FAR EAST ENERGY CORP

Far East Energy filed for Chapter 7 liquidation on 10 November 2015 after failing to sell or restructure itself, handing control to a trustee to sell off the assets. The filing defaulted every borrowing at once - $23.2 million on the 2011 facility, $10.8 million on the working capital loans and $89.1 million on the 13% notes, about $123 million in all - and both remaining officers ceased to hold office immediately. Fourteen years of Chinese coalbed methane exploration ended without commercial production.

bankruptcy or receivership

Standard Chartered sold its position out of the 2011 facility to the same lender group behind the working capital loans, and the new holders extended the maturity to March 2016. The original bank was gone; the company's fate now sat with a single group of distressed lenders.

material agreement

A $16.3 million unsecured facility was arranged, $8.8 million of it simply to refinance the three working capital loans taken since February. New money was being raised almost entirely to repay recent borrowing.

debt financing

A thirteenth and final extension carried the bank loan to 8 October 2015 with interest deferred once more - the last of a year of month-by-month reprieves.

debt default or forbearance

A twelfth extension carried the bank loan to 4 September 2015, interest deferred.

debt default or forbearance

The February working capital loan was extended a second time and a third $4 million unsecured facility was taken from the same lenders - the company now rolling three separate stopgap loans at once.

debt financing

An eleventh extension moved the bank loan to 3 July 2015, interest deferred again.

debt default or forbearance

A tenth extension carried the bank loan to 1 June 2015 with interest deferred.

debt default or forbearance

A second unsecured working capital facility, this one $4 million over six months, was drawn from the same lender group six weeks after the first.

debt financing

A ninth extension moved the bank loan to 30 April 2015, interest deferred again.

debt default or forbearance

With the bank loan unpayable, the company took a $1.4 million three-month unsecured working capital loan from a group of lenders - borrowing to keep the lights on rather than to drill.

debt financing

An eighth extension carried the unpaid principal and interest to 31 March 2015.

debt default or forbearance

Another month bought, to 13 February 2015, with the interest deferred once more.

debt default or forbearance

Principal and the deferred interest were pushed again, to 15 January 2015 - a fortnight at a time.

debt default or forbearance

For the first time the bank deferred the interest itself, not just the principal: the November payment was rolled into a new maturity of 31 December 2014. The company had stopped being able to service the loan at all.

debt default or forbearance

CUCBM extended Shouyang exploration to June 2016 over 1,103 square kilometres, but only in exchange for a commitment to drill at least 39 more wells - more time bought with spending the company had no obvious way to fund.

material agreement

Far East Energy raised $60 million by selling senior secured notes of its Bermuda subsidiary plus warrants, at 13% cash interest or 14.5% if paid in more notes, maturing January 2016. It cleared the immediate bank problem, but committed a company with no revenue to a hard three-year deadline at a punishing rate. Those notes are the largest claim in its 2015 liquidation.

capital raising announcement

Standard Chartered granted another short deferral of principal and interest to mid-January while the company finished documenting a private placement of senior secured notes - the bank lending against a refinancing that had not closed yet.

debt default or forbearance

Unable to repay at maturity, the company got Standard Chartered to push both the facility's termination date and the payment of all accrued interest out three weeks to 19 December 2012.

debt default or forbearance

The Shouyang exploration period was extended to June 2015 with Chinese government approval - the block that carried the gas sales contract and the bank loan now had three more years to deliver.

material agreement

Beijing approved a deal under which Far East Energy handed back the Enhong block in Yunnan and kept the 483 square kilometre Laochang block, with more time to explore it. Ten years after signing for 1,072 square kilometres, the company was giving half of it back.

material agreement

Standard Chartered provided a $25 million facility to the Bermuda subsidiary, guaranteed by the parent, for Shouyang project costs - the company's first bank debt and, over the next four years, the obligation it spent most of its energy refinancing. The initial term was just nine months.

debt financing

Arrow's $10 million exchangeable note - now held by Dart Energy after Arrow was broken up - fell due and could not be repaid; the maturity was pushed to September 2011, with Dart free to convert into shares at any time. The 2009 rescue had become a debt the company had to keep rolling.

capital raising announcement

Shares were sold at $0.5025 through Religare Capital Markets, a rare raise at a higher price than the last, on the back of progress at Shouyang.

material agreement

Macquarie placed 105.5 million shares at $0.33 - a raise so large relative to the company that it roughly doubled the share count, at a third of the price paid a year earlier.

