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 Far East Energy Corp (PINK:FEEC)

Friday, July 11, 2014
Deal Flow

Item 1.01 Entry into a Material Definitive Agreement.

 
On July 9, 2014, Far East Energy (Bermuda), Ltd. (the “Borrower”), a wholly-owned subsidiary of Far East Energy Corporation (the “Guarantor”), the Guarantor and Standard Chartered Bank (the “Lender”) entered into the Second Extension Agreement to the Facility Agreement (the “Second Extension Agreement”) to, among other things, extend the maturity date of the Facility Agreement from July 15, 2014 to September 15, 2014. The Second Extension Agreement contains certain customary representations, warranties, releases and confirmations.
 


Thursday, May 8, 2014
Comments & Business Outlook

HOUSTON, May 8, 2014 /PRNewswire/ -- Far East Energy Corporation (OTCBB:FEEC), the U.S. listed company that operates the Shouyang Coalbed Methane (CBM) Production Sharing Contract (PSC) in Shanxi Province, People's Republic of China, today announced that it has filed its results for the quarter ending March 31, 2014 on Form 10-Q with the SEC.  The company also announced the release of an updated independent engineering report prepared by Resource Investment Strategy Consultants (RISC), as of December 31, 2013.  The reserves estimates in the updated RISC report were prepared in accordance with the standards recognized by the Society of Petroleum Engineers (SPE) in the Petroleum Resources Management System (PRMS).

Gas sales volumes in the first quarter of 2014 were up 73% compared to the same period in 2013, following the multi-well drilling and fracing program completed during 2013.  At the same time, and as previously announced, the gas contract price for 2014 has increased following negotiation with our off-taker, Shanxi Provincial Guoxin.  For first quarter 2014, the company received a gas price averaging the equivalent of $8.90/Mcf, up 38% from the same period in 2013.  The actual base price paid for our gas prior to subsidies rose by 42% on January 1, 2014, from 1.2 RMB per cubic meter to 1.7 RMB per cubic meter.  As a result of these two factors, operating revenue in Q1 2014 was up 138% compared to the same period in 2013.

Commenting, CEO and President Michael McElwrath said, "It's rewarding to see that the work put into the Shouyang Block in 2013 drilling and fracing new wells has resulted in a significant increase in production and revenues during the first quarter of 2014."

Separately, the company has released an updated reserves report conforming to the PRMS standards as defined by the SPE engineers and prepared by RISC, as of December 31, 2013.  The updated report indicates that the estimated future net cash flow, on an NPV10 basis, for the 2P (Proved plus Probable) reserves has increased to $2.85 billion, up 39% from the figure at December 31, 2012, reflecting an 104% increase in the Proved Developed reserves category.  Reserves have been upgraded from the Proved Undeveloped category to the Proved Developed category, to leave overall 1P and 2P reserves at similar levels, of 301 Bcf and 439 Bcf, respectively.

In March 2014, RISC had released its reserve report prepared in accordance with the rules and regulations of the Securities and Exchange Commission (SEC).  The primary difference in the two reports is in regard to the calculation of proved reserves.  The PRMS guidelines allow for more Proved Undeveloped locations to be assigned (that would otherwise be assigned as Probable reserves under the rules and regulations of the SEC) when an area is known to have certain geologic connectivity in a region.  This difference is particularly relevant to CBM projects where the coal seam characteristics are well known.

CEO Michael McElwrath said, "Our development drilling in 2013 and our 42% increase in gas price are both reflected in this report, which continues to underscore the value of our Shouyang project."

The Overall Development Plan (ODP) for the 1H production area is expected to be submitted to the NDRC shortly and the company expects to receive the "road-pass" ODP by this summer.

With a strong 2013 program now showing results in terms of higher gas production, the key focus for management is to secure the funds required to broaden the production well pattern in the core 1H area, and to continue the appraisal of the southern portion of the Shouyang Block. 

Commenting further, McElwrath said, "We are devoting substantial time to securing the funding required to continue the development of the Shouyang PSC.  The extension to the Standard Chartered Bank facility agreement provides time to progress further.  Field activity continues, with the next round of drilling and fracing subject to the ability to secure new funding.  We are mindful of our shareholders, are very grateful for your continued support of the company and are committed to providing you further updates as we continue to make progress toward our shared goals."


