The milling facility Michelin site capable of processing 10,000 tonnes of mineralization per day, which will produce up to 7.3 million pounds of U3O8 per annum.

The project is held by Aurora Energy Resources Inc., a wholly owned subsidiary of Fronteer Development.

Direct cash costs are stated at $28.57 per pound of U3O8 over the 17-year mine life. At an 8% discount rate, the Project’s pre-tax net present value is $914 million with a pre-tax internal rate of return of 19.4% on an unlevered 100% equity basis, and a pay-back period of 4.7 years.

The PEA results now provide Fronteer Development with a context for examining all project development and financing options.

The Nunatsiavut Government is currently in the process of developing its environmental legislation and the Land Administration System for Labrador Inuit Lands, which are well underway and on schedule. The Land Use Planning process, which is a joint process between Nunatsiavut Government and the Government of Newfoundland and Labrador, is underway and is expected to be completed on schedule. The Nunatsiavut Government requires these instruments to be in place ahead of large-scale resource development projects, and they are expected to be completed on or before March 2011. March 2011 is also when the current moratorium on mining, milling and production of uranium on Labrador Inuit Lands shall be reviewed by the Nunatsiavut Government Assembly.

In Fronteer Development management’s view, the study shows that, on its own, the Michelin Project provides strong returns in the current economic environment. Further, given the prospectivity of this new uranium district, the Michelin Project will be the platform for further growth in the region through ongoing discovery and deposit expansion. The Project’s combination of a large resource, low technical risk, high production rates, and excellent location means that this project can expand the foundation of uranium mining in Canada.

Also, Fronteer Development management believes there are excellent opportunities to enhance the Project economics through optimization of input and throughput factors, including increasing grade through refinements in the geological model, additional infill drilling, and expanding the resource base.

The most significant opportunity identified with the Project is the remodeling of the mineral resources to better delineate the grade distribution of the deposit. The known occurrence of high- and low-grade areas has not been separated in the resource model due to variable drill density. AMEC identified a statistical break in the grade distribution at 0.1% U3O8 that may be used to help delineate high-grade domains. Combined with the support of additional infill drilling, this refinement to the resource model is considered a significant opportunity to enhance the NPV of the Project through an anticipated increase in grade and improved confidence in the resource estimate.

The PEA also identified the opportunity to better optimize the underground and open-pit mining interfaces, which could add value to the Project through the mining schedule and timing of capital investment.

Fronteer Development will be giving further consideration to establishing the most advantageous method for financing the development of the Michelin Project.

The Michelin Project is located in Labrador’s Central Mineral Belt and, in Fronteer management’s view, is one of the world’s most promising new uranium districts. Aurora’s properties in Labrador consist of a total of 91,500 Ha in 32 licences. To date, Aurora has identified six uranium deposits in the region, collectively containing a measured and indicated resource of 84.4 million pounds of U3O8 and an inferred resource of 52.5 million pounds of U3O8, and has identified numerous areas of mineralization and highly prospective targets. All of the deposits currently identified, including both Michelin and Jacques Lake, remain open for expansion.

The construction phase is expected to take three years. It is planned that the Michelin Project would consist of open-pit and underground mines at both the Michelin and Jacques Lake deposits. A mill to process the mineralization would be located at the Michelin site. Most of the buildings, including maintenance facilities, employee accommodations and a water treatment plant, would also be located at the Michelin site. Roads would connect the mine sites to a dock at Kaipokok Bay, 40 kilometres away. Tailings and waste management plans are currently being developed.

The forecast production life of the mine is 17 years, with the planned 3.65 million tonnes per year rate achieved in Year 2 of production, and maintained at that rate until Year 15 of production.

Production begins with 2.5 million pounds U3O8 produced in Year 1, followed by ramp up to a production rate of 7.03 million pounds in Year 4. During Years 4-12, the production rate will vary between 6.3 million pounds U3O8 and 7.3 million pounds of U3O8 per year (average of 6.9 million pounds U3O8 per year). From Years 13-17 production declines on an annual basis, with 3.0 million pounds being produced in Year 16.

The plan assumes that both the open-pit and underground operations will start simultaneously at Michelin, followed by Jacques Lake, commencing in Year 12. There is an overlap in open-pit production in Years 9 to 12, which allows for a production ramp up at Jacques Lake, and production of sufficient tonnes to supplement Jacques Lake underground mining.

The open-pit production schedule is based on ultimate pit shells derived from Whittle Optimization Software. All of the mineralized material classified as measured, indicated and inferred mineral resources was considered in the optimization and the mine plan. AMEC did not phase the pit at this study stage. It could be expected that with a starter pit and several push-backs, the NPV would be higher due to mining higher U3O8 grades earlier in the schedule.

Material grading better than 0.06% U3O8 was considered for underground mining at Michelin. The total mineral resource considered for underground mining is 26.6 million tonnes at an overall grade of 0.13% U3O8. The total mineral resource considered for underground mining at Jacques Lake is 2.6 million tonnes at an overall grade of 0.09% U3O8.