-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GmrRE2rZaikYJ4kUlDmLLS7ww11BOD9eAOPONJwG9W/G2YSOcASBSQNJLLqfltdj 8TONfmxs+RbC4j8XwNLKXw== 0001157523-07-001715.txt : 20070220 0001157523-07-001715.hdr.sgml : 20070219 20070216173530 ACCESSION NUMBER: 0001157523-07-001715 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20061231 FILED AS OF DATE: 20070220 DATE AS OF CHANGE: 20070216 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN ENERGY GROUP LTD CENTRAL INDEX KEY: 0000843212 STANDARD INDUSTRIAL CLASSIFICATION: CRUDE PETROLEUM & NATURAL GAS [1311] IRS NUMBER: 870448843 STATE OF INCORPORATION: NV FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-26402 FILM NUMBER: 07632711 BUSINESS ADDRESS: STREET 1: P O BOX 489 STREET 2: 1861 BROWN BLVD,STE 655 CITY: SIMONTON STATE: TX ZIP: 77476 BUSINESS PHONE: 2813462652 MAIL ADDRESS: STREET 1: PO BOX 489 CITY: SIMONTON STATE: TX ZIP: 77476 FORMER COMPANY: FORMER CONFORMED NAME: BELIZE AMERICAN CORP INTERNATIONALE DATE OF NAME CHANGE: 19941004 FORMER COMPANY: FORMER CONFORMED NAME: DIM INC DATE OF NAME CHANGE: 19920703 10QSB 1 a5336810.txt AMERICAN ENERGY GROUP, LTD. 10-QSB UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB (Mark One) [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 31, 2006 ___ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to ______________ Commission file number: 0-26402 THE AMERICAN ENERGY GROUP, LTD. (Exact name of Registrant as specified in its charter) Nevada 87-0448843 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1 Gorham Island Suite 303 Westport, Connecticut 06880 (Address of principal executive offices) (Zip code) 203-222-7315 (Registrant's telephone number including area code) --------------------------- Securities registered pursuant to Section 12(b) of the Act: None Securities registered pursuant to section 12(g) of the Act: Common Stock, Par Value $.001 Per Share --------------------------- Check whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No ___ APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS Check whether the issuer has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court. Yes [X] No ___ APPLICABLE ONLY TO CORPORATE ISSUERS As of February 16, 2007, the number of Common shares outstanding was 30,079,182 Transitional Small Business Issuer Format (Check one) Yes___ No [X] THE AMERICAN ENERGY GROUP, LTD. INDEX TO FORM 10-QSB PART I-FINANCIAL INFORMATION PAGE Item 1. Financial Statements ................................ 3 Item 2. Management's Discussion and Analysis or Plan of Operation................................. 7 Item 3. Controls and Procedures.............................. 9 PART II-OTHER INFORMATION Item 1. Legal Proceedings.................................... 10 Item 6. Exhibits............................................. 10 -2- PART I-FINANCIAL INFORMATION THE AMERICAN ENERGY GROUP, LTD. AND SUBSIDIARY Consolidated Balance Sheets
Assets December 31, June 30, 2006 2006 (Unaudited) (Audited) ------------ ------------ Current Assets Cash $ 594,157 $ 1,138,209 Funds reserved for acquisitions 2,100,000 2,000,000 Prepaid expenses 13,646 39,318 ------------ ------------ Total Current Assets 2,707,803 3,177,527 ------------ ------------ Property and Equipment Office equipment and leasehold improvements 36,980 6,786 Accumulated depreciation (2,529) (966) ------------ ------------ Net Property and Equipment 34,451 5,820 ------------ ------------ Other Assets Security deposit 22,209 22,209 ------------ ------------ Total Assets $ 2,764,463 $ 3,205,556 ============ ============ Liabilities and Stockholders' Equity Current Liabilities Accounts payable $ 97,765 $ 46,030 Accrued liabilities 21,500 15,000 ------------ ------------ Total Current Liabilities 119,265 61,030 ------------ ------------ Liabilities Not Subject to Compromise Accrued postpetition expenses 44,870 57,701 ------------ ------------ Liabilities Subject to Compromise Prepetition trade accounts payable 238,588 238,588 Prepetition accrued liabilities 45,500 45,500 Current portion of capital lease obligation 679 679 ------------ ------------ Total Liabilities Subject to Compromise 284,767 284,767 ------------ ------------ Total Liabilities 448,902 403,498 ------------ ------------ Stockholders' Equity Common stock, par value $0.001 per share; authorized 80,000,000 shares; 30,079,182 and 29,917,705 shares issued and outstanding, respectively 30,079 29,868 Capital in excess of par value 7,819,343 7,610,563 Accumulated deficit (5,533,861) (4,838,373) ------------ ------------ Total Stockholders' Equity 2,315,561 2,802,058 ------------ ------------ Total Liabilities and Stockholders' Equity $ 2,764,463 $ 3,205,556 ============ ============
