, and actual results may differ materially. These risks include the economic health of the oil and gas industry, competitive pricing pressures, completion of possible acquisitions, success at integrating and operating any acquired operations and the availability of necessary financing without limitations. These statements speak only as of above date, and Frontier Energy Corp. disclaims any intent or obligation to update them.