UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] Quarterly report under Section 13 or 15(d) of the Securities Exchange Act of
1934 for the quarterly period ended June 30, 2002.
[ ] Transition report under Section 13 or 15(d) of the Securities Exchange Act
of 1934 for the transition period from ____________________ to
_____________________.
Commission file number: 0-32455
FAR EAST ENERGY CORPORATION
---------------------------
(Name of Small Business Issuer as Specified in Its Charter)
Nevada 88-0459590
------ ----------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
400 N. Sam Houston Parkway East, Suite 205, Houston, Texas 77060
----------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
(713) 586-1900
---------------
(Issuer's Telephone Number, Including Area Code)
Check whether the issuer: (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes [X] No [ ]
The number of shares outstanding of Registrant's common stock, par value $0.001
("Common Stock") as of August 1, 2002 was 45,750,500.
Transitional Small Business Disclosure Format (check one):
Yes [ ] No [X]
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION...............................................1
Item 1. Financial Statements..........................................1
Consolidated Unaudited Financial Statements..............F-1
Item 2. Management's Discussion And Analysis and Plan of4Operation....2
Forward-looking Information................................2
Overview...................................................2
Results Of Operations......................................3
Capital Resources And Liquidity............................3
PART II - OTHER INFORMATION..................................................4
Item 4. Submission of Matters to a Vote of Security Holders...........4
Item 6. Exhibits and Reports on 6orm 8-K..............................4
INDEX TO EXHIBIT.............................................................6
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Except as otherwise required by the context, references in this quarterly
report to "we," "our," "us" or "the Company" refer to Far East Energy
Corporation and its subsidiaries and predecessors.
Our unaudited interim financial statements including a balance sheet as of
the fiscal quarter ended June 30, 2002, a statement of operations and a
statement of cash flows for the interim period up to the date of such balance
sheet and the comparable periods of the preceding fiscal year are attached
hereto beginning on F-1 and are incorporated herein by this reference.
The financial statements included herein have been prepared internally,
without audit, pursuant to the rules and regulations of the Securities and
Exchange Commission (the "Commission"). Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with the generally accepted accounting principles have been omitted. However, in
our opinion, all adjustments (which include only normal recurring accruals)
necessary to present fairly the financial position and results of operations for
the period presented have been made. These financial statements should be read
in conjunction with the financial statements and notes thereto included in our
annual report on Form 10-KSB for the fiscal year ended December 31, 2001.
1
FAR EAST ENERGY CORP.
(formerly EZFoodstop.com)
Balance Sheet
As at December 31, 2001 and June 30, 2002
(U.S.$) (U.S.$)
(audited) (unaudited)
December 31, 2001 June 30, 2002
----------------- -------------
ASSETS
Current Assets
Cash and Cash Equivalents $ 27,539 $ 2,451,882
Property and Equipment
Equipment - 23,412
Other Assets
Investment in Contract Rights - 3,300,000
-------------- ------------
TOTAL ASSETS 27,539 5,775,294
============== ============
LIABILITIES
Current Liabilities
Accounts Payable 725 55,683
Current Portion of Long-Term Liabilities - 300,000
Total Current Liabilities 725 355,683
-------------- ------------
Long-Term Liabilities
Other Long-Term Liabilities - 3,000,000
-------------- ------------
TOTAL LIABILITIES 725 3,355,683
-------------- ------------
STOCKHOLDERS' EQUITY
Stockholders' Equity (note 4)
Authorized:100,000,000 common shares,
par value $0.001 per share
Issued: 2,250,000 common shares as of
December 31, 2001 2,250
Issued: 45,750,500 common shares as of June 30, 2002 45,751
Additional paid in capital 50,250 3,058,822
Deficit accumulated during the Development Stage (25,686) (684,962)
-------------- ------------
26,814 2,419,611
-------------- ------------
Continuance of Operations (note 3) 27,539 5,775,294
============== ============
F-1
FAR EAST ENERGY CORP.
