Frontera Copper Corporation
TSX : FCC.WT
TSX : FCC
TSX : FCC.NT
TSX : FCC.NT.A

Frontera Copper Corporation

August 14, 2006 18:07 ET

Frontera Copper Reports Results for Second Quarter 2006

TORONTO, ONTARIO--(CCNMatthews - Aug. 14, 2006) -

(All dollar amounts are expressed in United States currency unless otherwise noted)

Frontera Copper Corporation (TSX:FCC)(TSX:FCC.NT)(TSX:FCC.NT.A)(TSX:FCC.WT) reports results for the second quarter ended June 30, 2006.

Financial Results

Frontera Copper reported a net loss of $8,328,898 ($0.17 per share) for the three months ended June 30, 2006 compared to a net loss of $562,741 ($0.01 per share) for the three months ended June 30, 2005. For the six months ended June 30, 2006, Frontera Copper reported a net loss of $11,244,966 ($0.23 per share) compared to a net loss of $962,611 ($0.02 per share) for the six months ended June 30, 2005. Significant spending on the Piedras Verdes Project began in the third quarter of 2005. The higher losses in the current period are a result of the increased activity and associated financing related to the development of the Piedras Verdes Project. The higher net losses primarily reflect increases in interest and accretion with respect to the notes payable, an increase in administrative expenses, and a foreign exchange loss during the second quarter of 2006, partially offset by higher interest income.

At June 30, 2006, Frontera Copper had a working capital surplus of $21,476,034 compared to $59,288,602 at December 31, 2005.

At June 30, 2006, the Company had capitalized mineral property and deferred development expenditures totaling $86,363,281, an increase of $52,245,977 from December 31, 2005. Significant expenditures during 2006 include plant construction costs of $40,844,987, field expenses and other of $7,446,527 (primarily Company project management and a pre-production royalty payment), and initially deferred property payments of $3,572,000.

Frontera Copper's consolidated financial statements for the three and six months ended June 30, 2006 and related management discussion and analysis are available on the System for Electronic Document Analysis and Retrieval (SEDAR) at www.sedar.com and on the Company's website at www.fronteracopper.com.

Company Developments and Outlook

Site construction is nearing completion. Contractor personnel on site peaked at nearly 700 workers in June and has been decreasing since then. All major equipment for operations is now installed. More than 3.2 million cubic meters of material have been mined and ore stacking continues with over 5.5 million tonnes of ore placed on the leach pad. Sulfuric acid shipments and wetting operations began in June and recruiting personnel for start-up continues. In addition, a core drill rig arrived at the nearby prospective Cerro Chato deposit and was operating by late July.

Construction of the Piedras Verdes SX-EW processing facility is proceeding on schedule and production of copper cathodes is expected to commence early in the fourth quarter of 2006. M3 Engineering and Technology, Inc. ("M3"), the firm responsible for the project's Engineering, Procurement and Construction Management, recently prepared a revised "Estimate at Completion" capital cost of approximately $106.9 million, including working capital requirements of $6.9 million. This compares with their previous estimate of $90.0 million, including working capital requirements of $6.1 million, which M3 produced in December 2005. The increase in the cost primarily relates to costs associated with preserving the current construction schedule and escalation in construction material and freight costs. In addition, more difficult than expected soil conditions in a portion of one of the heap leach pads increased construction costs. In order to maintain the construction schedule, additional equipment was used to perform multiple tasks and specialized equipment was used to accelerate the placement of concrete. In addition, the project has experienced escalations in the cost of stainless steel and electrical materials. Frontera Copper has arranged a $15,000,000 senior secured revolving credit facility with Standard Bank Plc to cover its additional expected increased capital and working capital requirements through to the commencement of production.

Effective July 12, 2006, Frontera Copper entered into an agreement with Gerald Metals, Inc., which provides for an off-take contract for the purchase of 100% of Piedras Verdes copper cathode from start-up through to December 31, 2010. Gerald Metals will market Piedras Verdes copper cathode through its international network of offices in the U.S., Mexico, and major overseas markets. Under the agreement, Gerald Metals will co-operate fully with Frontera Copper to rapidly achieve COMEX and LME brand registrations for Piedras Verdes copper cathode.

"Copper prices have averaged over $2.80 per lb so far this year as demand in all major markets remains robust, mine production by many major producers remains below expectations and investor participation in commodity markets remains strong," said Gary Loving, President and CEO of Frontera Copper Corporation. "All of these factors are contributing to the continuation of one of the highest price cycles for copper and other base metals in recent history. With our project reaching full production in the fourth quarter of 2006, Frontera Copper is well positioned to benefit from this strong commodity cycle."

About Frontera Copper

Frontera Copper was incorporated in March 2002 to purchase and bring into production the Piedras Verdes run-of-mine heap leach, SXEW copper project in Sonora, Mexico. Production is expected to commence early in the fourth quarter of 2006 at an annual rate of 70 million pounds of LME Grade A copper cathode. A total of 942 million pounds of copper is projected to be produced during the 18-year life of the project. Existing resources and prospective exploration targets adjacent to the main open-pit have the potential to improve the economics and extend the life of the project.

Information in this news release that is not current or historical factual information may constitute forward-looking information or statements within the meaning of applicable securities laws. Implicit in this information, particularly in respect of statements as to future operating results and economic performance of the Company, and resources and reserves at the Piedras Verdes Project, are assumptions regarding projected revenue and expense, copper prices and mining costs. These assumptions, although considered reasonable by the Company at the time of preparation, may prove to be incorrect. Readers are cautioned that actual results are subject to a number of risks and uncertainties, including risks relating to general economic conditions and mining operations, and could differ materially from what is currently expected. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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