2017 Drill Program At Yerington Copper Project

VANCOUVER, BC - Quaterra Resources Inc. and its subsidiary Singatse Peak Services LLC (SPS) reported a 2017 drill program of at least 15 drill holes to test targets throughout the Company’s 51-square-mile land package located in the historic Yerington District of Nevada.

Freeport-McMoRan Nevada LLC has agreed to make accelerated option payments of up to $1.5 million. SPS has determined that these will be used to fund the 2017 drill program. Freeport Nevada is a wholly owned subsidiary of Freeport Minerals Corporation, which in turn is a wholly owned subsidiary of Freeport-McMoRan Inc.

Quaterra President and COO Gerald Prosalendis said, “This year’s drill program is focused on locating and drilling both potential open-pitable and higher-grade porphyry and skarn mineralization in a number of prospective areas that we have identified across our district-scale property.

“Work will begin in the first quarter of the year and will include both reverse circulation and core drilling of a minimum of 15 holes in and around the Yerington pit, at the MacArthur deposit five miles north of the Yerington pit, and on other prospective targets identified on the Company’s large land position,” he said.

“For example, MacArthur contains significant sulfide mineralization beneath the oxide zone as discovered by a relatively few previously drilled holes that continued beyond the base of the oxide. We want to better understand the porphyry system that underlies the oxide cap.”

Geophysical surveys, geologic mapping and data from the previous drilling programs have been used to select drill targets. An induced polarization (IP) geophysical survey is currently in progress to assist in final drill site selection.

Freeport Nevada’s accelerated $1.5 million option payments are in addition to an option payment last month of $1.25 million by Freeport Nevada to SPS that is being used for property maintenance, G&A and environmental compliance at Yerington. Last month’s option payment was the second of a four-tranche agreement totaling $5.75 million over two years announced in June last year to extend Stage 2 of Freeport Nevada’s option to acquire an interest in the Company’s Yerington Copper Project. Freeport Nevada has the right to terminate the agreement at any time with 60 days’ notice.

In June 2014, Quaterra and its subsidiary SPS entered into an agreement which gives Freeport Nevada an option to earn an initial 55% interest in SPS by providing $40.7 million in option payments to SPS. In June 2016, Stage 2 of the agreement was potentially extended by another two years. The Stage 2 extension option payments and any accelerated option payments will reduce the payments required for Freeport Nevada to earn its initial 55% interest in SPS. Freeport Nevada can earn a further 20% in SPS (increasing its holding to 75%) by spending $99.5 million or by funding a feasibility study, whichever comes first. Before then, Freeport Nevada can terminate the agreement at its discretion.

Quaterra’s Yerington Copper Project is located in the historic Yerington Copper District, about 70 miles southeast of Reno, Nevada. It consists of the Yerington pit sulfide and oxide deposit previously mined by Anaconda; the MacArthur oxide and sulfide deposit; the Bear porphyry copper deposit; and several untested exploration targets. Quaterra’s 51-square-mile land package is situated in a mining-friendly jurisdiction with a history of copper production and good infrastructure. It also owns valuable water rights in the district. Quaterra has invested some $36 million in the Yerington District since 2006, and has released NI 43-101-compliant oxide and sulfide resources at both MacArthur and Yerington, and a preliminary economic assessment at MacArthur.