Tuesday, April 1, 2014
Comments & Business Outlook
FAR EAST ENERGY CORPORATION
Consolidated Statements of Operations and Comprehensive Loss
(In Thousands, Except Per Share Data)
 
 
 
Year ended December 31,
 
 
 
2013
   
2012
   
2011
 
Operating revenues:
 
   
   
 
Gas sales
 
$
1,108
   
$
1,219
   
$
653
 
Other, net
   
478
     
425
     
205
 
 
   
1,586
     
1,644
     
858
 
Operating expenses:
                       
Lease operating expense
   
5,425
     
5,129
     
3,873
 
Exploration costs
   
4,968
     
5,604
     
5,967
 
General and administrative
   
10,531
     
11,434
     
9,701
 
Depreciation, depletion and amortization
   
2,091
     
1,890
     
1,045
 
Total operating expenses
   
23,015
     
24,057
     
20,586
 
Operating loss
   
(21,429
)
   
(22,413
)
   
(19,728
)
Other income (expense):
                       
Interest expense
   
(11,755
)
   
(4,756
)
   
(678
)
Interest income
   
3
     
13
     
6
 
Gain (loss) on sales of other fixed assets
   
(13
)
   
3
     
(1
)
Foreign currency transaction gain (loss)
   
(816
)
   
(7
)
   
(844
)
Total other income
   
(12,581
)
   
(4,747
)
   
(1,517
)
Loss before income taxes
   
(34,010
)
   
(27,160
)
   
(21,245
)
Income taxes
   
-
     
-
     
-
 
Net loss
 
$
(34,010
)
 
$
(27,160
)
 
$
(21,245
)
 
                       
Comprehensive loss
 
$
(34,010
)
 
$
(27,160
)
 
$
(21,245
)
 
                       
Net loss per share:
                       
Basic and diluted
 
$
(0.10
)
 
$
(0.08
)
 
$
(0.06
)

Management Discussion and Analysis

Results of Operations

Year Ended 2013 compared to Year Ended 2012

Sale volumes for the year ended December 31, 2013, net to Far East, decreased 28 MMcf, or 12%, as compared to the same period a year ago.  This decrease is partially attributable to intermittent interruptions from the power supply to our pumps and compressors as the Shanxi Province engaged in upgrades to the regional power infrastructure in the first several months of 2013.

Oil and gas exploration costs, other than the costs of drilling exploratory wells, are charged to expense as incurred. The costs of drilling exploratory wells are capitalized pending determination of whether they have discovered proved commercial reserves.  For further discussion of our accounting policies, see "Critical Accounting Policies—Accounting for Oil and Gas Properties" below.


Friday, December 13, 2013
Comments & Business Outlook
Item 1.01. Entry into a Material Definitive Agreement.

 

Far East Energy (Bermuda), Ltd. (“FEEB”), a wholly-owned subsidiary of Far East Energy Corporation (the “Company”), and China United Coalbed Methane Corporation Ltd. (“CUCBM”) are parties to that certain Production Sharing Contract for the Exploitation of Coalbed Methane Resources for the Shouyang Area in Shanxi Province, Qinshui Basin, The People’s Republic of China, dated April 16, 2002 (as amended from time to time, the “Shouyang PSC”). On December 6, 2013, FEEB and CUCBM agreed to extend the exploration period under the Shouyang PSC to June 30, 2016 for 1,103.1 square kilometers (272,581.95 acres) (designated as Area B in the Shouyang PSC). In return for such extension, FEEB agreed to drill at least 39 additional wells in such area by June 30, 2016. In addition, FEEB and CUCBM agreed to revise certain additional terms of the Shouyang PSC to reflect the agreement regarding the foregoing matters and certain other matters and intend to do so within 90 days following December 6, 2013.


Tuesday, November 12, 2013
Comments & Business Outlook

HOUSTON, Nov. 12, 2013 /PRNewswire/ -- Far East Energy Corporation (OTCBB:FEEC), the U.S. listed company that operates the Shouyang Block Coalbed Methane (CBM) Production Sharing Contract (PSC) in Shanxi ProvincePeople's Republic of China, is pleased to provide an update on operations.

