In the beginning of this month, the company set up the dates on which a research report would announce the estimated total coalbed methane resources in Far East Energy’s Shouyang Block in Shanxi Province, China. It is expected that the company will receive the independent research report on Monday next week at the earliest and will announce the results to the market.
It is not surprising that the markets is getting anxious on the news about the potential of the reserves that should come out, since the company’s Gas Sales Agreement for the Shouyang Block would become the first established source of revenues for FEEC. Far East Energy is in the development stage since its inception in 2000 and has so far spent over $94 million on its business. Since the beginning of September, traders look encouraged that management plans to report the first sales in this quarter may actually come true.
FEEC share price has gained substantial value and has kept the higher trading range for more than a month. Yesterday, the price stock jumped again up by 9.43%, closed at $0.58 and the trading volume of one million shares was almost four times higher than the average. The 67% dilution this year was also not such a problem, considering that $37 million in cash have been raised.
In March this year, the company sold 11.7 million shares of common stock and warrants to purchase up to 4.7 million for net proceeds of $4.6 million. In August, another 105.5 million shares were sold at $0.33 in a registered direct offering. The net cash amount raised was $32.4 million.
