American Eagle Energy Corporation( American Eagle or the Company) is pleased to announce that it has
expanded its existing Carry Agreement to further accelerate its drilling activities. In May 2012, American Eagle announced that it had entered into a six-well Carry Agreement, pursuant to which American Eagle’s proportionate share of the costs of drilling, completing and equipping each of the six wells will be funded by the financing source (subject to certain limitations) and will be repaid from its share of the wells’ net production revenue.
The Amended Carry Agreement extends the terms of the financing to an additional four wells, all of which will be drilled in the Bakken or Three Forks zones of its Spyglass Project. The expansion of our existing Carry Agreement is an important accomplishment, as it allows us to continue aggressively pursuing our development program within the Spyglass Property, while minimizing our capital outlay, stated Brad Colby, American Eagle’s President. “The terms of the original Carry Agreement and the Amended Carry Agreement are extraordinarily favorable and allow us to grow our proved reserves in a manner that is designed to quickly build stockholder value.
The expansion of the scope of the Carry Agreement allows American Eagle to contract a second drilling rig to begin drilling infill locations on the Spyglass Property. American Eagle expects a second Nabors Drilling rig to arrive by the middle of September and anticipates drilling and completing a total of 12 gross wells (4.2 net) with the two rigs by the end of 2012, including all ten wells covered by the Amended Carry Agreement.