Since the last release of October 30th, the company has fraced 7 additional wells, of which 6 are production wells and one an appraisal well, bringing the total number of wells fraced so far this year to 65.  Of this combined total, 57 are production wells and 8 are appraisal wells.

The company is continuing to drill new wells with 5 wells in the process of being drilled, one of which has been completed and is awaiting perforation.

As the company reported in its press release of October 30th, Critical Desorption Pressure (CDP) has been reached in a number of discrete locations, as a result of the ongoing de-watering process. 

Commenting, CEO Mike McElwrath said, "In the first seven days of November, our field team  fraced wells at a rate of one well per day while preparing additional wells for the fracing and pumping process.  And since mid-June when the first new wells began pumping, water production in the 1H Production Area has increased by approximately 96%.  The hard work of this year is now evident across much of the core production area, as we see initial gas in an increasing number of wells."


Wednesday, October 30, 2013
Comments & Business Outlook

HOUSTON, Oct. 30, 2013 /PRNewswire/ -- Far East Energy Corporation (OTCBB:FEEC), Operator of the Shouyang Block Coalbed Methane (CBM) Production Sharing Contract (PSC) in Shanxi Province, People's Republic of China, today announced that an additional 21 wells have been commenced since July 31, bringing to 74 the total number of wells spudded in 2013. Additionally, 32 additional wells have been fraced since July 31, bringing to 58 the number of wells fraced in 2013. Of the 74 wells that have been spudded thus far in the 2013 drilling program, 47 are new production wells in the core 1H Production Area, and 27 are appraisal wells which have confirmed the lateral extension of the high-permeability and high gas content #15 coal seam across the Shouyang Block.

More importantly, in terms of making progress towards significant gas production from Shouyang, as of October 29, of the 58 wells fraced this year, 51 have been production wells in the 1H Production Area, including 28 fraced since the end of July 2013. In addition, 7 appraisal wells have been fraced this year, including 4 since July 31. Twelve further wells are scheduled to be fraced over the next two to three weeks, ten of which are production wells.

Commenting, CEO Michael McElwrath said, "The 2013 drilling program has already more than doubled that of any prior year in terms of wells spudded and will soon more than double the number of production wells fraced in any previous year. But the true measure lies in water produced as we strive to reach critical desorption pressure (CDP) across a broad area thereby achieving a meaningful gas saturation and attendant gas production. And since mid-June when the first new wells began pumping, water production in the 1H Production Area has increased by 80 to 85% while the number of wells on pump to date has increased by approximately 30% and CDP is now beginning to be achieved in a number of discrete areas."


Monday, September 30, 2013
Comments & Business Outlook

 HOUSTON, Sept. 30, 2013 /PRNewswire/ -- Far East Energy Corporation (OTCBB:FEEC), the U.S. listed company that operates the Shouyang Block coalbed methane (CBM) Production Sharing Contract in Shanxi ProvincePeoples Republic of China, in partnership with China United Coalbed Methane Co., Ltd., is pleased to announced the latest results of its intensive 2013 drilling program.

Since early June when the first group of wells were fraced, weekly water production across the Shouyang Block 1H core production area has risen 54%.   This increase in field water production results from the first 26 wells fraced and placed on pump in 2103. An additional 8 wells will soon be placed on pump, which will further add to the water production.

Commenting, CEO Michael R. McElwrath said, "We are exceptionally pleased to register such a strong rise in water production on the basis of the first 26 of our recently fraced wells being placed on pump across the past few months.  This increase in water production, coming as it does from only 26 wells, clearly indicates the effectiveness of our new fracs, and we look forward to seeing how the next group of wells will further contribute to the dewatering of the field.  Historically, this is exactly what we should expect to see from a high-permeability, high gas content CBM project.   As new wells continue to come on-stream, and water production continues to increase, sufficiently de-pressurizing the seam, the high levels of CBM gas contained in the seam should be released and produced."

Appraisal Wells Reveal 10 Meter Coal Seam Thickness
As the Company continues to analyze the results of the appraisal well drilling program, in the southern and eastern sections of the Shouyang Block, recent appraisal wells have revealed coal seam thickness as high as 10.3 meters in the target #15 coal seam, which compares to previously known ranges of 3-5 meters of thickness.   

