EXHIBIT 99.1


On May 2, 2005, the Registrant issued the following news release:

          "AMERICAN OIL & GAS TO COMMENCE DRILLING INITIAL FETTER WELL

     DENVER- American Oil & Gas, Inc. (OTC Bulletin Board: AOGI) today announced
that it expects to commence drilling the first of two planned wells at its
Fetter area project as soon as weather conditions permit. Both wells are
targeting the Niobrara and Frontier formations located in an over-pressured area
of the southern Powder River Basin of Wyoming, to a total depth of approximately
11,500 feet. The drilling rig and related equipment is on location, however
weather conditions have hindered final preparations.

     The Fetter field project area consists of approximately 51,000 gross acres
within American's 103,000 gross acre Douglas Project. American owns a 75%
working interest in the entire Douglas Project acreage. The Fetter field has a
history of various exploration and development attempts. Numerous wells, which
have been drilled by others over four decades, have encountered and/or produced
natural gas and condensate, including four wells drilled in the 1990s (owned by
others) that are still producing from the Niobrara and Frontier formations.

     The Company believes that prior development efforts were negatively
affected by various factors including costs associated with inordinately long
single well drill times of greater than six months, drilling techniques and
delays in connecting wells that resulted in the potential for significant
reservoir damage, and low commodity pricing environments.

     The Company has an agreement with an Oklahoma based exploration and
production company with expertise in the application of under-balanced
horizontal drilling ("UBHD") technologies to participate in the drilling of the
two new wells to evaluate the Niobrara and Frontier formations. Under the terms
of the agreement, the joint venture participant has brought in specialized
equipment to apply its UBHD drilling technology and experience. The joint
venture participant will pay 60% of the costs to earn a 50% interest in the
first well and will pay 30% of the costs to earn a 25% interest in the second
well. Subject to certain additional funding terms, the joint venture participant
will earn a 25% WI in the Fetter area AMI. American will pay 30% to own a 37.5%
WI in the first well and will pay 52.5% to own a 56.25% WI in the second well.
Subject to terms of this agreement, American would retain a 56.25% WI in the
entire Fetter area AMI.

     "We're pleased to report that drilling at Fetter is about to begin," said
Pat O'Brien, CEO of American Oil & Gas. "By utilizing advances in drilling
technologies in the top portion of the well and then by applying modern,
under-balanced horizontal drilling, we are optimistic that we will be successful
in getting through the target formations as quickly and as efficiently as
possible. We fully expect to drill to the top of the Niobrara in a matter of
weeks, as opposed to the months that it has historically taken to drill wells in
this area. We'll have a natural gas line at the location so if we are
successful, we can immediately flow gas to the processing plant. We expect the
application of UBHD will allow us to get through the over-pressured Niobrara and
Frontier formations without reservoir damage, and we are fortunate to be teamed
up with an industry participant with experience in the application of this
technology."

     Commenting on the Company's previously announced result at South Glenburn,
CEO Pat O'Brien said, "while it is unfortunate that the South Glenburn
exploration effort was not successful, it is important to understand that this
was a peripheral project to our portfolio. The risk/reward profile made South
Glenburn a very compelling and affordable prospect."

     American Oil & Gas, Inc. is an independent oil and natural gas company
engaged in exploration, development and production of hydrocarbon reserves
primarily in the Rocky Mountain region. Additional information about American
Oil & Gas, Inc. can be found at the Company's website:
www.americanoilandgasinc.com.

                                      # # #

     This release and the Company's website referenced in this release contain
forward-looking statements regarding American Oil & Gas, Inc.'s future plans and
expected performance that are based on assumptions the Company believes to be
reasonable. A number of risks and uncertainties could cause actual results to
differ materially from these statements, including, without limitation, the
success rate of drilling efforts and the timeliness of development activities,
fluctuations in oil and gas prices, and other risk factors described from time
to time in the Company's reports filed with the SEC. In addition, the Company
operates in an industry sector where securities values are highly volatile and
may be influenced by economic and other factors beyond the Company's control.
This press release may include the opinions of American Oil & Gas, Inc. and does
not necessarily include the views of any other person or entity."