The Good News: Sao Tome, Nigeria To Split $283 Million - And Much, Much More; A Review Of World Press Reaction

News stories on the remarkably quiet end to the fractious and sometimes superheated awards process in the Nigeria-Sao Tome and Principe Joint Development Zone have been and will continue to pile up in the coming days. ERHC On The Move is trying to include as many as possible in one place - this article - for future reference.


President Olusegun Obasanjo of Nigeria Obasanjo, beset on every side by by immense problems of governance, steered a firm and direct course towards a conclusion of the JDA awards process, often against bitter opposition.

Missing from the lineup is an English-language story from the Portuguese news agency Lusa, which circulated a strictly-Sao Tome point of view, and Vitrina, which provided much of the most difficult-to-come-by news during the three weeks the first awards document languished in Sao Tome's bureaucracy.

Other Nigerian newspapers which have covered the story in the past are also silent tomorrow, including The Punch of Nigeria (which predicted awards on May 27, nearly setting off a riot on Raging Bull), The Sun, The Guardian, The Vanguard, Daily Champion, Financial Standard and New Age. Some of these newspapers are truly indifferent to important news.


President Fradique de Menezes
The Sao Tome and Principe President fought for a conclusion that would benefit his poverty-stricken island nation, and in the end triumphed over a fractious opposition party that wanted to embarrass him. Instead, he emerged with a $125 million windfall for Sao Tome.

Incidentally, none of the stories have yet explained how 105 percent of Block 2 was awarded. And there is as yet no press release on the Joint Development authority Website, http://wwww.nigeriasaotomejda.com.


Sir Emeka Chukwu Offor
Few will deny that the man behind ERHC Energy is a financial genius of startling proportion. He took a tiny Louisiana firm worth absolutely nothing - indeed, far less than nothing, because it was deeply in debt - and nurtured it slowly in the toxic environment of the West African petroleum industry into what is now an important world player controlling vast acreage in the Gulf of Guinea, where seismic data indicates there could be as much as 14 billion barrels of oil. Offor controls 42 percent of ERHC Energy shares, listed as ERHE on the OTC Bulletin Board.

Here's one of the most recent pieces, from Agence France-Presse, which was one of the few truly independent voices in the hectic last days before awards, an helped counteract the negativity of Lusa:

Nigeria, Sao Tome announce award of oil exploration blocks

ABUJA (AFX) - Nigeria and its island neighbour Sao Tome awarded five major offshore exploration contracts in their joint offshore development zone to foreign and local energy firms, officials said.

The long-awaited announcement came at the close of a meeting of the leaders of presidents Olusegun Obasanjo of Nigeria, Fradique de Menezes of Sao Tome and Teodoro Obiang Nguema of Equatorial Guinea on security in the Gulf of Guinea.

Nigeria and Equatorial Guinea are already major oil exporters and with Tuesday's decision De Menezes will now hope that his island nation can join what could become a major regional oil boom.

"The important documents that Sao Tome endorsed today will bring benefits to all our peoples, who are the owners of these resources," De Menezes told reporters after the bilateral and trilateral meetings.

EHRC Energy Inc, a US-listed but Nigerian-owned firm which had been controversially pre-assigned much of the acreage, was among the companies emerging with awards.

Along with its partners - US-based independents Pioneer Natural Resources and Devon Energy - EHRC will be the operator firm of the 692 square kilometer Block 2 and hold 65 pct of the equity.

It will also operate Block 4 with a 60 pct share along with another US ally, Noble Energy.

EHRC will also hold 25 pct of Block 3, and 15 pct of Blocks 5 and 6.

The US firm Anadarko Petroleum Corp will operate Block 3 with a 51 pct stake, while Virginia-based ICC-OEOC have Block 5 and the Nigerian start-up Filtim-Huzod takes 85 pct of block 15.

The rest of the equity in the various blocks has been sold to a variety of local and foreign firms including Nigeria's Conoil and India's ONGC Videsh.

The sale netted the two countries a total bonus of US$283 million.

ola/dc/nb/tr

http://www.iii.co.uk/news/?type=afxnews&articleid=
5310667&subject=markets&action=article

This article is from tomorrow's ThisDay Online, whose Mike Oduniyi was one of the few reporters who tried to keep up with confusing news (and lack of news) from the Nigeria-Sao Tomne and Joint Development Authority for the better part of a year. Note that Conoil's 20 percent gets more ink than ERHC/Boble Energy's 60 percent; the paper has always had a pro-Conoil bias.

Today's report is from Josephine Lohor, and includes a long and very interesting quote from Presdietn De Menezes, in which he likens Sao Tome to Nigeria's "younger brother," and rejects the idea of there being any bad blood between them:

Five Oil Blocks Approved in JDZ
From Josephine Lohor in Abuja, 05.31.2005

Nigeria President Olusegun Obasanjo and his Sao Tome and Principe counterpart, Mr. Fradique de Menezes, yesterday jointly approved the award of five oil blocks in the 2004 Joint Development Zone (JDZ) licensing round.

They gave the approval in Abuja at the Presidential Lounge of the Nnamdi Azikiwe International Airport. Obasanjo said the approval was a follow up to the bids conducted last December.

Conoil has 20 percent of equity in Block 4 won by Noble/ERHC.

Hercules oil got equity of 10 percent; Godsonic Oil and Gas – five percent and Overt Oil, five percent. Noble/ERHC, which is the operator of Block 4, has equity of 60 percent. The winners of the block are to pay a signature bonus of $90 million.
Block 2 was won by Devon/Pioneer/ERHC as the operator with equity of 65 percent. The signature bonus for the block is $71 million. Others who got equity in the block include Equator Exploration/ ONGC Videsh, 25 percent; A. & Harmattan, 10 percent; Foby Engineering, five percent and Momo Oil & Gas, five percent.

For block 3 with a signature bonus of $40 million, the lead operator is Anardako with equity of 51 percent. Others who won equity include Devon/ERHC, 20 percent; DNO/EER, 10 percent; Equinox, 10 percent and Ophir/Broadlink, four percent.
ICC/OEOC Consortium is the lead operator for Block 5 with a signature bonus of $37 million. Its equity is 75 percent. ERHC has equity of 15 percent while Sahara has 10 percent.

For Block 6, the lead operator is Filtzim-Huzod Oil & Gas with equity of 85 percent. ERHC has equity of 15 percent in the block.

Of the successful bidders, Devon/Pioneer/ERHC, Devon/ ERHC and Noble/ERHC won the bids as operators including their existing rights. ENHC won their equity for Blocks 5 & 6 plus their existing rights.

Obasanjo after the meeting that “transparency and accountability” would guard the activities and decisions of JDZ for oil and gas.

“I’ve always believed that whatever we do cannot really be called local because in the oil sector, all local issues are international issues particularly because of the nature of oil and gas as the most prized and important source of energy all over the world.

“This 2004, which runs into 2005, have been analyzed by our ministers and advisers. They have come together to agree on basis of technical. And they have made recommendations on the local participation, to a large extent, political. He said that there was a deliberate effort to include companies where citizens of both nations have interests or are sponsoring.

“We want people either sponsored by citizens of your country (ST&P) or citizens of Nigeria who can be part of the exercise in order to learn. The way things have been done is sufficiently satisfactory for all of us to feel proud that we have done the best. If there is any complaint like you find in all commercial transactions, it can be resolved by explaining the rationale behind our decisions.”

Also President De Menezes of Sao tome and Principe said the Gulf of Guinea Treaty is before his country’s parliament for approval and immediate implementation. He added that “you will understand that our worries and questions we have often raised for clarifications were only and shall always be questions and clarifications. We just wanted to know as a curious younger brother why our bigger brother is doing this because we are younger in this industry. Nigeria is older and more experienced. We are just asking you why not the other way. Nothing whatsoever apart from curiosity and anxiety. Our relationship is deep. It is large and important.

"Whatsoever comes out of this transaction, 60 percent comes to Nigeria. The rest 40 percent goes to Sao Tome & Principe. It is a novelty and a lesson for the rest of Africa.”

The meeting was preceded by a tri-partite meeting by Obasanjo, Menezes and President Nguema Mbasogo of Equatorial Guinea on the issue of peace, security, political and economic cooperation in the Gulf of Guinea.

Explaining the reasons for the tri-partite meeting, Obasanjo stated that the meeting between him and the two visiting leaders dwelt on peace and security including the “menacing issue of mercenaries” and co-operation at government and people to people level.

Mbasogo who spoke after the meeting said, “we are much more concerned about issues affecting our nations with regards to mercenaries. We also spoke about establishing joint commissions of the Gulf of Guinea that will enable us implement measures to ward off these threats of mercenaries affecting our nations. We have the three biggest reserves in the oil and gas.

“Therefore, all those who are eyeing these resources are constantly looking into situations and ways by which they will get their hands into our resources. At the tri-partite level, we have to look into ways and revise means by which we will be securing these resources meant for our people’s well being and not for the hands of those wanting to take them away from us. We have to put the commission in place," he said.

Here's a piece from the Daily Independent, whose Bassey Udo was a hard-working voice of reason for most of the long awards process, and just last week offered a long, well-researched explanation for the many delays. Today's piece is by Chesa Chesa, a correspondent who usually covers Abuja government doings:

Wednesday June 1st, 2005

Obasanjo, Menezes meet, approve oil blocs award
by Chesa Chesa
State House Correspondent, Abuja

ABUJA -- President Olusegun Obasanjo and his counterpart from Sao Tome and Principe, Mr. Fradique de Menezes, met on Tuesday in Abuja and approved the award of five oil blocs in the 2004 Joint Development Zone (JDZ) licencing round.

The two leaders, who met at the Nnamdi Azikiwe International Airport Presidential Guest House, also had a tripartite meeting with the President of Equatorial Guinea, Nguema Mbasogo.

Both meetings focused on the issues of peace, security, political and economic cooperation in the Gulf of Guinea.

Expressing satisfaction with the oil blocs as awarded in December 2004, Obasanjo said there was a deliberate effort by the Joint Ministerial Council (JMC), which recommended the bids for approval, to include companies in which citizens of Nigeria and Sao Tome have interests or are core sponsors.

According to the president, “transparency and accountability is the watchword for our working together in the area of JDZ for oil and gas. I have always believed that whatever we do cannot really be called local because in the oil sector, all local issues are international issues particularly because of the nature of oil and gas as the most prized and important source of energy all over the world.

“This 2004 which runs into 2005 has been analysed by our ministers and advisers. They have come together to agree on basis of technicality and they have made recommendations on the local participation.

“We want people either sponsored by citizens of your country (Sao Tome and Principe) or citizens of Nigeria who can be part of the exercise in order to learn. The way things have been done is sufficiently satisfactory for all of us to feel proud that we have done the best. If there is any complaint like you find in all commercial transactions, it can be resolved by explaining the rationale behind our decisions”.

Menezes on his part explained some of his inquiries which had stalled early approval of the award of the oil bloc and disclosed that the Gulf of Guinea Treaty is before his country’s parliament for ratification.

And here's an article from Wednesday morning's The Punch, which infamously - and very near correctly - predicted awards on May 27 way back in March, scaring the hell out of everyone:

Oil blocks: Nigeria, Sao Tome earn $283m extra
The Punch, Wednesday, June 01, 2005
http://www.punchng.com/main/article16
Michael Faloseyi, Abuja

Nigeria and Sao Tome and Principe, are to earn $283million as signature bonuses to be paid by the winners of the five oil blocks placed on offer in their joint development zone.

Heads of governments of the two countries, President Olusegun Obasanjo, and Mr. Fradique de Menezes, on Tuesday, endorsed the recommendations of the technical committee of the Joint Development Authority on the oil blocks.

The two heads of government met at the Nnamdi Azikiwe International Airport, in Abuja, to ratify winners of the five oil blocks placed on offer in December 2004 in the JDZ of the two countries. The JDZ is an overlapping boundary area of the two countries.

This development brought to $406million, the total amount of signature bonuses realisable from the JDZ. The two countries had earlier realised $123million as signature bonuses from block one.

Another United States oil company, Anadarko, made a foray into the Nigerian oil and gas industry when it emerged a winner and operator of block three.

Two US multinationals ChevronTexaco and ExxonMobil, are currently holding sway in the country’s oil and gas industry. The two are closely rated after the Shell Petroleum Development Company, the leading oil producing company in Nigeria.

The announcement also confirmed Environmental Remediation Holding Company (sic), an indigenous oil and gas company, as a force in the oil and gas industry as it registered its presence in all the five oil blocks advertised in the JDZ.

EHRC has equity participation ranging from 15 to 65 per cent in each of the oil blocks. It also has joint operator status in two of the blocks oil blocks.

A breakdown of the winners as contained in the recommendations of the Joint Ministerial Council held last week, indicated that $71 million signature bonuses would be paid on block two where ERHC has joint operator status.

Other joint operators of the oil block with 65 per cent equity are Devon and Pioneer, while Equator Exploration and ONGC Videsh have 15 per cent joint equity.

Other winners are Hartman with 10 per cent equity, while Foby Engineering and Momo Oil and Gas, have five per cent apiece.

Anadarko, with 51 per cent equity on block 3, will pay $40 million as signature bonus alongside seven other oil companies. They are Devon and EHRC with joint equity holding of 25 per cent, DNO and EER have 10 per cent joint equity, Equinox has 10 per cent joint equity and Ophir has 4 per cent joint equity with Broadlink.

Here, in Portuguese (where it shall remain, at least for the time being) is the latest Tela Non story, containing a lot of negativity despite the fact that the awards have produced a $283 million windfall for the two nations, including $125 million for Sao Tome's desperate, poverty-stricken people:

Adjudicação dos 5 blocos de petróleo foi revista
by Abel Veiga

São Tomé e Príncipe e a Nigéria decidiram reavaliar as propostas de adjudicação de 5 blocos de petróleo da zona de exploração conjunta, cujo o processo gerou polémica nas últimas semanas.

Responsáveis dos dois países reuniram-se em Abuja, para encontrar consenso a volta dos interesses participativos de algumas companhias petrolíferas nos 5 poços de petróleo.

A segunda reunião do conselho Ministerial Conjunto São Tomé e Príncipe-Nigéria, que decorreu na capital nigeriana 24 e 25 de Maio, é consequência directa da crise que se instalou no país a volta do dossier petróleo, e que só a intervenção do Presidente Nigeriano Olusengo Obasanjo, serviu para acalmar o confronto interno por causa do ouro negro.

A delegação nacional, composta pelos Ministros da Defesa Oscar Sousa , dos Negócios Estrangeiros e Cooperação Ovídeo Pequeno, do Plano e Finanças Adelino Castelo David, e outros membros dos órgãos de soberania deixaram o país em silêncio, a delegação são-tomense recebeu orientações do Conselho Nacional de Petróleo, tendo antes recebido orientações do Conselho Nacional de Petróleo. A missão visa dar corpo ao entendimento criado em São Tomé, com a visita do Presidente Nigeriano.

Num comunicado curto o Ministro dos Negócios Estrangeiros, explicou que a segunda reunião de Abuja visa a revisão das propostas de adjudicação de cada bloco de petróleo, bem como os interesses participativos das empresas concorrentes.

O comunicado acrescentou também que São Tomé e Príncipe adoptou uma nova posição negocial com vista a discussões com a parte nigeriana. O Presidente da República, que tinha anunciado o seu afastamento da liderança do dossier petróleo, voltou no entanto a presidir o Conselho Nacional de petróleo alargado, do passado dia 23.

O Ministro dos Negócios Estrangeiros e Cooperação, Ovídeo Pequeno, que é porta-voz do Conselho Nacional do Petróleo, não explicou a imprensa se Fradique de Menezes tinha reconsiderado a sua posição ou não.

No meio de incertezas e desentendimentos a volta do dossier petróleo os são-tomenses, parecem perder concentração suficientes para tratar de um assunto tão fundamental para o futuro do país. A Nigéria assume-se cada vez mais como o guia, o apaziguador das turbulências provocadas pelo ouro negro no país.

Numa nota de imprensa, a Presidência são-tomense explicou que o Presidente Obasanjo considerou os problemas levantados pelos são-tomenses a volta do dossier petróleo, como sendo de caracter político e não técnico. Segundo a nota, Obasanjo garantiu que foram observados todos os requisitos técnicos para a adjudicação dos 5 poços de petróleo.

