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): January 9, 2007
TRANS ENERGY, INC.
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(Exact name of registrant as specified in its charter)
NEVADA 0-23530 93-0997412
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
210 Second Street, P.O. Box 393, St. Mary's, West Virginia 26170
(Address of principal executive offices)
Registrant's telephone number, including area code: (304) 684-7053
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))
FORM 8-K
Section 2 - Financial Information
Item 2.01 Completion of Acquisition or Disposition of Assets
On January 9, 2007 Trans Energy, Inc. completed the assignment for cash to
Leatherwood, Inc., a Pennsylvania corporation, of six oil and/or gas wells
located in Mannington District, Marion County, West Virginia. The assigned wells
are designated as follows: O.N. Koen No. 1, Moffett No. 2, Simon Moore No. 3,
Simon Moore No. 1, Simon Moore No. 2 and W.T. Morris No. 2.
Trans Energy assigned all of its right, title, operating rights and interest
in and to the aforementioned wells, including the absolute right to produce,
operate and maintain the wells. The assignment is by good and sufficient general
warranty assignment, free and clear of all liens and encumbrances and includes
the entire working interest, all wells, equipment, personal property, gathering
and distribution pipelines and other fixtures and improvements located on the
property.
Leatherwood becomes responsible for the plugging and abandoning of the
acquired wells, as necessary, and for any reclamation of the lands after
plugging and abandoning operations are completed. All plugging and abandoning
operations will be done in accordance with the applicable rules and regulations
of the State of West Virginia or other jurisdictional authorities.
Upon effectiveness of the assignment of the lease, all production, revenue,
costs, expenses and other liabilities attributable to the assigned wells will
belong to Leatherwood. For a period of one year following the effective date,
Trans Energy will have the right, at its sole cost and expense, to permit and
drill one or more oil and gas wells located on two of the assigned properties.
Also on January 10, 2007, Trans Energy acquired from National Gulf
Production, Inc. of Giddings, Texas, 75% of National Gulf's rights and interests
in and to certain oil and gas leases covering the oil and gas in and under
certain tracts of land containing approximately 3,120 acres located in Trego
County, Kansas. National Gulf originally acquired the leases pursuant to a
farmout agreement with Wevco Production, Inc. In connection with the agreement,
Trans Energy and National Gulf will acquire certain 3-D seismic data on the
subject leases.
In consideration for the leases Trans Energy will pay its proportionate 75%
of the farmout fee, or approximately $146,250, plus its proportionate 75% of the
seismic acquisition, processing and interpretation cost, a total of
approximately $285,000. The final seismic cost will be adjusted when completed.
The lease has a reservation by Wevco of an overriding royalty interest of
3.5% and the right, but not the obligation, to participate up to 25% at cost, in
the wells drilled by National Gulf and Trans Energy. There will also be an
overriding royalty interest of 1% to the Project Geophysicist and National Gulf
will retain an overriding royalty interest of 2%, resulting in an 81% working
interest. National Gulf will also earn a 6.15% carried working interest.
Upon completion of each well capable of commercial production, Trans Energy
will be entitled to receive an assignment of its proportionate share of the 20
acre producing unit, or other unit size as may be directed or allowed by the
State. This assignment will be made without warranty of title, express or
implied.
From the date of the agreement Trans Energy and National Gulf will have one
year to drill the first well and will also have an option for six months after
completion of any well to drill another well, until all drillable 20 acre units
in the leases are drilled. In the event Trans Energy and National Gulf do not
drill the first well within one year, or do not drill subsequent wells within
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the prescribed six month periods, then this agreement terminates with respect to
all undrilled areas, unless such failure to perform is due to an act of God,
labor disputes, riots, or any other cause beyond the control of the parties. In
such an event, the required time to perform would be extended for the period of
the interruption.
Trans Energy and National Gulf will enter into a mutually acceptable
participation and operating agreement, whereby National Gulf will be the
Operator and will drill and operate the wells that are drilled on the leases.
Section 9 - Financial Statements and Exhibits
Item 9.01 Financial Statements and Exhibits
(c) Exhibits
Exhibit No. Description
10.1 Assignment and Bill of Sale
10.2 Seismic Data Acquisition and Farm Out Agreement
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Notes about Forward-looking Statements
Statements contained in this current report that are not historical facts,
including all statements regarding the consummation of the acquisition of
assets, may be considered "forward-looking statements" under the Private
Securities Litigation Reform Act of 1995. Forward-looking statements are based
on current expectations and the current economic environment. Trans Energy
cautions the reader that such forward-looking statements are not guarantees of
future performance. Unknown risks and uncertainties as well as other
uncontrollable or unknown factors could cause actual results to materially
differ from the results, performance or expectations expressed or implied by
such forward-looking statements.
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.
TRANS ENERGY, INC.
Date: January 25, 2007 By /S/ WILLIAM F. WOODBURN
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William F. Woodburn
Chief Operating Officer and Director
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