The Company has entered into a Letter of Intent with PentaNova Energy Corp. to Farm-in on PentaNova´s interest held in the Sinu-9 block (313,639 gross acres), located in the Cordoba Province in the Lower Magdalena Valley Basin of Colombia. To complete the agreement, the Company will Farm-in for 50% of the PentaNova´s 80% beneficial working interest, by way of replacing the guarantee required by the ANH license, as well as funding 100% of the Phase I minimum exploration work program under the ANH contract, over the next 3 years. PentaNova shall reimburse 50% of the funds invested by AOG in the Phase I activities from 70% of PentaNova´s net production. Further capital commitments will be assumed proportionally by the partners. The remaining working interest on the block is held 15% by Desarrolladora Oleum and 5% by Clean Energy.
The Sinu-9 block is located adjacent to Canacol’s Esperanza block and approximately 14km from the Northern gas trunk line which has available capacity. The Company believes the block contains substantial gas reserves based on initial wells drilled, and the available seismic data providing evidence of commercial natural gas accumulations. The Company is evaluating, in conjunction with PentaNova, an initial workover of a discovery well drilled in 1992, which tested over 10MMscf/d. Work is expected to begin in the first quarter of next year.
About American Oil & Gas Inc.:
American Oil & Gas Inc. is an exploration and production company with headquarters in Houston, Texas. Our focus is to acquire and develop oil and gas assets in the Andean region. The Company is led by a top-tier management team with a history of building and operating world-class assets.
About PentaNova Energy Corp.
PentaNova Energy Corp. is a publicly traded E&P company focused on proven oil & gas plays in Latin America. The Company holds a large diversified portfolio of unexploited assets in Colombia and Argentina where it will leverage its amplitude of technical expertise and proven track record building companies and creating value.
For additional information, please contact:
Chief Executive Officer, [email protected]
President & Director, [email protected]
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