Junex, reportedly the largest single rights holder in Quebec's St. Lawrence Lowlands, on June 3 announced that it was raising $20.46 million gross proceeds through a private, bought deal placement through a syndicate led by Merrill Lynch Canada. The company will issue 3.3 million common shares at $6.20 and is granting the underwriters an option to acquire and additional 495,000 at the same price exercisable prior to closing on June 10. The company had 54,232,732 outstanding prior to the deal's closing.

In January, management reported the first successful shale fracturing in the St. Lawrence Lowlands basin had been completed in order to stimulate gas production at the Becancour 8 well, drilling Junex participated in through the partnership agreement it signed with Forest Oil in July 2006. The agreement aimed to evaluate the shale gas potential of four blocks encompassing 143,395 acres between Montreal and Quebec City wholly owned by Junex.

Junex holds rights to more than 1 million of what it considers prospective shale gas acreage in the St. Lawrence Lowlands between Montreal and Quebec City. The company has signed partnership agreements with Forest Oil and Talisman Energy that could lead to investments upwards from US$20 million during the next three years to develop prospects on its properties, and another - an 11.5% interest - with Petrolia, which led to the discovery of oil at Haldimand.

"Junex has a 15% working interest in 143 million acres at Becanceour and a 40% working interest in 55 million acres at Contreceour, both to be operated by Forest Oil (NYSE:FST)," the National Post reported May 29, quoting research from Wellington West analyst Kim Page. Page believes the company could be sitting on up to 1.25 trillion cubic feet of natural gas valued at more than $19 per share, according to the article.

Junex is drilling the St-Antoine-sur-Richelieu number one well, which seeks to test the Trenton-Black River phase estimated at 770 metres below surface. After the well logs are provided to Forest Oil , Forest will make a decision on exercising its option to increase participation through increased investment.

Junex is also drilling the Junex St-Augustin-de-Desmaures No. 1 well that is situated about 20 kilometres from Quebec City. The prime objective of this well is to cut cores in the Lorraine and Utica shales then to analyze these cores for specific geological characteristics. The well is currently drilling at a depth of 637 metres and Junex has already cut four different cores over parts of the interval between 342 and 514 metres. These cores have been sent to CBM Solutions for lab analysis such as thermal-maturation analysis and analysis of mechanical properties of the shales. The company anticipates completion of these analyses over the next three to six months.