Junex Spuds Champlain #2

Junex has started last week the drilling of the Champlain No 2 well located in the St. Lawrence River geological basin. The well is now at a depth of 275 meters and the total depth targeted by the company is approximately 800 meters in order to test the Trenton /Black-River Formation.

The Champlain No 2 well is located at 2.5 kilometers of the Champlain No 1 well, which had encountered important natural gas shows. The purpose of this drilling is to reach a collapsing zone (sag) identified by seismic data. These zones, associated with hydrothermal dolomite, are successfully drilled in the Trenton/Black-River Formation in New York State. The well was positioned at a 25-kilometer distance from the Gentilly No 1 well, drilled by Talisman last Fall which led to the discovery of natural gas in the Trenton / Black-River Formation. Junex is scheduling to complete the drilling for the beginning of October.

Results from the Champlain No 1 well

The Champlain No 1 well was drilled by Junex at a total depth of 958 meters. The drilling encountered a 100-meter thick zone saturated with natural gas. This zone is located at the contact point between the sedimentary formations of the Utica Shales and the Trenton /Black-River. However, the production tests have not demonstrated a commercial production capacity from the Trenton / Black-River zone. Therefore, taking into account the important indications of gas met during the drilling, the well remains suspended from now but could be reopened for further investigation at a later time.

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.