McElwrath continued, "These recent appraisal well results further confirm the world-class nature of the Shouyang Block, as evidence of these thicker coals in the southeastern portion of Shouyang, coupled with high gas content, indicates excellent production potential. We hope to see this new data provide added uplift to our gas resources, and ultimately, to our valuation."


Wednesday, May 29, 2013
Comments & Business Outlook

HOUSTON, May 28, 2013 /PRNewswire/ -- Far East Energy Corporation (OTCBB: FEEC) today announced that 7 new wells have been commenced in the 12 days since the last 2013 drilling program update release issued on Thursday, May 16, bringing to 23 the number of wells spudded in 2013. They are production wells 62-4D, 81-1D, 81-2D, 81-3D, and 165D and appraisal/exploration wells SYSE-09 and SYE-09. Additionally five wells reached total depth (TD) in the past 12 days. These are the 62-2V, 62-1D and 104D production wells, as well as the SYW-13 and SYW-09 appraisal wells. The Company noted that the 62-2V was drilled in only 12 days.

"On the 16th, we had 13 rigs in the field; now we have 18 rigs in the field with 4 more en-route," said CEO Michael McElwrath. "We have spudded 7 new wells in the past 12 days -- a testament to our entire team on the ground and their hard work."

Meanwhile, the Company's 2013 frac campaign has commenced, with 16 wells now ready to be fracture stimulated, 13 of which are production wells and 3 of which are appraisal wells.

Bob Hockert, Far East Energy China Country Manager commented, "We are excited the frac program is underway. A little over a week ago, our team had 12 wells ready to frac, and that number has now moved up to 16. By the time these 16 wells are stimulated, another 10 wells will be in the queue for fracing. Our goal is to continue the frac program uninterrupted until late October or November, ultimately comprising approximately 100 wells."

Hockert continued, "We have beefed up our capabilities in the field, adding 14 field personnel, including 5 drilling supervisors, a completions engineer, and several landmen. Additionally, a GIS mapping specialist and Land Manager have been added in Beijing. The results are reflected in the ability to spud 7 wells in 12 days."


Monday, May 13, 2013
CFO Trail

HOUSTON, May 13, 2013 /PRNewswire/ -- Far East Energy Corporation (OTCBB:FEEC) announced today that Jennifer D. Whitleyhas been appointed as Chief Financial Officer to succeed Bruce N. Huff .  On May 7, 2013, Mr. Huff notified the Company that he was resigning as the Company's Chief Financial Officer for medical reasons. 

"It is with sadness that we announce Bruce Huff 's resignation and retirement," said Michael R. McElwrath , CEO and President of Far East Energy.  Continuing, McElwrath said, "As the Company's longest-tenured CFO, Bruce has made many tremendous contributions to Far East Energy.  He joined the Company in May of 2004, and while serving as CFO saw the company successfully acquire its lynchpin Shouyang concession from ConocoPhillips, was a key contributor to many successful fundraises that funded the early exploration and initial development of our high permeability discovery in Shouyang, and tirelessly fulfilled a very demanding role as our CFO.    

"Bruce was also responsible for bringing Jennifer Whitley to the Company.  His value to the Company and its shareholders cannot be over-estimated.  I am pleased that Jennifer has been able to take on the mantle of CFO during this busy period for the company; her previous experience as Finance Director of a UK listed oil & gas company and CFO of a US mid-stream international energy company provide a strong background for this role.  Given events of the past year in which Jennifer played an integral role, the transition will be seamless."

McElwrath continued, "We wish Bruce and his family great happiness in his retirement.  The Board of Directors and the entire staff � from corporate headquarters to the Beijing staff as well as our field personnel, join in thanking Bruce for the key role he played in the history of Far East."

Ms. Whitley has served as the interim Chief Financial Officer of the Company since February 2013 and Director of Finance of the Company since January 2011.  Prior to joining the Company, Ms. Whitley served as the Chief Financial Officer of Zero Emission Energy Plants Ltd, a mid-stream international energy company focused in Louisiana and China, from 2008 to 2010.  From 2006 to 2008, Ms. Whitley served as the Finance Director of Global Energy Development PLC where she was responsible for all of the financial, accounting, and administrative matters for the UK listed company's international oil exploration and production operations. Previously, Ms. Whitley worked at Harken Energy Corporation and on the audit staff of Ernst & Young LLP.