A nota sublinha por outro lado, que Olusengo Obasango manifestou desagrado e mal estar, tendo relembrado que o tratado confere apenas aos dois Presidentes os poderes para aprovar ou não aprovar a adjudicação recomendada pelo conselho ministerial conjunto, cabendo às autoridades de cada estado membro no tratado preencher os seus requisitos internos.

Finally, here's a piece from Jornal San Tome, another Portuguese publication, which notes that President Fradique de Menezes is en route to Abuja but misses the big story - his reason for going. The Jornal missed much of the process. This story does note that in the Sao Tome President's group in Abuja were oil minister, Arlindo de Carvalho, finance and planning minister Adelino Castelo David, and foreign affairs minister Ovídio Pequeno:

Fradique de Menezes encontra-se com Olusegun Obasanjo
Petróleo: Presidente são-tomense a caminho da Nigéria
2005-05-31 14:32:24

São Tomé - O chefe de Estado são-tomense, Fradique de Menezes, deixou na manhã desta terça-feira o país rumo à Nigéria, onde deverá manter um encontro com o seu homólogo nigeriano, Olusegun Obasanjo, sobre a questão do petróleo, que tem levantado polémica no arquipélago nos últimos tempos devido ao suposto favorecimento de algumas companhias.

Acompanham o Presidente da República de São Tomé e Príncipe os ministros dos Recursos Naturais, Arlindo de Carvalho, de Plano e Finanças, Adelino Castelo David, e dos Negócios Estrangeiros, Ovídio Pequeno.

Esta viagem, que Fradique de Menezes classificou como mais uma «missão», tem como objectivo atender ao pedido que o Presidente Obasanjo havia feito ao chefe de Estado são-tomense no sentido de ser pôr fim às negociações desta segunda licitação de blocos petrolíferos que criou problemas ao país e muitas especulações.

«O Estado são-tomense manifesta-se junto do Estado nigeriano para podermos dar seguimento a este tratado, se não estamos numa situação de bloqueio, e precisamos ir avante com isso», declarou o Presidente são-tomense.

No que concerne à possibilidade de assinar com o seu homólogo nigeriano um acordo de adjudicação directa dos cinco blocos às companhias pretrolíferas que forem seleccionadas, Fradique de Menezes respondeu: «Os Presidentes não assinam, mas aprovam ou não aquilo que for negociado e cabe aos referidos sectores que assinam a conclusão que chegaram».

Segundo o chefe de Estado, há ainda «dúvidas» a esclarecer. «É evidente que a parte são-tomense ainda tem muitas dúvidas, tem problemas em compreender por que é que o grupo tal está no bloco tal e não está no outro. São coisas que mais uma vez iremos falar, mais é necessário darmos sinais de um Estado organizado. Não podermos continuar nisto. Parece que São Tomé e Príncipe é que está a bloquear as coisas».

O tratado de exploração conjunta de petróleo entre a Nigéria e São Tomé e Príncipe foi assinado em Fevereiro de 2001 e estabelece 60% de receitas para os nigerianos e 40% para os são-tomenses.

Inácio Amorim

Trading Updates: AWARDS ARE OUT, JDA SAYS!! REUTERS CONFIRMS!! ERHE WINS BLOCKS 2 AND 4; PRICE UP 28%

The Nigeria-Sao Tome and Principe Joint Development Authority have awarded operatorship of Block 2 in the oil-rich Gulf of Guinea to a consortium of ERHC Energy, Devon Energy/Ocean Energy and Pioneer Natural Resources, and Block 4 to a consortium of ERHC Energy and Noble Energy.

The awards have instantly transformed our "minnow" into a substantial player in the world's petroleum industry, and dramatic price gains came with the news.

As day traders took profits during the lunch hour, the price has slipped back to $0.73 from a high of $0.81, but in the next few hours and days as more news emerges of our success and the larger market becomes aware of our price potential, we expect to see gains that dwarf any enjoyed so far.

Update, 4pm, 5/31/05: The closing price is $0.76, with the Bid $0.76 and the Ask $0.77, setting us up for more nice gains tomorrow. The closing volume was a record 13,569,500 shares, and it was climbing so fast all day I could barely keep pace with it. ADVFN reports there were 2,625 trades Tuesday, with 7,579,417 Buys and 5,553,339 Sells and 436,244 shares unidentified. Surprisingly, the last 41 trades were almost evenly divided between Buys and Sells, 21 to 20. There were 82,500 Buys and 75,212 Sells among those last trades, The share price gained $0.13, 0r 20.63 percent, an improvement of $15,995 for the ERHC On The Move portfolio of 120,000 shares.

Update, 3:59pm, 5/31/05: The price is $0.76, the Bid and the Ask is $0.76, with volume at 13,598,800.

Update, 3:57pm, 5/31/05: Looking for a close of $0.76. The price is now $0.75, the Ask, and the Bid is still $0.745. Volume is climbing to 13,481,200.

Update, 3:54pm, 5/31/05: We're better with the Bid at $0.745, the Ask at $0.75 and volume of 13,310,500 shares. The price is $0.745.

Update, 3:52pm, 5/31/05: Day-traders are taking a toll as the price slips to $0.735, the Bid, and the Ask to $0.74. Volume is up a quarter million shares to 13,255,700.

Update, 3:44pm, 5/31/05: The price is $0.745, the Bid is $0.74, and the Ask is $0.746. Volume has climbed 500K to 13,001,900 shares. Per ADVFN 15 minutes ago, there have been 2,444 trades today, with 7,046,875 Buys and 5,042,033 Sells, a Buy-Sell gap of 2 million shares.Some 418,244 shares were unidentified. Virtually all the action was on the Buy side in the last 41 trades.

Update, 3:37pm, 5/31/05: While our partner in Block 4, Noble Energy (NBL) is up $1.09, our Block 2 and Block 3 partner, Pioneer Natural Resources (PXD) is off $0.02, and our other Block 2 and 3 partner, Devon Energy, is off $0.53. That may have something to do with the second-rate Nigerian players we got saddled with in both blocks. So far as we know, the Dow Jones newswire has not yet corrected its reporting of the Block 2 award, which adds up to 105 percent, or clarified the relationship between the Pioneer/EER win of 10 percent and their MOU with ERHE. It may be that "EER" was supposed to be "ERHE," as EER is reportedly broke.

Update, 3:35pm, 5/31/05: The price is $0.745, the Bid, and the Ask is $0.749 as volume hits 12,550,600 shares. We're looking for modest daily gains through Friday.

Update, 3:28pm, 5/31/05: The price is $0.76 as volume climbs to 12,330,800 shares. The Bid and Ask are $0.75 x $0.76.

Update, 3:15pm, 5/31/05: We're starting the 3:15 Surge very close to 12 million shares, with volume at 11,928,500. The price is $0.76, the Bid, and the Ask is $0.755.
Update, 2:54pm, 5/31/05: The price slips back to $0.76, the new Ask, while the Bid stays at $0.755 and volume hits 11,613,500 shares.

Update, 2:52pm, 5/31/05: Volume is 11,612,600 shares and the Bid imporoves to $0.744, while the Ask and the price stay at $0.77.

Update, 2:49pm, 5/31/05: The price is $0.77 and the Bid $0.75, with volume now at 11,590,000 shares and just 40 minutes to go on the first day of trading our minnow-turned-whale.

Update, 2:47pm, 5/31/05: The price is $0.74. A three-cent gap had opened up ($0.74 x $0.77) but the Sellers blinked. Now the Bid and Ask are $0.74 x $0.75 and volume has reached 11,570,000 shares.

Update, 2:43pm, 5/31/05: Volume has climbed 400K in a few minutes to 11,489,500. On ADVFN's 15-minute delay at 2:28pm EDT, there were 2,169 trades today, with 6,092,324 Buys and 4,401,725 Sells. Some 385,000 shares were unidentified.

Update, 2:38pm, 5/31/05: The price is $0.775, and volume hits 11,300,800. The Bid is $0.77 and the Ask is $0.775. This must be the cheapest $5 billion company on Earth right now.

Update, 2:34pm, 5/31/05: Great lunch, and more great news from UpstreamOnline:

*******UPSTREAM NEWS************

Gulf of Guinea blocks awarded

By Upstream staff


Sao Tome and Nigeria have awarded five offshore oil exploration licences, after a controversial five-month delay between the countries due to corruption accusations.

The blocks are located in the deep waters of the Gulf of Guinea.

A consortium of ERHC Energy nabbed a 65% stake and the operatorship of block two, while the operatorship of the highly contested block four was won by a consortium of ERHC Energy and Noble.

Anadarko grabbed a 51% share and the operatorship of block three, the consortium of International Commerce and Communications (ICC) and Oil Exploration Consortium (OEC) got 75% and operatorship of block five, while block six went to Nigerian indie Filtim Huzod which won 85% and operatorship of the acreage.

The first licensing round was suspended after just one exploration contract was awarded for $123 million, to a consortium led by Chevron. The second round went through a bidding stage in December, receiving bids as high as $175 million.

Update, 2:12pm, 5/31/05: The market is catching its breath, and I'm going to lunch. The price is $0.755, the Bid, the Ask is $0.76, and volume is 10,570,000 shares.

Update, 2:06pm, 5/31/05: The price is $0.76, the Ask, and the Bid is $0.755, with volume still rising like crazy and now at 10,546,200.

Update, 2:01pm, 5/31/05: The price goes to the Bid at $0.745 and the volume reaches 10,515,900 shares.

Update, 2pm, 5/31/05: The price is $0.76, with the Bid at $0.745 and the Ask $0.76. Volume is 10,504,400 shares.

Update, 1:57pm, 5/31/05: The price is $0.75 and volume hits 10,423,500 shares.

Update, 1:56pm, 5/31/05: The price is $0.745, and the Ask $0.75, as volume scales to 10,396,000 shares.

Update, 1:53pm, 5/31/05: The Dow Jones story is a bit weird, because it shows
105 percent of Block 2 awarded, and shows Pioneer Natural Resources and Energy Equity Resources with 10 percent in Block 3, while Pioneer has a deal with us to exploit our 25 percent award there. Earlier reports showed our consortium winning 35 percent of Block 3, which makes more sense. The JDA may have released it this way for appearences' sake. In Block 5, no percentage is given for Godsonic, one apparent winner, which judging fromn the math got 5 percent since only 95 percent of the block is listed.

Update, 1:45pm, 5/31/05: Here is the Dow Jones story, at last - it was waiting for me all along at 12:54 from Mike in the Comments section. The blog is being overwhelmed with visitors, probably in the 10,000-visitor range or higher now.

MORE) Dow Jones Newswires

05-31-05 1217ET

DJ Sao Tome Awards 5 Oil Blocks In Second Licensing Round-2-

The first round of licensing offered for deep-water blocks thought by some to hold huge oil reserves was won by a consortium of companies led by Chevron Corp. (CVX).

In all, 26 bids from 23 companies for the five blocks, offered a total $433 million in signature bonuses.

The award process was delayed by five months and marred by allegations of corruption.

Table: JDA Licensing Second Round Results

Block 2

Devon/ERHC 65%

Equator Exploration/ONGC Videsh 15%

A & Hartman Resources 10%

Foby Engineering 10%

Momo Petroleum 5%

Block 3

Anadarko 51%

Devon/ERHC 25%

Pioneer/Energy Equity Resources 10%

Equinox Oil and Gas 10%

Ophir Energy 4%

Block 4

Noble/ERHC 60%

Conoil Producing 20%

Hercules 10%

Godsonic Oil

Atlas Petroleum 5%

Block 5

I.C.C.-O.E.O.C. 75%

ERHC 15%

Sahara Energy 10%

Block 6

Filtim-Huzod 85%

ERHC 15%

-By Shai Oster, Dow Jones Newswires; +44-20-7842-9357; shai.oster@dowjones.com


(END) Dow Jones Newswires

05-31-05 1237ET

http://www.amtddj.inlumen.com/
bin/djstory?StoryId=CqPVHqaebqLqWmduWmdm

Update, 1:43pm, 5/31/05: The price is $0.76, at the $0.76 Ask, while the Bid is at $0.755 and the volume has climbed over 10 million to 10,108,100 shares.
Update, 1:38pm, 5/31/05: The price is $0.76, the Ask, while the Bid is $0.765 and volume has climbed to 9,900,600. A second update on the Reuters story doesn't yet update the percentages in all five blocks, so we're still waiting on the Reuters Update 3 for details on the minority winners in each block.
Update, 1:33pm, 5/31/05: The price is $0.745, the Ask and the volume goes to 9,615,700 shares. We're searching for the Dow Jones story.

Update, 1:31pm, 5/31/05: The Bid and Ask move to $0.74 x $0.745 with volume unchanged.

Update, 1:29pm, 5/31/05: The price is $0.735, the Ask, while the Bid is better at $0.731, and volume reaches 9,605,700 shares.
Update, 1:26pm, 5/31/05: The price is $0.725, the Ask, while the Bid is $0.721 and volume soars to 9,496,700 shares.

Update, 1:24pm, 5/31/05: The price is $0.721 and the Ask $0.725 with volume at 9,438,400.

Update, 1:23pm, 5/31/05: We expect a $0.10 run to develop shortly. The price is $0.73, the Bid $0.724, and the Ask $0.735 opn volume of 9,396,799 shares.

Update, 1:21pm, 5/31/05: The price slips to $0.721, the Bid, while the Ask is $0.735 and we hit 9,392,000 shares.

Update, 1:20pm, 5/31/05: The Bid is $0.735, the price $0.744, and the Ask $0.735 as volume reaches 9,356,200 shares.

Update, 1:18pm, 5/31/05: The Bid is at $0.74, the price at $0.735 and the Ask at $0.745 as we hit 9,257,200 shares of colume.

Update, 1:16pm, 5/31/05: The price is $0.735, the Ask, with the Bid at $0.731 and volume at 9,223,100 shares - something like 100K shares a minute for a long time now.>br>
Update, 1:11pm, 5/31/05: Volume hits 9,066,600 with the price at $0.741, while the Bid slips to $0.731 and the Ask to $0.735.

Update, 1:09pm, 5/31/05: The price is $0.745, and the Bid and Ask are $0.743 x $0.745, with volume at 8,938,600 shares.

Update, 1:02pm, 5/31/05: The price is $0.74, the Bid, while the Ask is $0.745 as short-sighted day-traders exit with a $$0.10 - $0.15 gain. Volume is 8,563,500.

Update, 1pm, 5/31/05: The price is $0.745, the Bid and the Ask is $0.75 as volume hits 8,513,500 shares.

Update, 12:58pm, 5/31/05: Dow Jones is reportedly moving a breakdown of percentages in each block. We await it eagerly, as the price slips to $0.75 and the Ask to $0.755. Volume is 8,452,700, and we expect another boost when the DJ story circulates.

Update, 12:52pm, 5/31/05: Now is a good time to go to the Raging Bull board and read posters like Balance Builder, who will try to steer you right on events and prices. Some investors there can be trusted, but it's a dangerous swamp, so be careful. The price is $0.77, and the Bid and Ask are $0.765 x $0.77. Volume is just soaring incredibly and is now at 8,345,200 shares.

Update, 12:51pm, 5/31/05: The price is $0.755 as traders start to trickle back in from lunch and the volume continues to climb rapidly, now at 8,035,700 shares.

Update, 12:47pm, 5/31/05: The price is $0.762, the Bid, while the Ask slips to $0.765 and volume reaches 7,891,600 shares. We hope you're around for the Surge.

Update, 12:46pm, 5/31/05: The price is $0.774 and the Bid slips to $0.76 and rises to $0.77 and the Ask goes to $0.774 on volume of 7,827,900.

Update, 12:42pm, 5/31/05: We're starting to bounce again, with the price $0.776, the Ask $0.78 and volume 7,712.400.

Update, 12:42pm, 5/31/05: We're starting to bounce again, with the price $0.776, the Ask $0.78 and volume 7,712.400.

