Quaterra Resources Inc.

Quaterra Resources Inc.

January 19, 2006 12:10 ET

Quaterra Commences Drill Program on Arizona Uranium Prospects

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Jan. 19, 2006) - Quaterra Resources Inc. (TSX VENTURE:QTA) announced today the company has started a 15,000 foot drilling program on nine solution collapse breccia pipe uranium targets in northern Arizona. Six of the targets are undrilled; three have been drilled but no data are available. All of the targets are within a few miles of uraniferous breccia pipes. Numerous additional targets are currently being evaluated for drilling later in the year.

A small drill rig from Beeman Drilling Company of Moab, UT will be used to drill shallow holes on at least five of the targets to depths of 200-300 feet to locate the center of the structure accurately so that a deep hole has a maximum chance of staying in the pipe to the depth at which uranium mineralization would be expected. A larger rig capable of drilling straight holes to depths of 1600 to 2200 feet will begin to test the best targets shortly after the shallow drilling is finished. Initial work will begin on the RM and AM targets located within five miles of the Hack's Canyon mine.. Down-hole logging of each deep hole will be done by Geophysical Logging Service of Prescott, Arizona. Data will include natural gamma, bore-hole deviation, resistivity, and self-potential.

Previous exploration on the Arizona Strip in northern Arizona has resulted in the discovery of eight breccia pipe ore bodies with production in the 1980's and early 1990's totaling approximately 19 million pounds of U3O8. Total amount of mineable uranium discovered to date in breccia pipes in northern Arizona is estimated to be in the range of 35 million pounds.

Quaterra president, Dr. Thomas Patton noted the breccia pipes are vertical columns of broken rock typically 200 feet in diameter and 3000 feet in height. They occur in flat-lying sediments, and originate by collapse of karst solution cavities in the Redwall Limestone. Some of them contain uranium mineralization beginning at depths from 700 to 1000 feet beneath the surface, with the mineralized zone typically being 500 to 800 feet thick. "These represent attractive exploration targets because of relatively high grade (typically between 0.5-1.0% U3O8) and because the relatively small footprint of the deposits facilitates exploration, mining and reclamation," Dr. Patton said.

Dr. Thomas Patton is the qualified person responsible for the preparation of this release.

On behalf of the Board of Directors,

Thomas Patton, President, Quaterra Resources Inc.

Statements contained in this news release that are not historical facts are forward-looking statements as the term is defined in the private securities litigation reform act of 1995. Such forward-looking statements are subject to risks and uncertainties which could cause actual results to differ materially from estimated results. Quaterra relies upon litigation protection for forward-looking statements.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the contents of this news release, which has been prepared by management.

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