Mrs. Whitley is a Certified Public Accountant and serves on the board of Zero Emission Energy Plants, as well as the board of the Houston Chapter of Financial Executives International.  She also serves as Chairman of the Youth Development Center and on the Advisory Board of MentorConnect.  She is a member of the Texas Society of CPAs and has previously served on the Business Advisory Council of Pepperdine University.  In 2006, Mrs. Whitley received the Change the World Award from her university in honor of her not-for-profit work with children in Houston's under-served neighborhoods.


Friday, May 10, 2013
Comments & Business Outlook

HOUSTON, May 10, 2013 /PRNewswire/ -- Far East Energy Corporation (OTCBB:FEEC) today announced that appraisal well SYS03 has reached total depth; preliminary gas content has been determined for the SYE06 appraisal well; and, the 108D, an additional production well has spudded, bringing to 14 the number of wells spudded thus far in 2013.

The focus for the company remains the drilling and well-fracing program that management detailed in its conference call held April 18, 2013, and which was discussed further in its operations update press release of May 6, 2013.

As part of the company's continuing appraisal well program, the SYS03, which is located in the east to southeast portion of the Shouyang Block, completed drilling to a total depth of 1,471 meters (or 4,826 feet) and penetrated the #15 coal seam revealing a total coal seam thickness of 3.77 meters (or approximately 12.4 feet).  The coal was cored in its entirety and seven samples have been collected for desorption testing, which will allow for an assessment of gas content. Wire-line logging and open-hole testing will shortly be completed with estimates of permeability to follow.

The SYS03 well is a good control point between the P18 and SYS05 wells, verifying good continuity and stability of the targeted #15 coal seam.  This encouraging result from the SYS03 greatly enhances confidence in the potential of the east and southeast portions of the Shouyang Block.

Meanwhile, results from the testing of core samples from the SYE06 appraisal well indicate an initial gas content of 592 standard cubic feet per ton (scf/t) or 16.76 cubic meters per ton (m3/t) in the #15 coal seam and 383 scf/t or 10.84 m3/t in the #9 coal seam.  This well is approximately 5 kilometers due east of the P18 appraisal well, and continues to confirm high gas content across virtually all of the Shouyang Block.

CEO Michael McElwrath said, "I am very pleased with the progress we have made this year on the Shouyang Block.  As previously announced, our drilling contractors are in the process of mobilizing up to twenty-five rigs dedicated to the Shouyang Block and we are in final preparations for the kickoff of the frac program, with 10 wells now awaiting fracing.  The operations team in China is wholly focused on delivery of the Company's 2013 drilling program, and we are encouraged by the results of yet another appraisal well, the SYE06, that affirms high gas content in our targeted coal seams across an ever-expanding area."

Gas sales for Q1 2013 were 66.9 MMcf, an increase of 40% over the same period in 2012.  Average gas price for Q1 2013 was $6.47/Mcf, inclusive of the various state and provincial subsidies and VAT refunds.  This compares to an average of $6.45/Mcf in Q1 2012.

Due to increased demand for power in the vicinity of our 1H Pilot Area, the electric grid in that area is being upgraded.  This increased demand for electricity is indicative of the rapid growth of energy demand in the region, for manufacturing facilities, chemical plants, and for the gas-fired power generation facility and LNG facilities being built adjacent to our 1H Pilot Area.  As a result of this ongoing upgrade, since March 2013, the company has been experiencing intermittent power supply interruptions to its compressors in the Shouyang Block, as the power grid is being upgraded.  In order to lessen the impact of these interruptions, the company's field personnel are in the process of procuring and installing company-owned gas-fired generators to ensure power continuity at its sales point.

As announced on January 16, 2013, the company completed a $60 million private debt placement during the first quarter, which funds a full production and appraisal well program through 2013. 


