Far East Energy Corp. (OTCBB:FEEC), the US listed company that operates the Shouyang block coalbed methane (CBM) production sharing contract (PSC) in Shanxi Province, People’s Republic of China, reports that, as a result of negotiations concluded Dec. 6 with its Chinese partner, China United Coalbed Methane Corp. (CUCBM), the parties have extended the exploration period of the portion of the Shouyang block identified as “Area B” until June 30, 2016, and have agreed that Far East will drill at least 39 additional wells in Area B by June 30, 2016.
The company also announced that there has been a large increase in gas production, with gas production now exceeding 1 million cubic feet per day.
The parties have agreed to revise certain related terms of the PSC to reflect this agreement and to do so within 90 days. Area B is significantly larger, at 1,103.1 sq km (272,581.95 acres), than the company’s 1H core production area, which contains 64.7 sq km (15,987 acres).
Far East also announced that there has been a significant increase in gas production in recent weeks. As of Dec. 12, gas production has risen to over 1 million cubic feet per day, and now stands at 1,034,038 cubic feet per day (1,034Mcf/pd). Average production for the seven days ending Dec. 12 was 957.65 Mcf per day, representing a 30% increase over production for the week ended Nov. 12, during which production averaged 738 Mcf/pd.
Based in Houston, Texas, with offices in Beijing, and Taiyuan City, China, Far East Energy is focused on coalbed methane exploration and development in China.