Dundee-Soulanges Property

On January 1st 2009, the Dundee Property is composed of four, 100%-owned exploration permits for a total area of approximately 57,909 hectares. The block is situated in the St. Lawrence Lowlands approximately 75 km southwest of Montreal, and borders the St. Lawrence River, New York State and Ontario. In January 2009, Gastem secured 2 additional exploration permits to the north of the existing block, between the St. Lawrence and Ottawa rivers and in the vicinity of the Soulanges canal. These permits have been incorporated into the Dundee block due to the similar geological setting and the combined permits have a total area of 92,712 hectares.

The Dundee Property has potential for both shallow primary gas accumulations and secondary storage reservoirs. Gas shows were observed in the late 1960s, and particularly in 1996 and 2002 when stratigraphic wells were drilled into highly fractured Beauharnois dolomites, showing primary and secondary porosities. Several studies were undertaken on the property and in 2004, the Gastem, Dundee No.1 well was drilled adjacent to the previous Ditem, Dundee No.1 well, producing similar results in that the well produced thermogenic natural gas at good pressure, but was subsequently invaded by salt water and abandoned.

During the autumn of 2009, Gastem undertook a 19.48 km 2-D seismic survey in the south western portion of the block, adjacent to the previous Gastem and Ditem Explorations wildcat wells and various methane seep anomalies observed during the 2007 soil geochemistry survey.

Epsilon Energy Ltd. has a 25% undivided participating interest on a in Gastem’s Dundee-Soulanges Property.