At this time, Junex does not intend to dilute anymore its position in Petrolia especially considering the development perspective of that company, particularly the Haldimand project in which Junex and Petrolia each hold a 45% interest. The placement at $1.00 price per share shows the potential value of this project. In this regard, Junex hopes that this placement announced yesterday will help to accelerate, as mentioned by Petrolia, the development of the Haldimand oil project. Junex has already submitted to Petrolia some projects for a global partnership agreement and the negotiations between both parties are moving forward in hopes of soon concluding an agreement which will lead to the production start-up of the Haldimand #1 well and to the launching of a development plan for the Haldimand project. Junex hopes that this agreement will be signed within the best timeframe period possible.
Historical of the Haldimand project
Petrolia well first drilled the Haldimand #1 discovery near the town of Gaspe in eastern Canada. Junex has exercised its back-in option on March 2006, allowing it to earn a 45% interest in the Haldimand project in which the other partners are Petrolia (45%) and Gastem (10%). According to a Four Point Isochronal production test, the Haldimand #1 well stabilized a production rate of 34 barrels of light oil per day. Following this test, the 45-day pressure build-up analysis indicated that the well had retrieved a pressure higher than the one registered at the end of the drilling, being 12,403 kPa, as it was 11,383 kPa at the end of the drilling at a reference level of 1,073 meters. The well was completed and equipped with a pump jack and production reservoirs in May 2006. Since that time, the partners have been negotiating a Joint Operating Agreement, which will allow them to initiate a development plan on the Haldimand project.
Junex holds exploration rights on more than 6 million acres of land located in the Appalachian basin in the province of Quebec. Recent major discoveries in the United States and Eastern Canada have stimulated exploration in Quebec, which is located in a favorable geological setting for oil and gas discovery. Junex's strategy is to reduce exploration risks by entering into partnerships with other exploration companies. In parallel to its exploration efforts, Junex's goal is to achieve positive cash flows from its natural brine and drillings services operations.
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