Current Drilling Status of the Utica Players

The current drilling is as follows:

(1) Junex is drilling a vertical on the Altai-focussed shallow Utica side for Forest to see if they want to earn a 60% interest in the Contrecoeur area. Forest selected this location after an in depth analysis of a seismically defined zone of collapse or sag atthe Trenton-Black River level at an estimated depth of 770 metres. Drilling should be complete. Interestingly at least 5 years ago, Altai also identified this feature as it extends onto Altai's property as stated on Altai's website:

One major deep exploration target (at depth of about 800 meters) hasbeen delineated. The target is a NE trending fault zone 34 kmlong averaging 1 km in width, all on land. The zone appears as adepression (a graben) at the top of Trentonformation of Ordovician age. The depression is interpreted by Paul Laroche,Consultant Geologist - Geophysicist, to have been caused by hydrothermaldolomitization of fractured limestones (hydrothermal dolomite reservoirfacies). His report points out that targets in similar geological setting alongformer shoreline of Cambro-Ordovician craton have produced large quantities ofgas and oil in the States of Ohio, Michigan, New York and West Virginiaand elsewhere in the Appalachian region of North America.Such targets are long and narrow.

Based on assumptions of 10% porosity and 30meters of thickness of pay zone (assumption based on analogy with knowndeposits of similar type), the Consultant estimates this target capable ofhosting 7.2 billion cubic feet (BCF) of gas per square km of closure in theprimary target. Only future drilling, however, will confirm the presence oftraps and the amount of gas in them. The secondary deep targets (beneath theprimary target zone) are Beekmantown dolomites and Potsdamsandstones which carry gas and oil elsewhere in the Appalachians.
Altai’s deep gas target zonemay extend for another 20 kmto the SW, all in Altai’s permits.


The vertical that Junex is drilling for Forest is southwest of Altai's property as stated above and is targeting the same feature. Below is the Junex release on this target.

Junex St-Antoine-sur-Richelieu No. 1 well in the Contrecoeur area

Junex is currently drilling the Junex St-Antoine-sur-Richelieu No. 1well in the Contrecoeur area located about 55 kilometres from Montreal.This well is targeting a seismically defined zone of collapse or sag atthe Trenton-Black River level at an estimated depth of 770 metres.Moreover, this well will drill through the overlying Utica formationshales. The well logs as well as all the geological data collected byJunex from this section of this well will be provided to its partner,Forest Oil Corp., who, after having analyzed these data, will decidewhether or not it will exercise its option to perform additionaloperations totalling $4-million (U.S.) in order to earn a workinginterest of 60 per cent in the shale section above the Trenton-BlackRiver on this 55,240-acre-sized property (see Stockwatch news datedApril 1, 2008). Upon Forest earning this working interest, Junex willthen hold 40-per-cent working interest in the shale section above theTrenton-Black River and 100-per-cent working interest in theTrenton-Black River and other geologic intervals on the property. TheJunex St-Antoine-sur-Richelieu No. 1 well is currently drilling at adepth of 471 metres and the anticipated total depth of the well is1,200 metres.

(2) Junex is drilling a vertical on their 100% owned St-Augustin-de-Desmaures property which is also on the Altai-focussed shallow side of the utica play as their pr states:

Junex St-Augustin-de-Desmaures No. 1 well

Junex is also drilling the Junex St-Augustin-de-Desmaures No. 1 wellthat is situated about 20 kilometres from Quebec City. The primeobjective of this well is to cut cores in the Lorraine and Utica shalesthen to analyze these cores for specific geological characteristics.The well is currently drilling at a depth of 637 metres and Junex hasalready cut four different cores over parts of the interval between 342and 514 metres. These cores have been sent to CBM Solutions for labanalysis such as thermal-maturation analysis and analysis of mechanicalproperties of the shales. The company anticipates completion of theseanalyses over the next three- to six-month period. While the companyhas completed the coring operations of the shale section, it iscontinuing to drill to an anticipated total depth of 850 metres throughthe Trenton-Black River and possibly other formations to obtain moreinformation about the geology in the region.

(3) Forest started drilling their first horizontal on 7/17 on the Yamsaka property (deep Utica) as stated by Questerre on their recent PR. This is only a few kilometers from Altai's deep Utica play area. Forest will also be doing a horizontal on the other Yamaska well (also deep) which is only a few kilometers from the Altai/Talisman JV as well as a horizontal on their Becancour well which is on the Altai-focussed shallow Utica play north of the Yamaska fault.

QUESTERRE ENERGY CORPORATION: SHALE GAS WELL SPUDS ON YAMASKA PERMITS

QuesterreEnergy Corp.'s operator has commenced work on the first horizontal wellon the Yamaska permits in the St. Lawrence Lowlands in Quebec.

Theoperations involve re-entering the existing St. Louis de Richelieu welland drilling a horizontal leg. This well was drilled last summer withGastem Inc. as operator targeting the Utica shale horizon. Subject tothe final drilling results, the well will be fracture stimulated andtested.

(4) Talisman is in the final stages of re-entering the Gentilly #1 well on the Questerre/Talisman/CQM.H property which is a deep Utica play that is just southeast of the Junex/Forest Oil Becancour horizontal well but is on the south side of the Yamaska fault (deep side) as the pr states:

QUESTERRE ENERGY CORPORATION: GENTILLY WELL TO BE RECOMPLETED FOR SHALE GAS

QuesterreEnergy Corp.'s operator, Talisman Energy Canada, has confirmed thatfieldwork is under way on a recompletion of the Gentilly No. 1 well.

TheGentilly No. 1 well will be fracture stimulated in several intervalsprospective for shale gas. Following the stimulations, an extensivetesting program will be conducted. The object of the program is toassess the potential commerciality of vertical well completions in thisthick shale package. The original discovery in the Trenton-Black Riverzone in this well has been suspended on a temporary basis during thisoperation.

The operator also confirmed it is mobilizing a rig tothe Lowlands area and the next well on Questerre's acreage is scheduledto spud by mid-August.

Michael Binnion, president and chiefexecutive officer of Questerre, commented: "We are very pleased to beparticipating on a joint venture basis with Talisman on this operation.This re-entry operation has allowed us to accelerate the pilot programto evaluate the shale gas potential in the Lowlands."

I would expect to hear the results of all of these drill programs in the September/October time frame. Then the fireworks begin.