In August 2008 Petrolia announced the signing of a farmout agreement with an oil company in the amount of $20 million (Bourque Project: Press release of Aug. 5, 2008). The first item of this agreement has been carried out: the execution of a 3-D seismic survey (July 2008) at a minimum cost of $2.5 million, earning this partner the right to take part in the agreement. In this regard, Pilatus Energy Canada has indicated to Petrolia that it wishes to continue with its exploration program.
Besides being a partner in the Bourque Project through its Canadian subsidiary Pilatus Energy Canada, the Pilatus Group of Switzerland also owns 11% of Petrolia's share capital (Press release of Jan. 31, 2008). In fact, Pilatus believes that Petrolia's positioning gives it a strategic stake in the future of the North American petroleum industry. In the Bourque Project, Pilatus has opted for an ambitious exploration program, and wishes to move ahead quickly with its subsequent stages. The discovery of hydrocarbons in a Devonian reef would open up largely the doors to petroleum exploration in new areas of the Gaspe region.
The results of the 3-D survey, obtained during the previous quarter, confirm the existence of the traps that had been predicted by the 2-D seismic and have enabled identification of a number of potential targets for drilling. Accordingly, Petrolia and Pilatus are now in a position to select the first site of an exploration well. The starting date for the drilling will be determined by Pilatus.
Petrolia is a junior oil and gas exploration company which owns interests in oil and gas licenses covering 15,000 km2 (3.7 million acres), which represents about 18% of the Quebec territory under lease. These leases, the majority of which are located on the Gaspe Peninsula and Anticosti Island, are considered to be very promising and represent almost 70% of Quebec's land-based oil potential. Petrolia foresees its 2009 drilling projects as a major exploration milestone. The Company has 41 M shares outstanding and holds 1,7 degrees% of the issued shares of Gastem in addition to a cash position of 6,9 million dollars. Over the next five years, Petrolia's objective is to produce 5% of the Quebec oil consumption.
Pilatus Energy S.A. is a company established under Swiss law, registered in Baar, Switzerland; it carries out high-risk petroleum exploration in Africa, mainly in the two Congo Republics. Pilatus Energy S.A. has become interested in Canadian developments, and has decided to wager on the geological resources of Quebec by choosing Petrolia as a partner.
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