Update, 12:38pm, 5/31/05: As some day traders take profits early, the price slips to $0.77, the Bid, and the Ask to $0.772, on volume of 7.440,200 shares. The volume shows no sign of slowing down. Long-term investors have predicted in the past that as many as 40 million shares could trade on this day. We don't think that will happen, but we'll guess 12 million before the end of the day.


Update, 12:34pm, 5/31/05: The price slips to $0.785, up $0.155 for the day, with the Bid and Ask at $0.785 x $0.79 and volume at 7,244,500 shares. For investors, the price declines and peaks are familiar from the run-ups of last October and the summer of 2003, when awards were also expected but not made. The pphenomenon is likely to keep on happening all through the day, and the share price is likely to improve all week. We have won approximately 4 billion barrels of oil, after all.

Update, 12:31pm, 5/31/05: We hit 7 million volume, with the price at $0.80, the Bid at $0.802 and the Ask at $0.803, and volume at 7,067,400.

Update, 12:29pm, 5/31/05: The price is $080, the Ask $0.805, and volume is 6,688,800 shares. The Bid is $0.801.

Here is the very latest update from Reuters at 12:07, from the Yahoo board:

UPDATE 1-Nigeria-Sao Tome award five offshore oil blocks
Tue May 31, 2005 12:07 PM ET
(Updates with details)
ABUJA, May 31 (Reuters) - Sao Tome and Nigeria awarded five offshore oil exploration licences on Tuesday after a turbulent five-month delay plagued by disagreements between the countries and accusations of corruption.

A consortium of ERHC Energy (ERHE.OB: Quote, Profile, Research) and Devon (DEV.N: Quote, Profile, Research) won a 65 percent stake and the operatorship of block two, while the operatorship of block four, the other most highly contested block, was won by a consortium of ERHC Energy and Noble.

Anadarko (APC.N: Quote, Profile, Research) won a 51 percent share and the operatorship of block three, the consortium of International Commerce and Communications (ICC) and Oil Exploration Consortium (OEC) got 75 percent and operatorship of block five, while block six went to Filtim Huzod which secured 85 percent and operatorship of the acreage.

The Joint Development Authority announced the winners after Nigeria's President Olusegun Obasanjo and Sao Tome's Fradique de Menezes endorsed the recommendations of the ministerial council at a meeting in the Nigerian capital of Abuja, the JDA said.

The offshore blocks are in the deep waters of the Gulf of Guinea, one of the world's exploration hotspots since a series of huge oil discoveries over the last decade.

Update, 12:24pm, 5/31/05: Slipping suddenly to $0.795, with the Bid at $0.791 and the Ask $0.795. Volume is 6,233,800.

Update, 12:20pm, 5/31/05: We're at $0.81 now, and the ERHC portfolio is up $22,147 on the day. The Bid and Ask at $0.809 x $0.808, and volume is an incredible 6,124,700.

Update, 12:07pm, 5/31/05: The price improves to $0.765, the Ask, with volume at 4,983,600 moving faster than I can type. The Ask is $0.76.

Update, 12:04pm, 5/31/05: This stock is flying out the door, but the price is lagging behind interest as volume hits 4,674,800 and the price remains $0.735, with the Bid $0.736 and the Ask $0.738. Nonetheless, the 3:15 Surge this afternoon ought to be a regular force of nature.

Update, 12pm, 5/31/05: The price is $0.745, the Ask, and the Bid is $0.74, with volume over 4 million at 4,272,700.

Update, 11:52am, 5/31/05: The price is $0.73, and volume is 200K higher at 3,706,900, while the Bid and Ask are $0.725 x $0.73. This day has a long way to go.

Update, 11:50am, 5/31/05: The price is $0.707, the Ask, while the Bid is $0.706, and colume hits 3,449,000 shares. That's almost half a million shares in a couple of minutes.

Update, 11:44am, 5/31/05: The price is $0.70, and volume crosses the 3 million mark to 3,008,000. The Ask is $0.704, and the Bid $0.70.

Update, 11:42am, 5/31/05: The market has begun to respond, pushing the price to the high of the day, $0.695, on volume of 2,806,300 shares.

Update, 11:28am, 5/31/05: OFFICIAL WORD FROM REUTERS:

ABUJA, May 31 (Reuters) - Sao Tome and Nigeria awarded five offshore oil exploration licences on Tuesday after a turbulent five-month delay plagued by disagreements between the countries and accusations of corruption.

A consortium of ERHC Energy ERHE and Devon DEV won a 65 percent stake and the operatorship of block two, while the operatorship of block four, the other most highly contested block, was won by a consortium of ERHC Energy and Noble.

((Reporting by Felix Onuah and Tume Ahemba, Editing by Brian Killen; Reuters Messaging: tume.ahemba.reuters.com@reuters.net; tel: +234 1 263 1943))

Update, 11:28am, 5/31/05: We're settling down now, hoping for an official announcement at the close of business, which is 5pm in Abuja and 12:00pm here. However, the Nigerians seem to like an evening celebration, so I'm betting the news - if it comes as indicated - will be released around 8pm Abuja time, or 3pm here in the Eastern United States. The price is $0.66, the Ask, while the Bid is $0.65. Volume is 2,293,500 shares.

Update, 11:14am, 5/31/05: Awaiting confirmation of the news we just reported, the price has started slipping to $0.675 after hitting $0.685 on current volume of 2,045,600 shares. The Bid and Ask ar $0.671 x $0.675.

Update, 11:11am, 5/31/05: Word has come from the JDA to thedaneslapper via a phone call from them that the awards have been released. More ASAP. Don't you love these three-day weekends?

***More***
From Mark - Sec of JDA just called and Awards were just announced. ERHE in 2 and 4. ALL 5 blocks Awarded

Update, 11:04am, 5/31/05: The price has soared in the past few minutes to $0.68 on volume of 1,675,912 shares.

Update, 10:55am, 5/31/05: The price is $0.585, the Ask, and the Bid is $0,58 as volume hits 953,405 shares. We issue the following Alert: There has been a substantial change of cirumstances following the most recent delays in Sao Tome, and there is a genuine chance that, as President de Menezes meets for several hours with Presdent Obasanjo today, that the awards document will be signed. That would in all likelihood catalyze an enormous reversal in the downward slide of share price in frenzied buying. While that outcome cannot be guaranteed, it follows from De Menezes' expressed desire to bring the awards process to an end that - since he is the only hold-up - this resolution could occur today. While it is more likely that whatever modifications are made to the awards would not benefit ERHC Energy, it could well be that they would affect only the so-called Nigerian "indies," such as Momo Petroleum, Godsonic and Conoil. In that case, with agreement from the Sao Tome and Princiope opposition, awards could occur shortly. We believe these developments merit a Hold and Accumulate position on ERHE now.

Update, 10:54am, 5/31/05: Here are an English machine translation and the Portuguese original of the latest Lusa story from Sao Tome - a solid confirmation of what we've heard, posted by the proprietor of www.greatsprings.net/erhc, dadd17:

NEWS http://noticias.uol.com.br/ultnot/lusa/2005/05/31/ult611u63392.jhtm 31/05/2005 - 11h01 Is Tomé: PR are -tomense go to the Nigéria to decide problems on oil Are Tomé, 31 Mai (Lusa) - the president of Is Tomé and Príncipe, Fradique de Menezes, left today for Abuja (Nigéria), where he goes to congregate with its homologous Nigerian, Olusegun Obasanjo, in an attempt to decide divergences on the adjudication of the blocks of oil in the zone of joint exploration. The announcement of the meeting was made by president Fradique de Menezes, moments before leaving the international airport of Is Tomé with destination the Abuja for a sojourn of some hours. Beyond the process of auction of five blocks, Menezes it said the journalists that she will try next to its homologous Nigerian to unblock the relative question to the transference of the resultant value of the first adjudication to a petroliferous North American. "I go to find me with Olusegun Obasanjo to arrive at the end of these negotiations of as auction of blocks", affirmed Fradique de Menezes, adding will also go to decide the relative question to the first auction. The trip of the head of State is -tomense appears in the sequência of the two last meetings of the Joint Ministerial Advice of Oil between the two countries, that had resulted unfruitful due to agreement on the proposals in the picture of the adjudication of the five blocks in cause. Also to try to exceed the divergences in the meetings of the Ministerial Advice, carried through in the capital Nigerian, president Olusegun Obasanjo was, has few days, but without success, in one visits lightning to the capital is -tomense. The discord is arrested with the criterion of selecção of the competing companies to the blocks, with Is Tomé and Príncipe, of a side, to defend proposals monetary of petrolígeras, opposing the position of the Nigéria that gives priority to the time established for the oil production. In relation to the sum still for transferring, São-Tomé and Principe wait to receive 49 million dollar of the 123 resultant million of the adjudication of a block in ends of 2004 to the petroliferous company North American Chevrom-Texaco in would seem Exxonnopil. Signed in February of 2001, the treated one to joint exploration of oil establishes 60 percent of prescriptions for the 40 Nigéria and percent for Are Tomé and Príncipe.

31/05/2005 - 11h01
São Tomé: PR são-tomense vai à Nigéria para resolver problemas sobre petróleo

São Tomé, 31 Mai (Lusa) - O presidente de São Tomé e Príncipe, Fradique de Menezes, partiu hoje para Abuja (Nigéria), onde vai reunir- se com o seu homólogo nigeriano, Olusegun Obasanjo, numa tentativa de resolver divergências sobre a adjudicação dos blocos de petróleo na zona de exploração conjunta.

O anúncio da reunião foi feito pelo presidente Fradique de Menezes, momentos antes de deixar o aeroporto internacional de São Tomé com destino a Abuja para uma estada de algumas horas.

Além do processo de leilão de cinco blocos, Menezes disse aos jornalistas que tentará junto do seu homólogo nigeriano desbloquear a questão relativa à transferência do valor resultante da primeira adjudicação a uma petrolífera norte-americana.

"Vou encontrar-me com Olusegun Obasanjo para chegarmos ao fim destas negociações do segundo leilão de blocos", afirmou Fradique de Menezes, acrescentando irá também resolver a questão relativa ao primeiro leilão.

A viagem do chefe de Estado são-tomense surge na sequência das duas últimas reuniões do Conselho Ministerial Conjunto de Petróleo entre os dois países, que resultaram infrutíferas por falta de entendimento sobre as propostas no quadro da adjudicação dos cinco blocos em causa.

Também para tentar ultrapassar as divergências nas reuniões do Conselho Ministerial, realizadas na capital nigeriana, o presidente Olusegun Obasanjo esteve, há poucos dias, mas sem sucesso, numa visita relâmpago à capital são-tomense.

A discórdia prende-se com o critério de selecção das empresas concorrentes aos blocos, com São Tomé e Príncipe, de um lado, a defender uma propostas monetária das petrolígeras, contrariando a posição da Nigéria que dá prioridade ao tempo estabelecido para a produção de petróleo.

Em relação ao montante ainda por transferir, São-Tomé e Principe espera receber 49 milhões de dólares dos 123 milhões resultantes da adjudicação de um bloco em finais de 2004 à empresa petrolífera norte-americana Chevrom-Texaco em pareceria com Exxonnopil.

Assinado em Fevereiro de 2001, o tratado de exploração conjunta de petróleo estabelece 60 por cento das receitas para a Nigéria e 40 por cento para São Tomé e Príncipe.

RCN.

Update, 10:41am, 5/31/05: We're back to $0.585 but haven't sold any shares, per Money.net. Not sure how that happens.

Update, 10:40am, 5/31/05: The price slips to $0.575, below the $0.58 Bid, as volume closes in on 900K at 899,905.

Update, 10:38am, 5/31/05: The price improves to $0.585, the Ask, while the Bid stays at $0.576. Volume is 884,905.

Update, 10:36am, 5/31/05: The Bid slips back to $0.576, a tenth of a cent over the low of the day. The Ask is $0.585, and volume is on the move again, now to 878,905.

Update, 10:33am, 5/31/05: We're at $0.58, the Bid, with volume at 842,305 and the Ask lower at $0.585. I wonder if President de Menezes brought the awards document with him? Meanwhile, there's a general strike going on in Sao Tome as civil service workers demand a 340 percent increase in the minimum wage, to $100 a month from $30. How do you live on $30 a month? Barely, we suspect.

Update, 10:23am, 5/31/05: We're at $0.59, off $0.04, as volume moves far more slowly with traders awaiting the outcome in Abuja. It's now 833,215 shares, and the Bid is lower at $0.58, with the Ask still at $0.59.

Update, 10:23am, 5/31/05: The volume is 815,807, and the meeting in Abuja has been confirmed by an RDP Africa radio report from Homeport. The price is $0.585, the ABid, and the Ask is still $0.59.

Update, 10:19am, 5/31/05: The price is $0.59, with volume at 807,807 - hello, hello. The Bid is still at $0.585 while the Ask is lower at $0.59.

Update, 10:13am, 5/31/05: The price is $0.585, the Bid, with volume at 800,807, and the Ask at $0.60. I just had a chance to check Raging Bullfor updates, and there's one (a Comment below) from thedaneslapper that suggests President Fradique de Menezes is winging his way to Abuja to chat with President Obasanjo there. At least he's gong in the right direction:

****UPDATE****

Just spoke with JDA (source did not want to be named) and they confirmed Menezes is meeting with Obi today. I asked if awards were today and all they would tell me is to call back later today for update. That's all for now. Will update later hopefull.

Update, 10:04am, 5/31/05: We hit 700K, with the price $0.585, the Bid, and the Ask at $0.595, on volume of 711,507.

Update, 10:02am, 5/31/05: After a strong shake, it looks like volume is slowing for the moment as we stand $0.595, off $0.035.

Update, 9:59am, 5/31/05: We're at $0.595 again, improving, with the Bid and Ask $0.585 x $0.595 and volume hitting 689,857.

Update, 9:54am, 5/31/05: The price is $0.576, the volume is 648,907 with the Bid and Ask unchanged. We're off 8.5 percent.

Update, 9:53am, 5/31/05: The price is $0.576, with volume now 615,559, and the Bid falling to $0.576 and the Ask at $0.58.

Update, 9:49am, 5/31/05: The price is $0.58, on volume of 583,959, with the Bid and Ask $0.58 x $0.59.

Update, 9:46am, 5/31/05: Volume is over 500K at 519,971 and we're at $0.60.

Update, 9:44am, 5/31/05: With volume at a fast-paced 476,071, we're off $0.02 at $0.61. There must be tremendous buying support at this level or we'd have seen the $0.60s vanish in the heavy volume.

Update, 9:40am, 5/31/05: We're at $0.61, improving, on volume of 454,071, with the Bid $0.60 and the Ask $0.61.

Update, 9:38am, 5/31/05: We're off $0.03, less than expected, on volume of 433,471. Money.net has chosen this moment to stop working.

The Not-So-Latest From Sao Tome - In French And English

Update: Here is a another English-language piece from Agence France-Presse based on the French one below and adding a quiote from Nigerian officials at the bottom:

Promise of oil sparks fights

May 30 2005 at 03:33PM

http://article.wn.com/link/WNATCC1A8FFB65054DF7232EC056746FB14C?source=templategenerator&template=nigeriadaily/index.txt

São Tomé -- The tiny West African island state of São Tomé and Príncipe is beginning to tear itself apart ahead of a promised oil boom that could transform one of the poorest countries in the world.

Giant neighbour Nigeria has expressed concern over a delay in awarding five oil exploration contracts in the offshore development zone it has created on a 60-40 basis with the twin island archipelago in the Gulf of Guinea.

Only one block has so far been attributed, in February, when it was awarded to US oil companies ChevronTexaco and Exxon-Mobil, plus the Nigerian and Norwegian consortium, Equity Energy Resources.

It enabled São Tomé's parliament to approve the largest budget in the country's history, totalling $96,2-million (about R634-million) and including oil revenue, of $49,2-million, for the first time.

Government wants to spend the money on health and education

Fired up by the prospect, state employees began a week-long strike on Monday, closing ministries, hospitals and other services and virtually every school in support of a pay rise after talks with the government broke down.

They are seeking an increase in the minimum monthly salary from $30 to $100, while the government has offered $40, and have threatened to bring the country to a halt from the end of this week if their demands are not met.

But the government says $8-million of the windfall will be spent on priority projects including health and education, with the rest being needed for debt repayments.