(formerly EZFoodstop.com)
Statements of Operations and Accumulated Deficit
For the Six Month Periods Ended June 30, 2002 and June 30, 2001
Cumulative
Amounts
Date of
Incorporation
(February 4, 2000)
to June 30, For the Six Month Periods Ended
2002 June 30,
(U.S.$) (U.S.$)
(unaudited) (unaudited)
----------------- -------------------------------
2002 2001
------------ -----------
Revenues 0 0 0
Expenses
General and Administrative 684,962 659,276 11,369
------------- ------------ -----------
Net loss for the period (684,962) (659,276) (11,369)
Deficit - beginning of period - (25,686) (10,970)
------------- ------------ -----------
Accumulated deficit - end of period (684,962) (684,962) (22,339)
============= ============ ===========
Weighted average number of shares outstanding (note 4) 45,750,500 40,500,000
============ ===========
Loss per share $ (0.01) $ (0.00)
============ ===========
F-2
FAR EAST ENERGY CORP.
(formerly EZFoodstop.com)
Statements of Operations and Accumulated Deficit
For the Three Month Periods Ended June 30, 2002 and June 30, 2001
Cumulative
Amounts
Date of
Incorporation
(February 4, 2000)
to June 30, For the Six Month Periods Ended
2002 June 30,
(U.S.$) (U.S.$)
(unaudited) (unaudited)
----------------- -------------------------------
2002 2001
------------ -----------
Revenues 0 0 0
Expenses
General and Administrative 684,962 609,818 5,861
------------- ------------ -----------
Net loss for the period (684,962) (609,818) (5,861)
Deficit - beginning of period - (75,144) (16,478)
------------- ------------ -----------
Accumulated deficit - end of period (684,962) (684,962) (22,339)
============= ============ ===========
Weighted average number of shares outstanding (note 4) 45,750,500 40,500,000
============ ===========
Loss per share $ (0.01) $ (0.00)
============ ===========
F-3
FAR EAST ENERGY CORP.
(formerly EZFoodstop.com)
Statement of Changes in Stockholders' Equity For the Period
from the Date of Incorporation(February 4, 2000) to June 30, 2002
Total
Common Additional Accumulated Stockholders'
Stock Paid-in-Capital Deficit Equity
U.S.$ U.S.$ U.S.$ U.S.$
----------- --------------- ----------- -------------
Shares issued 2,250 50,250 - 52,500
Net loss - - (10,970) (10,970)
----------- --------------- ----------- -------------
Balance, December 31, 2000 2,250 50,250 (10,970) 41,530
Net loss - - (14,716) (14,716)
Balance, December 31, 2001 2,250 50,250 (25,686) 26,814
18 for 1 Stock Split 38,250 (38,250) -
Shares issued 5,251 3,046,822 3,052,073
Net loss - - (659,276) (659,276)
----------- --------------- ----------- -------------
Balance, June 30, 2002 45,751 3,058,822 (684,962) 2,419,611
=========== =============== =========== =============
F-4
FAR EAST ENERGY CORP.
(formerly EZFoodstop.com)
Statements of Cash Flows
For the Six Month Periods Ended June 30, 2002 and June 30, 2001
Cumulative
Amounts
Date of
Incorporation
(February 4, 2000)
to June 30, For the Six Month Periods Ended
2002 June 30,
(U.S.$) (U.S.$)
(unaudited) (unaudited)
----------------- -------------------------------
2002 2001
------------ -----------
Cash Provided By (Used For):
Operating Activities
Net loss for the period (684,962) (659,276) (11,369)
Adjustment to reconcile net loss to cash:
- increase in accounts payable 55,684 54,959 (1,229)
-------------- ----------- -----------
(629,278) (604,317) (12,598)
-------------- ----------- -----------
Investing Activity
Investments in property and equipment (23,412) (23,412) -
-------------- ----------- -----------
Financing Activity
Proceeds from the sale of common stock 3,104,572 3,052,072 -
-------------- ----------- -----------
Increase (decrease) in cash and cash equivalents 2,451,882 2,424,343 (12,598)
Cash and cash equivalents - beginning of period - 27,539 43,159
-------------- ----------- -----------
Cash and cash equivalents - end of period 2,451,882 2,451,882 30,561
============== =========== ===========
Non-Cash Transactions
Acquisition of contract rights 3,300,000 3,300,000 -
============== =========== ===========
F-5
FAR EAST ENERGY CORP.
