Schlumberger's Report Determines 300Bcf for Haynesville Leases

American Exploration Corp. has received a shale gas analysis completed by Schlumberger, evaluating the total gas in place within the Haynesville Formation (Shale) in the mineral leases held by the Company in Mississippi. From existing well data, the assessment confirms similar reservoir attributes to the Haynesville Shale of northwestern Louisiana and demonstrates estimated gas in place of at least 300Bcf/section. This places more than 2 Tcf of estimated gas on the property.

A single deep well was drilled into the prospect in 1981, at a time when neither the technology for developing nor the understanding of shale gas reservoirs existed. The well penetrated a greatly over-thickened Haynesville shale reservoir that was completely gas charged and tremendously overpressured. The Haynesville Shale on the American Exploration leases is more than eight (8) times the thickness of that found in northwestern Louisiana.

The gas in place assessment by Schlumberger was performed having first conducted mineralogical and geochemical analyses on rock cuttings samples from the 1981 well, which penetrated the Haynesville Formation. These results were then integrated with the petrophysical log data from which the gas volumes were determined.

The Haynesville Formation in NW Louisiana exploded onto the natural gas market over the past 18 months, following announcements from some of the industry's most significant gas players. Chesapeake, EnCana and Petrohawk have released results indicating that the Louisiana shale contains upwards of 250 Tcf. Current wells show Initial Production ranging from 5 Mmcf to 23.5 Mmcf per day.

The Haynesville shale is now widely recognized as the 4th largest gas field in the world.