On the political front, already poor relations between the main component in the ruling coalition, the São Tomé and Príncipe Liberation Movement-Social Democrat Party (MLSTP-PSD) and President Fradique de Menezes have worsened.

A month ago the head of the MLSTP-PSD-dominated parliament's oil commission, Carlos Neves, hit out at the procedure for attributing the five blocks, saying there had been "serious errors which harm the interests" of the country.

'Avoidable delays have been experienced'

He claimed certain oil companies had been favoured and attacked the alleged role of some presidential aides, notably Menezes' chief of staff who was accused of links to one company in particular.

Menezes yielded, sidelining the official from oil negotiations, but then found himself under attack for his own handling of the oil issue.

"We don't know what criteria have been used for awarding of the various blocks," said MLSTP-PSD spokesperson Carlos Tiny, demanding a judicial inquiry.

"Some companies were ruled out at the technical stage but are still being given a share."

Menezes retorted that problems had emerged because of agreements signed before he became president in 2001, but the row grew more bitter when he sacked his oil adviser, Patrice Trovoada, head of a smaller party in the ruling coalition.

Natural Resources Minister Arlindo Carvalho, a member of Trovoada's party, responded by handing in his resignation, which the president refused, on the grounds that negotiations over attributing further exploration blocks were in full swing.

Last week Nigeria's Deputy Foreign Minister Abubakar Tanko told a meeting of the neighbours' joint ministerial council that "nothing has been achieved due to undue politicisation of what should be a purely technical matter.

"Avoidable delays have been experienced in the awarding of blocks in this round."

"It is pertinent to note that the more delays that are experienced, the more the credibility of this laudable partnership and brotherhood is eroded, which I believe is not in the best interest of our governments and people," he warned.

"If we continue to allow extraneous factors to guide our thoughts and decisions, it will seriously affect the bond of our partnership and our brotherhood which had started becoming the envy of many countries with similar situations," he said.

Tanko's warning came two days after Nigerian President Olusegun Obasanjo made a lightning visit to the archipelago. Sources close to his São Tomé counterpart said he had "knocked heads together" in a bid to cool tensions. - Sapa-AFP

By Anonymous, at 12:14 PM

I won't have time to translate all of this for you, but get your kids to do it - most of them have at least a year of French! It's from Agence France-Presse, which is a reliable and uninvolved news agency. I notice in the first glance at it that it seems to be repeating the demand of Carlo Tiny of the MLSTP that the awards process go to the courts.

Now that I have had time to read it, the article seems to have missed the occurrence of the second meeting of the JMC, and is merely recapping all that went before.
There appears to be nothing new in it. There are several machine translations in the Comments section. Ou sont mon Pierette, mon Claudine?

Note that the earlier story, in French, has some different people quoted in it:

Sao Tomé et Principe en proie à la fièvre pétrolière,
déjà

Avant même d'avoir extrait son premier baril de brut,
l'archipel de Sao Tomé et Principe se déchire déjà
autour de son or noir, sujet d'une polémique qui
oppose depuis plusieurs semaines le président à son
opposition autour de l'attribution des puits de
pétrole.

Pauvre parmi les pauvres, le petit pays du Golfe de
Guinée attend depuis des années avec impatience ses
premiers pétrodollars. Longtemps retardés par un
différend frontalier avec le Nigeria voisin, les
premiers revenus pétroliers ont enfin été inclus dans
le budget 2005 de l'Etat santoméen, après
l'adjudication en février d'un premier bloc de la zone
conjointe entre les deux pays.

Cinq autres blocs devaient être rapidement attribués
et consacrer l'entrée officielle de Sao Tomé dans le
club jalousé des pays producteurs de pétrole. Mais
depuis quelques semaines, l'or noir et ses promesses
de richesse font tourner la tête des responsables du
pays.

Tout a commencé fin avril lorsque le principal parti
de la coalition gouvernementale, le Mouvement de
libération de Sao Tomé et Principe-Parti
social-démocrate (MLSTP-PSD), a critiqué le processus
d'attribution de ces cinq blocs, qualifié de
"frauduleux".

"Il y a dans ce processus de graves erreurs de
procédure qui affectent les intérêts de Sao Tomé", a
déploré le président de la commission pétrolière de
l'Assemblée, à majorité MLSTP-PSD, Carlos Nevès.

Et de dénoncer les droits octroyés à certaines
compagnies pétrolières en vertu d'accords passés et le
rôle jugé "trouble" de certains proches du président
Fradique de Menezes, particulièrement celui de son
directeur de cabinet accusé d'avoir des intérêts dans
une compagnie pétrolière.

Après quelques jours de polémique, le chef de l'Etat a
finalement décidé d'écarter son collaborateur des
négociations pétrolières. Mais l'incendie est reparti
de plus belle lorsque le MLSTP-PSD, en guerre larvée
avec le président depuis son arrivée au pouvoir en
2001, a mis en cause sa gestion personnelle du
dossier.

"On ne sait quel sont les critères utilisés pour
l'attribution des différents blocs. Certaines
compagnies ont été exclues lors de l'examen technique
mais ont malgré tout bénéficié de parts", s'est étonné
le porte-parole du MLSTP-PSD, Carlos Tiny, avant de
demander l'ouverture d'une enquête judiciaire sur la
question.

Le chef de l'Etat a vivement réagi et affirmé devant
la presse que "les problèmes (du dossier pétrolier)
sont apparus à cause des accords signés avant (son)
entrée en fonction".

Loin de se calmer, la polémique a atteint son
paroxysme lorsque le président de Menezes a congédié
son conseiller pour les affaires pétrolières Patrice
Trovoada, par ailleurs secrétaire général d'un parti
de la coalition gouvernementale qui lui est opposée,
pour avoir évoqué les "nuages" qui obscurcissent le
dossier pétrolier.

Membre du même parti, le ministre des Ressources
naturelles Arlindo Carvalho a riposté le 16 mai en
présentant sa démission. Le président l'a refusée, au
motif que l'Autorité conjointe Sao Tomé-Nigeria était
est en pleine négociation sur l'adjudication des
blocs.

Il aura finalement fallu la visite éclair à Sao Tomé,
dimanche dernier, du président nigérian Olusegun
Obasanjo et, selon des sources proches de la
présidence santoméenne, un rappel à l'ordre "musclé"
pour que la fièvre de l'or noir qui s'est emparée de
l'archipel retombe. Provisoirement.

Début mai, un défenseur des droits civiques dans la
province angolaise de Cabinda en visite sur l'archipel
avait mis en garde ses hôtes contre la "malédiction"
du pétrole. "Les politiciens feront de ce pétrole leur
richesse personnelle", avait dit Raul Danda,
"réservant à la population le cauchemar de la misère".

Nigeria, Sao Tome Feuded Over Priorities, Lusa Says

The dispute that ended the Nigeria-Sao Tome and Principe Joint Ministerial Council meeting on awards for the second licensing round of blocks in the two nations' Joint Development Zone Thursday was over priorities, a source told the Portuguese news agency Lusa, but the source felt the two heads of state would "probably" work the issue out between themselves - as paragraph 48 of the the 2001 Abuja Declaration directs them to do when there is a disagreement - within 15 days.

The priorities, of course, were whether the Joint Development Authority should accept the highest bidder or the best "technical" bid, meaning the one most likely to acomplish a quick return of oil royalties to the two countries, the source told Lusa, as reported here several weeks ago in the face of scathing criticism.

In another news report, Sao Tome Natural Resources minister Arlindo de Carvalho told a radio station that arrangements had been made for a quick payment of the $49 million, but the oil minister added that the dispute over the awards remains on the table.

The meeting ended without agreement on that point, according to the source that talked to Lusa - contradicting the communique issued by the Joint Ministerial Council Secretariat Friday afternoon - and now the two heads of state, President Olusegun Obasanjo of Nigeria and President Fradique de Menezes of Portugal, will probably resolve it within 15 days, said the source said, who demanded anonymity.

That may happen, but history doesn't indicate it will. If it does, it now appears the reason may be the demand by Nigeria that Sao Tome pay its share of $15 million in costs run up by the Joint Development Authority, which must be paid for out of signature bonus fees paid to the two countries. A $49 million bonus fee awaits Sao Tome in a Nigerian bank, Nigerian deputy foreign Minister Abubakar Tanko said last week, if and when they do sign the awards document.

However, no money would go to Sao Tome from that sum if it has to pay its share of costs and also repay a recent $44 million loan from Nigeria meant to tide them through the delays caused by ExxonMobil's lengthy cnsideration of its rights in the JDZ.

Here is my translation of the original story in Portuguese:

27/05/2005 - 3:15pm
São Tomé: Nigéria e São Tomé em desacordo sobre venda de blocos de petróleo

Sao Tome and Nigeria in Disagreement Over Sale Of Oil Blocks

São Tomé, 27 Mai (Lusa) -- A Nigéria e São Tomé e Príncipe discordam sobre o processo de adjudicação de blocos de petróleo de uma zona de exploração conjunta entre os dois países, revelou hoje à Lusa fonte oficial.

Nigeria and Sao Tome are in diagreement over the the process of awarding blocks of oil in a joint exploration zone between the two countries, an official source revealed to Lusa today.

Segundo uma fonte do conselho petrolífero do arquipélago que pediu anonimato, a reunião iniciada terça-feira em Abuja, capital da Nigéria, entre as autoridades do petróleo dos dois países, foi infrutífera, por falta de entendimento entre as partes sobre as propostas para a licitação de cinco blocos da zona de comum acordo de exploração.

According to the source on the national petroleum council who demanded anonymity, a meeting that began Tuesday in Abuja, the Nigeran capital, between the authorites on petroleum from both countries, was fruitless, as it failed to reach an understanding between the parties on bids in the auction of five blocks of their agreed-upon exploration zone.

A mesma fonte sublinhou que não tendo o conselho ministerial de exploração conjunto resolvido a questão de desentendimento entre as partes, a decisão será, provavelmente, tomada dentro de quinze dias pelos chefes de Estado, Olusengu Obasanjo da Nigéria e Fradique de Menezes de São Tomé e Príncipe.

The same source stressed that while the Joint Ministerial Council had not resolved the questions in disagreement between the countries, there will probably be a decision within fifteen days by the heads of state, Olusengu Obasanjo of Nigeria and Fradique de Menezes of Sao Tome and Principe.

A fonte acrescentou que a discórdia prende-se com o critério de selecção de empresas concorrentes aos blocos, com São Tomé e Príncipe, de um lado, a defender a proposta monetária apresentada pelas petrolíferas, contrariando a posição da Nigéria que dá prioridade ao tempo estabelecido para produção do petróleo.

The source added that the discord was fanned by the criteria for selection of companies competing for the blocks, with Sao Tome and Principem on one side preferring the monetary bids offered for the oil, and with Nigeria in a contrary position saying that the priority should be based on the time needed to produce the oil.

A mesma fonte referiu ainda que, como forma de pressionar a parte são-tomense a ceder, a Nigéria teria apresentado um ultimato a São Tomé e Príncipe para pagar uma divida de cerca de 15 milhões de dólares resultante dos serviços da autoridade conjunta de exploração entre os dois Países.

The same source revealed that as a form of pressure on the Sao Tome side ro yield, Nigeria had presented to Sao Tome an ultimatum to pay its share of nearly $15 million resulting from the serviceces of the Joint Development Authority of the two countries.

A delegação ministerial de São Tomé e Príncipe, que regressou esta tarde desta falhada missão petrolífera em Abuja, não prestou qualquer informação à imprensa, relegando os jornalistas para uma posterior comunicação ao país.

The ministerial delegation that returned to Sao Tome and Principe this afternoon from the failed oil mission in Abuja would not lend any insights to the press, directing journalists to a later national address.

Além do ministro dos Recursos Naturais, Arlindo de Carvalho, integraram a delegação são-tomense, o ministro dos Negócios Estrangeiros, Ovídio Pequeno, o ministro da Defesa, Óscar Sousa, o ministro de Plano e Finanças, Adelino Castelo David, e um assessor do Presidente da República para o sector petrolífero.

Beyond the minister of the Natural Resources, Arlindo de Carvalho, included in the Sao Tome delegation were Minister of Foreign Commerce Ovidio Pequeno, Minister of Defense Oscar Sousa, the Minister of Planning and Finance Adelineo Castelo David, and the advisor to the President of the Republic on the petroleum sector.

Esta reunião sem êxito que aconteceu quatro dias depois do Presidente da Nigéria, Olusengu Obasanjo, ter efectuado uma visita relâmpago a São Tomé e Príncipe, surgiu na sequência de um pedido da parte são-tomense no sentido de se rever o processo de adjudicação de blocos da zona de sobreposição.

The unsuccessful meeting happened four days after Nigerian President Olusegun Obasanjo had put in motion a stormy meeting in Sao Tome and Principe at the request of the Sao Tomese, who felt strongly that the award of the of blocks in the zone had to be reversed.

Há quase duas semanas, as autoridades de São Tomé e Príncipe, sobretudo, a Assembleia Nacional, exortaram o Governo de Damião Vaz Almeida a rever as propostas do documento antes da conclusão do processo de adjudicação de blocos face à denúncia de irregularidades.

It's been two weeks since authorities on Sao Tome and Principe, especially the National Assembly, implored the government of Prime Minister Damiao Vas d'Almeida to reject the bid document before completing the process of awarding the blocks in the facce of criticism of irregularities.

A denúncia de irregularidades na adjudicação de blocos foi tornada pública há três semanas na capital de São Tomé através da imprensa por alegado favoritismo de petrolíferas, nas quais, alguns dirigentes são-tomenses são accionistas, envolvendo figuras próximas do Presidente da República, Fradique de Menezes.

The criticism of irregularities in the award of the oil blocks has generated a public tempest in the press for three weeks in the Sao Tome capital over allegations of favoritis, springing from t some Sao Tomese directors and shareholdders involved who are close to the President of the Republic, Fradique de Menezes.

No âmbito da polémica instalada em São Tomé, o Movimento Libertação de São Tomé e Príncipe-Partido Social-democrata (MLSTP-PSD) no governo acusou o Presidente Fradique de Menezes de estar a violar a lei-quadro das receitas de petróleo em benefício próprio.

In the ambience of controversy prevailing in Sao Tome, the ruling Movement for the Liberation of Sao Tome and Princiope and the Social Democratic Party accused President Fradique de Menezes of violating the law by having benefitted himself from oil revenues.

Assinado em Fevereiro de 2001, o tratado de exploração conjunta entre os dois Países estabelece 60 por cento de receitas para Nigéria e 40 para São Tomé e Príncipe.

Signed in February of 2001, the joint exploration treaty between the two countries provides that 60 percent of the revenues go to Nigeria and 40 percent to Sao Tome and Principe.
RCN.

JMC Secretariat Asks 'More Patience' From Stakeholders As It Seeks "Speedy Endorsements'; Two Posts From Homeport In Trading Updates Suggest Bad News

JDA Communique, Page 2

Page 2 says the Joint Ministerial Council delegates from both countries "harmonized" on all the blocks, and asks "more patience" of stakeholders as it makes "spirited efforts" to obtain signatures.


Update, 5/27/05, 3:59: Although we are keeping our 120,000 shares, we recommend to anyone who may need their money with the next month or two to sell, as there appears to be a long, drawn-out process much like the last one ahead for us. Thus, the advice below is no longer operative, having been overtaken by Radio Africa RDP news reports of the Prime Minister's statements on Sao Tome radio.

Sorting Out The News
There's an awful lot of confusion, as always; today, it's about the Communique from the Joint Ministerial Council Secretariat this morning and three articles from UpstreamOnline, Reuters and the Dow Jones Newswires. What do they add up to?

First, as I said in the preceding article (just updated), I think that the reporters are taking anything the JDA says with a grain of salt, having been burned too many times by bad information they went to press with; their editors are probably furious that their news organizations have bween wrong so many times about the where and when of awards.

The reporters state the facts: 1) that there was no announcement of awards; and 2) that the JMC Secretariat statement did not promise an announcement at any specific time. So they did their job; the headlines merely reinforce what they said, that there was a meeting and that no awards came from it, and that the results of the meeting have been forwarded to the two heads of state for signature.

