Gastem reported that its partner, a major US independent oil and gas public company, has notified Gastem of its election to exercise its Financial Commitment option on the Yamaska Property as per the January 2007 Agreement. According to the terms of the Agreement, the company may earn up to a 60% interest in the Yamaska Property by undertaking an earn-in program.
The exercise of the option follows a hydraulic fracturing program undertaken in mid-December at the Gastem St-Francois-du-Lac #1 well. The frac stimulated an interval considered prospective within the Utica Shale sequence and identified during coring and logging operations in June 2007. Results to date have yielded new data with respect to frac design and potential gas flow rates. Further work is now anticipated in the coming months.
Gastem has contracted Sproule and Associates of Calgary to complete a Gastem resource assessment for the Yamaska Property. The report is scheduled to be completed during the Second Quarter of this year.
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