Georgia: Frontera Mtsare Khevi Sales Delayed

Frontera Resources has said today that sales from production at its Mtsare Khevi Field in Georgia have been delayed, possibly until September, due to delays in permits for the transport of the gas.

In an update on its 100 per cent owned Block 12 in Georgia, the company said that sales, which were expected to begin in July, had been stayed due to "unanticipated delays" in acquiring the permits needed for the transport of the gas from the Georgian government. It estimated that sales should be resumed this September.

The company also said in its update that it had taken a draw down of £145,068, drawn from its previously announced $35 million Standby Equity Distribution Agreement with YA Global Master SPV Ltd., to act as a buffer for the costs of sales from the field. The draw down will act as a "short term buffer" for the infrastructure associated with the beginning of the gas sales from the Mtsare Khevi Gas field.

When sales begin from the Mtsare Khevi field, Frontera expects sales to begin at approximately two million cubic feet of gas a day.

Frontera also said today that it has three rigs and two swabbing units in place at the Mirzaani Field, Mtsare Khevi Field and Taribani Field, all held within the Block 12 licence. The company says these rigs and units will help to maintain and enhance current production levels.