American Oil & Gas Reports 1st Quarter 2006 Results
Monday May 22, 8:00 am ET
DENVER, May 22 /PRNewswire-FirstCall/ -- American Oil and Gas, Inc. (Amex: AEZ - News) today announced net income of $2,236,354 (six cents per share, basic and diluted), for the quarter ended March 31, 2006, as compared to net income of $60,818 ($0.00 per share, basic and diluted), for the quarter ended March 31, 2005. Included in net income for 2006 is a gain of $4,254,854 ($2,565,677, net of tax) from the sale of American's Big Sky project, which was sold on March 31, 2006 for a contract price of $11.5 million. During the quarter ended March 31, 2006, the Big Sky project accounted for approximately 95% of American's oil and natural gas production revenues and approximately 88% of its proved oil and natural gas reserves.
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During the quarter ended March 31, 2006, American sold 24,933 barrels of oil at an average price of $54.96, resulting in oil revenues of $1,370,416, and sold 23,038 Mcf of natural gas at an average price of $8.70 per Mcf, resulting in natural gas revenues of $200,236. During the quarter ended March 31, 2005, American sold 13,726 barrels of oil at an average price of $45.59, resulting in oil revenues of $625,737, and sold 10,069 Mcf of natural gas at an average price of $6.06 per Mcf, resulting in natural gas revenues of $60,990.
American's general and administrative expenses were $1,072,570 and $466,707 for the quarters ended March 31, 2006 and 2005, respectively. The increase in the current quarter is primarily attributable to a non-cash charge of $498,360 for the estimated value of employee stock options resulting from our adoption of FAS 123® Share-Based Payments in accordance with generally accepted accounting principals. The increase is also attributable to salaries and related expenses of approximately $208,000.
At March 31, 2006, American had $13.1 million of working capital, $35.2 million of total assets, $2.3 million of current liabilities, long-term portion of deferred income taxes of $1.5 million and stockholders' equity of $31.2 million. There are currently 36,687,134 common shares and 250,000 series AA convertible preferred shares outstanding.
Operationally, American currently expects to commence drilling the first of two additional wells at its Fetter project in late June 2006, after the drilling rig scheduled to move onto the project completes the second of a two well prior commitment. American also currently expects drilling operations to commence at its Krejci and Goliath projects, subject to rig availability, in mid-summer 2006. In addition, American has sold its interest in the Bear Creek project, located in the Big Horn Basin of Montana, to GSL Energy Corporation and received a convertible note in the amount of $1,080,000. The note calls for a 14% annual interest payment and is convertible into 2,106,000 shares of GSL restricted common stock.