(formerly EZFoodstop.com)
(A Development Stage Company)
Notes to the Financial Statements
For the Six Month Period Ended June 30, 2002 (unaudited)
1. THE CORPORATION AND ITS BUSINESS
The Company was incorporated as Egoonline.com in the State of Nevada,
United States of America on February 4, 2000 under the Nevada Revised
Statutes, Chapter 78, Private Companies, and changed its name to
EZfoodstop.com on April 26, 2000. EZFoodstop.com changed its name to Far
East Energy Corporation on January 10, 2002.
The Company's United States office is located in Houston, Texas, and the
Company has offices in the Yunnan and Guizhou Provinces of the People's
Republic of China, specifically in the city of Guiyang, Guizhou Province
and the city of Kunming, Yunnan Province. The Company is in its
development stage and to date its activities have been limited to initial
organization, capital formation, and CBM well drill planning.
2. SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
These financial statements have been prepared in US Dollars using US
Generally Accepted Accounting Principles.
Accounting Method
The Company records income and expenses on the accrual method.
Fiscal Year
The fiscal year end of the Company is December 31.
Net Loss Per Share
Basic loss per share includes no dilution and is computed by dividing net
loss available to common stockholders by the weighted average number of
common shares outstanding in the period. Diluted earnings per share
reflects the potential dilution of securities that could occur if
securities or other contracts (such as stock options and warrants) to
issue common stock were exercised or converted into common stock.
Financial Instruments
Unless otherwise indicated, the fair value of all reported assets and
liabilities which represent financial instruments (none of which are held
for trading purposes) approximate the carrying values of such amounts.
F-6
Statement of Cash Flows
For purposes of the statement of cash flows, the Company considers all
highly liquid debt instruments purchased with an original maturity of
three months or less to be cash equivalents.
Use of Estimates
The preparation of the Company's financial statements in conformity with
United States Generally Accepted Accounting Principles requires the
Company's management to make estimates and assumptions that effect the
amounts reported in the financial statements and accompanying notes.
Actual results could differ from those estimates.
3. GOING CONCERN
The Company's financial statements are prepared using generally accepted
accounting principles applicable to a going concern, which contemplates
the realization of assets and the liquidation of liabilities in the normal
course of business. The Company currently has no source of revenue. The
ability of the Company to continue as a going concern is dependent upon
its ability to raise substantial funds for use in development activities.
4. COMMON STOCK
Authorized
The authorized share capital consists of 100,000,000 shares of common
stock with a par value of $0.001.
Issued
Prior to an 18 for 1 forward stock split:
1,250,000 common shares were issued at $0.002 per share for a
consideration of $2,500.
1,000,000 common shares were issued at $0.05 per share for a
consideration of $50,000.
Subsequent to an 18 for 1 forward stock split:
5,250,500 common shares were issued at $0.65 per share. Net of
expenses associated with the offering, consideration to the Company
was $3,052,072.
5. ACQUISITION OF ASSETS
On June 5, 2002, we executed a Sino-Foreign Joint Venture Contract (the
"Contract") with Panjiang Coal-Electricity (Group) Co. Ltd. ("Panjiang")
to establish a joint venture limited liability company ("Joint Venture")
in the People's Republic of China to extract and use coal mine methane gas
from six (6) operating Panjiang coal mines which cover an area of 120
F-7
square kilometers. This Contract was entered into on our behalf by our
wholly owned subsidiary Far East Energy (BVI), Inc., an international
business company incorporated in the British Virgin Islands. We are
developing drilling plans to prove and exploit the resources in our
contract areas in the Guizhou Province.
In consideration for this right to capture Panjiang's coal mine methane
gas, the Company will pay a total of $3,300,000 to Panjiang over the next
three (3) years with $300,000 being paid at the beginning of the
thirteenth (13th) month, $600,000 being paid at the beginning of the
nineteenth (19th) month, $1,100,000 being paid at the beginning of the
twenty-seventh (27th) month, and $1,300,000 being paid at the beginning of
the thirty-third (33rd) month. Additionally, the Company has agreed to
provide Panjiang with 16,000,000 cubic meters per year of untreated,
minimum 30% concentration, coal mine methane gas (equivalent to 5,500,000
cubic meters of pure methane) for use in Panjiang employee households. The
Company has also committed to provide all of the necessary funds for the
extraction and use of the coal mine methane gas operations over the twenty
(20) year term of the Contract.
