American Oil & Gas expects to close on the sale of non-core acreage within its Douglas Project the week of October 27, 2008. In August of this year, American entered into a definitive agreement with a major independent natural gas producer to sell 36,000 net acres in its 128,000 gross (70,000 net) acre Douglas project area for approximately $27 million. Of the 36,000 net acres, 33,000 net acres are located in the West Douglas and Douglas project areas and 3,000 acres are located on the far western edge of the Fetter project area. Included in the sale is American's carried interest in the State Deep 7-16 well at West Douglas.
Within American's Fetter project, The Hageman 11-22 well, a vertical well drilled to 12,945', is currently producing from the Frontier formation after being fracture stimulated with a slick water frac design that had not
Based on the favorable slick water frac response seen in the Hageman 11-22 well, the Wallis 6-23 well, a vertical well that has been undergoing long term production testing from the Frontier formation, was recently
Also at Fetter, the Hageman 11-22UK well, a vertical well drilled to test the oil potential of the shallower Teapot and Parkman formations, has yielded non-commercial results. American owns a 69.375% working interest in
Pat O'Brien, CEO of American commented, "While we are very encouraged with the early production response we have seen from the slick water frac designs used on the Frontier formation in the Hageman and Wallis wells, we recognize there are still improvements that we will work towards with respect to drilling efficiencies, gathering system design and production optimization. Given that there are up to five formations that are
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