Financing conducted by Religare Capital Markets to finance drilling
By Devika Patel
Knoxville, Tenn., March 16 - Far East Energy Corp. said it settled a registered direct offering of stock. Religare Capital Markets, Inc. was the agent for the $17.53 million deal, which priced for up to $25.98 million on March 11.
The company sold 34,880,599 common shares at $0.5025 apiece. The price per share represents a 5.13% discount to the March 10 closing share price of $0.53.
Proceeds will be used to continue the drilling, completion and testing of coalbed methane wells in China and for general corporate purposes.
"We were recently presented with the opportunity by Religare Capital Markets, Inc to receive capital primarily from a few excellent Hong Kong and Singapore based funds," chief executive officer and president Michael R. McElwrath said in a press release at settlement.
"Simultaneously with this, we were presented with the opportunity to pursue what could be a very large overall development plan at Shouyang and with a suggestion that we expand our activities across the block."
"The basic opportunity is to accelerate drilling of approximately 10 Pilot Development Test wells that will cover the far reaches of the Shouyang Block and also to possibly drill two 5-well clusters. The five-well clusters or '5-spots' may aid in the establishment of additional Chinese reserves for overall development plan purposes and perhaps establish additional pilot production areas within our ongoing Pilot Development Work Program. The net proceeds from this placement allow us to undertake these accelerated operations activities," McElwrath said Wednesday.
Far East is a Houston-based natural gas company focused on coal-bed methane projects.
| Issuer: | Far East Energy Corp.
|
| Issue: | Common shares
|
| Amount: | $17,527,500
|
| Shares: | 34,880,599
|
| Price: | $0.5025
|
| Warrants: | No
|
| Agent: | Religare Capital Markets, Inc.
|
| Pricing date: | March 11
|
| Settlement date: | March 16
|
| Stock symbol: | OTCBB: FEEC
|
| Stock price: | $0.53 at close March 10
|
| Market capitalization: | $136.87 million
|
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