Second, we did get word via a Comment that Obasanjo has returned from Paris and signed the awards document.
Third, we believe that the surge in EEL's price on the London AIM today is evidence that ADI party leader Patrice Trovoada got at least some of what he wanted, so that he and his party will join with the MDFM, their Christian Democrat allies and move the awards forward in the National Petroleum Council, the National Petroleum Agency and Parliament. It should be noted that unless there was a very substantial change, the first two bodies have already seen and approved the awards with caveats that were addressed by the second meeting, and in fact may not have to see them again. It's difficult to be sure on that point.

Fourth, we think the MLSTP, the ruling party whose Damaio vaz de Alemida is Sao Tome's Prime Minister, has also gotten what it wanted - a thoroughgoing embarrassment of the de Menezes presidency through the resignations of himself and two others (one of which was rejected) and the firing of Patrice Trovoada. If they will have calculated correctly, they have done all the damage they can do to the de Menezes candidacy without also bankrupting the country for the next several years, and inheriting a shell of a nation when they next seize the top spot.

It is my very firm belief, then, that action on the awards will be forthcoming within the Memorial Day Weekend, and that the awards will become known by Tuesday night at the very latest; I don't think they will wait until Tuesday, however.
Along with dozens of others, I have been wrong before about these awards and their timing, but I have not felt more certain than I do now that they are due within three days.

Trading Updates: We Recommend A Sell, But Are Not Selling Ourselves

The share price of ERHC Energy (OTC BB symbol: ERHE) broke away from yesterday's close and began climbing this morning after Nigerian and Sao Tome officials indicated they had finally reached agreement on block awards and were awaiting signatures from Nigerian President Olusegun Obasanjo and Sao Tome and Principe's President Fradique de Menezes.

A story from UpstreamOnline like one from Reuters said the awards meeting of the Nigeria-DRSTP Joint Ministerial Council ended yesterday with the delegates from both countries, who are slated to share oil royalties from their Joint Development Zone in the Gulf of Guinea on a 60:40 basis, "harmonized" on who wins and sending the awards document to their respective leaders for signatures.

A two-page communique from the parties says the same thing. Here is Page 1:


JDA Communique on Block Awards
Right-click on Page 1, above, and select "Open Link" to view it in a larger size. Page 2 says the delegates from both countries "harmonized" on all the blocks, and asks "more patience" of stakeholders as it makes "spirited efforts" to obtain signatures.

Trading Updates
Update, 5/27/05, 5:33pm EDT: The sellers obviously dominated today, but in the last 41 trades the Buys outpaced Sells 25 to 16, with some $88,000 Buys and 63,000 Sells. The very last trade was a Form T after-hours Sell of 9,500 shares, and the preceding two last trades in normal trading were Buys of 3,000 and 1,000. The Buys for the day totaled 1,062,027 shares, and the Sells totaled 1,645,291 shares, with 69,908 unidentified. It's incredible how closely this selloff resembles that of the collapse at this time last year, although this time around the share price ended on an uptick at $0.63. The one after-hours Form T sale went off at $0.62, however; the low of the day was $0.60, while the high reached $0.70 early in the day.

Update, 5/27/05, 4:02pm EDT: The closing price is $0.63, the Ask, and the Bid is at $0.62. Final volume sounds lucky, but it isn't: 2,777,100 shares.

Update, 5/27/05, 3:55pm EDT: A major selloff is underway, with 2,658,500 shares traded and the price at $0.625, the Bid at $0.62 and the Ask at $0.625.

Update, 5/27/05, 2:38pm EDT: The 3:15 Surge has brought some trades, with volume climbing to 1,429,500 even though most brokers are trying to get home for the holiday weekend ahead. The price is $0.65 and we recommend selling if you need the money anytime soon. The Bid and Ask are $0.64 x $0.655. Our explanation for the recommendation, which supersedes the the article on top of this one, appears immediately below. Note: I am not selling anything other than the 3,040 shares I already sold to raise some money to pay June bills. I still have 120,000 shares.

The latest news from Homeport is decidedly bad and could produce a late-trade selloff, as it suggests that MLSTP Prime Minister Damaio Vaz d'Almeida is amenable to starving Sao Tome for a few more months to try to win his case in arbitration of the International Chamber of Commerce in Paris, which first ensured ERHC Energy its rights.

Since the process has been flawless from a technical and legal viewpoint - especially after any potential cnflicts of interest were eliminated by the firing of Patrice Trovoada and the resignations of Mateus Meira Rita and Arlindo de Carvalho (since rescinded) and of President de Menezes from the presidency of the National Petroleum Council, we see this as a delaying action that will prepare the way for a reemergence of ExxonMobil and a no-confidence vote to force elections in Parliament.
The ex-communist MLSTP leadership is still inspired by the Siege of Leningrad, where millions of Russians starved for a year to hold off the Nazis, and are willing to let Sao Tome suffer for as long as it takes to make ExxonMobil and a few of their politicians rich, in my not-so-humble opinion.

Update, 5/27/05, 2:38pm EDT: A second Investors Hub post from Homeport, in whom we detect a pro-Portuguese, pro-MLSTP bias, says the talks "were fruitless" and that nonetheless a "decision" will be made within two weeks. That looks like the long, slow arbitration route to us, at this point. In our experience, Marxists are always willing to let the people starve if it is for a good political advantage. It makes not much sense, but does anything? Here it is:

Posted by: Homeport
In reply to: None Date:5/27/2005 2:43:15 PM
Post #of 3264

ERHE: Portuguese Lusa agency reporting ex-STP that latest Abuja talks were "fruitless" and that two presidents are likely to take a decision within a fortnight. It cites Petroleum Council source who asked to remain anonymous.

Lusa quotes source as saying bilateral disagreement centered on "criteria for selection of companies competing for five blocks" with STP defending priority of signature bonuses against Nigeria's preference for proposed production timetables.

Official reportedly said one stick Nigeria was using to get its way was to press STP to pay up USD 15 Mn in expenses incurred by the JDA.

Digest and spew out some veteran analysis, folk. The story is in Portuguese at www.lusa.pt, but possibly only on reserved service.

Bests,

Homeport

Update, 5/27/05, 2:38pm EDT: According to the Portuguese news agency Lusa, all civil service unions and the teachers' union have joined in calling for a general strike beginning Mobnday, June 1, in a demand for a 340 percent increase in the minimum wage. It doesn't sound like a great week for President Fradique de Menezes, who can only give them the money if he signs the awards, and the ruling MLSTP may not allow him to sign so they can take advantage of the turmoil and the strike.

Update, 5/27/05, 2:38pm EDT: A post from Homeport On Raging Bull's ERHE message board says a "declaration" is forthcoming from Prime Minister Damiao Vaz d'Almeida of the MLSTP, the party that runs parliament in opposition to President Fradique de Menezes. The report originates with Radio Africa RDP (Radio Diffusion Portugal), which catalyzed the original problems with its report of corruption the JDZ process. The radio network may be thought of as an extension of the Portuguese government, which was upset that it came too late to the party to win a part of Blocks 2 through 6. Like other Portuguese news reports, it is suspect in that it only tells the Portuguese-speaking peoples' side, not the Nigerian or other sides of this complex, fast-moving story. The good news is that according to RDP Africa, there were no changes in the awards document; the bad news is that the delgation seemed unhappy that there were no changes.

Here is the Homeport post:

From Homeport:
ERHE: FYI, Portuguese RDP-Africa radio reporting ex-Sao Tome that JMC delegation just arrived home from Abuja - wordless, but with "preoccupation visible on their faces."

While delegation made no statement on arrival, radio reports PM Damiao Vaz d'Almeida expected to make a public declaration later today.

RDP-Africa cites an unnamed member of the delegation as telling it it "very difficult" to negotiate with the Nigerians.

In Abuja, the Nigerians had not been open to changing a single "comma" in their earlier stance on the awarding of five JDA blocs (NB: apparently a reference to the JMC decisions of late April), the unidentified official was quoted as saying.

He added that STP viewed Nigeria´s position as unfavorable to Sao Tome, while favoring Nigerian companies.

Bests,

Homeport

Update, 5/27/05, 2:09pm EDT: The price is $0.665, the Ask, while the Bid is $0.66. Volume has topped a million shares, and now stands at 1,184,200.

Update, 5/27/05, 1:37pm EDT: Here are two of the more recent Updates available, one from Markviol10 and one from Vincent Nwanma of Dow Jones Newswires.

****UPDATE****
from the "Slapper"

Just spoke with Secretary of JDA. This is the same fellow who told me what we'd have a PR yesterday and we did. He told me Obansanjo has already signed and that the STP delagation just left for home today. I asked him when Menezes will sign and all he would say is "read the press release and use your head this is done."

Basically what he is saying is that STP would not have agreed on all block winners "harmonised" if Menezes was not going to sign off on all this. Menezes will sign at any time apparently. He said he can't speak for Menezes obviously as to when he will sign but he reiterated that "all is done."

He also mentioned that both parties wanted this done as soon as possible.
Take it for what it's worth folks but this looks very good IMO. Call JDA if you want to verify.

And here's today's Dow Jones article on the awards, which takes the same tack as the Reuters and UpstreamOnline pieces. I think you are beginning to see reporters who have been burned too many times responding to new announcements with great caution. Good for them!

Here;s the Dow Jones story, courtesy of trusted poster Ruby1100:

DJ Still No Award On Nigeria-Sao Tome Oil Blocks
by Vincent Nwanma
Dow Jones Newswires

LAGOS (Dow Jones)--The Nigerian-Sao Tome Joint Development Zone failed to award oil blocks after three days of meetings that ended late Thursday.
But the group which overseas the highly prospective offshore Gulf of Guinea fields said it had reached ""a harmonized position" that would have to be approved by both countries' presidents.

The statement quashed speculation officials from Nigeria and the tiny island state of Sao Tome had been able to end five-months of haggling over the awards of the promising oil blocks.

The awards process has been marred with allegations of corruption and influence peddling. Sao Tome, an island of 170,000 people, has suffered one coup attempt in 2003 and last week the oil minister tendered his resignation, shortly after his chief advisor left his post.

This is the second licensing round for five blocks.

The first round ended with only one block awarded to a consortium led by Chevron (CVX) which bed $123 million. The second round closed Dec. 15 with bids as high as $175 million, but officials have been deadlocked ever since.

Nigeria is the world's eighth biggest oil producer.

Sao Tome currently produces no oil, but its blocks are thought to hold billions of barrels.

Nigeria and Sao Tome ended years of dispute over control of the region with a treaty in 2000, agreeing to jointly administer the area.

A Nigerian diplomat early this week said officials of the JDA should not "allow external factors" to influence their decisions on the award of the blocks.

"Now is the time for them to rededicate themselves to the objectives of the JDA," he said.

Update, 5/27/05, 1:13pm EDT: The price is $0.66 as Sao Tome time hits 6pm without any word of a signature from President de Menezes. The Dow Jones story is out and also toes the line established by Reuters that the talks ended in failure. Oops - now it's $0.65, the Bid, and the Ask is $0.66, with volume leaping to 866,334 shares. I hope my sale didn't scare anyone, as I simply ran out of dough, not out of confidence.

Update, 5/27/05, 12:47pm EDT: I just sold 3,040 shares to pay my June bills and carry me through the Memorial Day weekend. I continue to hold 120,000 shares, and since I sold the expensive ones ($0.58 and $0.59), my average cost ought to go down below the former $0.4394. I hated to do it because the $2,057 I got would have been worth about $9,000 in a few weeks, I think. I got $0.68 for the shares after waiting a few minutes at the Ask. The price is now $0.671, the Bid, and the Ask is $0.675, with volume now at 717,614 shares.

And E*Trade, by the way, gets some big props from me today: Without even telling us customers, they lifted the limit on the number of transfers you can make on a given day. They formerly had a limit of one transfer a day, so you could transfer from your brokerage to your E*Trade Bank (you couldn't transfer directly to your home bank) and then the next day could transfer to your outside bank. Now they let you send money back and forth to your outside bank directly from your brokerage account as often as you want, so long as the transfers don't exceed $25,000. This is great, and I thanked Robert, the brokerage aide, and the company for making my life a lot easier.


Update, 5/27/05. 12:30pm EDT: The price is $0.68, the Ask, and the Bid is better at $0.675 as volume hits 652,414.

I got the following interesting note from a French journalist whose name I recognize, and well link to his stories when they are published:

Dear Joe,
thanks for your blog
one of the very fews french journalists regularly
assigned in Nigeria, and more globally in the Gulf of
Guinea, I'm regularly reading with great interest your
site

I'm presently back from stp, where I was at the core
of the crisis which finally push OBJ to make a 4 hours
visit to STP. And from hallmark to Equador, as from
Patrice Trovaoda to Exxon Mobil, or Emeka Offor to
alhadji dangote via Wabara it was a very interesting
trip.

As a desillusionment. After two weeks of intense
interviews and travel into this so beautiful little
big country, looks like stp in falling into the same
problematics of the oil curse than its
neighbours...Money and indies oil companies for a
few, despair for the majority
a majority of sao tomean which show, since a couple of
months, their first signs of angryness. Just before
leaving, I attend to the first protest in the stp
history of students from the national high school

so, my point of view is that stp, in between Naija and
Angola, and under high scrutiny of your country (
and let's not forget China which could come back after
the next elections) is really at a turning point....

anyway, It was just to keep in touch with you
you can check my last articles ( some in english) via
my name + africa on google, and please, let's stay
tuned, my articles should be soon published in french
daily Liberation as in monthly magazines

yours, sincerely
Jean Christophe Servant

Update, 5/27/05, 12:03pm EDT: The price is $0.671, the Bid, and the Ask is still at $0.68 as volume closes in on 600K at 594,414 shares. If President de Menezes meets the plane, gets the document and signs it, we would see action before the close. I am not sure how unlikely or not that scenario may be. There seems to be substantial anxiety to get the deal done on all sides.

Update, 5/27/05, 11:47am EDT: The Bid and Ask are $0.671 x $0.68, and volume has climbed to 594,099 going into the lunch hour, so it's likely we'll hit 1 million or more - unless President De Menezes signs the awards document, in which case we'll hit 3 million if news comes after 3pm.

Update, 5/27/05, 11:05am EDT: The price is still $0.675, after having fallen to $0.66, and volume is a healthy 474,766 shares. Bid and Ask remain $0.67 x $0.675.

Update, 5/27/05, 10:13am EDT: The price slips to $0.675 on volume of 346,146 shares, while the Bid falls to $0.67 and the Ask slips to $0.68.

Update, 5/27/05, 10:07am EDT: Reading the Communique with a magnifying glass, page 1 says that the due diligence from the 2004 round was scrutinized and more analysis was done, and the JMC concluded that everything had been done in conformity with the Abuja Declaration. We're waiting for Page 2.

The price is $0.685, the Ask, while the Bid is $0.68. Volume is 336.146 shares.

Update, 5/27/05, 10:02am EDT: The price is $0.69, the Bid, and the Ask is $0.695, with volume at 271,146 shares.

Update, 5/27/05, 9:52am EDT: The price is $0.699, the Ask, with the Bid at $0.69 and volume 219,508 shares.

Update, 5/27/05, 9:48am EDT: An Update from the JMC is circulating, per a Comment below this post:

There is a PDF of the communique from the JMC. Looks positive, says heads of state have to approve 'per the treaty'.

Will try and get whole thing here soon.

Update, 5/27/05. 9:42am EDT: The price is $0.699 as the Bid rises to $0.695 and then falls to $0.69 on 196,508 shares.

Update, 5/27/05. 9:41am EDT: The price is $0.69 as volume moves to 169,008.

Update, 5/27/05. 9:40am EDT: The price is $0.699, up $0.034 on 164,508 shares of volume. The Bid and Ask are $0.69 x $0.699.

Article Probes Goodworks, Attacks Jeter, But Offers No Evidence

An article in a small Nigerian newspaper, the Port Harcourt Telegraph, today attacks former U.S. Ambassador Howatd Franklin Jeter and the head of his his "lobbying" firm, Goodworks International, LLC, but after a highly suiggestive train of allegations reveals there is nothing to support them. It has the appearance of a "hatchet job" that might have been sponsored by ExxonMobil, a disappointed suitor in the second licensing round for five blocks of the Nigeria-Sao Tome and Principe Joint Development Zone.


