.twol is a format used for writing two-level-rules to describe what changes happen when morphemes are joined together, morphographemics (or morphophonology).
See Starting_a_new_language_with_HFST for more details.
If you get this error
syntax error, unexpected SYMBOL_SPACE on line 6: Sets Aborted. make: *** [all] Error 1
You should triple check that you don't have any misplaced "nbsp" spaces in your file. Most text editors have a feature where you can display space characters. If you find "nbsp" spaces, delete them.