Tuesday, April 16, 2013
Comments & Business Outlook

HOUSTON, April 16, 2013 /PRNewswire/ -- Far East Energy Corporation (OTCBB: FEEC) today announced the release of an updated independent engineering report prepared by RISC Operations Pty Ltd (RISC), an internationally recognized independent petroleum advisory evaluation and valuation firm based in Perth, Australia, with respect to its coalbed methane (CBM) project located in the Shouyang block in Shanxi ProvinceChina as of December 31, 2012.  The reserves estimates in the updated RISC report were prepared in accordance with the standards recognized by the Society of Petroleum Engineers (SPE) in the Petroleum Resources Management System (PRMS).

The updated RISC report indicates that the net total proved reserves under PRMS standards are now approximately 303.7 billion cubic feet (Bcf), with estimated future net cash flow, on an NPV10 basis, of approximately US$1.1 billion.  In addition, the updated RISC report estimates the net total proved and probable reserves under PRMS standards are now approximately 440.8 Bcf, with estimated future net cash flow, on an NPV10 basis, of approximately US$2.0 billion.  And the updated RISC report estimates the net total proved, probable and possible reserves  to be approximately 552.3 Bcf, with an estimated NPV10 of US$2.8 billion.

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Wednesday, January 16, 2013
Deal Flow

HOUSTON, Jan. 16, 2013 /PRNewswire/ -- Far East Energy Corporation (OTCBB: FEEC), a U.S. listed company operating the Shouyang Coalbed Methane (CBM) Block in Shanxi Province, People's Republic of China, is now pleased to confirm the completion and funding of a private placement of $60 million of senior secured notes with a three year term and associated warrants, combined with the decision by Standard Chartered Bank to roll forward $21 million of its existing $25.125 million credit facility (the "SCB credit facility") for one year. 

"We are thrilled with our new investment group," said Michael R. McElwrath, CEO and President, "and we are also quite pleased that Standard Chartered Bank rolled forward eighty percent of the current SCB credit facility and is continuing its strong support of the Company and its Shouyang Project.  Access to this combination of capital provides the funding for a major drilling program that should enable the company to realize much of the vast potential of the Shouyang CBM block."

Far East will utilize the proceeds for drilling and completion of wells in its Shouyang Block; construction of associated gathering and compression facilities; development of an overall development plan for the 1-H Pilot area; repayment of $4.125 million of principal outstanding under the SCB credit facility, together with all capitalized and accrued interest and an amendment fee; and general corporate purposes.

Far East intends to implement two main drilling programs: (i) drill additional wells in its core production development area in the north portion of the Shouyang Block to accelerate progress towards increased gas production and sales levels, and (ii) drill additional appraisal wells in the south, west and east sections of the block to enhance reserves and ensure that the Company retains the highest potential portions of the block in future PSC extensions.  Drilling rigs and crews are ready to be mobilized and, subject to weather and seasonal factors, new well drilling is expected to commence during Q1 2013. 

"With a four-year PSC extension now in place for Shouyang, proved reserves under U.S. standards, and an existing gas pipeline off-take contract, as well as the support of our exceptional Chinese partner, China United Coalbed Methane Corporation (CUCBM), we look forward to a year focused upon intensive drilling activity in addition to increased gas marketing activities and the accomplishment of an ODP," said McElwrath. 

McElwrath continued, "We believe that, in combination, these factors underline the significant progress made on the Shouyang Project over the past year.  The financing proceeds and extension of a significant portion of the SCB credit facility provide us with the means to move the project into full development and to access long term debt funding for the Company.  Speaking on behalf of the entire management team, we are very pleased with this outcome."


Tuesday, January 15, 2013
Deal Flow

HOUSTON, Jan. 15, 2013 /PRNewswire/ -- Far East Energy Corporation (OTCBB:FEEC) a U.S. listed company operating the Shouyang Coalbed Methane (CBM) Block in Shanxi Province, Peoples Republic of China, announced today that it has executed a Securities Purchase Agreement to sell senior secured notes and warrants in a private placement for $60,000,000 in gross proceeds.  The transaction is expected to close and fund by January 16, 2013 or as soon as practicable thereafter upon satisfaction of the closing conditions.

Far East will utilize the proceeds for drilling and completion of wells in its Shouyang Block, construction of associated gathering and compression, development of an overall development plan for the 1-H Pilot area, repayment of $4.125 million of principal outstanding under the $25.125 million with Standard Chartered Bank (the "SCB credit facility"), together with all capitalized and accrued interest and an amendment fee, and general corporate purposes.

