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American Oil & Gas raises working interest tin Goliath projects to 95 pct

Published: 20:15 20 Jul 2009 BST

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American Oil & Gas Inc (NYSE Amex: AEZ) said it has increased its working interest in the approximate 87,000 gross acres Goliath project located in Williams and Dunn Counties, North Dakota, to 95 percent from 50 percent.

American increased its interest through two separate and unrelated transactions with Teton Energy Corp and privately held Evertson Energy Partners.
 
American purchased Teton Energy's interests in the Goliath project, which comprised approximately 14,900 net undeveloped acres, Teton's 25 percent ownership in the Champion 1-25H well, 17 percent ownership in the Viall 1-30 well, 6 percent ownership in the Solberg 32-2 well, and Teton's interest in seven gross producing Bakken wells for US$900,000 in cash.

American also closed on an acreage exchange at Goliath with Evertson Energy Partners which resulted in American receiving approximately 11,600 net acres and Evertson receiving a 50 percent working interest in the Champion 1-25H well, a 34 percent working interest in the Viall 1-30 well, an 11.9 percent working interest in the Solberg 32-2 well and American's rights to formations below the Three Forks in four 640 acre sections.

After closing these transactions, American now controls approximately 60,000 net undeveloped acres at Goliath, a 25 percent working interest in the Champion 1-25H well, a 17 percent working interest in the Viall 1-30 well, a 6 percent working interest in the Solberg 32-2 well and an interest in seven gross other producing Bakken wells.

"The Bakken play in the Williston Basin of North Dakota and Montana remains one of the most active and prolific oil areas in North America," stated Pat O'Brien, CEO of American. "This activity is supported by strong economic returns at current oil prices and a USGeological Survey assessment in 2008 that estimated the Bakken formation holds over three billion barrels of technically recoverable oil."

“We continue our efforts to bring in an outside participant to pay for all or a substantial portion of one or more wells in return for an ownership interest in the project, and we remain confident that the Bakken and Three Forks formations at Goliath will become a major focus for American in the coming months," he added.

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