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Petrolia: Exploring for oil in Gaspe

Q&A with Alexandre Gagnon, vice-president of finance Petrolia Inc.

Alexandre Gagnon, vice-president of finance
Petrolia Inc.
Ticker: PEA
Ranking:#1 in Oil & Gas
Market Capitalization, Dec. 31, 2011: $79.5 million

Tell us a bit about your company.
We’re an oil and gas exploration company that’s only active in Quebec. We focus on the Gaspe Peninsula and Anticosti Island. We are still without revenues, but we expect to be in production in 2013. Although we’re not yet in production, we do know we have 7.7 million barrels of oil in our Haldimand project.

When did you list on the Venture exchange?
The CEO, Andre Proulx, started the company in 2002. We took it public in 2005. It’s expensive to do oil exploration in Quebec.  

Do you think you’ll need to go back to the public for more money next year?
We have $8.5 million in our bank account — that’s enough to run the business for two years. We still need money to drill and explore properties, so we’re looking for a strategic partner for the island. This year we’ll need around $15 million to drill the Bourque project (which is on the Gaspe). For the moment we don’t know how we’ll raise that money. It could be through a strategic partner or through the capital market.


What’s attracting investors to your company?
We’re the only oil company that’s active in Quebec. We’re on 70% of all permits with oil potential and we have this big project on the island. It’s exactly the same type of formation as the Utica Shale in Ohio. For the moment we don’t know the extraction rate of this project, but it has a lot of potential.  

Andre had a good vision of oil potential in Quebec. During 2008 when everyone was looking for gas plays in Quebec we were active buying oil permits. It was a contrarian strategy. And we like the price of oil better than the price of gas.

What does the future hold?
Revenues will come from Haldimand and then (hopefully) from Bourque and we’ll use that cash flow from these projects to continue exploration in the island. We’ll also continue to focus on Quebec — we have no plans to go anywhere else.