In addition to the $60 million raised through the private placement, under the agreements governing the private placement, and subject to the closing and funding of the private placement, Standard Chartered Bank has elected to roll forward $21 million of its existing $25.125 million credit facility (the "SCB credit facility"), for an additional 12 month term from the date of closing.  

The notes will be senior secured obligations of Far East Energy (Bermuda), Ltd., a wholly owned subsidiary of Far East Energy Corporation, and are fully and unconditionally guaranteed by Far East Energy Corporation.  The notes provide for the payment of 13% interest semi-annually in arrears with an option to pay interest in kind at a rate of 14.5% per annum.  The notes mature three years from date of closing.

The notes provide that Far East will, under any future credit facility, such as a reserves-based lending facility, first use the funds drawn thereunder to repay any obligations that remain outstanding under the SCB credit facility and then to redeem the notes.


Thursday, December 20, 2012
Comments & Business Outlook

HOUSTON, Dec. 20, 2012 /PRNewswire/ -- Far East Energy Corporation (OTCBB:FEEC) today provided additional information regarding the extension of its bridge facility agreement with Standard Chartered Bank.  Far East noted that the purpose of the extension announced yesterday, December 19, 2012, is to provide the Company additional time to complete the currently ongoing process of final documentation with an investor for a private placement of senior secured notes. 

As announced yesterday, the termination date of the facility agreement was extended to January 15, 2013, subject to an earlier date if the investor and other participants to the currently contemplated private placement of senior secured notes notify Far East or Standard Chartered of an intention not to proceed with such private placement. It is believed that the extension to January 15, 2013, provides sufficient time for the current closing documents to be finalized and executed. If the transaction that is currently in the process of final documentation does not close or fund by January 15, 2013, then Far East intends to seek an extension and/or pursue investment from the other interested investors.

Far East Energy (Bermuda), Ltd. and its management, due to applicable rules and regulations, are at this time prohibited from making further detailed statements related to the potential senior secured notes transaction, which is being conducted as a private placement not registered under the Securities Act of 1933, as amended (the "Securities Act").


Friday, October 5, 2012
Deal Flow

HOUSTON, Oct. 5, 2012 /PRNewswire/ -- Far East Energy Corporation (OTCBB:FEEC) previously announced the intention of Far East Energy (Bermuda), Ltd., a wholly owned subsidiary of Far East Energy Corporation, to offer, subject to market conditions, senior secured notes due 2017 in a private placement not registered under the Securities Act of 1933, as amended (the "Securities Act").  

Far East Energy (Bermuda), Ltd. and its management, due to applicable rules and regulations, are prohibited from making further detailed statements related to the offering at this time. However, Far East Energy (Bermuda), Ltd. and its management continues to work with their advisors and potential investors to complete the transaction.


Friday, July 27, 2012
Deal Flow
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

 

On July 19, 2012, Far East Energy (Bermuda), Ltd. (“FEEB”), a wholly-owned subsidiary of Far East Energy Corporation (the “Company”) received a drawdown of $2.6 million (the “Advance”) pursuant to the $25 million Facility Agreement, dated as of November 28, 2011 and as amended as of May 21, 2012 (as amended, the “Facility Agreement”), with Standard Chartered Bank, as lender, and the Company, as guarantor. In connection with the Advance, FEEB also elected to extend the term of the Facility Agreement by three months, which extended the term of the Facility Agreement to November 28, 2012. FEEB intends to use the proceeds of the Advance to fund certain expenses under the Facility Agreement and for general corporate purposes. After giving effect to the Advance, borrowings under the Facility Agreement will have an outstanding principal amount of $22.9 million with accrued and unpaid interest of $0.4 million. FEEB may, from time to time, draw additional funds under the Facility Agreement up to the credit limit stated therein. All terms and conditions under the Facility Agreement, including the applicable interest rate, remain unchanged.

 

The foregoing description of the Facility Agreement does not purport to be complete and is qualified in its entirety by reference to the Facility Agreement attached as Exhibit 10.1 to the Form 8-K filed on December 2, 2011, and the amendment thereto attached as Exhibit 10.1 to the Form 8-K filed on May 25, 2012, which are incorporated by reference herein.