-3- THE AMERICAN ENERGY GROUP, LTD. AND SUBSIDIARY Consolidated Statements of Operations For the Three Months and Six Months Ended December 31, 2006 and 2005
Three Months Ended Six Months Ended ----------------------------- ------------------------------ December 31, December 31, December 31, December 31, 2006 2005 2006 2005 Restated Restated (Unaudited) (Unaudited) (Unaudited) (Unaudited) -------------- ------------- -------------- -------------- Revenue Oil and gas sales $ 0 $ 0 $ 0 $ 0 -------------- ------------- -------------- -------------- Expenses Legal and professional 244,499 46,833 376,293 110,801 Administrative salaries 104,000 93,000 197,000 186,000 Depreciation 949 164 1,563 328 Office overhead expenses 18,157 5,110 32,550 10,264 General and administrative 51,701 30,010 106,745 139,363 -------------- ------------- -------------- -------------- Total Expenses 419,306 175,117 714,151 446,756 -------------- ------------- -------------- -------------- Net Operating Profit (Loss) (419,306) (175,117) (714,151) (446,756) -------------- ------------- -------------- -------------- Other Income and (Expense) Interest income 8,548 0 18,663 0 Interest expense 0 (5,286) 0 (11,358) -------------- ------------- -------------- -------------- Net Other Income (Expense) 8,548 (5,286) 18,663 (11,358) -------------- ------------- -------------- -------------- Net (Loss) Before Tax (410,758) (180,403) (695,488) (458,114) Federal Income Tax 0 0 0 0 -------------- ------------- -------------- -------------- Net (Loss) for the Period $ (410,758) $ (180,403) $ (695,488) $ (458,114) ============== ============= ============== ============== Basic Loss Per Common Share $ (.01) $ (.01) $ (.02) $ (.01) ============== ============= ============== ==============
-4- THE AMERICAN ENERGY GROUP, LTD. AND SUBSIDIARY Consolidated Statements of Cash Flows For the Six Months Ended December 31, 2006 and 2005
2006 2005 Restated (Unaudited) (Unaudited) ----------- ----------- Cash Flows From Operating Activities Net (loss) $ (695,488) $ (458,114) Adjustments to reconcile net loss to net cash provided by (used in) operating activities: Depreciation 1,563 329 Common stock issued for services 162,793 125,550 Commons stock issued for accrued expenses 46,198 - Additional expense for warrant issuance - 88,714 Changes in operating assets and liabilities (Increase) decrease in prepaid expenses 25,672 (23,362) Increase (decrease) in accounts payable 51,735 39,000 Increase (decrease) in accrued postpetition liabilities (12,831) - Increase (decrease) in accrued expenses and other current liabilities 6,500 22,657 ----------- ----------- Net Cash Provided By (Used In) Operating Activities (413,858) (205,226) ----------- ----------- Cash Flows From Investing Activities Funds reserved for acquisitions (100,000) - Expenditures for property and equipment (30,194) (-) ----------- ----------- Net Cash (Used In) Investing Activities (130,194) (-) ----------- ----------- Cash Flows From Financing Activities Proceeds from the issuance of warrants - 105,000 Cash received on stock subscription - 27,000 Cash received for stock issued - 110,000 ----------- ----------- Net Cash Provided By Financing Activities - 242,000 ----------- ----------- Net Increase (Decrease) in Cash (544,052) 36,774 Cash and Cash Equivalents, Beginning of Period 1,138,209 227 ----------- ----------- Cash and Cash Equivalents, End of Period $ 594,157 $ 37,001 =========== =========== Cash Paid For: Interest $ - $ 6,072 Taxes $ - $ - Non-Cash Financing Activities: Common stock issued for services rendered $ 162,793 $ - Common stock issued for accrued expenses $ 46,198 $ - Warrants issued for payment of debt $ - $ 50,000
-5- THE AMERICAN ENERGY GROUP, LTD. AND SUBSIDIARY Notes to the Consolidated Financial Statements December 31, 2006 GENERAL The American Energy Group, Ltd. and Subsidiary (the Company) has elected to omit substantially all footnotes to the financial statements for the three months and six months ended December 31, 2006 since there have been no material changes (other than indicated in other footnotes) to the information previously reported by the Company in their Annual Report filed on the Form 10-KSB for the year ended June 30, 2006. WARRANTS During the quarter ended September 30, 2005, the Company issued 260,000 warrants in exchange for $130,000. The warrants provide that up to 160,000 shares may be purchased at $1.50 per share and up to 100,000 shares may be purchased at $1.75 per share during the three year period ending September 30, 2008. The Company estimates the fair value of each stock award at grant date by using the Black-Scholes option pricing model. The warrants granted during the quarter ended September 30, 2005 were based on the following assumptions. Dividend yield 0 Expected volatility 100% Risk free interest 3.90% Expected