International Frontier Resources Corporation

International Frontier Resources Corporation

December 01, 2008 17:00 ET

IFR Announces Third Quarter Results and Contingent Resource Report

CALGARY, ALBERTA--(Marketwire - Dec. 1, 2008) -


International Frontier Resources Corporation (TSX VENTURE:IFR) has released interim financial results for the quarter ended September 30, 2008. Third quarter financial and operating highlights are;

- Consolidated net earnings in the period were $89,185 ($0.00/share) compared to $21,290 ($0.00/share) in the third quarter 2007. The increase in earnings is a result of higher net oil revenues of $255,490 compared with $186,915 at September 30, 2007. For the nine month period ended September 30, 2008 net oil revenue was $826,065 versus $451,560 in 2007. For the period ending September 30, 2008 the Company recorded a net loss of $1,238,690 ($0.02) versus a loss of $1,748,870 ($0.04) at September 30, 2007. The reduction in the nine month loss is a result of higher oil prices and reduced G&A.

- Working capital at September 30, 2008 was $8,813,135 ($0.15/share) and restricted cash on deposit was $2,267,175 ($0.03) compared with working capital of $22,407,855 and restricted cash on deposit of $2,267,175 at December 31, 2007. The restricted cash secures letters of credit covering six exploration licenses in the NWT. To date work commitments on four exploration licenses have been fulfilled therefore the Company anticipates receiving refunds of approximately 85% ($1,927,000) in Q1, 2009. The Company has no debt.

- Capital expenditures for the nine month period ending September 30, 2008 were $14,157,380 (2007 - $2,074,045) of which $9,379,650 is related to seismic acquisition and exploratory drilling costs in the Northwest Territories, Canada and $4,777,730 relates to seismic and exploratory drilling in the UK sector of the North Sea.

- Given the current state of the financial markets, coupled with depressed commodity prices and the excessively high drilling costs in the NWT and North Sea, the Company has asked its operators to defer drilling plans until markets improve.

The Company also reported today that a Resource Assessment Report, dated July 1, 2008, covering the Company's previously announced discoveries located in the Northwest Territories, Canada and in the Central Graben of the North Sea, ("UKCS") has been completed. In addition the Company commissioned an evaluation of its unproven Northwest Territories acreage; the fair market value of which at July 1, 2008 was estimated to be CDN$11,786,400 ($0.20/share). The reports do not assign a value to the Company's future drilling prospects in the Northwest Territories and in the North Sea.

Company Share Contingent Resource

Area Low Case (P90) Best Case (P50) High Case (P10)
Canada (2) 341,000 1,339,500 5,670,000
UKCS (3) 175,000 512,000 1,187,000
Total Barrels Equivalent (1) 516,000 1,911,500 6,857,000

1) Gas conversion ratio 6:1 (6 mmcf = 1 barrel), a BOE conversion ratio is
based on an energy equivalency conversion method primarily applicable at
the burner tip and does not represent a value equivalency at the
2) Primarily gas-rich hydrocarbons
3) Primarily oil hydrocarbons

The contingent resource estimates and the unproven acreage evaluation were prepared and presented by McDaniel & Associates Consultant Ltd., the Company's independent reserve engineers, in accordance with the Canadian standards set out in the Canadian Oil and Gas Evaluation Handbook (COGEH) and National Instrument NI 51-101.COGEH Volume 1 defines contingent resources as "quantities of oil and gas estimated to be potentially recoverable from known accumulations using established technology or technology under development, but which are not currently considered to be commercially recoverable due to one or more contingencies. Contingencies may include factors such as economic, legal, environmental, political, and regulatory matters, or a lack of markets." Contingent resources are further classified in accordance with the level of certainty associated with the estimates and may be sub classified based on project maturity and/or characterized by their economic status.

Contingent resources have been determined for the following mutually exclusive categories:

Low Estimate (P90): This is considered to be a conservative estimate of the quantity that will actually be recovered from the accumulation. If probabilistic methods are used, this term reflects a P90 confidence level.

Best Estimate (P50): This is considered to be the best estimate of the quantity that will actually be recovered from the accumulation. If probalistic methods are used, this term is a measure of the central tendency of the uncertainty distribution (most likely mode or arithmetic average).

High Estimate (P10): This is considered an optimistic estimate of the quantity that will actually be recovered from the accumulation. If probabilistic methods are used, this term reflects a P10 confidence level.

The Company also reported today that 1,350,000 stock options with an expiry date of June 26, 2012 exercisable at $0.82 per share have been surrendered for cancellation. The Company's financial statements and MD&A can be viewed on Sedar or on the Company's website.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the contents of this news release.

Contact Information

  • International Frontier Resources Corporation
    Pat Boswell
    (403) 215-2781
    International Frontier Resources Corporation
    Mark Powell
    VP Exploration
    (403) 215-2783