ExxonMobil President Rex Tillerson
Joe Shea/The American Reporter

ExxonMobil's vast power extends throughout the U.S. government and across the nation and the world. Through its hundreds of thousands of employees and legions of consultants, it seems to have mounted a full-scale attack on the Joint Development Authority block awards, including a hornet's nest of opposition in Sao Tome and a series of damaging intelligence reports and other initiatives that seem aimed at undermining the Obasanjo government in Nigeria and the De Menezes government in Sao Tome while getting the awards process reopened so they may take part.

President Obasanjo met Jeter and was honored at a dinner sponsored by Goodworks and former U.N. Ambassador Andrew Young during his recent visit to the United States.

ExxonMobil is being investigated at present for its role in bribery of the government of Equatorial Guinea, along with smaller oil companies. Sao Tome officials have hinted that angry "oil majors" are bnehind the problems. Tens of billions of dollars are at stake in the awards process.

Thursday, May 26, 2005 4:20 PM
Obasanjo's multi-million dollar lobbyist exposed
by Jonathan Elendu

Until just a few days before the launching of Pres. Olusegun Obasanjo's Presidential Library, very few Nigerians had heard the name, Carlton Masters, let alone his company, Goodworks International, LLC. Goodworks is an Atlanta based lobbying firm founded by Obasanjo's long-time friend and former United States Ambassador to the United Nations, Andrew Young, and Carlton Masters, a naturalized American. Masters served as a former Deputy Minister of Trade and Agent-General to the United States for Ontario, Canada.

The firm, GWI, founded by Andrew Young and Carlton Masters in 1997, lobbies the United States government on behalf of Nigeria. The relationship between this company and Obasanjo's government has made some past and present top government functionaries uneasy.

In recent years there have been growing concerns among Nigerians that the various governments from the Babangida era to date have used influential African Americans to sustain their power, to the ultimate detriment of Nigerian masses. A few prominent Nigerians privately express concern at the growing influence Andrew Young, Carlton Masters and their company, Goodworks International, LLC have on the Obasanjo Government.

Goodworks International enjoys a multi-million dollar lobbying contract with the Federal Government of Nigeria. There are also rumours that Andrew Young, and his partner, Carlton Masters are secretly involved in other aspects of the economy, especially in the oil and telecommunications sectors.

Disregarding national pride, propriety and common sense, the Obasanjo Presidential Library has engaged Carlton Masters, an American, as one its Co-Chairmen. The Obasanjo Presidential Library was launched on May 14th and was reported to have realized about six billion naira in one day.

On the day of the launching of the Presidential Library, this writer had a brief conversation with Masters and requested an interview with him. Initially, Masters responded favourably to an interview, but after a few transatlantic calls with him, he changed his mind and suggested we talk to his lawyer instead.

We since discovered that his interview with Sowore Omoyele, a columnist and special correspondent for ELENDUREPORTS.COM, upset him. His lawyer called Omoyele to threaten him. But harassing Nigerians is not new to Masters. In the past he had threatened Nigerian journalists including former NEWS magazine Abuja Bureau Chief, Alex Kabba.

Kabba, who now publishes African Abroad USA, confirmed that Masters and his colleague, Amb. Howard Jeter, called to threaten him shortly after he published a story on Goodworks International, LLC. We called the Atlanta headquarters of Goodworks International. A lady directed us to Jeter's office in Washington. A call to the Washington office did not yield much as Amb. Jeter was said to be out of the office.

So who is Carlton Masters? Masters, 55, is a naturalized American. Originally from Jamaica, Masters had a long career in banking. He was a Vice President of Bank of Montreal before being appointed in 1992 by then Premier of Ontario, Bob Rae, to serve as Agent-General and Deputy Minister of Trade to the United States. Masters worked for the Ontario government for 15 months. The last five months of the 15 months was spent on leave of absence following allegations of sexual misconduct levelled against him by nine women.

One of the women, Catharine Arnston, was a commercial officer at Boston office of the Ontario government. During a government-sponsored dinner in Boston, Masters, according to a report by Christie Blatchford, then of the Toronto Sun, rejected a place at the high table, choosing instead to sit at Ms. Arnston's table. According to Toronto Sun, Masters repeatedly asked Ms. Arnston, "How they would be spending the night together." He was infuriated by Ms. Arnston's attempts to deflect his propositions. In frustration, he made an obscene hand gesture and said, "She's jerking me around."

Masters reportedly told another Ontario government staffer, "I don't do threesomes," after she showed up with another friend with whom she already had plans, for a dinner Masters insisted that they have. She worked at the Los Angeles office of the Ontario government.

The sexual misconduct allegations against Carlton Masters were investigated by a team of lawyers hired by the Ontario government. No charges were filed and Masters resigned after hinting that he was ready to fight the Ontario government if they tried to fire him.

Reporter and columnist, Christie Blatchford, who now works for Canada's Globe and Mail newspaper wrote seven stories on the Masters sexual harassment saga. She interviewed Catharine Arnston. She also interviewed Carlton Masters on April 4, 1993. The tone of her stories changed as she wrote more about the issue. "I became more sympathetic to Masters as I learned more about the allegations," she told ELENDUREPORTS.COM during an interview.

Although she believed Catharine Arnston to be credible and the investigators hired by the Ontario government found her allegations to be true, Blatchford says, "I just think the process was not fair to Masters. He was not given an opportunity to confront his accusers as the names of some of the women were not even revealed to him." Was Masters set up? "I don't think so...I believe he demanded a lot from the people he worked with...and some of the women may have been too sensitive," Blatchford said.

Many Nigerians believe that Carlton Masters' involvement in the Obasanjo Presidential Library is offensive to propriety and suggests corruption at a time the President is supposedly engaged in an anti-corruption war. Some are more disturbed by the obvious conflict of interests in this matter.

The Government's chief lobbyist is also asking companies and individuals who do business with the government to donate to the President's private library. Nobel Laureate, Prof. Wole Soyinka, described the launching of the library as an "executive extortion."

There are a few questions that need answers from Pres. Obasanjo and Carlton Masters: How many Nigerians serve on the boards of Presidential libraries in the United States? Is there a dearth of Nigerians qualified to be on Obasanjo's Presidential library? Other than being a lobbyist for the President, what other unique qualities does Masters bring to the table that Nigerians can not?

There is one obvious similarity in the characters of Pres. Obasanjo and Carlton Masters: They like to bully journalists.

Copyright 2004© The Port Harcourt Telegraph |Alrights Reserved | Email Us

'Awards Harmonized,' JMC Says, And Go To Heads Of State

The 2004 licensing round may yet come to an uplifting end if heads of state President Fradique de Menezes of Sao Tome and President Olusegun Obasanjo of Nigeria can sign the agreed-on awards documents and announce the results, Reuters reported this evening as a three-day meeting of the Nigeria-DRSTP Joint Ministerial Council ended without an announcement by either side.

The language Reuters used in a story long on history but short on quotes suggests that the required consensus - agreement by everyone - was obtained among the delegates from both states, but De Menezes has the tougher job of selling the agreement to his countrymen, who have proved both fractious and resistant in the past.

In Sao Tome, the awards have to meet a consensus of the National Petroleum Council and the National Petroleum Agency, and may be reviewed by Parliament, where the opposition Movement for the Liberation of Sao Tome and Principe (MLSTP) is in control. It was the MLSTP that forced the awards to be reviewed again by the Nigeria-DRSTP Joint Ministerial Council, so there could be a well-founded presumption that the party will accept the new awards document.

It is less likely to run into trouble with either the NPC or NPA, two institutions created by the country's new "transparency" law that has led to a bevy of resignations and the firing of former special presidential advisor on petroleum Patrice Trovoada, who is a likely candidate against President de Menezes in the 2006 presidential elections.

But it is unclear how long the process might take a second time, and indeed, whether the awards process will survive the "transparency" requirements. At best, the process could be complete by the end of the three-day weekend, or at worst, be dragged out for several more weeks. Most observers would probably say rapid approval is the more logical outcome.

In Nigeria, the process is simple; upon his return from Paris, President Olusegun Obasanjo can either sign the awards document or not, and that is the end of the matter.

The lead paragraph of the Reuters story gives a much different impression of the actual outcome of the JMC meeting, since it says the parties failed to award the blocks. However, the statement issued by the governments said they had reached agreement on "all the blocks." Th delegations are not empowered to award the blocks without approval from the two heads of state.

The entire story was posted in the Raging Bull ERHE message board.

Here is are a few paragraphs of the story, which is by Felix Onuah and from Abuja:

REUTERS
Sao Tome/Nigeria fail to award oil blocks again
by Felix Onuah

ABUJA, May 26 (Reuters) - Sao Tome and Nigeria failed again on Thursday to award oil exploration licences after a two-day meeting that sought to end five months of delays plagued by discord and corruption allegations.

A communique issued after the ministerial meeting in the Nigerian capital said the two parties had come to a "harmonised position on all the blocks," but added that this was "subject to the endorsement of the heads of state."

At the previous ministerial meeting in April, the two sides also said they had forwarded recommendations to the heads of state for endorsement.

The offshore blocks are in deep water in the Gulf of Guinea, one of the world's exploration hotspots since a series of huge oil discoveries over the last decade.

In another report that suggests pretty much the same thing and mentions ERHC Energy in a negative light, afrol news reports agreement on the shape of the latest awards, too, citing Sao Tome oil minister Arlindo de Carvalho as a source:

New oil block awards after São Tomé corruption scandal
By staff writers

ABUJA 25 May 2005 (afrol News) -- Licensing of oil blocks in the Nigeria, São Tomé and Príncipe Joint Development Zone (JDZ) is set to resume after a delay of five months. The delay came after a scandal involving corruption charges and the temporary resignation of São Tomé's Natural Resources Minister Arlindo Carvalho, which only ended after the personal intervention by Nigeria's President Olusegun Obasanjo.

Government officials in São Tomé and Príncipe today told the press in Nigeria that there was reached an agreement on going on with the JDZ licensing process of five oil and gas blocks in their jointly administered waters. Final decisions on the new awards could now be announced within a short time, the official indicated after having met his Nigerian counterparts.

The licences of the five blocks were originally to be awarded in January this year, but the JDZ's administration agency could not come up with a decision at that stage. This rapidly caused speculations on a possible power struggle between the different interests represented in the agency and its overall integrity.

In particular the relatively small and unknown US-based Environmental Remedial Holding Corporation (ERHC) has been at the focus of possible corrupt practices at the Joint Development Authority (JDA). ERHC had obtained preferential rights on the most promising blocks during the first licensing round, which it now was to make use of.

According to investigations by Nigeria's independent press, a company belonging to Nigerian businessman Emeka Offor holds around 50 percent of the shares in ERHC. Mr Offor is reported to have had close links with Nigeria's former military dictator Sani Abacha and ERHC has never documented any oil exploration or drilling experiences from other parts of the world.

While the "oil company" originally was brought aboard by the São Toméan government in a 1997 contract, current President Fradique de Menezes is reported to be eager to exclude ERHC from further oil deals in the JDZ. President Menezes is further accused by the São Toméan opposition of abusing his double role in the national Petroleum Council and receiving cash from other Nigerian-controlled bidders.

The apparent power struggle in the JDA had paralysed its awards of five new blocks for five months, causing São Tomé's Nigerian partners to lose patience. President Menezes fired his adviser on petroleum issues, Patrice Trovoada, accusing him of furthering his private business interests and delaying the award process. Another adviser, Manuel Rita, was also sacked after it was known he owned shares in ERHC.

São Tomé's Minister of Natural Resources, Arlindo Carvalho, last week found it was impossible to continue working in the current environment of suspicions and allegations and resigned from his post. The resignation was however not accepted by President Menezes, who reiterated his confidence in Minister Carvalho.

Given the chaotic situation in São Tomé and Príncipe, Nigerian President Obasanjo on Friday went on a quick visit to the nearby archipelago. During a three-hour stay, the Nigerian President met with President Menezes, Prime Minister Damião Vaz d'Almeida, a parliamentary commission on petroleum issues and representatives of the JDA.

President Obasanjo, who was visibly irritated over the necessity to go to São Tomé, had advised his colleagues against "politicking with purely technical matters." Other Nigerian politicians feared the JDA would lose its good reputation and indicated that economic stakeholders in São Tomé were jealous of the large Nigerian business involvement on the new blocks.

The Nigerian intervention nevertheless led to the rapid regrouping of the JDA, and reinstated São Toméan Minister Carvalho has already announced that the licences most probably will be awarded in a JDA meeting very soon. Nigeria gets 60 percent of the oil revenues from the JDZ, while São Tomé gets 40 percent of revenues.

Trading Updates: Another Day Of JMC Talks Is Underway As Price Unravels; Monday Declared A Holiday In Nigeria, Making Double Probability 3-Day Weekend

Yet another day of talks between delegations from Sao Tome and Principe and Nigeria to their Joint Ministerial Council is underway, and traders so far have not moved the $0.702 x $0.702 Bid and Ask.

An update from regular poster ArtK4K, a Miami psycholgist, says he called the Nigeria-Sao Tome Joint Development Authority's offics in Abuja and was told that the meeting got started at 1pm Abuja time, which is 8am EDT in New York.

Another poster was told the JDA would issue a press release today.

Update, 4:15pm EDT, 5/26/05: We were wrong about the last-minute buying; rather oddly, between 3:50 and 4:00 there were 12 trades, with 22,000 Buys and 43,000 Sells, but the Sells did not take the Bid or the Ask down, and the final purchase of 2,500 shares that followed a 40,000 burst of six Sells bumped the price to $0.665. The Buys vs. Sells for the day tell a different story. While they often seemed in the early afternoon as though they might tie, by late in the day selling overtook the issue and ended up ahead by 234,000 shares. For the day, there were 729,680 Buys and 963,627 Sells, with 53,500 unidentified shares in 337 trades.

Update, 4:08pm EDT, 5/26/05: I expect a strong opening tomorrow, and I'm delighted that despite the intense uncertainty and indeed, anxiety, this awards process has generated for so many people, we lost only $0.037 cents. That translated to $4,552.48 for the ERHC On The Move portfolio of 123,040 shares purchased at an average of $0.4394. It just goes to show you that we have nothing to fear from the truth.

Update, 4pm EDT, 5/26/05: We close at $0.665. Looking at ADVFN on its 15-minute delay, I see a splurge of buying of some 80,500 shares in 14 trades without a single sell, but that the Buy-Sell margin is greater than ever for the day, at around 212,000 shares favoring the Sell side. I need to see the last 15 minutes to get the whole picture, though, because there was a lot of buying at the end.

Update, 3:59pm EDT, 5/26/05: Volume jumps to 1,739,800 and the price goes to $0.665, with Bid and Ask unmoved.

Update, 3:57pm EDT, 5/26/05: The volume leaps 10K to 1,719,300 and it looks like we may close at $0.665.

Update, 3:54pm EDT, 5/26/05: Now the price and the Bid is $0.66, and the volume 1,709,300.

Update, 3:53pm EDT, 5/26/05: We're at $0.6510 now but the Bid has gone to $0.655 and the Ask to $0.665 on 1,709,300 shares of volume.

Update, 3:48pm EDT, 5/26/05: Just 11 minutes to go and the price is $0.645, despite rallies in oil prices and on both the4 Nadaq (+20) and the DJIA (+80). The Bid is better at $0.65 and the Ask has improved to $0.655. It may yet move up a few cents.

Update, 3:46pm EDT, 5/26/05: Last-minute posts are frequently a pumper's scam to get out higher after day-trading at a bad price. This one from our Comments section sounds like one, but you make up your own minds:

This meeting is it and it will be finalised this evening. They started late today and there are many items on the agenda, as you smart and on the ball investors should be aware of. Please do not call Senor Augusto at the UN Mission any more. He has the same information that many of you have and nothing more. The official news will come from the JDA. You've waited this long you can wait another day or two. If not, please sell your shares for whatever company you are invested in now.

Obrigado

Update, 3:40pm EDT, 5/26/05: We're climbing a bit, to $0.655, the Ask, and so is the Bid, to $0.646, but slips back a tenth-cent to $0.646. Volume is closing in on 1,.7 million, now at 1,682,100 shares.