lives 3 years As a result of the 260,000 warrants issued during the quarter ended September 30, 2005, the Company incurred $88,714 of expense which is included in general and administrative expenses in the consolidated statement of operations. RESTATEMENT The financial statements for the quarter ended December 31, 2005 were restated to reflect the changes identified below. Management and the Board of Directors concluded these restatements were necessary to reflect the changes described below. At December 31, 2005, $108,526 of the amount included in prepaid expenses as an asset were related to the unamortized value of common stock issued for payment of prepaid services. This amount has been reclassified from an asset to the stockholders' equity section of the balance sheet. The restated financial statements also include the reclassification of $164 of depreciation expense on the consolidated statement of operations. UNAUDITED INFORMATION The information furnished herein was taken from the books and records of the Company without audit. However, such information reflects all adjustments which are, in the opinion of management, necessary to properly reflect the results of the interim period presented. The information presented is not necessarily indicative of the results from operations expected for the full fiscal year. -6- ITEM 2- MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION Forward-Looking Statements This report contains statements about the future, sometimes referred to as "forward-looking" statements. Forward-looking statements are typically identified by the use of the words "believe," "may," "will," "should," "expect," "anticipate," "estimate," "project," "propose," "plan," "intend" and similar words and expressions. We intend the forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act and Section 21E of the Exchange Act. Statements that describe our future strategic plans, goals or objectives are also forward-looking statements. Readers of this report are cautioned that any forward-looking statements, including those regarding the Company or its management's current beliefs, expectations, anticipations, estimations, projections, proposals, plans or intentions, are not guarantees of future performance or results of events and involve risks and uncertainties, such as: * The future results of drilling individual wells and other exploration and development activities; * Future variations in well performance as compared to initial test data; . Future events that may result in the need for additional capital; . Fluctuations in prices for oil and gas; . Future drilling and other exploration schedules and sequences for various wells and other activities; * Uncertainties regarding future political, economic, regulatory, fiscal, taxation and other policies in Pakistan; * Our future ability to raise necessary operating capital. The forward-looking information is based on present circumstances and on our predictions respecting events that have not occurred, which may not occur or which may occur with different consequences from those now assumed or anticipated. Actual events or results may differ materially from those discussed in the forward-looking statements as a result of various factors, including the risk factors detailed in this report. The forward-looking statements included in this report are made only as of the date of this report. We are not obligated to update such forward-looking statements to reflect subsequent event or circumstances. Overview Prior to the Company's bankruptcy proceedings initiated on June 28, 2002, we were an active oil and gas exploration and development company. The foreclosure of our Fort Bend County, Texas oil and gas leases by the secured creditor in early calendar 2003 resulted in the loss of our only revenue producing asset. We intend to initiate new business activities by prudent management of our Pakistan overriding royalty interest and our Galveston, Texas interests and if we are successful in generating working capital from these investments or from sales of securities, we intend to pursue investment opportunities in the oil and gas business. Drilling of the first well in Pakistan as to which our overriding royalty pertains, named the Haseeb No. 1 Well, was successfully completed in the fourth quarter of the fiscal year ended June 30, 2005. All testing to date indicates that the Haseeb No. 1 well will be a significant commercial gas well. While prior estimates of the commencement of gas sales were late 2006 and then the first calendar quarter of 2007, revised estimates received from Hycarbex-American Energy, Inc. indicate that the gas sales are expected to begin during the summer of 2007 based upon revised estimates for the completion of the contractual