frontier uses its rigs to bolster cash positio

FRONTIER Resources will boost its cash position by $A800,000 (K1.80 million) by carrying out exploration on behalf of Coppermoly at the Simuku copper and molybdenum project on New Britain Island, PNG.



Drilling at Frontier's projects in PNG

Frontier has two of its fully-owned rigs in the four-rig Simuku program operating on a 3000m drilling contract that is more than half complete.

With the company having about $A528,000 in cash at the end of June, Frontier managing director Peter McNeil told PNGIndustryNews.net the drilling contract was worth about $A800,000, including mobilisation and demobilisation.

“It is very good for our cash flow and assists us to continue exploration and limited drilling on our own properties,” he said.

Frontier also owns two rigs in Tasmania which can also generate cash flow.

McNeil said it was possible to likely that the company will have work for one rig in Tasmania until mid 2009 on two different programs, one for 1000m and the other for 3000m.

Frontier has previously conducted commercial drilling jobs in Tasmania and McNeil said the company was viewed positively by other explorers.

“We can provide full exploration services and support, including drilling, excavators, transport (crawler carriers, trucks, quads), camp establishment and regulatory knowledge.”

With Frontier’s exploration in Tasmania, McNeil said the company aims to have the Narrawa polymetallic deposit finalised by year-end and to report an inferred resource for the area shortly.

Meanwhile, Frontier continues to pursue legal action against the PNG government for failing to renew its exploration licence 1348, near the Kokoda Track.

McNeil said affidavits are being prepared.

The PNG Mining Department has previously said the licence was not renewed because of issues concerning the nation’s future power and water supplies.

McNeil said the government had to cite those reasons as the Kokoda Track could not be considered in the national interest.

The company’s previous released independent environmental assessment, which consulted with the nation’s energy and water providers, noted that water supplies are available for the next 40 years.

The report also detailed other sources for power and water, making a case that the area of EL1348 was not contingent for PNG’s future power or water needs.

Frontier shares last traded at A4.9c.