American Oil & Gas, Inc. announced that drilling operations have been successfully completed at the Fetter Project Sims 15-26H well located in Section 26-T33E- R71W, Converse County, WY. The well was drilled to a total measured depth of 12,840 feet, which includes a horizontal lateral leg of 1,165 feet in the Frontier formation, one of several prospective formations in the field. A 4- 1/2 inch liner that incorporated sliding sleeves and packer assemblies were successfully installed to depth. This completion assembly is designed to allow the well to produce naturally without stimulation, but will also allow the well to be fracture stimulated with as many as five separate stages at a later date if deemed necessary. The Frontier formation was drilled utilizing managed pressure drilling (slightly underbalanced) which allowed natural gas and associated condensate (light oil) to be produced during the drilling process. Natural gas was periodically sold into the sales line at rates up to 20 million cubic feet per day (MMCFPD). Rates greater than 20 MMCFPD were periodically produced and flared. The well is currently shut-in to allow the packer assemblies to properly set and the well is expected to commence production within several weeks.

The Sims 15-26H well is the first of a three to four well program at Fetter that is funded by Red Technology Alliance (RTA) and project managed by Halliburton. American is being carried through the tanks in this phase of the drilling program for a 23.125% working interest in each of the three to four wells, and currently owns a 92.5% working interest in the approximate 50,000 net acre Fetter Field acreage position. Upon completion of the initial drilling program, RTA will earn a 25% working interest in the undrilled acreage. American will retain a 69.375% working interest in the undrilled acreage and privately held North Finn LLC will retain the remaining 5.625% working interest.

American and North Finn are discussing the potential for RTA to re-enter American’s Hageman 16-34 wellbore where drilling operations on the second well of the program could commence within 30 days. The Hageman wellbore was drilled in 2005 to a total measured depth above the Frontier formation of 11,332 feet when drilling rig issues required American to suspend drilling operations and temporarily abandon the well. The well has 9-5/8 inch casing set to 8,583 feet and current drilling plans for the Hageman well are to replicate the Sims 15-26H drilling program by again drilling horizontally in the Frontier formation.

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