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Business Wire AMERICAN INTERNATIONAL PETROLEUM ENTERS INTO EXCLUSIVE OPTION TO ACQUIRE 75% WORKING INTEREST IN A JOINT VENTURE FOR THE DEVELOPMENT OF 17 OIL AND GAS LICENSES IN RUSSIA WITH TOTAL RECOVERABLE
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NEW YORK--(BUSINESS WIRE)--March 18, 1998--American
International Petroleum Corporation (NASDAQ: AIPN.O), announced today
that its wholly-owned subsidiary, American Eurasia Petroleum Co., has
entered into a 90-day exclusive option agreement to acquire a 75%
working interest in a joint venture for the development of 17 oil and
gas licenses in the Samara and Saratov regions of European Russia
covering 877,000 acres. The option is with Zao Nafta, a Russian
closed stock company.
The Russian government companies, who initially did the
exploration program, estimated total recoverable reserves on the
licenses to be about 200 million barrels, of which 33.5 million
barrels are proven reserves (A+B+C1) and 167.5 million barrels are
probable and possible reserves (C2+C3). The crude gravity is 35
degrees API with low sulfur content.
After confirmation of the recoverable reserve estimates by
independent parties and modification of some of the existing
commitment terms, the company intends to immediately rework 16 shut-in
wells on the Samara license which have tested at an aggregate of 6,200
barrels per day.
The agreement provides that the company will become the operator
and will have full control of all operations. The company agreed to
pay $300,000 for the exclusive option and $10.7 million for the
acquisition of the 75% working interest. The acquisition payment will
be made at closing in the form of $4.7 million in cash and stock and
$6 million from 25% of the company's future net production. The
company said that the agreed acquisition price is substantially lower
than what it would normally cost the company to find proved reserves.
The above statements are forward-looking and are based on
estimates and current expectations. They involve certain risks and
uncertainties detailed from time to time in the company's SEC reports.
Actual results may differ materially.
American International Petroleum Corporation is engaged in oil and
natural gas exploration in Russia in Kazakstan and refining in
Louisiana.
--30--sid/ny*
CONTACT: Millennium Holdings Group, Inc.
Wall Street Associates
561/988-2334
www.millenniumholdings.com
E-Mail mhgi@bellsouth.net
KEYWORD: NEW YORK LOUISIANA
INDUSTRY KEYWORD: OIL/GAS ENERGY UTILITIES MINING/METALS
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