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July 20, 2009
Share ThisAmerican Oil & Gas (AEZ) recently raised its working interest in the Goliath project -- located in Williams and Dunn Counties, North Dakota. The company presently holds a 95% working interest of the project, encompassing nearly 63,000 net acres. Previously, American Oil & Gas held a 50% working interest.
American Oil & Gas increased the ownership through two distinct deals with Teton Energy Corporation and Evertson Energy Partners. It inked an all cash deal worth $900,000 with Teton Energy to acquire the latter's stake (nearly 14,900 net undeveloped acres) in the Goliath project, 25% ownership in the Champion 1-25H well, 17% ownership in the Viall 1-30 well and 6% ownership in the Solberg 32-2 well. It also gained control of Teton Energy's stake in the seven gross (approximately .12 net) producing Bakken wells.
Moreover, American Oil & Gas signed an acreage exchange contract with Evertson Energy Partners. It gained control of Evertson Energy's stake in the Goliath project (nearly 11,600 net acres). In exchange, Evertson Energy received a 50% ownership in the Champion 1-25H well, a 34% ownership in the Viall 1-30 well and an 11.9% ownership in the Solberg 32-2 well. Evertson Energy also obtained American Oil & Gas' rights to formations below the Three Forks in four 640 acre sections.
As a consequence of these two transactions, American Oil & Gas now owns approximately 60,000 net undeveloped acres at Goliath, a 25% working interest in the Champion 1-25H well, a 17% working interest in the Viall 1-30 well, a 6% working interest in the Solberg 32-2 well and an interest in seven gross (approximately .36 net) other producing Bakken wells.
American Oil & Gas closed at $1.02 on Friday. It will report second-quarter financial results on Aug 10. We reiterate our Buy recommendation for the company.
Read the full analyst report on "AEZ"
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