Frontera Copper Corporation Requests Extension of Interest Payments on Notes

MEXICO CITY, MEXICO -- (Marketwire - June 15, 2009) - Frontera Copper Corp. ("Frontera") announced today that it is seeking to extend the payment of interest on its Notes such that these payments would be made over the period of June through August 2009. Such a change is being submitted to the Note holders for approval through an Extraordinary Resolution dated June 10, 2009.

Frontera has been advised by its mining contractor PEAL S.A. d CV that they were going to sell their mining equipment previously being used at the Piedras Verdes Mine under its contract with Frontera. In the period of February to May, PEAL had already sold some of this equipment and relocated others to its Spanish operations. Frontera Management was extremely concerned that the sale of this equipment would make it extremely difficult for Frontera to eventually take advantage of rising copper prices by restarting operations and thereby improving the Company's prospects.

Frontera Management entered into discussions with its shareholder and with PEAL to determine if an alternative solution could be found to secure the mining equipment and find sufficient funding to allow the restart of mining should Management develop sufficient confidence in the projected metallurgical recovery of copper and associated costs, and that the price for copper continues to increase to the level that such a restart is economically justified.

The Company is close to reaching an agreement with PEAL that will secure this equipment and substantially improve its chances of restarting mining. This agreement will require the assistance of a third party. This will essentially consume most of the funds available within Frontera to secure this equipment and obtain a commitment to restart mining under the terms of the existing PEAL Contract. The Frontera Board believes that it is only through the restart of operations that the viability of the company can be maintained, and although this agreement will consume most of Frontera's liquidity, it is therefore in the best interests of all stakeholders including creditors, to defer the use of cash for debt service to the extent possible and reasonable. No assurance can be offered that mining can be restarted even if Frontera is successful in in securing the possession and right to use of the Piedras Verdes PEAL mining equipment.

Since the acquisition of Frontera by Invecture, the Company has been reviewing the prior operation especially with respect to copper recovery and costs. As has been previously advised, lower copper prices, poor copper recoveries and consequent low production resulted in Frontera a reporting a year end 2008 Impairment Charge of $87.162 million and a net loss of $71.8 million.

Management has been considering options with respect to a restart of operations, but remains extremely concerned with the leach recovery being achieved by the oxide ore on Pads 1 and 2 and with the chalcocite ore placed on the existing Pad 3. Notwithstanding, the Board believes that if the current copper price is sustained over a period of time the operation may be economic and believes it is essential to the future of the Company that it retain the ability to restart mining.

John Detmold, CEO of Invecture Group S.A. de C.V., the indirect shareholder of Frontera, stated that it is extremely disappointed by the metallurgical performance inherited from the previous owners.


Extraordinary Resolution

The extraordinary resolution is being sought to waive the default expected in connection with the failure to pay interest due on June 15, 2009 and to amend the Trust Indenture made as of June 10, 2005 between the Company and CIBC Mellon Trust Company accordingly. The resolution provides that interest payable on June 15 will be paid in three equal instalments on each of June 15, 2009, July 15, 2009 and August 15, 2009.
Contact Information



Contact Information

Frontera Copper Corporation
Gerardo Luis Cazenave-Tapie Isoard
Chief Executive Officer
602-424-5481
www.fronteracopper.com