DENVER, Oct. 31 /PRNewswire-FirstCall/ -- American Oil & Gas, Inc.
(Amex: AEZ) announced that it has entered into an agreement to sell its
interests in three oil and gas leases, covering approximately 6,400 net
mineral acres in Box Elder County, Utah, to MAB Resources LLC ("MAB").
American owns a 75% interest in the leases and expects to realize net proceeds
of approximately $680,000 after deducting costs related to the sale. Third
parties own the remaining 25% and are also selling their interests to MAB.
MAB will pay a total of $1.2 million in cash for the leases. The Company has
received 40% of its share of the sales price and expects final closing to
occur on or before December 1, 2005.
Under the agreement, American Oil & Gas will retain an overriding royalty
interest of approximately 2.65%, and will receive 48 cents for each barrel of
hydrocarbon produced and sold.
The leases are located in Utah's Great Salt Lake basin in the West Rozel
field, an area within the boundaries of the lake itself, that previously
produced heavy oil from test wells drilled by Amoco in the late 1970's and
early 1980's. West Rozel crude has potential applications that include the
making of asphalt for highway paving, asphalt roofing materials and
specialized pharmaceutical applications.
Pat O'Brien, CEO of American stated, "We have done extensive work over the
last two years bringing our West Rozel project to this stage. We are pleased
to announce this agreement with MAB, which we believe has the team and vision
required to move the project forward toward development. The structure of
this agreement will allow us to participate in the future success at West
Rozel in a very meaningful way while allowing us to focus our manpower and
resources on the other large projects in our portfolio."
American Oil and Gas, Inc. is an independent oil and natural gas company
engaged in exploration, development and production of hydrocarbon reserves
primarily in the Rocky Mountain region. Additional information about American
Oil and Gas, Inc. can be found at the Company's website:
http://www.americanoilandgasinc.com.
MAB Resources, LLC is a private entity that identifies, evaluates and
participates in the development of prospective oil and gas exploration and
development opportunities. Additional information about MAB Companies is
available at http://www.mabcompanies.com.
This release and the Company's website referenced in this release contain
forward-looking statements regarding American Oil and Gas, Inc.'s future plans
and expected performance that are based on assumptions the Company believes to
be reasonable. A number of risks and uncertainties could cause actual results
to differ materially from these statements, including, without limitation, the
success rate of drilling efforts and the timeliness of development activities,
fluctuations in oil and gas prices, and other risk factors described from time
to time in the Company's reports filed with the SEC. In addition, the Company
operates in an industry sector where securities values are highly volatile and
may be influenced by economic and other factors beyond the Company's control.
This press release may include the opinions of American Oil and Gas, Inc. and
does not necessarily include the views of any other person or entity.
Contact:
Andrew Calerich, President Neal Feagans, Investor Relations
303.991.0173 Fax: 303.595.0709 Feagans Consulting, Inc
1050 17th Street, Suite 1850 303.449.1184
Denver, CO 80265
SOURCE American Oil & Gas, Inc.
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Related links:
http://www.americanoilandgasinc.com
CONTACT:
Andrew Calerich, President of American Oil &
Gas, Inc., +1-303-991-0173, fax +1-303-595-0709; or Investor
Relations, Neal Feagans of Feagans Consulting, Inc,
+1-303-449-1184, for American Oil & Gas, Inc.
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