Thanks for all the kind comments on the previous post. I'm glad people found it useful. I did get a couple of people asking if I was an insider and while that would be much more interesting and mysterious, the fact is I'm just a regular investor that hates to loose money, so I do a lot of DD. While I don't post a lot, I do read the board regularly, I just don't have a lot to say. From my stand point there are really only about 6 steps of interest to this play and there isn't a lot to be said in between each step.

1. First vertical test well to identify the potential resource and get rock samples

2. Fracing the first wells, just to prove that the rock can in fact be fraced.

3. Verifying the geology over the acreage by doing more test wells separated by large distances

4. Horizontal test wells to identify the best fracing procedures

5. Pilot drilling to improve rig efficiency and buildout of the collector pipes to tie-in to the big continental transport pipes

6. Full on production drilling.

Again, from my standpoint, once you get the first 3 items confirmed on the list, the remainder are really just a matter of time and assigning priority on the company's CAPEX to exploit it. The stock price should only go up, but again, you've got analysts saying we've now put the likely hood of commercial production up to 40% from 30%. Unless there is something dumb like the Quebec government saying sorry, only Quebec companies can drill in Quebec, Production probability is already at 100% or damn close to it.

The question of where the SP will be at the end of June is a difficult one, it's just such a short time frame from today. The question isn't so much what I think it's going to be worth in June, but what will the rest of the market think it will be worth. People are obviously focusing on the next horizontal from Talisman. While I don't want to burst any bubbles, I think it's important to mention that I expect the next well to come in lower than the current one. I know that seems counter to the learning curve expectation of it always getting better, but sometimes you have to try something on the opposite end of the scale to get a better view of where the most efficient point really is. I believe this is the case for the next well.

The current well was drilled to a 1000m horizontal with an 8 stage frac, so it's using 125m spacing between the fracs. They've already said the next well was drilled to a 700m horizontal and will be an 8 stage frac again. This puts the frac spacing at 87m, much shorter. There isn't a direct 87m/125m correlation on the spacing to the eventual flow rate, but it's reasonable to expect the flow rate to be lower per frac. What they're trying to find out is where the sweet spot is. As an example, they may figure out from this next well that 100m spacing should give them the same flow rate as 125m spacing. So a 1000m horizontal should include a 10 stage frac instead of an 8 stage frac. That would have put the flow rate on the current well up to 7.5mmcf/d instead of the 6mmcf/d they got during the test.

I don't think the general market is smart enough to pick up on some of these points so they may be disappointed if we only get say, an 80% flow rate compared to the current well. That will likely bring the SP down or just not bring it up any higher.

On the other side of the coin, just over a year and a half ago, people were willing to pay at a peak of just over $6 for QEC when we were just at stage 1 and we're now into stage 4 in the list above. So $6 seems to be a good top end in the short term. Technical Analysts will probably say this is some sort of "resistance" level etc. It doesn't mean a lot to me, but it does to some people. Again, on the possitive side, there are many funds and investors that just don't get involved in what's perceived to be a risky investment. The current results may start to bring some of that money into QEC.

So if I have to pick a number, I'll go with $6/share at the end of June. When you think about it, that's still a 20% increase in only a few months, not bad at all.

Brym