The Galt Oil Project covers an area of 16,645 acres located 20 kilometres west of Gaspé. Galt is the most advanced oil project in Quebec in terms of geological knowledge and engineering, of delineation of the structure, wells drilled and resource potential. Based on publicly disseminated information, our project contains the largest Discovered and Undiscovered Oil Resource potential so far established on the Gaspé Peninsula by independent evaluators and currently it is the only project in Québec containing Proved and Probable oil reserves.
At the end of autumn 2014, Junex drilled the first horizontal well on this project, the Galt No. 4 Horizontal well, which was drilled from the Galt No. 4 Vertical wellbore to a total measured depth of 2,400 meters, of which 1,503 meters was drilled within the oil reservoir. This well demonstrated the validity of the geological concept for the Galt project.
In total, Junex recovered a total volume of 7,200 barrels of light oil from its production testing and its cleanup/swabbing operations in its Galt No. 4 Horizontal well. Constant production rates varying between 161 to 316 barrels of light oil per day were recorded during the production tests. Positive results from the Galt No. 4 Horizontal well encouraged Junex to update its reserve and resource evaluation of the Galt Field.
Netherland, Sewell & Associates, Inc., ("NSAI"), a firm of worldwide petroleum consultants based in Texas, provided an update of their Best Estimate of the total Oil-Initially-In-Place (“OIIP”) resources at 557 million barrels for the Forillon and Indian Point formations on Junex’s Galt Field property on the Gaspe Peninsula.
This 557 million barrel figure includes Discovered OIIP volumes of 81 million barrels and Undiscovered OIIP volumes of 476 million barrels in the combined Forillon and Indian Point formations, of which Junex’s net share of the total OIIP resources is 390 million barrels that includes Discovered OIIP volumes of 57 million barrels and Undiscovered OIIP volumes of 333 million barrels. This represents a 227 million barrel increase (69%) with respect to NSAI’s previous Best Estimate of the total OIIP resources as outlined in a press release made by Junex on March 27, 2013.
Junex continued its efforts to complete the exploration phase that could lead to commercial production. As a minimum, this exploration phase includes the following steps:
- The drilling of the Galt No. 5 Horizontal well;
- The acquisition of a 3D seismic data survey, and;
- The drilling of the Galt 6 & 7 Horizontal wells, whose locations will be selected based on prior results, is planned for 2016 to 2017.
It is only after the completion of this exploration program that the company intends to apply for a production lease with the applicable government authorities.