material agreement

A gas sales contract was signed for coalbed methane from the Shouyang block, between state partner CUCBM and a Shanxi provincial gas group - the first firm route to market for gas Far East Energy had been drilling for since 2003.

material agreement

Three months later the company raised again, selling stock and warrants at $0.43 a share through Rodman & Renshaw. The price kept falling and the raises kept coming.

material agreement

Far East Energy sold units of five shares plus a two-share warrant at $2.12 through Pritchard Capital in a registered offering off its shelf - roughly 42 cents a share, a fraction of the $2.61 the World Bank's investment arm had paid two years earlier.

material agreement

China's commerce ministry approved extensions taking the exploration periods on both the Shouyang and the Yunnan blocks out to June 2011, buying nearly two more years to prove up gas.

material agreement

Far East Energy brought in Australian coalbed methane producer Arrow Energy as a partner: Arrow paid $10 million for an exchangeable note issued by the Bermuda subsidiary plus warrants over 7.4 million shares, and was to receive 75.25% of the company's rights in the Qinnan block. Cash and a credible operating partner at the depth of the financial crisis - but it handed away three quarters of one of its three blocks.

capital raising announcement

Phil Christian, a BP operations manager with Russian project experience, was appointed president, chief operating officer and country manager of the Bermuda subsidiary - a heavyweight operator brought in to get the China wells drilled.

director officer appointment

The World Bank's International Finance Corporation bought $15 million of stock - 11.5 million shares plus warrants at $2.61 - putting a development-finance institution on the register. The most credible endorsement the company ever received, and its largest single cheque to that point.

material agreement

China's commerce ministry approved all three exploration-period extensions signed in April, giving Far East Energy legally effective extra time on every one of its blocks.

material agreement

Three separate modification agreements were signed to extend the exploration periods on the Shouyang, Qinnan and Yunnan production sharing contracts, all subject to Chinese government approval - a company-wide reset of every deadline it had missed.

material agreement

Far East Energy raised $8.94 million selling 6.6 million shares privately at about $1.35, paying 6.75% in fees. Another year, another placement, with no revenue yet in sight.

capital raising announcement

Far East Energy got its Yunnan partner CUCBM to extend the phase-two exploration deadline at Enhong and Laochang all the way to June 2007, subject to Chinese government approval - the same slippage now affecting its second block as well as its first.

material agreement

Far East Energy raised $10.9 million selling 12.1 million shares privately, promising to register the shares within 60 days and to get its stock onto the American Stock Exchange within 180 days.

capital raising announcement

Shareholders approved moving essentially all the China business - the CUCBM production sharing contracts and related agreements - into a new Bermuda subsidiary, Far East Energy (Bermuda), Ltd. Every later contract, loan and default in this story sits at that subsidiary rather than the Nevada parent.

material agreement

Far East Energy sold its Montana leases and royalties for $1.135 million, closing out the US asset experiment three years after buying it. From here the company was a pure bet on Chinese coalbed methane.

asset acquisition disposition

The escrow securing Far East Energy's drilling obligations to Phillips China was restated to run to end-2005, and to grow by $1.6 million to $2.6 million if the company failed to drill its first horizontal well on time. Missing the deadline would now cost real cash.

material agreement

Overseas investors subscribed $10.25 million for 6.4 million units of two shares plus a warrant exercisable at $2.50, with $820,000 of commissions and 1.5 million agent warrants on top. The money was earmarked for horizontal coalbed methane drilling in China in 2005.

capital raising announcement

Far East Energy had to renegotiate its farmout agreements with Phillips China on the Qinnan and Shouyang blocks, buying an extension to complete phase one to January 2005 and phase two to end-2005 and reshaping the work programme. The first of what became years of missed drilling deadlines.

material agreement

Far East Energy began drilling its first exploration wells in the Enhong-Laochang coalbed methane blocks in Yunnan, moving from contract-signing to actual drilling for the first time.

drilling progress report

China's commerce ministry ratified the production sharing contract Far East Energy had signed with state partner CUCBM in January 2002, making its rights over 1,072 square kilometres at Enhong and Laochang in Yunnan legally effective. The company's core asset was now secure on paper; proving it held gas was the harder part.

asset acquisition disposition

Far East Energy signed a Chinese joint venture with Panjiang Coal-Electricity to capture coal mine methane from six working coal mines across 120 square kilometres, agreeing to pay Panjiang $3.3 million over three years for the rights. Its first operating position in China alongside the exploration contracts.

asset acquisition disposition