Gastem Inc.

Gastem Inc.

December 14, 2007 09:34 ET

Gastem Spuds the Joly 4 Well

MONTREAL, QUEBEC--(Marketwire - Dec. 14, 2007) - Gastem (TSX VENTURE:GMR) today announced the spud of the Gastem Intragaz Joly No4 well located approximately 60 km South West of Quebec City, and directly adjacent to the existing Intragaz gas storage infrastructure at St-Flavien.

Joly No4 will be a 1,200m deviated well into a Foothills type carbonate thrust sheet, which was delineated by a dedicated 2-D seismic survey in 2005. The Joly thrust sheet contains a highly porous oolitic dolostone-limestone sequence in the Beekmantown Group. Both the Joly and St Flavien thrust sheets are overlying the organic rich Utica shale source rock and the shape of both structures allows for hydrocarbons to have accumulated in classic, Foothills type traps.

By drilling Joly No4 and a second well in another part of the Joly structure before December 31st 2008, Gastem stands to earn a 50% interest in the potential production of natural gas and a 49% interest in the operation of gas storage on two Intragaz permits (2002PG669 and 2005PG788) totaling approximately 140 km2.

"The Joly 4 well represents a significant expansion in our company's exploration portfolio" said Marc-Andre Lavoie, Gastem President. The Joly structure is probably one of the better documented conventional targets in the St-Lawrence Lowlands, given three existing offset wells and a dedicated 2D Seismic. The potential for two revenue streams, from gas production and gas storage, was a further key element in our decision to pursue this opportunity, particularly in the context of the existing shortage of natural underground gas storage in Quebec and the proven commercial success of Intragaz' neighbouring St-Flavien facility."

Gastem (45,516,492 shares outstanding) is an independent oil and gas exploration company based in Montreal. The company holds exploration and storage rights to 3,135 km2 of land in the St. Lawrence Lowlands and the Gaspe Peninsula in Quebec as well as rights and interests in Alberta and West Virginia. Gastem also collects revenues from a participation in the Amber Bank shale gas project with Epsilon Energy in West Virginia.

Intragaz is a private company specialising in the research, development and operation of underground natural gas storage facilities in Quebec. It operates the only two such facilities in Quebec, at Pointe-du-Lac and St-Flavien.

The TSX Venture Exchange Inc. has not reviewed and does not accept responsibility for the adequacy and accuracy of this release.

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