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Far East Energy Clarifies Recent CEO Stock Transactions

Posted on: Wednesday, 26 March 2008, 12:00 CDT

Far East Energy Corporation (OTCBB:FEEC) issued the following press release to clarify recent stock transactions by its CEO and President, Michael R. McElwrath. On March 21, 2008, Mr. McElwrath vested in the ownership of 150,000 shares of restricted stock, which results in compensation income under IRS regulations. Pursuant to the restricted stock agreement, Mr. McElwrath is permitted to reduce the number of shares he is otherwise entitled to receive by an amount representing the tax liability associated with this transaction. Mr. McElwrath chose this alternative to avoid the necessity to sell shares in the market to satisfy this tax obligation. Under SEC reporting requirements, this transaction is reported as a disposition of shares back to the Company. Certain insider transaction reporting services may report this transaction as a sale of shares, which it is not.

Pursuant to an arrangement to compensate Mr. McElwrath for the diminution of value of certain stock options held by him pursuant to new IRS regulations under Section 409A, Mr. McElwrath will have future vestings of restricted stock over the next 60 days. Mr. McElwrath has informed the Company that he intends to offset his tax liabilities in a similar manner in the future. Certain other executives and directors may report similar transactions over the next 60 days as well.

Far East Energy Corporation

Based in Houston, Texas, with offices in Beijing, Kunming, and Taiyuan City, China, Far East Energy Corporation is focused on CBM exploration and development in China through its agreements with ConocoPhillips and China United Coalbed Methane Company, Ltd. (CUCBM).

Statements contained in this press release that state the intentions, hopes, beliefs, anticipations, expectations or predictions of the future of Far East Energy Corporation and its management are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. It is important to note that any such forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties. Actual results could differ materially from those projected in such forward-looking statements. Factors that could cause actual results to differ materially from those projected in such forward-looking statements include: the preliminary nature of well data, including permeability and gas content, and commercial viability of the wells; risk and uncertainties associated with exploration, development and production of oil and gas; drilling and production risks; our lack of operating history; limited and potentially inadequate cash resources; expropriation and other risks associated with foreign operations; anticipated pipeline construction and transportation of gas; matters affecting the oil and gas industry generally; lack of availability of oil and gas field goods and services; environmental risks; changes in laws or regulations affecting our operations, as well as other risks described in our Annual Report on Form 10-K and subsequent filings with the Securities and Exchange Commission.

Source: Business Wire

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