The Yamaska Property
The Yamaska Property consists of two exploration permits covering 45,381 hectares, located in the St. Lawrence Lowlands, south of Lac St-Pierre and Trois-Rivières. The property is situated between 2 major fault systems (the Yamaska and the Aston) and the Utica shale is present with a conservative average thickness of more than 200m at a depth of about 1.6 km.
Gastem drilled two vertical wells on this property in 2007 in order to core and evaluate the Utica formation, the first two such wells in the Quebec Lowlands to test this formation. Both wells were later fracced by earn-in partner Canadian Forest Oil later in 2007 and early in 2008. In April 2008, Gastem’s partner Canadian Forest Oil announced a major natural gas discovery in Quebec’s Utica Shale resulting, to a large extent, from work on Gastem’s Yamaska Property in the St. Lawrence Lowlands.
During the summer of 2008, Forest Oil undertook a 2 horizontal well test program of the Utica Shale underlying the Yamaska permits. In late 2008, the wells were completed with multi-stage frac treatments and successfully tested. The initial flow rate, up to 800 Mcf/d, confirmed the Utica Shale potential. General conclusions drawn from Gastem’s and Forest’s operations were released by Forest Oil on February 23, 2009 and were encouraging for commercial production.
At present, Forest Oil has a 60% interest in the property. In late 2008, Gastem exercised its right under the agreement with Questerre Energy to convert the latter from a 7.5% non participating GORR position to a 20% working interest. The working interests on the Yamaska wells were Canadian Forest Oil 60%, Gastem 20% and Questerre Energy 20%. Epsilon Energy has not yet participated in any wells on this property, but may do so Questerre 20% and Gastem 20%. Epsilon Energy which has a 25% undivided participating interest in Gastem’s interest has yet to participate. Gastem and Questerre each hold 50% rights in the formations below the Utica.