documents, the gas allocation notification and the physical connection to the line. Additional wells and seismic operations are currently planned by Hycarbex. -7- Results of Operations Our operations for the six months ending December 31, 2006 reflected a net loss of $714,151 attributable to salaries paid to the directors, legal and professional fees related to the prosecution and settlement of the Hussain/Khan lawsuit, office overhead, and administrative expense (See "Legal Proceedings" below). There were no revenues from operations and our sole business during the quarter consisted of management of our Pakistan and Texas assets. All of our previously owned producing oil and gas leases were foreclosed by the first lien lender in early calendar 2003. Subsequent to emerging from bankruptcy, the Company has had no recurring income stream and has been solely dependent upon cash infusion from the sale of securities and loans which occurred in periods prior to the current quarter and which have been used and will continue to be used to finance salaries, legal expenses and administrative overhead until the revenues from gas sales from the successful Haseeb No. 1 Well begin. These gas sales are now expected to begin during the summer of calendar 2007 based upon revised timing estimates received from Hycarbex-American Energy, Inc., the operator of the well. Liquidity and Capital Resources Since emerging from bankruptcy, we have been funded through the private sale of convertible debt securities totaling $575,000 pursuant to Second Amended Plan of Reorganization, all of which has been converted to common stock, and from various loans and private sales of common stock and warrants. In the fourth quarter of our last fiscal year, we sold $3.95M of our Common stock and warrants. Of this amount, we have deposited $2,100,000 with Hycarbex in trust for future acquisitions of additional royalty interests in Pakistan. We anticipate that the capital obtained from these prior transactions will provide sufficient working capital through the estimated time that the Haseeb No. 1 Well sales into the pipeline will begin and that actual production revenues will then meet our working capital needs. However, there can be no assurance that the gas sales will begin at the time anticipated and we may require additional operating capital to meet future needs. Since we do not have an existing credit facility to meet our capital needs, we will have to resort to private loan sources or additional sales of securities to meet these cash requirements should the distribution of production revenues be delayed. There can be no assurance that we will be successful in our efforts to raise the needed capital through such means. Business Strategy and Prospects We believe that there have been positive developments resulting from the bankruptcy proceedings. We have eliminated the Company's debt burden, diminished its labor force and significantly reduced all facets of general and administrative overhead. The cancellation and reissuance of new securities have reduced the outstanding shares from over sixty six million shares to just under thirty million shares, a number which both permits the issuance of additional securities in the future as needed to obtain strategic assets or funding from investors, and which provides an opportunity for enhanced shareholder value if the current assets become cash generating assets, as anticipated. Our registration of 2,000,000 Common shares on Form S-8 during the quarter ended June 30, 2005 will likewise provide a means of compensating key consultants in the coming months. During the quarters ended December 31, 2006 and September 30, 2006, we issued 110,000 shares and 50,000, respectively, under this Registration Statement at values of $83,600 and $63,745, respectively, to our legal counsel in the then ongoing litigation with Moin Hussain, Saleem Khan and Khan & Piracha. This litigation was settled in December, 2006. In the near term, we intend to continue to manage our Pakistan royalty and our Galveston County, Texas oil and gas leases discussed below. Pakistan Overriding Royalty The Company, through its Hycarbex subsidiary (before the sale of that subsidiary) expended in excess of $10,000,000 on drilling and seismic on the Jacobabad and Yasin concessions in the Republic of Pakistan comprised of over 2,200 square kilometers. The structure, to date, has no Proved Reserves as that term and the calculation for discounted future net cash flows for reporting purposes is mandated by the Financial Accounting Standards Board in Statement of Financial Accounting Standards No. 69, titled "Disclosures About Oil and Natural Gas Producing Activities". We did not obtain a commercial discovery well in any of our previous Pakistan