Based upon the pattern which led other junior energy companies towards success, Junex has set up since 2001 an exploration strategy including five steps, which were thoroughly followed since then.

STEP 1
SECURING THE MINING TERRITORY
The first step of a winning exploration strategy consists in being sure we hold the exploration rights on a large mining territory which will be valorized if any discovery occurred. Through the years, Junex has accumulated rights over more than six million acres before the arrival in Quebec of other companies which were encouraged by results obtained in the United States for comparable geological basins, and has acquired exploration permits in our territory. Today, having rights covering prospects in the St-Lawrence Lowlands as well as those in Gaspésie, Junex holds without doubt the best position to benefit from an important hydrocarbon discovery in the Province of Quebec.

Growth of the lands under exploration permit in Quebec



STEP 2
CREATE A CREDIBLE GEOLOGICAL MODEL
Since 2001, Junex has conducted basic exploration works that have allowed the development of credible geological models. This step consists in identifying stones on the territory; in analysing the characteristics of the source rock; in carrying out seismic surveys; in identifying the presence of hydrothermal dolomite; in working with scientific organisms such as the Geological Survey of Canada. We mean here a scientific work which is essential to succeed in exploration.

STEP 3
INVEST TO DEMONSTRATE THE VALUE OF THE MODEL AND PROPERTIES
We invested millions of dollars in order to complete up to fifteen drillings which prove the value of our geological models. These drillings have shown the presence of petroleum and natural gas and have led to successes which enhance the value of our projects. These results allow us to position prospects in Québec in their North-American context by indicating the geological similarities existing between our projects and those discoveries made in comparable basins elsewhere in the world, particularly in the Appalachian Basins in the United States.

STEP 4
SIGNING EXPLORATION PARTNERSHIPS
By signing these partnerships we wish to generate investments on our properties and, in some cases, to take benefit from the expertise of reliable partners in the oil and gas industry. Junex presently counts four active partnerships which allow managing the financial risks linked to exploration while optimizing opportunities of discovery.

STEP 5
HAVING THE PRIVILEGE OF WAITING FOR THE MOST IMPORTANT DISCOVERY
It is quite obvious that the future growth of our company and of its stock-market value depends on the results obtained after exploration activities. On the other hand, whether we sell natural brine, petroleum or sign drilling and service contracts, exploration activities of Junex generate cash flows (123,358.00$ in 2006) and improve managing with exploration risks. The objective of Junex is to participate in a discovery of hydrocarbons that will give an important value to our shareholders. Some solid projects such as Haldimand, Galt or Champlain are very promising and could result in the kind of discovery we are waiting for. Meanwhile, we can rely on our secondary activities to generate cash flows and on our partners who invest most of the exploration capital. These means allow us to wait for the most important discovery while we better manage the exploration risk and the reduction of shares of the company.