Panjiang will, in addition to allowing full and complete access to the
coal mine methane gas, do the following:
o Apply to the relevant authorities for the establishment of the Joint
Venture and obtain necessary approvals;
o Assist in obtaining a business license for the Joint Venture;
o Assist in getting land use rights, water use rights, electricity
supply and other necessities for field development, well drilling,
installation, upgrading, purification of coal mine methane gas and
production of chemical products;
o Provide all the land use rights for the household use methane gas
pipelines;
o Assist the foreign employees in getting relevant visas;
o Assist in purchasing equipment, materials, vehicles, communication
equipment; and,
o Assist in the design and construction of the project, and in
recruiting managers, technicians, workers and other required
employees.
The Company may withdraw from the Panjiang project at any time by
providing ninety (90) days written notice. During the first seven (7) year
period, the Company will receive one hundred percent (100%) of the profits
derived from its sale of coal mine methane gas and its products. After the
expiration of the first seven (7) year period, the Company will pay
Panjiang the following percentage of net profits derived from its sale of
coal mine methane gas and its products:
Year Eight 10%
Year Nine through Sixteen 20%
Year Seventeen through Twenty 50%
F-8
6. LONG-TERM LIABILITIES
Long-term liabilities consist of obligations arising from the acquisition
of certain assets as more fully described in "Note 5. Acquisition of
Assets."
Liabilities associated with the acquisition
of certain contract rights $3,300,000
Less current maturities included in
current liabilities 300,000
-----------
$3,000,000
Following are maturities of long-term liabilities for each of the next
three years:
Year Amount
2003 $ 600,000
2004 1,100,000
2005 1,300,000
-----------
$ 3,000,000
F-9
Item 2. Management's Discussion And Analysis and Plan of Operations
Forward-looking Information
This quarterly report contains forward-looking statements. For this
purpose, any statements contained herein that are not statements of historical
fact may be deemed to be forward-looking statements. These statements relate to
future events or to our future financial performance. In some cases, you can
identify forward-looking statements by terminology such as "may," "will,"
"should," "expects," "plans," "anticipates," "believes," "estimates,"
"predicts," "potential" or "continue" or the negative of such terms or other
comparable terminology. These statements are only predictions. Actual events or
results may differ materially. There are a number of factors that could cause
our actual results to differ materially from those indicated by such
forward-looking statements. Some of these factors include risks associated with
doing business in China, changes in environmental regulation, variations in
coalbed methane well development costs, and fluctuations in natural gas prices.
Although we believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results, levels of
activity, performance, or achievements. Moreover, we do not assume
responsibility for the accuracy and completeness of such forward-looking
statements. We are under no duty to update any of the forward-looking statements
after the date of this report to conform such statements to actual results.
Overview
Our operations for the six months ended June 30, 2002 and throughout 2001
consisted of searching for a viable merger or acquisition candidate and
developing drilling plans. We executed two (2) Production Sharing Contracts with
China United CoalBed Methane Corporation ("CUCBM") on January 25, 2002. Pursuant
to the two Production Sharing Contracts, which are subject to formal
ratification by the Ministry of Foreign Trade and Economic Cooperation
("MOFTEC'), we received the authority from CUCBM to jointly explore, develop,
produce and sell coalbed methane gas in and from a total area of 1,330 square
kilometers in the Yunnan Province of the People's Republic of China.
On June 5, 2002, we executed a Sino-Foreign Joint Venture Contract (the
"Contract") with Panjiang Coal- Electricity (Group) Co. Ltd. ("Panjiang") to
establish a joint venture limited liability company ("Joint Venture") in the
People's Republic of China to extract and use coalmine methane gas from six (6)
operating Panjiang coalmines which cover an area of 120 square kilometers. This
Contract was entered into on our behalf by our wholly owned subsidiary Far East
Energy (BVI), Inc., an international business company incorporated in the
British Virgin Islands. We are developing drilling plans to prove and exploit
the resources in our contract areas in the Guizhou Province.
