Yesterday, FEEC shares closed the market at a price of $0.69 and a modest 1.62% increase from the previous close. Trading volume amounted 1.5 million shares, or almost twice the average for the stock. Another update from this Monday made traders expect further news to support FEEC uptrend and maybe convinced them of the upward potential.
Far East Energy and its partners announced the start of the process for the initial gas sales, the first delivery should occur between late December and January 2011. Under the agreement, the purchaser should make the payments for the gas volumes in advance each month, the first payment being anticipated before the end of the year. Also, the company stated that additional equipment is ready for installation on site and that more wells are being drilled currently.
Although no exact numbers for the anticipated payments have been given that could help investors evaluate FEEC shares, it looks like the general financial position of the company is attractive enough. Far East substantially improved its cash position recently, having $33.1 million in cash at the end of September 2010 and no long-term debts.
FEEC share price jumped into a higher price range and even hit a new 52-week high at the end of November, when as promised the company announced the results of the independent engineering report with the estimates of the total gas reserves in Far East Energy’s Shouyang Block in Shanxi Province, China. The best estimate given in the press release was 7.0 trillion cubic feet (Tcf) of coalbed methane Original Gas-in-Place (OGIP).
