I am trying to get a balanced view of this play. There are two major risks associated with this play.

1. Strategic Enviromental Assessment (SEA) / exploitation of shale gas

2. Natural gas price / break even / profitability

Ad. 1: This point has been discussed quite a bit and I have nothing to add. Personally, I think Quebec will move forward with shale gas. This is politics taking its course and things will work out eventually. Sadly, time is money.

Ad. 2: What concerns me the most is the long term price of natural gas and the general profitability of shale gas plays. A break even price of 3-3.5 dollars seems rather optimistic? I am talking about break even including all costs.

'Canadian explorer Talisman Energy Inc. of Calgary is active in the Marcellus and Eagle Ford shales in the United States and the Utica and Montney shales in Canada.

The company’s recent economic analysis shows a steady decline in its shale gas development breakeven price over recent years, from $8.50/Mcf in 2008, to $6.50 in 2009, to $4.50 in 2010, to a projected $3-$4 in 2011.

At $3-$4/Mcf gas, that would be just breaking even.'

http://www.aapg.org/explorer/2011/04apr/shale0411.cfm

Back in 1998 when QEC got their Quebec land, the gas prices were around 2 dollars. Some are questioning whether or not shale gas is profitable at current gas prices (4.5 dollars). Needless to say, the company took a very big gamble back then! What were they thinking...