In consideration for the right to capture Panjiang's coalmine methane gas,
we will pay a total of $3,300,000 to Panjiang over the next three (3) years with
$300,000 being paid at the beginning of the thirteenth (13th) month, $600,000
being paid at the beginning of the nineteenth (19th) month, $1,100,000 being
paid at the beginning of the twenty-seventh (27th) month, and $1,300,000 being
paid at the beginning of the thirty-third (33rd) month. Additionally, we have
agreed to provide Panjiang with 16,000,000 cubic meters per year of untreated,
minimum 30% concentration, coalmine methane gas (equivalent to 5,500,000 cubic
meters of pure methane) for use in Panjiang employee households. We have also
committed to provide all of the necessary funds for the extraction and use of
the coalmine methane gas operations over the twenty (20) year term of the
Contract.
Panjiang will, in addition to allowing full and complete access to the
coalmine methane gas, effect the following:
o Apply to the relevant authorities for the establishment of the Joint
Venture and obtain necessary approvals;
o Assist in obtaining a business license for the Joint Venture;
o Assist in getting land use rights, water use rights, electricity
supply and other necessities for field development, well drilling,
installation, upgrading, purification of coalmine methane gas and
production of chemical products;
o Provide all the land use rights for the household use methane
gas pipelines;
o Assist the foreign employees in getting relevant visas;
o Assist in purchasing equipment, materials, vehicles,
communication equipment; and
2
o Assist in the design and construction of the project, and in
recruiting managers, technicians, workers and other required
employees.
We may withdraw from the Panjiang project at any time by providing ninety
(90) days written notice. During the first seven (7) year period, we will
receive one hundred percent (100%) of the profits derived from its sale of
coalmine methane gas and its products. After the expiration of the first seven
(7) year period, we will pay Panjiang the following percentage of net profits
derived from its sale of coalmine methane gas and its products:
Year Eight 10%
Year Nine through Sixteen 20%
Year Seventeen through Twenty 50%
Results Of Operations
The following discussion should be read in conjunction with the audited
financial statements and notes thereto included in our annual report on Form
10-KSB for the fiscal year ended December 31, 2001; and should further be read
in conjunction with the financial statements included in this report.
Comparisons made between reporting periods herein are for the six month period
ended June 30, 2002 as compared to that period in 2001 and for the three month
period ended June 30, 2002 as compared to the same period in 2001. A meaningful
comparison of the periods in 2002 relative to the same periods in 2001 cannot be
achieved as we did not have exploration, development, extraction and sale of
coalbed methane gas activities in China during the first six months of 2001
versus our current focus.
We had no revenue for the six months ended June 30, 2002 and no revenue
for the same period in 2001. Our operating loss increased to $659,276 for the
six months ended June 30, 2002 as compared to $11,369 for the same period in
2001, attributable to increases in general and administrative expenses related
to our exploration, development, extraction and sale of coalbed methane gas in
China.
We had no revenue for the three months ended June 30,2002 and no revenue
for the same period in 2001. Our operating loss for the three months ended June
30, 2002 was $609,818 as compared to $5,861 for the same period in 2001.
Our current assets as of June 30, 2002 were $2,451,882 as compared to
$30,561 as of June 30, 2001. The increase in current assets is due entirely to
cash received as a result of our March 2002 private placement 5,250,500 shares
of Common Stock at $0.65 per share.
Capital Resources And Liquidity
During the six month period ended June 30, 2002, we sold 5,250,500 shares
of Common Stock at US$0.65 per share to a group of accredited entities for a
total offering price of $3,412,825. The offering was made pursuant to exemptions
from registration under Section 4(2) of the Securities Act of 1933.
Although there was a net loss from our operating activities, due to
financing there was an increase in our liquidity. Net cash provided from
financing activities increased to $3,052,072 for the six months ended June 30,
2002 from $0 for the same period in 2001.
Business operations in China will continue to increase our expenses and,
if such operations are successful, our revenues. We are moving forward in the
natural gas industry in China by virtue of our recent acquisition of rights to
methane gas in the Guizhou Province from Panjiang. We are confident that the
Production Sharing Agreements for properties in the Yunnan Province will be
ratified by MOFTEC and a final agreement memorializing the terms of the
memorandum of understanding will be executed, however, no assurances can be
given.
