HoleQM68 intercepted 115 feet averaging 1

The mineralized area currently covers an area ofapproximately 1.5 square miles and remains open to extension on threesides and near the deposit center just west of the pit."Tetra Tech's resource calculation is based on 449 Quaterra and Anacondadrill holes containing 134,255.6 feet and 26,727 sample assay values. Copper gradeswere estimated in the individual blocks of the model measuring 25 by 25feet by 20 feet high, by ordinary, whole-block kriging. The rock modelwas then assigned a tonnage factor based on the historic information thatindicates an average in-place bulk density of 12.5 cubic-feet per ton.The tonnage factors were based on a number of tests from the core and, inTetra Tech's opinion, are representative of the various rock units, andare acceptable for estimation of the in-place geologic resources. Thecopper resources were estimated using whole block kriging techniques andoriented search ellipsoids based on the individual variograms and werethen classified into measured, indicated, and inferred categories by acombination of kriging variance, number of points used in the estimate,and number of sectors used.

Several isolated areascontaining indicated resource blocks are also estimated where one or moreangle holes have been drilled from the same location in the wider spacedpattern. The Tetra Tech resource estimate for the project isincluded with a description of the project history, geology,mineralization, sampling procedures, and laboratory QualityAssurance/Quality Control procedures. This report will beavailable at The Qualified Person for the MacArthur CopperProject resource estimate and the technical report is Mr. John W.Rozelle, P.G., Principal Geologist for Tetra Tech, Golden Colorado.MacArthur Drilling Program UpdateSince April 2007, Quaterra has completed 80,137 feet of drilling in 49core holes and 124 reverse circulation holes prior to discontinuing theprogram to facilitate the completion of the Technical Report. Theintercepts of 33 new holes totaling 16,100 feet are reported in thisrelease in Table 2-1 and are included on a complete list of interceptsthat has been posted on the Company's website. All but the last threeholes (QM-083, QM-084 and QM-085) of the 33 new holes were used in thecalculation of today's resource estimate. The results of the three unusedholes, located in the MacArthur pit, were later inserted and used by Ttto validate the resource model add confidence to the orientation andinterpolation parameters used for the estimate.The most recent round of drilling concentrated on defining themineralization along the northern margin of the deposit and infilling thehistoric drill pattern within and around the MacArthur pit.

The zone ofacid-soluble copper mineralization continues to be extended to thenorthwest. Hole QM-60, located on the north central margin, intercepted260 feet of predominantly chalcocite mineralization averaging 0.38copper at a depth of 140 feet. The intercept includes a higher gradeinterval of 50 feet averaging 0.89 copper.Recently completed drill holes along the northeast margin of the depositencountered high grade primary copper mineralization in pervasivesericite and magnetite that defines a new porphyry copper target. HoleQM-68 intercepted 115 feet averaging 1.15 copper at a depth of 470 feet.A similar section of mineralization in QM-70 averaged 1.02 Cu over athickness of 45 feet at a depth of 435 feet. Together with mineralizedintercepts in QM-26, the results point to a possible porphyry center inthe foot wall of the MacArthur fault where it is "blind" except for asmall patch of pervasive sericite alteration exposed on the surfaceimmediately south of holes QM-70 and QM-72. The alteration appears to betoo far to the east to be related to the MacArthur oxide porphyry center.The sulfide mineralization may develop down dip to a larger depositsimilar to the Yerington porphyry copper deposit. Until the POO is approvedand a Decision Record issued, work on the project is expected to includepreliminary metallurgical testing, geophysical studies, and a review ofdistrict exploration data from the Anaconda Library in Laramie, Wyoming.Mr Eugene D.