drilling efforts prior to the sale of the subsidiary, but have announced the success of the Haseeb No. 1 well and the completion of 110 kilometers of additional seismic research by Hycarbex-American Energy, Inc. -8- While the subsequent Al-Ali #1 Well did not prove commercially successful and is under review to determine whether it can be completed as a producing well, we strongly believe that the concession acreage contains oil and gas producing physical structures which are worthy of further exploration. If successfully developed, our reserved 18% overriding royalty interest will likely be a good source of cash revenues because the royalty, by its nature, entitles us to share in gross, rather than net, production. These revenues are expected to be used by the Company for further investment in other revenue generating assets or business activities. Galveston County, Texas Leases In 1997, we purchased the interests of Luck Petroleum Corporation from its bankruptcy trustee in two oil and gas leases in Galveston County, Texas. The leases are situated in an area which is productive in multiple zones or horizons and the leases themselves have produced commercial quantities of oil and gas from both shallow and mid-range zones. In 1986, Luck Petroleum Corporation assigned these mid-range zones to Smith Energy, reserving for itself an "after-payout" 15% back-in working interest. Luck Petroleum Corporation also limited the depths assigned to Smith Energy, thereby resulting in depths generally greater than 10,000 feet being reserved to Luck Petroleum Corporation. We previously asserted to Smith Energy our contention that "payout" has occurred, as defined in the 1986 conveyance by Luck Petroleum Corporation to Smith Energy, and Smith Energy disputed our contention. On April 14, 2006, we entered into a Compromise Settlement Agreement with Smith Energy and Howard A. Smith, fully resolving the dispute without the need for further litigation. Under the settlement terms, we agreed to relinquish our 15% back in interest in the mid-range zones in exchange for Smith Energy's overriding royalties in the deep zones, access to Smith Energy's existing high quality 3D seismic data covering the leases, and a stipulation by Smith Energy that we can operate all wells drilled by us or our agents in the deep zones and, where needed, utilize existing Smith Energy roads, water injection wells, and other facilities. We are exploring the various opportunities to realize value from these deep rights, including potential farmout or sale. The best course for these assets has not been determined, but the leases are held in force by third party production and, therefore, do not require development of these rights by a certain date. Off Balance Sheet Arrangements We had no off balance sheet arrangements during the quarter ended December 31, 2006. ITEM 3- CONTROLS AND PROCEDURES In conjunction with this Report on Form 10-QSB and the certification of the disclosures herein, and as required by Rule 13a-15 under the Securities Exchange Act of 1934 (the "Exchange Act"), the Company's principal executive officer and principal financial officer, Pierce Onthank, evaluated the effectiveness of the Company's disclosure controls and procedures as of December 31, 2006. This review found the disclosure controls and procedures to be effective. There have been no changes in the Company's internal controls over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rules 13a-15 or 15d-15 which occurred during the fiscal quarter ended December 31, 2006, that have materially affected or are reasonably likely to materially affect these internal controls over financial reporting. PART II-OTHER INFORMATION ITEM 1- LEGAL PROCEEDINGS On January 12, 2006, a lawsuit was filed in the 281st Judicial District Court of Harris County, Texas against the Company, the Company's subsidiary, The American Energy Operating Corp., Hycarbex-American Energy, Inc., Pierce Onthank, individually, Iftikhar Zahid, individually, and Georg Friedher Von Canal, individually, titled: M.S. Moin Hussain, Saleem Z. Khan and Khan & Piracha vs. The American Energy Group, Ltd., The American Energy Operating Corp., Hycarbex-American Energy, Inc. f/k/a Hycarbex, Inc., Pierce Onthank, Iftikhar -9- Ahmed Zahid and Georg Friedher Von Canal. American Energy Operating Corp. was dismissed from the suit by the Plaintiffs very soon after the filing. The Plaintiffs were Moin Hussain, who originally incorporated Hycarbex, Inc. in 1985, and Saleem Khan, and Khan & Piracha, who are Pakistan-based attorneys. The plaintiffs' primary allegation was that a written document signed by Georg Von Canal, while claiming to be the President of Hycarbex, promised Khan & Piracha, a Pakistani law firm, a twenty percent (20%) carried working interest in the Yasin Concession for allegedly providing assistance to Hycarbex in extending the exploration license for the Concession in 2003. After the filing, Hycarbex provided the Company with written assurance that the Company's 18% overriding royalty interest in the Yasin Concession would not be impaired by the lawsuit, whatever the lawsuit results. American Energy, Hycarbex and Pierce Onthank also filed a counterclaim against Saleem Khan and Khan & Piracha alleging that the attempt to obtain a 20% carried working interest in the Concession while serving as legal counsel was a breach of fiduciary duty. During the quarter ended December 31, 2006, the lawsuit was settled. Under the terms of the settlement, all parties denied liability to one another. Hycarbex agreed to pay $800,000 to the plaintiffs upon execution of the settlement agreement. American Energy guaranteed collection from Hycarbex of this sum by plaintiffs and the sum has been fully paid by Hycarbex as agreed. Additionally, under the settlement terms, Hycarbex and American Energy have agreed, jointly and severally, to pay $450,000 to the plaintiffs by September 12, 2007. This agreement is supported by an agreed judgment which will remain in place against each company until the 2007 payment is made. All claims of every character asserted against Pierce Onthank and Iftikhar Zahid have been dismissed. The parties, while denying liability to one another, executed mutual, general releases, but the settlement documentation specifically excluded a release of Georg Friedher Von Canal by any party. The Company expects to satisfy the financial obligations of the settlement utilizing the proceeds of production from the Haseeb No. 1 Well. Pursuant to the instructions on Part II of Form 10-QSB, items 2,3,4 and 5 were omitted. ITEM 6- EXHIBITS The following documents are filed as Exhibits to this report: Exhibit 31.1 - Certification by R. Pierce Onthank, President, Chief Executive Officer and Principal Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a); Exhibit 32.1 - Certification by R. Pierce Onthank, President, Chief Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, Section 1350(a) and (b). SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. THE AMERICAN ENERGY GROUP, LTD. By: /s/ R. Pierce Onthank --------------------- R. Pierce Onthank, President, Chief Executive Officer, Principal Financial Officer and Director DATED: February 16, 2007 -10- EX-31.1 2 a5336810ex311.txt EXHIBIT 31.1 Exhibit 31.1 CERTIFICATION PURSUANT TO RULE 15D-14 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 I, R. PIERCE ONTHANK, President, chief executive officer and chief financial and accounting officer of The American Energy Group, Ltd., certify that: 1. I have reviewed this Quarterly Report on Form 10-QSB for the quarterly period ended December 31, 2006 of The American Energy Group, Ltd.. 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report. 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4. I am the registrant's sole certifying officer and I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have: a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure the material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) designed such internal control over financial reporting or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting, and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; c) evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and d) disclosed in this report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and 5. I am the registrant's sole certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions): a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. DATED: February 16, 2007 By: /s/ R. PIERCE ONTHANK ----------------------------------- Printed Name: R. PIERCE ONTHANK President, Chief Executive Officer and Principal Financial Officer EX-32.1 3 a5336810ex321.txt EXHIBIT 32.1 EXHIBIT 32.1 THE AMERICAN ENERGY GROUP, LTD. CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the accompanying Quarterly Report on Form 10-QSB of The American Energy Group, Ltd. (the "Company") for the period ended December 31, 2006, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I R. Pierce Onthank, President and chief executive and chief financial and accounting officer of the Company, certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that: 1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (the "Exchange Act"); and 2. The information in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. DATED: February 16, 2007 By: /S/ R. Pierce Onthank ---------------------------------- R. Pierce Onthank President, Chief Executive Officer and Principal Financial Officer -----END PRIVACY-ENHANCED MESSAGE-----