American Oil & Gas has entered into a letter of intent with a large independent oil and natural gas production company to sell all of American's ownership in non-producing wells, producing wells and undeveloped acreage located in the Powder River Basin of Wyoming for approximately $44 million. The sale will include all of American's ownership in the Fetter and Krejci projects. The letter of intent is subject to land due diligence by the purchaser and other conditions and is expected to close by March 31, 2010.
Pat O'Brien, CEO of American, commented, "Closing of this sale should allow us to focus our financial and human resources primarily on accelerating the development of the Bakken and Three Forks potential within our Goliath project area. While our Fetter project has recently demonstrated encouraging results from several re-completions into the Niobrara formation, we firmly believe it will take considerable time and considerable financial resources to move this project forward with a risk profile that is more appropriate for a larger organization."
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