BILLINGS, Mont., Oct. 3, 2011 /PRNewswire/ -- American Eagle Energy Inc. (OTCBB:AMZG; "American Eagle" or the "Company") wishes to provide an operations update on the Company's Spyglass project in North Dakota. The Company's proposed merger with Eternal Energy Corp. is progressing, subject to completing standard regulatory and administrative processes.
Activity in American Eagle's Spyglass Project, a Bakken and Three Forks play in Divide County, North Dakota, increased significantly during the third quarter following a number of weather-related delays in the second quarter.
The second closing of the previously announced sale of half of the respective working interests in the Spyglass Project by American Eagle and its proposed merger partner Eternal Energy to a third party occurred on August 5, 2011. The second closing involved the sale of an undivided 50% interest in approximately 760 acres for approximately $642,000 that was divided equally between American Eagle and Eternal Energy.
American Eagle participated in eight non-operated wells in the project area operated by SM Energy, Samson Resources Company and Crescent Point Energy during the third quarter. Three wells that were pending completion in the Three Forks Formation were stimulated and put on production at average initial flowing rates (14 days) of 514 bopd, 574 bopd and 644 bopd with joint working interests of 3.87%, 0.34% and 4.38%, respectively. The other five wells, two Bakken and three Three Forks, were drilled and are pending completion. Joint working interests in all these wells ranged from approximately 1% to over 6%. Three more outside operated wells are scheduled to be drilled by yearend with American Eagle – Eternal Energy joint working interests ranging from 6.5% to 16%. Based on this projected drilling schedule and similar production results, the companies could show a joint 2011 exit rate of approximately 240 bopd net from the non-operated Spyglass properties.
American Eagle and Eternal Energy have secured a drilling rig and expect to begin drilling joint company-operated wells in the Spyglass Project in November, 2011. Efforts to permit three Bakken and four Three Forks wells are underway, such that the first two wells should be drilled before the end of 2011. Joint working interests in these six wells range from 19% to more than 60%.
Including land packages purchased in the second quarter of 2011, along with ongoing leasing efforts, total acreage jointly controlled in the project area is approximately 14,700 net acres.
Richard Findley, the Company's Chief Executive Officer stated, "American Eagle's land acquisition and project evaluation strategies for the Spyglass Project are beginning to yield the exciting results that we have expected. The early completion results are exceeding our original expectations and are confirming both the Three Forks and Bakken potential of the area. We believe the drilling plans over the near term should position to us for significant production by early 2012, along with proving up more than 14 proven undeveloped and infill locations in the Spyglass area."
About American Eagle Energy Inc.:
American Eagle Energy Inc. is an oil and gas company engaged in the exploration of petroleum and natural gas. The company was incorporated in Nevada on March 14, 2007 to engage in the acquisition, exploration and development of natural resource properties.
The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for forward-looking statements. Certain information included in this press release contains statements that are forward-looking, such as statements relating to the future anticipated direction of the industry, plans for future expansion, various business development activities, planned capital expenditures, future funding sources, anticipated sales growth, potential contracts, and/or aspects of litigation. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future, and, accordingly, such results may differ from those expressed in any forward-looking statements made by, or on behalf of, American Eagle Energy Inc. These risks and uncertainties include, but are not limited to, those relating to development and expansion activities, dependence on existing management, financing activities, and domestic and global economic conditions. Persons are encouraged to read our Annual Report on Form 10-K for the eight-month period ended December 31, 2010, our Quarterly Report on Form 10-Q for the three-month period ended June 30, 2011, and our other documents filed with the Securities and Exchange Commission for meaningful cautionary language in respect of forward-looking statements in this press release. Interested persons are able to obtain free copies of filings containing information about the Company at the SEC's internet site (http://www.sec.gov). The company assumes no obligation to update any of these forward-looking statements.
SOURCE American Eagle Energy Inc.