Frontera Copper Corporation

Frontera Copper Corporation

March 01, 2005 09:22 ET

Frontera Copper Signs Letter of Intent with Mining Contractor


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: FRONTERA COPPER CORPORATION

TSX SYMBOL: FCC
TSX SYMBOL: FCC.WT

MARCH 1, 2005 - 09:22 ET

Frontera Copper Signs Letter of Intent with Mining
Contractor

TORONTO, ONTARIO--(CCNMatthews - March 1, 2005) - Frontera Copper
Corporation (TSX:FCC)(TSX:FCC.WT) is pleased to announce that it has
signed a Letter of Intent with the PEAL Group for the provision of
contract mining services at Frontera Copper's proposed open-pit mine at
Piedras Verdes in the state of Sonora, Mexico. PEAL is a large and well
respected Spanish contractor with extensive experience in large scale
open-pit mining and currently operating in Mexico.

PEAL has agreed in principle to undertake all aspects of the proposed
mining operation including drilling, blasting, loading and hauling. PEAL
will also be responsible for recruitment of all its own personnel
involved in operating and maintaining the mining equipment.

The pre-production period will be 6 months followed by an initial
contract period of 5 years. PEAL has undertaken to complete site
mobilization and provide the required mobile mining equipment to enable
pre-production mining to commence in the last quarter 2005.

Based on the Feasibility Study completed by M3 Engineering & Technology
Corporation dated September 2004, Frontera Copper has estimated that the
equipment to be provided by PEAL represents approximately $25 million of
the initial capital expenditure required to bring the Piedras Verdes
project into production.

The terms of the Letter of Intent are subject to the negotiation of a
definitive mining contractor agreement, and Frontera Copper securing the
remaining loan financing as well as the required environmental and
operating permits.

Frontera Copper is evaluating financing alternatives for the balance of
the funds required to develop the Piedras Verdes project. With an
agreement-in-principle with PEAL, Frontera Copper anticipates moving
forward to secure the remaining loan financing by mid-2005.

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 in 2006 at
an annual rate of 70 million pounds per year 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 proposed open-pit have
the potential to improve the economics and extend the life of the
project.

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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Frontera Copper Corporation
    Ann Gibbs
    Manager of Investor Relations
    (416) 350-5132
    ann@fronteracopper.com
    or
    Frontera Copper Corporation
    James Pringle
    Chief Financial Officer
    (416) 350-5130
    james@fronteracopper.com