8-K

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): August 30, 2005

Far East Energy Corporation
__________________________________________
(Exact name of registrant as specified in its charter)

Nevada	000-32455	88-0459590
_____________________ (State or other jurisdiction	_____________ (Commission	______________ (I.R.S. Employer
of incorporation)	File Number)	Identification No.)
400 N. Sam Houston Parkway E., Suite 205, Houston, Texas		77060
_________________________________ (Address of principal executive offices)		___________ (Zip Code)

Registrant’s telephone number, including area code: 832-598-0470

Not Applicable
______________________________________________
Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[  ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[  ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[  ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[  ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

On August 30, 2005, Far East Energy Corporation (the "Company"), ConocoPhillips China Inc. and JP Morgan Trust Company, N.A. entered into the Second Amendment to the Amended and Restated Escrow Agreement under the farmout agreements between the Company and ConocoPhillips China Inc. for the Qinnan block and Shouyang block in the Shanxi Province in the People's Republic of China. The amendment revises the performance guarantee in Phase II of the exploration phase to provide an extension from August 31, 2005 to September 30, 2005 for the Company to complete the drilling of the first horizontal well under Phase II. If the Company has not completed the drilling of the first horizontal well under Phase II by September 30, 2005, the Company will be required to increase the amount of the escrow account to $2,600,000 on September 30, 2005. Notwithstanding the requirement to increase the amount of the escrow account to $2,600,000 on September 30, 2005, and subject to certain events described in the Amended Farmout Agr eements (as defined in the Amended and Restated Escrow Agreement), the Company shall have the right, each time subject to the prior written consent of ConocoPhillips China Inc., to drawdown amounts required to fund operations in Phase II. Each such drawdown may not exceed $250,000.

The above discussion of the Second Amendment to the Amended and Restated Escrow Agreement is a summary description of certain terms and conditions of the amendment and is qualified in its entirety by the terms and conditions of the amendment. For complete descriptions of the rights and obligations summarized in this report, reference must be made to the Amended and Restated Escrow Agreement and the Amendment to the Amended and Restated Escrow Agreement, which has been previously filed with the Securities and Exchange Commission, and the Second Amendment to the Amended and Restated Escrow Agreement, which is attached hereto as Exhibit 10.1 and incorporated by reference hereto.

Item 9.01 Financial Statements and Exhibits.

(c) Exhibits

10.1 Second Amendment to Amended and Restated Escrow Agreement between Far East Energy Corporation, ConocoPhillips China Inc. and JP Morgan Trust Company, N.A., dated August 30, 2005.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	Far East Energy Corporation
August 30, 2005	By:	/s/ Bruce N. Huff
		Name: Bruce N. Huff
		Title: Chief Financial Officer

Exhibit Index

Exhibit No.	Description
10.1	Second Amendment to Amended and Restated Escrow Agreement between Far East Energy Corporation, ConocoPhillips China Inc. and JP Morgan Trust Company, N.A., dated August 30, 2005.

EX-10.1

Exhibit 10.1

SECOND AMENDMENT TO AMENDED AND RESTATED
ESCROW AGREEMENT

This Second Amendment to Amended and Restated Escrow Agreement (“Second Amendment”), dated as of the 30^th day of August, 2005 (the “Effective Date”) is by and among Far East Energy Corporation (“FEEC”), ConocoPhillips China Inc. (“CPI”), and JP Morgan Trust Company (the “Escrow Agent”).

RECITALS

WHEREAS, the parties hereto are parties to that certain Amended and Restated Escrow Agreement with an effective date of December 17, 2004 (“Amended Escrow Agreement”).

WHEREAS, Section 4 of the Amended Escrow Agreement provides that, in the event FEEC has not completed drilling one Phase Two horizontal well by June 30, 2005, pursuant to that certain Shouyang Amended Farmout Agreement and that certain Qinnan Amended Farmout Agreement, the amount required to be held in escrow shall increase;

WHEREAS, pursuant to that certain Amendment to Amended and Restated Escrow Agreement, dated effective June 24, 2005, the parties extended until August 31, 2005 the date for increasing the amount held in escrow; and

WHEREAS, the parties hereto desire to extend such increase in the escrow amount under the Amended Escrow Agreement for one (1) month.

NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants hereinafter set forth, the parties hereto agree as follows:

1. In each instance where the Amended Escrow Agreement requires an increase in the amount held in escrow after June 30, 2005, the date therefor shall be amended to September 30, 2005.

2. This Second Amendment shall not affect any other provision of the Amended Escrow Agreement other than as expressly stated herein, and the parties otherwise ratify and affirm all other provisions of the Amended Escrow Agreement.

IN WITNESS WHEREOF, the parties hereto have executed this Second Amendment as of the Effective Date set forth above.

FAR EAST ENERGY CORPORATION

By:	/s/ Bruce N. Huff
	Bruce N. Huff Chief Financial Officer

CONOCOPHILLIPS CHINA INC.

By:	/s/ Steve Park
	Steve Park Vice President

JP MORGAN TRUST COMPANY, N.A.,
As Escrow Agent

By:	/s/ May Ng
Name:	May Ng
Title:	Vice President, Trust Officer