Thursday, July 12, 2012
Deal Flow
HOUSTON, July 12, 2012 /PRNewswire-Asia/ -- Far East Energy Corporation (OTCBB:FEEC) today announced the intention of Far East Energy (Bermuda), Ltd., a wholly owned subsidiary of Far East Energy Corporation, to offer, subject to market conditions, senior secured notes due 2017 in a private placement not registered under the Securities Act of 1933, as amended (the "Securities Act").  Far East Energy (Bermuda) expects to use the net proceeds from the notes offering to repay all of the indebtedness outstanding under its existing $20.3 million secured term loan and for drilling and completion capital, general corporate purposes and to fund a portion of the interest payments under the notes.  There can be no assurance that the issuance and sale of any notes or the repayment of our existing indebtedness will be consummated.

Friday, June 22, 2012
Comments & Business Outlook

Item 1.01. Entry into a Material Definitive Agreement

On June 15, 2012, Far East Energy (Bermuda), Ltd. (“FEEB”), a wholly-owned subsidiary of Far East Energy Corporation, was notified that the Ministry of Commerce of the People's Republic of China approved its modification agreement (the “Modification Agreement”) to the Production Sharing Contract (the “Yunnan PSC”) for Exploitation of Coalbed Methane Resources for the Enhong and Laochang Area in Yunnan Province, the People’s Republic of China, dated January 25, 2002, between China United Coalbed Methane Corporation Ltd. and FEEB. Under the terms of the Modification Agreement, FEEB will relinquish the Enhong Block while retaining the 483 square kilometer Laochang Block (approximately 119,340 acres). The Modification Agreement extends the exploration period of the Yunnan PSC to December 31, 2013


Tuesday, May 8, 2012
Comments & Business Outlook
FAR EAST ENERGY CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Per Share Data)
(Unaudited)
 
   
Three Months Ended March 31,
 
   
2012
   
2011
 
Operating revenues:
           
Gas sales
  $ 226     $ 23  
Other, net
    71       8  
      297       31  
Operating expenses:
               
Exploration costs
    1,409       1,675  
Lease operating expense
    1,668       732  
General and administrative
    2,779       2,108  
Depreciation, depletion and amortization
    358       56  
Total operating expenses
    6,214       4,571  
Operating loss
    (5,917 )     (4,540 )
Other income (expense):
               
Interest expense
    (1,076 )     (198 )
Interest income
    1       1  
Foreign currency transaction loss
    (46 )     (182 )
Total other income
    (1,121 )     (379 )
Loss before income taxes
    (7,038 )     (4,919 )
Income taxes
    -       -  
Net loss
  $ (7,038 )   $ (4,919 )
                 
Comprehensive loss
  $ (7,038 )   $ (4,919 )
                 
Net loss per share:
               
Basic and diluted
  $ (0.02 )   $ (0.02 )
                 
Weighted average shares outstanding:
               
Basic and diluted
    343,972       305,818  

Saturday, December 3, 2011
Deal Flow
On November 28, 2011, Far East Energy (Bermuda), Ltd. (“FEEB”), a wholly-owned subsidiary of Far East Energy Corporation (the “Company”), entered into a Facility Agreement, as borrower, with Standard Chartered Bank (“SCB”), as lender, and the Company, as guarantor (the “Facility Agreement”).

Saturday, March 12, 2011
Deal Flow
On March 10, 2011, Far East Energy Corporation, a Nevada corporation (the “Company”), entered into a placement agent agreement (the “Placement Agreement”) with Religare Capital Markets, Inc. (“Religare”) pursuant to which Religare agreed to act as placement agent on a reasonable best efforts basis in connection with the sale of shares of the Company’s common stock, par value $0.001 per share (“Common Stock”), in a registered direct public offering (the “Offering”). In connection with the Offering, the Company has entered into a Stock Purchase Agreement (the “Stock Purchase Agreement”) dated March 11, 2011 with the investors party thereto (the “Investors”) pursuant to which the Common Stock is being sold at a purchase price of $0.5025 per share and will be issued pursuant to a prospectus supplement or supplements filed with the Securities and Exchange Commission (“SEC”) included in the Company’s shelf registration statement on Form S-3 (File No. 333-162019), which became effective on November 4, 2009.