As a result of our recent sale of equity, we believe that our current cash
position of approximately $2,450,000 will be sufficient to satisfy our operating
needs for the next twelve (12) months. We intend to utilize the proceeds raised
to support our current and proposed business operations in China. If the
proceeds are not enough to satisfy our operating needs and we are unable to
generate revenues and/or obtain bank loans on favorable terms and/or sell
additional shares of our equity securities to secure the cash required to
conduct our business operations for the next twelve (12) months, we could fail.
Because we have acquired an undeveloped natural resource which
3
will require substantial exploration and development, we do not expect to
generate meaningful revenues until at least October 2004. Expenses associated
with the exploration and development are expected to exhaust our cash reserves
in approximately twelve (12) months. Expenses beyond this time will have to be
financed through cash flow, which may not yet be available if production and
sales of coalbed methane gas are not significant, or through future financings
of equity and/or debt. We are currently pursuing additional financing for our
projects in the Yunnan and Guizhou Provinces. In the event we do not raise funds
sufficient to finance our current development plans for projects in Yunnan and
Guizhou, we may not generate revenues until after October 2004.
PART II
OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
On June 14, 2002, the Annual Meeting of our Shareholders was held for the
following purposes:
PROPOSAL NO. 1: Election of the Board of Directors until the next Annual
Shareholders Meeting or until their respective successors are
elected and qualify. The number of votes cast for each
nominee was sufficient for all to be elected.
BROKER
FOR AGAINST WITHHELD NON-VOTES
Jawaharlal Gondi 24,323,100 0 0 0
Bill Jackson 24,323,100 0 0 0
Ramesh Kalluri 24,323,100 0 0 0
Tun Aye Sai 24,323,100 0 0 0
PROPOSAL NO. 2: Ratification of the employment of Payne, Falkner, Smith &
Jones, P.C. as the Company's independent auditor for the
fiscal year ending December 31, 2002. The number of votes
required for this proposal to pass was 22,875,251 and the
total number of votes cast for this proposal was 24,323,100,
therefore, the proposal passed.
BROKER
FOR AGAINST WITHHELD NON-VOTES
24,323,100 0 0 0
PROPOSAL NO. 3: Any other business as may properly come before the meeting or
any adjournment thereof.
BROKER
FOR AGAINST WITHHELD NON-VOTES
There was no other business brought before the meeting.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits. Exhibits required to be attached by Item 601 of Regulation S-B
are listed in the Index to Exhibits beginning on page 6 of this Form
10-QSB, which is incorporated herein by reference
(b) Reports on Form 8-K.
1. A Form 8-K was filed on May 15, 2002 regarding the change in our
Certifying Accountant.
2. A Form 8-K was filed on June 7, 2002 regarding the acquisition of
assets.
3. A Form 8-K/A was filed on August 1, 2002 presenting financial
statements concerning the June 7, 2002 acquisition of assets.
4
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized this 6th day of August, 2002.
Far East Energy Corporation
/s/ John Springsteen
--------------------------------
John Springsteen, Vice President
and Chief Financial Officer
5
INDEX TO EXHIBITS
Exhibits marked with an asterisk have been filed previously with the
Commission and are incorporated herein by reference.
EXHIBIT PAGE
NO. NO. DESCRIPTION
- --- --- -----------
3.1 * Articles of Incorporation
3.2 * Bylaws
10.1 * Sino-Foreign Cooperative Joint Venture Contract between
the Company and Panjiang Coal-Electricity (Group) Co.
Ltd., dated June 5, 2002
99.1 7 Certification Pursuant To 18 U.S.C. Section 1350, As
Adopted Pursuant To Section 906 Of The Sarbanes-Oxley
Act Of 2002.
99.2 8 Certification Pursuant To 18 U.S.C. Section 1350, As
Adopted Pursuant To Section 906 Of The Sarbanes-Oxley
Act Of 2002.
6
Exhibit 99.1
Certification Pursuant to
18 USC, Section 1350, as Adopted Pursuant to
Sections 302 and 906 of the Sarbanes-Oxley Act of 2002
In connection with the Quarterly Report of Far East Energy Corporation (the
"Company") on Form 10-QSB for the quarter ended June 30, 2002 (the "Report"), as
filed with the Securities and Exchange Commission, on the date hereof, I,
Jawaharlal Gondi, Chief Executive Officer of the Company, certify to the best of
my knowledge, pursuant to 18 USC 1350, as adopted pursuant to ss.302 and
promulgated as 18 USC 1350 pursuant to ss.906 of the Sarbanes-Oxley Act of 2002,
that:
1. The Report referenced above has been read and reviewed by the undersigned.
2. The Report fully complies with the requirements of Section 13(a) or 15(d)
of the Securities Exchange Act of 1934.
