Frontier Oil Reports Third Quarter 2009 Results

For the nine months ended September 30, 2009, net income totaled $108.2 million, or $1.03 per diluted share, compared to net income of $177.6 million, or $1.71 per diluted share, for the comparable period in 2008. The results for the first nine months of 2009 included an after-tax inventory gain of $108.5 million, or $1.04 per diluted share, and an after-tax hedging loss of $2.0 million, or $0.02 per diluted share. The results for the comparable nine months of 2008 included an after-tax inventory gain of $87.8 million, or $0.85 per diluted share, and an after-tax hedging loss of $24.7 million, or $0.24 per diluted share.

Refined product margins remained depressed during the third quarter due to continued weak demand and sustained high inventory levels, particularly distillates. Frontier's diesel crack spread averaged $7.94 per barrel in the third quarter of 2009, compared to $26.76 per barrel in the third quarter of 2008 and $6.28 per barrel in the second quarter of 2009. Frontier's gasoline crack spread averaged $7.92 per barrel in the third quarter of 2009, down from $9.42 per barrel in the third quarter of 2008 and $10.85 per barrel in the second quarter of 2009.

Crude differentials improved modestly during the third quarter compared to the second quarter, though still lower than the comparable period of 2008, partially due to strength in the asphalt markets. The light/heavy crude oil differential averaged $6.34 per barrel in the third quarter of 2009, compared to $14.10 per barrel in the third quarter of 2008 and $4.53 per barrel in the second quarter of 2009. The WTI/WTS differential averaged $1.62 per barrel in the third quarter of 2009, compared to $2.77 per barrel in the third quarter of 2008 and $1.02 per barrel in the second quarter of 2009.

Frontier's total charges for the third quarter of 2009 averaged 177,741 barrels per day ("bpd"), up from an average of 173,954 bpd in the third quarter of 2008 mainly due to the planned coker shutdown in El Dorado during the third quarter of last year. For the fourth quarter of 2009, charge rates are expected to decrease to an average of 136,000 bpd due to the planned maintenance on the FCCU and gasoil hydrotreater at El Dorado.

Frontier's President and CEO, Mike Jennings, commented, "This period of low refining margins continues to challenge domestic refiners, evidenced by recent capacity exiting the system. For Frontier, the balance sheet strength provides endurance, but reporting a quarterly loss is always a disappointment. While many market factors in this economy are beyond our control, we are taking action to improve those within our control. We have launched an initiative at the Cheyenne refinery to improve refining margins. We are working to achieve this initiative through a combination of cost reductions and projects aimed at energy efficiency, yield improvements, and crude flexibility."

For the three months ended September 30, 2009, Frontier generated $21.7 million in cash flow before changes in working capital (note 2), invested $44.9 million in capital expenditures, and paid $6.4 million in dividends during the quarter. As of September 30, 2009, Frontier maintained a cash balance of $487.3 million, which exceeded debt by $139.9 million, and had $720.6 million of working capital. In addition, there were no cash borrowings under the Company's revolving credit facility, which had $339.1 million of borrowing base availability at quarter end.

Conference Call

A conference call is scheduled for today, November 5, 2009, at 10:00 a.m. central time to discuss the financial results. To access the call, which is open to the public, please dial (800) 446-1671 (international callers (847) 413-3362), confirmation number 25516509. A recorded replay of the call may be heard through November 19, 2009 by dialing (888) 843-8996 (international callers (630) 652-3044), passcode 25516509. In addition, the real-time conference call and a recorded replay will be available via webcast by registering from the Investor Relations page of our website www.frontieroil.com.

Frontier operates a 130,000 bpd refinery located in El Dorado, Kansas, and a 52,000 bpd refinery located in Cheyenne, Wyoming, and markets its refined products principally along the eastern slope of the Rocky Mountains and in other neighboring plains states. Information about the Company may be found on its website www.frontieroil.com.

This press release includes "forward-looking statements" as defined by the Securities and Exchange Commission. Such statements are those concerning strategic plans, expectations and objectives for future operations. All statements, other than statements of historical fact, included in this press release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. These statements are based on certain assumptions made by the Company based on its experience and perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in the forward-looking statements.

