After a series of zero price changes, Far East Energy Corp. (OTC:FEEC
, FEEC message board
) took the way down yesterday. The stock lost
approximately 4% of its price, while its traded volume jumped over 3 million shares traded. Though, no one knows the reason for the unexpected price fall yet.
In fact, just yesterday Far East released a drilling update on the Shouyang Block and some details for an upcoming conference call on July 25. The news should have encouraged investors, however, it did not happen. Maybe that's because they have waited for over a month before FEEC released some data on its operations.
Far East Energy Corporation is engaged in the acquisition and development of coalbed methane gas properties in China. Last November, the company used to trade about three times higher than at present, though currently the stock price is moving down.
In mid-May, Far East filed its quarterly results, which however, were quite contradictory. As of March 31 this year, FEEC had more assets than liabilities in its balance, though the deficit accumulated during the development stage has increased, as well as the net loss.
Since the beginning of this year, Far East has entered into some agreements for the sale of shares of its common stock under the company's shelf registration statement. However, the management claims they still may seek to secure capital by obtaining debt or project financing, or by exploring potential strategic relationships or transactions such as a joint venture, farm-out, merger and acquisition or sale of assets.
At the same time, the team may need to seek the approval by the Chinese authorities for its key transactions. Thus, there can be no guarantee of future capital acquisition.
Management of Far East concludes that the funds available to them should be sufficient for their planned expenditures until near the end of the fourth quarter of this year. However, despite this fact, they believe that FEEC will continue to be successful in securing any funds necessary to continue as a going concern.