3. The Report referenced above does not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make
the statements made, in light of the circumstances under which such
statements were made, not misleading.
4. I acknowledge that the management of the Company is solely responsible for
the fair presentation in the financial statements of the financial
position, results of operations and cash flows of the Company in
conformity with accounting principles generally accepted in the United
States of America.
Based upon my knowledge, the financial statements, and other such
financial information included in the report, fairly present the financial
condition and results of operations of the Company as of and for the
period ended June 30, 2002.
In my opinion, the accompanying interim financial statements, prepared in
accordance with the instructions for Form 10-QSB, are unaudited and
contain all material adjustments, consisting only of normal recurring
adjustments necessary to present fairly the financial condition, results
of operations and cash flows of the Company for the respective interim
periods presented. The current period results of operations are not
necessarily indicative of results which ultimately will be reported for
the full fiscal year ending December 31, 2002.
Additionally, I acknowledge that the Company's Board of Directors and
Management are solely responsible for adopting sound accounting practices,
establishing and maintaining a system of internal control and preventing
and detecting fraud. The Company's system of internal accounting control
is designed to assure, among other items, that 1) recorded transactions
are valid; 2) valid transactions are recorded; and 3) transactions are
recorded in the proper period in a timely manner to produce financial
statements which present fairly the financial condition, results of
operations and cash flows of the Company for the respective periods being
presented.
/s/ Jawaharlal Gondi
- ---------------------------------------
Jawaharlal Gondi
Chief Executive Officer
Dated: August 6, 2002
7
Exhibit 99.2
Certification Pursuant to
18 USC, Section 1350, as Adopted Pursuant to
Sections 302 and 906 of the Sarbanes-Oxley Act of 2002
In connection with the Quarterly Report of Far East Energy Corporation (the
"Company") on Form 10-QSB for the quarter ended June 30, 2002 (the "Report"), as
filed with the Securities and Exchange Commission, on the date hereof, I, John
Springsteen, Chief Financial Officer of the Company, certify to the best of my
knowledge, pursuant to 18 USC 1350, as adopted pursuant to ss.302 and
promulgated as 18 USC 1350 pursuant to ss.906 of the Sarbanes-Oxley Act of 2002,
that:
1. The Report referenced above has been read and reviewed by the undersigned.
2. The Report fully complies with the requirements of Section 13(a) or 15(d)
of the Securities Exchange Act of 1934.
3. The Report referenced above does not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make
the statements made, in light of the circumstances under which such
statements were made, not misleading.
4. I acknowledge that the management of the Company is solely responsible for
the fair presentation in the financial statements of the financial
position, results of operations and cash flows of the Company in
conformity with accounting principles generally accepted in the United
States of America.
Based upon my knowledge, the financial statements, and other such
financial information included in the report, fairly present the financial
condition and results of operations of the Company as of and for the
period ended June 30, 2002.
In my opinion, the accompanying interim financial statements, prepared in
accordance with the instructions for Form 10-QSB, are unaudited and
contain all material adjustments, consisting only of normal recurring
adjustments necessary to present fairly the financial condition, results
of operations and cash flows of the Company for the respective interim
periods presented. The current period results of operations are not
necessarily indicative of results which ultimately will be reported for
the full fiscal year ending December 31, 2002.
Additionally, I acknowledge that the Company's Board of Directors and
Management are solely responsible for adopting sound accounting practices,
establishing and maintaining a system of internal control and preventing
and detecting fraud. The Company's system of internal accounting control
is designed to assure, among other items, that 1) recorded transactions
are valid; 2) valid transactions are recorded; and 3) transactions are
recorded in the proper period in a timely manner to produce financial
statements which present fairly the financial condition, results of
operations and cash flows of the Company for the respective periods being
presented.
/s/ John Springsteen
- ---------------------------------------
John Springsteen
Chief Financial Officer
Dated: August 6, 2002
8