Update, 3:34pm EDT, 5/26/05: Someone on RB tipped LLLI this morning, and that's up $0.75 to $4.01 now. ERHE, meanshile, is at $0.65 on 1,672,100 shares.

Update, 3:30pm EDT, 5/26/05: The Bid is up to $0.645, and the Ask stays at $0.65 as volume climbs to 1,637,100 shares. It doesn't make sense to me that they would announce awards late at night, but it would not be terribly unusual, either. I just don't think so.

Update, 3:27pm EDT, 5/26/05: The price rises a cent to $0.65, while the Bid lingers at $0.64 and volume hits 1,624,600 shares. By the way, the 3:16pm tip and the 3:25pm tip are from different people.

Update, 3:25pm EDT, 5/26/05: A last-minute Update from Markvol10:

****JMC MEETING UPDATE***Just called Sam's cell phone. A lady answered. I asked to speak with Sam and she told me that he had just been called into the JMC meeting. It's 8:00 pm there right now and she said they will be meeting until 9;30-10pm. I asked her if meeting was going well and she said that everything seemed very positive. She told me to call Sam in 2 hours. The wait continues although it seems like real progress is being made and things are moving towards a conclusion.

Update, 3:20pm EDT, 5/26/05: Welcome, first-time poster!

Update, 3:16pm EDT, 5/26/05: A nice Surge develops with volume going to 1,601,600 as a trusted poster informs me that his most reliable source in Nigeria assures him that at whatever time, there will be an awards announcement from the Joint Development Authority - so you heard it here third-hand, presuming his source also heard it. The price is $0.64, the Bid, and the Ask is $0.645.

Update, 3:07pm EDT, 5/26/05: A 37K jump in volume brings the price from $0.64 to $0.642, and volume to 1,548,000 shares. Eight minutes to the 3:15 Surge.

Update, 2:59pm EDT, 5/26/05: Sellers are now increasing their lead over buyers, with some 811,000 Sells topping 600,00 Buys and 53,500 shares unidentified in 289 trades recorded by ADVFN at 2:43. The price is $0.642 and current volume is 1,513,000 shares.

Update, 2:56pm EDT, 5/26/05: The price is $0.645, and the Bid has improved to $0.64 as we stand 20 minutes from the 3:15 Surge. The volume is 1,507.500 shares. There may not be a lot of late buying today unless news breaks soon.

Update, 2:53pm EDT, 5/26/05: We just hit 1,500,000 shares, with the Bid lower at $0.635 and the Ask at $0.645. Looks like there will be no news forthcoming today, and perhaps another day of meetings tomorrow.

Update, 2:44pm EDT, 5/26/05: Investor's Hub, which had captured some of the better posters from Raging Bull, seems to have lost them now. The Raging Bull madness goes on and on. Let's just hope that no newbie stops there first.

Update, 2:38pm EDT, 5/26/05: The price is $0.64 once more, the Bid, and the Ask is lower at $0.645 as volume reaches 1,460,500 shares on slow trading.

Update, 2:31pm EDT, 5/26/05: The price has improved to $0.652, the Ask, while the Bid is $0.645. Volume has reached 1,321,400.

Update, 1:58pm EDT, 5/26/05: The coming three-day weekends in Abuja and the United States gives me great confidence that an announcement of awards will come late Friday or on Saturday, and if not then, at a ceremonial event on Monday. The Bid and Ask are $0.65 x $0.655, and volume is 1,410,100 shares.

Update, 1:52pm EDT, 5/26/05: The price is $0.65, and volume is 1,401,100. The Bid has risen to $0.65.

Update, 1:40pm EDT, 5/26/05: The price slips to $0.645, while the Bid rises to $0.645 and the Ask slips to $0.655 on volume of 1,389,600 shares.

Update, 1:35pm EDT, 5/26/05: The price slips to $0.65, while the Bid stays at $0.64 and the Ask slips to $0.655 on volume of 1,388,600 shares.

Update, 1:33pm EDT, 5/26/05: The price has risen two cents to $0.66 on volume of 1,387,800 shares, and falls back to $0.655. The Ask stays at $0.66.

Update, 1:25pm EDT, 5/26/05: The price is $0.64, the Bid, and there is now a two-cent gap with the Ask at $0.66. Volume is approaching 1.4 million, now at 1,384,600 shares.

Update, 1:23pm EDT, 5/26/05: Nigeria's president has declared a public holiday for Monday, May 30, creating the rare combination of a three-day weekend both there and in the United States. Virtually every large one-day gain in ERHE share price has come on a three-day weekend. This would seem to virtually ensure that the awards will be announced on Monday, which Nigeria has dubbed "Democracy Day:

FG declares Monday Public Holiday
2005-05-25 09:09:55

The Federal Government has declared Monday, May 30, 2005, a Public Holiday to commemorate democracy day.

This was announced by the Internal Affairs Minister, Iyorchia Ayu.

Update, 1:06pm EDT, 5/26/05: The Bid falls back to $0.64, while the Ask stays at $0.66. We're off $0.052, or 7.41 percent now, on improving volume of 1,381,100 shares.

Update, 1:02pm EDT, 5/26/05: The Bid improves to $0.65 as the lunch hour ends. We await the 3:15 Surge. Volume is unchanged.

Update, 12:58pm EDT, 5/26/05: The price has improved to $0.65 and the Ask is better at $0.66, but the Bid stays at $0.64. The volume stands at 1,376,100 shares.

Update, 12:53pm EDT, 5/26/05: Some pumper who can't spell Botswana has a rosy message for us in the Comments section. The errors and ampersand spell SwingingK:

Joe,

I think you will be very happy with what was accomplished in the meetings. It will open a new era in Prosperity for the Sao Tomeans, & give the world a much needed Natural Resource.

Batswanna

Update, 12:45pm EDT, 5/26/05: Now we're at the Bid, $0.64, and the Ask is lower at $0.65. Volume has reached 1,365,800 shares, and Abuja's silence continues. When we get our money, they'll get theirs.

Update, 12:40pm EDT, 5/26/05: The Bid has fallen to $0.64 after no news emerged from Abuja. The Ask is at $0.655, and the current price is $0.65. Volume has reached 1,354,800 shares.

Update, 12:33pm EDT, 5/26/05: Now they knows how we feel. Nigeria is getting the hold-up act from Switzerland, where the Supreme Court recently ruled the Swiss government should immediately return $458 million in funds looted by late dictator Gen. Sani Abacha. Nigeria, meanwhile, is holding up payment of the Block 1 share owed to Sao Tome, some $49 million - less its loan of $44 million. Here's a couple of grafs from the Vanguard story:

Swiss govt aborts deal on $458m Abacha loot
Posted to the Web: Thursday, May 26, 2005

PARIS -— Switzerland has halted a deal to hand back $458 million stolen by the late General Sani Abacha and hidden in Swiss banks while it seeks to expel Nigerian illegal immigrants, an outraged President Olusegun Obasanjo said yesterday.

President Obasanjo, who is on a visit to Paris, accused Switzerland of acting illegally in side-stepping a ruling from its own Supreme Court, which in February ordered that the funds be returned and demanded that the money be immediately returned.

“I must express deepest disappointment and dismay with the Swiss authorities who continue to hold onto Nigeria’s legitimate funds, covertly looted and kept in their banks,” he told an audience of dignitaries at the UNESCO headquarters in Paris, according to his spokeswoman, Mrs Remi Oyo.

Update, 12:27pm EDT, 5/26/05: The price is $0.66, the Bid is $0.665, with the Ask at $0.665. Volume is now over 1,329,800.

Update, 12:20pm EDT, 5/26/05: Buys leads Sells 63,250 to 11,500 in the past 39 minutes, per ADVFN's 15-minute delay.

Update, 12:20pm EDT, 5/26/05: The Bid has dipped to $0.65, and the Ask to $0.665, likely on the lack of news at 5pm Abuja time. The price is $0.66, and volume stands at 1,281,400, moving pretty slowly.

Update, 12:17pm EDT, 5/26/05: The gap between Buys and Sells has steadily fallen, from 180K to 169K to 127K now, and the last 41 trades reported on ADVFN still show Buys leading Sells by 29 to 12. ADVFN has a 15-minute delay.

Update, 12:12pm EDT, 5/26/05: The price is $0.66, and volume is 1,276,400. In Iraq, Operation Thunder is about to get underway. It will encircle Baghdad and work inward to root out insurgents.

Update, 12:07pm EDT, 5/26/05: We're looking better now at $0.67, with the Bid at $0.66 and the volume uop 47K to 1,273,800. At 11:39 on ADVFN's 15-minute delay, the Buy-Sell gap had narrowed and the last seven trades were Buys. Oops - the price has slipped to $0.66. No news from Abuja.

Update, 11:50am EDT, 5/26/05: The volume has pretty much come to a halt as investors wait to see whether the JDA will issue a promised press release or the Joint Ministerial Council meeting will come to an end with - or without - awards being announced. Any announcement would likely have to wait until Friday or Monday, however, as Presdent Obansanjo is not in Nigeria today.

Update, 11:44am EDT, 5/26/05: GEECF has reversed course by 25 percent. It was at $0.62 earlier and is now at $0.40, down $0.15 from the open, on 178,000 shares of volume, and there is an $0.11 gap.

Update, 11:39am EDT, 5/26/05: The price is $0.655, the Ask, while the Bid lingers at $0.651. Volume has climbed to 1,206,300, with trading very quiet now. There were 223 trades at 11:17, and Buys lagged Sells by 160,000 shares, with 53,500 unidentified.

Update, 11:36am EDT, 5/26/05: The President is making an important policy statement on Israeli-Palestinian relations. We think a significant breakthrough is near. He says "Now we have reached a moment of hope."

Update, 11:32am EDT, 5/26/05: Checking in with the London desk, I note that that EEL has moved up after yesterday's decline. After a block of 1.2 million shares traded at 1.17 pounds yesterday, the price fell to $1.15, and is now back up to 1.20. Maybe Patrice Trovoada has made some headway. ERHE's price has improved to $0.665.

Update, 11:30am EDT, 5/26/05: The price is stuck at $0.655, and so is volume, and the Bid and Ask remain at $0.65 x $0.655.

Update, 11:24am EDT, 5/26/05: Volume has kicked over 1.2 million to 1,200,600. Price, Bid and Ask are unchanged. It's now 4:22 in Abuja, and the close of business draws near. Will the JDA issue a press release, as promised? Who knows?

Update, 11:21am EDT, 5/26/05: Buys lead Sells 29 to 12 in the last 41 trades at 11am EDT.

Update, 11:17am EDT, 5/26/05: The price is $0.65, the Bid, and the Ask is $0.655. Volume has reached 1,198,600 shares, a good showing on any day.

Update, 11:11am EDT, 5/26/05: One thing we can conclude from the talks going into a third day is that no one came to them ready to give up their position. That was reinforced by the Tanko and de Carvalho comments as well. But knowing what is at stake for both nations and the probable consequences of failure, it seems hard to believe that we would get another non-result this week.

Update, 11:09am EDT, 5/26/05: The price is $0.65, the Bid, with the Ask now $0.655. Volume is 1,185,600 shares. Good discussion our Comments section on the possibility of awarding undisputed blocks.

Update, 11:05am EDT, 5/26/05: With 211 trades as of 10:47, the last 41 were 3:1 Buys to Sells, according to ADVFN. Sells still dominate over the day, however.

Update, 11am EDT, 5/26/05: The price has slipped to $0.655, the Ask, with the Bid at $0.651 and volume up to 1,170,600 shares.

Update, 10:55am EDT, 5/26/05: The price is unchanged at $0.66, with volume now 1,165,600 shares.

Update, 10:50am EDT, 5/26/05: The JMC meeting is likely to take a break any minute now, after two hours of non-stop dialogue. All indicators but volume are unchanged. Volume is 1,156,600 shares.

Update, 10:48am EDT, 5/26/05: The price is $0.66 again, with the Bid and Ask unchanged at $0.655 x $0.66. Volume is 1,150,600.

Update, 10:46am EDT, 5/26/05: The price is $0.655, with all else unchanged. If news does come and it's positive, there could be an extremely sharp upturn today.

Update, 10:44am EDT, 5/26/05: The Bid has fallen to $0.655 and the Ask is lower at $0.66, the current price, as volume rises once more to 1,143,100 shares.

Update, 10:42am EDT, 5/26/05: The price is $0.66 as volume rises to 1,138,100 shares. The Bid and Ask are $0.66 x $0.665.

Update, 10:37am EDT, 5/26/05: By 10:22am EDT this morning, there were a whopping 182 trades, with 378,305 Buys and 572,320 Sells and 53,500 undidentified shares. These are ADVFN's numbers, delayed 15 minutes .<

Update, 10:35am EDT, 5/26/05: The price has come back to $0.665, the Ask, with the Bid at $0.66. Volume is a great 1,069,600 shares. Lots of folks picked up cheap shares on the way back up.

Update, 10:25am EDT, 5/26/05: Money.net has crashed again.

Update, 10:21am EDT, 5/26/05: You blink and it's gone. The price has surged back to $0.655, the Bid, and the Ask is now $0.66 as volume hits 992,426 shares.

Update, 10:17am EDT, 5/26/05: Volume is 961,725 with the price still at $0.645. the Ask, and the Bid a half-cent lower at $0.64. Feels like the market will rest for a breather here. I'll make coffee.

Update, 10:15am EDT, 5/26/05: Just 45 minutes into the day and we're closing in on a million shares traded, one of the heaviest days of volume in recent mwemory. The price is $0.645, the Ask, and the Bid is $0.64.

Update, 10:13am EDT, 5/26/05: We're back at $0.64 and the Ask is $0.645. Volume is 941,225.

Update, 10:11am EDT, 5/26/05: Now we're bouncing off the bottom, at $0.632, with the Bid $0.635 and the Ask $0.64. Volume slowing, finally, at 930,525.

Update, 10:11am EDT, 5/26/05: We're at $0.63 now, the Ask, with the Bid better at $0.625. Volume is 913,050 shares.

Update, 10:09am EDT, 5/26/05: Now the price is $0.625 and the Bid is $0.621, with volume at 810,982 and the Ask $0.625. Traders are headed for the exits. We're sticking around.

Update, 10:05am EDT, 5/26/05: Slipping to $0.63 now as volume hits 744,482, promising a 2 million-share day or better. Bid and Ask are $0.64 x $0.635. The pattern has always been to have a sharp selloff before the high of the year is reached.

Update, 10:03am EDT, 5/26/05: We hit $0.64, off $0.062, and the Bid and Ask are lower at $0.64 x $0.645. Looks like we're headed to a good solid loss. No word from the JDA, of course.

Update, 10am EDT, 5/26/05: The price is $0.65 again, as volume hits 628,832. Bid and Ask are $0.65 x $0.66. It looks like another run at the low of the day. By the first 69 trades at 9:42am, Buys lagged Sells by 1:2.

Update, 9:51am EDT, 5/26/05: Yesterday's volume at this time was 77,000. Now it's 591,332 and we're off $0.047 at $0.655, the Bid, with the Ask at $0.66. The Buy-Sell ratio at the opening was 1:1, but the unidentified shares traded were as high as both in the first 160,000 or so. There were lots of Buys.

Update, 9:51am EDT, 5/26/05: The sellers have made their statement. The price is $0.655, the new Bid, and the Ask stays at $0.66. Volume is 546,832.

Update, 9:48am EDT, 5/26/05: We're clawing back to $0.655. Volume is a very healthy 455,332 and the Ask has risen to $0.66.

Update, 9:46am EDT, 5/26/05: It looks for the moment as though $0.65, the day's low, will hold, as the Bid rises again to $0.651, the current price.

Update, 9:44am EDT, 5/26/05: Volume is now 300K in the first 15 minutes, or at least 297,832, and the Bid is $0.65, the price, and the Ask is $0.655.

Update, 9:42am EDT, 5/26/05: We're blowing through the stops now, at $0.65, with the Bid $0.651 and the Ask $0.655. Volume is 287,832, so this qualifies as a shake, if not a selloff.

Update, 9:39am EDT, 5/26/05: We're at $0.665 now, off $0.042, with the Bid and Ask both lower at $0.66 x $0.666. Volume is a brisk 253,142 shares.