FRONTIER OIL CORPORATION
                                                                   Nine Months Ended                     Three Months Ended
                                                                   September 30,                         September 30,
                                                                   2009               2008               2009             2008
INCOME STATEMENT DATA ($000s except per share)
Revenues                                                           $   3,148,674      $   5,150,641      $  1,200,582     $  2,198,302
Raw material, freight and other costs                                  2,631,548          4,565,992         1,097,559        1,991,966
Refining operating expenses, excluding depreciation                    232,175            244,861           83,701           76,267
Selling and general expenses, excluding depreciation                   38,937             32,379            13,650           9,876
Gain on sale of assets                                                 -                  (44       )       -                -
Operating income before depreciation                                   246,014            307,453           5,672            120,193
Depreciation, amortization and accretion                               54,226             48,072            18,099           16,635
Operating income (loss)                                                191,788            259,381           (12,427   )      103,558
Interest expense and other financing costs                             21,046             7,043             6,709            2,480
Interest and investment income                                         (1,948    )        (4,691    )       (661      )      (1,056    )
Provision (benefit) for income taxes                                   64,517             79,421            (3,348    )      29,811
Net income (loss)                                                  $   108,173        $   177,608        $  (15,127   )   $  72,323
Diluted (basic) earnings per share of common stock                 $   1.03           $   1.71           $  (0.15     )   $  0.70
Average diluted shares outstanding (000s)                              104,688            103,785           103,747          103,920
OTHER FINANCIAL DATA ($000s)
Adjusted EBITDA (1)                                                $   246,014        $   307,453        $  5,672         $  120,193
Cash flow before changes in working capital (2)                        209,467            233,648           21,704           95,707
Changes in working capital from operations                             (62,401   )        (13,258   )       28,618           4,904
Net cash provided by operating activities                              147,066            220,390           50,322           100,611
Net cash used in investing activities                                  (121,574  )        (167,674  )       (44,865   )      (45,198   )
Net cash provided by (used in) financing activities                    (21,710   )        113,913           (6,500    )      187,375
OPERATIONS
Consolidated
Operations (bpd)
Total charges                                                          180,439            153,857           177,741          173,954
Gasoline yields                                                        83,809             72,508            84,913           78,755
Diesel yields                                                          70,649             53,205            67,167           66,424
Total sales                                                            182,890            157,782           178,163          177,219
Refinery operating margins information ($ per bbl)
Refined products revenue                                           $   63.03          $   119.91         $  73.02         $  128.47
Raw material, freight and other costs                                  52.71              105.62            66.96            122.18
Refinery operating expenses, excluding depreciation                    4.65               5.66              5.11             4.68
Depreciation, amortization and accretion                               1.08               1.11              1.10             1.02
Cheyenne Refinery light/heavy crude oil differential ($ per bbl)   $   5.96           $   17.64          $  7.11          $  14.02
WTI/WTS differential ($ per bbl)                                       1.44               4.13              1.62             2.77
El Dorado Refinery light/heavy crude oil differential ($ per bbl)      5.71               19.15             5.69             14.33
BALANCE SHEET DATA ($000s)                                         At September 30, 2009                 At December 31, 2008
Cash, including cash equivalents (a)                                                  $   487,314                         $  483,532
Working capital                                                                           720,571                            651,352
Short-term and current debt (b)                                                           -                                  -
Total long-term debt (c)                                                                  347,416                            347,220
Shareholders' equity (d)                                                                  1,150,111                          1,051,140
Net debt to book capitalization (b+c-a)/(b+c-a+d)                                         -13.8     %                        -14.9     %

(1) Adjusted EBITDA represents income before interest expense and other financing costs, interest and investment income, income tax, and depreciation, accretion and amortization. Adjusted EBITDA is not a calculation based upon generally accepted accounting principles; however, the amounts included in the Adjusted EBITDA calculation are derived from amounts included in the consolidated financial statements of the Company. Adjusted EBITDA should not be considered as an alternative to net income or operating income, as an indication of operating performance of the Company or as an alternative to operating cash flow as a measure of liquidity. Adjusted EBITDA is not necessarily comparable to similarly titled measures of other companies. Adjusted EBITDA is presented here because the Company believes it enhances an investor's understanding of Frontier's ability to satisfy principal and interest obligations with respect to Frontier's indebtedness and to use cash for other purposes, including capital expenditures. Adjusted EBITDA is also used for internal analysis and as a basis for financial covenants. Frontier's Adjusted EBITDA for the nine months and three months ended September 30, 2009 and 2008 is reconciled to net income as follows:

                                                Nine Months Ended             Three Months Ended
                                                September 30,                 September 30,
                                                2009           2008           2009           2008
Net income (loss)                               $  108,173     $  177,608     $  (15,127 )   $  72,323
Add provision (benefit) for income taxes           64,517         79,421         (3,348  )      29,811
Add interest expense and other financing costs     21,046         7,043          6,709          2,480
Subtract interest and investment income            (1,948  )      (4,691  )      (661    )      (1,056  )
Add depreciation, amortization and accretion       54,226         48,072         18,099         16,635
Adjusted EBITDA                                 $  246,014     $  307,453     $  5,672       $  120,193

(2) Cash flow before changes in working capital represents cash flow excluding the effects of changes to cash flow related to changes in working capital. Cash flow before changes in working capital is not a calculation based upon generally accepted accounting principles; however, the amounts included in the cash flow before changes in working capital calculation are derived from amounts included in the consolidated financial statements of the Company. Cash flow before changes in working capital is presented here because the Company believes it enhances an investor's understanding of Frontier's cash flow irrespective of the cash used in or provided by the working capital accounts. Frontier's cash flow before changes in working capital for the nine months and three months ended September 30, 2009 and 2008 is reconciled to net income as follows:

                                                                   Nine Months Ended             Three Months Ended
                                                                   September 30,                 September 30,
                                                                   2009           2008           2009           2008
Net income (loss)                                                  $  108,173     $  177,608     $  (15,127 )   $  72,323
Depreciation, amortization and accretion                              69,194         61,082         23,153         21,296
Deferred income taxes                                                 12,097         15,684         7,284          2,214
Stock-based compensation expense                                      15,193         13,736         4,440          3,934
Excess income tax benefits of stock-based compensation                (227    )      (4,201  )      (76     )      (266    )
Amortization of debt issuance costs                                   1,117          603            373            260
Senior notes discount amortization                                    196            8              67             8
Allowance for investment loss and bad debts                           500            411            -              411
Gain on sales of assets                                               -              (44     )      -              -
Amortization of long-term prepaid insurance                           -              909            -              303
Increase (decrease) in other long-term liabilities                    11,357         (1,331  )      8,467          (3,219  )
Changes in deferred turnaround costs, deferred catalyst costs and     (8,133  )      (30,817 )      (6,877  )      (1,557  )
other
Cash flow before changes in working capital                           209,467        233,648        21,704         95,707
Changes in working capital from operations                            (62,401 )      (13,258 )      28,618         4,904
Net cash provided by operating activities                          $  147,066     $  220,390     $  50,322      $  100,611

SOURCE: Frontier Oil Corporation

Frontier Oil Corporation 
Kristine Boyd, 713-688-9600 ext. 135