Update, 9:38am EDT, 5/26/05: We are sharply off this morning and look headed for a good dive. With 181,422 shares traded in the first seven minutes, the price is $0.67, the Ask, and the Bid is $0.665.

Money.net was not working, so I apologize for the two earlier posts when I thought it was.

Update, 9:32am EDT, 5/26/05: Momentarily, at least, the Bid is higher than the Ask, at $0.702 x $0.70. There is no volume.

Update, 9:26am EDT, 5/26/05: No change in the Bid and Ask as the opening bell draws near. Yesterday's close was $0.702, and that is the opening Bid and Ask at this time - but likely to change in a few minutes.

Nigeria Warns Sao Tome On Oil Award Delays

A story in the daily Punch of Nigeria business section Thursday morning says Nigeria warned Sao Tome at the start of yesterday's meeting not to let extraneous facotors influence their country's decision to ratify the Nigeria-Sao Tome and Principe Joint Development Authority licensing awards.

Here is that story, which can be read in conjunction with an earlier post here citing the warning issued by Abubakar Tanko, a high-ranking Nigerian foreign ministry official and a member of the JDA's ruling Joint Ministerial Council:

THE PUNCH, Wednesday, May 25, 2005
Oil blocks: Nigeria alerts Sao Tome
by Michael Faloseyi

ABUJA -- The resumed meeting of the Joint Ministerial Council of the Nigeria-Sao Tome and Principe started on a cautious note on Tuesday, when Nigeria warned her partner not to bow to external influences in arriving at a decision.

The meeting was expected to determine winners of the five oil blocks put on offer during the 2004 bidding round but could not start until very late in the day, as representatives of each country met privately before the joint deliberations.

Earlier, there had been widespread media reports that both parties could not agree on the ratifications of the winners of the blocks as recommended by the technical committee of the Joint Development Authority.

The parties were said to have accused each other of exerting undue influence in the determination of the winners recommended by the technical committee.

The leader of Nigerian delegation on the JMC, the Minister of State for Foreign Affairs, Alhaji Abubakar Tanko, while declaring the meeting open, acknowledged that the meeting had been unusually delayed.

According to him, “We met here on April 26 and 27, 2005 and took some far reaching decisions which are expected to chart the way forward for the activities of the JDA to proceed for endorsement of the winners in the bids without encumbrances.”

“One of the crucial decisions was arriving at a harmonised position on the award of blocks in the JDZ 2004 licensing round, which was forwarded to our heads of government for endorsement before announcement.”

The minister, however, said that the delay was as a result of some technical hitches, even as he cautioned Sao Tome not to allow external influences to becloud her judgement.

He said, “It is pertinent to note that the more delays that are experienced, the more the credibility of this laudable partnership and brotherhood is eroded.”

“If we continue to allow extraneous factors to guide our thoughts and decisions it will seriously affect the bond of our partnership and our brotherhood which has started becoming the envy of many countries with similar situations.”

The two countries have decided to float a common vehicle, the JDA, to manage the resources in their overlapping border areas, which is now reputed as one of the prolific hydrocarbon laden zone in the Gulf of Guinea.

Bassey Udo Explains 'Long Wait' For JDZ Awards

In a well-researched article for Nigeria's Daily Independent, veteran oil writer Bassey Udo has attempted to explain the multiple reasons for the long delay of the Nigeria-Sao Tome and Principe Joint Development Zone block awards in its second Gulf of Guinea licensing round.

Here is the analysis published Tuesday by Udo, one of Nigeria's best writers on his country's oil industry:

Tuesday May 24th, 2005
The long wait for JDZ deal
by Bassey Udo

Release of results of the 2004 Licensing Round of the Nigeria-Sao Tome and Principe Joint Development Zone (JDZ) originally scheduled for December 31, 2004 has been postponed a couple of times for inexplicable reasons.

In this analysis, Energy Editor, Bassey Udo, contends that ExxonMobil’s decision to reserve its rights in two of the five blocks on offer in the zone, the recent sack of the Sao Tomean Special Adviser on Petroleum and Energy, Patrice Traovoda, as well as last week’s resignation of the country’s Minister of Petroleum, Arlindo de Ceita Cavalho, over allegations of involvement in shady deals that compromised the bid process appear to fuel the perception in some quarters of a waning interest and credibility crisis of the exercise among investors.

ABUJA -- The eighth meeting of the Joint Ministerial Council (JMC) held in Abuja, October 28 and 29, 2004, captured the mood and enthusiasm of the two partner countries – Nigeria and Sao Tome and Principe – towards the early development of the JDZ.

Apart from the announcement of the official closure of the 2003 Licensing Round, the JMC directed the Joint Development Authority (JDA) to make necessary arrangements to conduct another bidding round with a view to awarding additional (oil) blocks within two months. This will “enable the generation of revenue that will assist the State parties in fulfilling the aspirations of their people”.

Abubakar Tanko, Nigeria’s Minister of State for Foreign Affairs in his opening remark spoke the minds of the governments of the two on the need to award new oil blocks in the zone in addition to the premier Block-1 to help “generate the desired level of activity and revenue”. Tanko, who described the meeting as “very crucial”, listed the review of negotiations of the Production Sharing Contract (PSC) for Block-1 and opening of discussions on the process for award of additional oil blocks as key items on the day’s agenda.

Timetable and guidelines

A timetable and guidelines issued at the end of the meeting for the conduct of a new licensing round indicated that five new oil blocks (2, 3, 4, 5 and 6) would be on offer between November 15 and December 15.

Prospective investors were requested to submit their bids within the period, at the end of which bids were to be officially opened, while results and announcement of winners of the oil blocks were to hold latest December 31, 2004.

The stakes were predictably high and the frenzy among prospective investors expectedly fierce, apparently as a result of the huge success recorded in the maiden round in which Chevron Corporation emerged operator of Block-1 with a whooping $123 million offer.

At the official bids opening, December 15, 2004, about N60 billion was staked from 26 bids submitted by 22 interested investors.

If things were going according to initial schedule, the results of the bids could have been released and winners emerge by December 31, 2004. But, that was not to be.

The official explanation was that there were a few issues that needed to be sorted out in respect of the Joint Operating Agreement (JOA) with Chevron Corporation and its partners in Block-1, to clear the way for the payment of the signature bonus.

Besides, it was gathered that the delay, though not originally intended, would afford the JDA sufficient time to carry out the technical and commercial evaluation of the bids before final announcement of winners.

ExxonMobil, ERHC rights

When the bids evaluation finally began, one issue that appeared to have proved a hard knot to untie was how to get ExxonMobil to agree to participate in the development of some of the oil blocks without engendering the credibility of the guidelines regulating the bid process.

ExxonMobil and Environmental Remediation Holding Corporation (ERHC) are two oil companies having pre-emptive option rights in the five oil blocks on offer by virtue of their existence in the Sao Tomean territorial waters in years predating the 2001 treaty establishing the JDZ.

ExxonMobil has 25 per cent rights in two of the five oil blocks, while ERHC, an American-based company in which a Nigerian oil firm, Chrome Energy, has major stakes, has rights ranging between 15 to 30 per cent in all five blocks.

The difference was that whereas ERHC participated in the bidding round and submitted bids for some of oil blocks, ExxonMobil did not. Yet, accommodation must be found for its pre-emptive rights by being offered equity as a joint venture partner in the event of its not willing to farm-out.

During the evaluation of the bids, ERHC had validated its pre-emptive option rights.

But, the JMC, at the end of its 9th meeting of April 26 and 27, 2005 in Abuja, issued a directive for ExxonMobil to move within 30 days to exercise its rights in two of the five blocks to pave the way for the release of the final results and announcement of the winners of the operational licenses for the five oil blocks.

After weeks of consultations and negotiations with JDA officials during which all the parties were afforded the opportunity to review the 26 bids to accommodate all interests, ExxonMobil, contrary to wide expectations, opted to reserve its rights in the two oil blocks, citing business reasons.

"We confirm that ExxonMobil has elected not to exercise its rights to participate in additional blocks that may be awarded pursuant to the current tender round in the Joint Development Zone of Nigeria and Sao Tome and Principe”, the company said in a terse statement in Lagos.

Though the company confirmed its interest to retain its 40 per cent stake it already holds in the zone’s premier Block –1 through its subsidiary, Esso Exploration and Production Nigeria-São Tomé "One" Limited, the real reason for its decision not to exercise its rights was left for conjecture, signaling the turning point in the bid process.

Why ExxonMobil reserve its rights

Sources close to the American oil firm alleged that ExxonMobil may have taken a strategic decision to protect its business interest by opting out when it became obvious that it was not going to win the argument and get the JDA to accept its proposal.

Though ExxonMobil did not submit bids for any of the five oil blocks on offer, it was gathered that throughout the month-long negotiations and consultations with the JDA, it was pushing a case for it to be granted the operatorship of the two oil blocks it was expected to exercise 25 per cent rights considering its capacity and clout in the industry, in terms of experience and technical know-how in deepwater operations.

It was gathered that the company never wanted to play a second fiddle to ERHC, which though known to have spearheaded oil and gas exploration and production activities in the Sao Tomean territorial waters since 1986, may not have been seen by industry players as possessing the kind of expertise and experience required to drive a highly challenging and capital intensive process of producing hydrocarbon in a risky terrain of about 3,000 feet on deep offshore waters, an environment that requires enormous technological and capital investments to succeed. Not even ERHC’s claim to have struck a partnership deal with some American oil firms, Pioneer Natural Resources, Devon Energy and Noble Energy could sway the argument in its favour.

“It would have been a marriage of strange bedfellows if ExxonMobil, the world's largest publicly traded oil and gas company, had accepted a position that would have seen it working in any capacity with ERHC other than as the operator of the concessions”, an industry analyst observed.

The situation reportedly triggered sharp disagreements among top officials of the Nigerian and Sao Tomean authorities, particularly what terms should be offered prospective participants in the development of the oil blocks.

Though some of the officials were said to have openly opposed any attempt to give any concession to ExxonMobil’s demand, apparently because of its obvious implications on the stipulated guidelines for the bid process, others were merely protecting their vested interests in the acreages.

A top ExxonMobil official, however, denied that its decision to reserve its right had anything to do with any rift or aversion for any company, saying: “Our decision not to exercise our right or not was informed by purely business reasons. Maybe after the assessment of the viability of the blocks, the company considered that going ahead was not in its strict business interest. It has nothing to do with anybody.”

Whether the parties involved agree or not, it would seem difficult not to appreciate the negative impact ExxonMobil’s decision not to exercise its rights would have on the initial enthusiasm and interest by investors in the development of the JDZ acreages.

JDA and reduced signature bonuses

Even the JDA appears to appreciate the reality of the waning interest among investors as it had to perk the signature bonuses for each of the five oil blocks at levels lower than the base offers during the bids to encourage participants, at least to still realise set objectives.

Whereas the highest offers as signature bonuses were $135 million, $41 million, $175 million, $37 million and $45 million for Blocks 2, 3, 4, 5 and 6, respectively, the JDA in its preliminary results to be ratified by the JMC, according to its Chairman, Carlos Gomes, perked the figures at $71 million, $40 million, $90 million, $37 million and $45 million, correspondingly.

JDZ and the Rumble in Sao Tome

Apparently to reassure prospective investors of stakeholders’ commitment to transparency and openness in JDZ transactions, Sao Tomean President, Fradique De Menezes, fired his Special Adviser on Petroleum and Energy, Patrice Traovoda, son of the country’s former President, Miguel Traovoda, one of the founding fathers of the JDZ.

Menezes accused Traovoda of ‘gross misconduct’ following allegations of his involvement in dealings that appeared to have compromised the transparency of the 2004 bid process.

According to Menezes, Traovoda was discovered to have interests in some companies that participated in the licensing round, adding that the former adviser was known to have been involved in illegal activities that tantamount to the corruption of the bid process having been linked with allegations of “promises to assist some companies that participated in the 2004 bid round.’’

Last week, apparently in sympathy with Traovoda, the country’s Minister of Petroleum Resources, Arlindo de Ceita Cavalho, resigned in controversial circumstances.

The two top Sao Tomean official, who were also members of JMC, played prominent roles in various negotiations by JDA and investors in the JDZ. The exit of the two officials will obviously complicate the problems, causing the delay in the completion of the bid process. How the problems are resolved will determine how long the parties have to wait for the realisation of the objectives the JDZ was established.

Nigerians Rescue Passengers of Sinking Sao Tome Ship

In what may be a good omen, the Internet-based Nigerian daily Business Day reported today that the Nigerian rescue of a sinking vessel from Sao Tome and Principe was enabled by the fact that Nigeria signed an international accord on maritime rescues.

The Sao Tome and Principe delegation (which has yet to sign the Joint Development Authority awards document in Abuja) was apparently not on board.

NMA, others rescue 68 passengers aboard distressed ship
by Ray Ugochukwu
2005-05-25 09:13:19

RIVERS STATE -- A Sao Tome and Principe vessel carrying 68 passengers on board was Monday rescued from sinking by a combined team of officials of the National Maritime Authority (NMA), Nigerian Ports Authority (NPA) and Marine Industrial Services Consultative Organisation (MISCO).

The vessel, MV Praque Yara, was said to have developed an engine problem on Saturday resulting in her drifting for 48 hours, 100 nautical miles off Nigerian shores, before she could be sighted by another vessel, LNG Bayelsa, at about 7.33pm on the fateful day.

Sources at the NMA disclosed that on receiving the distress call, officers from the Search and Rescue Department of the apex maritime regulatory body jumped into a Caverton helicopter and went to sea and located the ship as she was drifting with its 68 passengers, including women and children, on board.

It was gathered that a rescue boat was immediately arranged, which towed the ocean liner to the Brass Terminal in Rivers State.

BUSINESS DAY gathered that the passengers had run short of food and water before succour came their way.

Though there was no casualty, sources revealed that 12 passengers were found to have fallen sick, with six of them developing stomach pains.

Confirming the development, the NMA Director of Marine Services, A. S. Olopoenia, said since Nigeria was a signatory to the 1979 Search and Rescue Convention of the International Maritime Organisation (IMO), she was obliged to respond to any distress call from the high seas.

"We must do everything to offer assistance to calls from the high seas and within our territorial waters", the Ship Master said.

On the fate of the rescued vessel, he said that his men would not release her until the surveyors had declared it fit and safe to sail.

Olopoenia added that appropriate officers of the NMA had been dispatched to Brass through Port Harcourt, to ascertain the level of assistance the authority would further render to the ill-fated vessel.

The NPA recently commissioned its helicopter services aimed at monitoring happenings in the country's territorial waters and beyond in line with the new IMO security measures better known as the International Ship and Port Facility Security (ISPS) Code.

The helicopter services is rendered by an indigenous firm, Caverton Helicopters, which service was deployed in the rescue of the drifting ship.

US Firms Bribed Nigerians For Pipeline Job, Paper Says

The respected Mike Oduniyi reported earlier this week in ThisDay Online that a U.S. firm involved in a $600 million pipeline project says an internal audit reveals it may have bribed Nigerian officials to get the contract.

Here is the story:

Fresh Bribery Scam Hits Oil Industry
Willbros investigates WAGP, EGP contract awards
by Mike Oduniyi
with agency report,
05.23.2005

ABUJA -- Even as the dust over alleged bribe-for-gas contracts involving a unit of oil service firm, Halliburton, is yet to settle, another US oil firm, Willbros, has opened another scandal of improper payments of money allegedly to some Nigerian government officials to win contracts.

Willbros's local unit, Willbros West Africa Inc., was awarded last Deecember, the Engineering, Procurement and Construction (EPC) contract for the onshore pipeline and facilities of the $600 million West African Gas Pipeline Project by the West African Pipeline Company Limited, comprised of ChevronTexaco, Nigerian National Petroleum Corporation (NNPC), Shell, and the Takoradi Power Company Ltd. of Ghana.

The oil services firm, which has its Nigerian unit based in Port Harcourt, also bagged the $780 million contract along with South Korea's Hyundai Heavy Industries, to build the third phase of the NNPC/Chevron Escravos Gas Pipeline (EGP) project.
However, the Willbros Group said last week that an investigation by its Audit Committee into the activities of the former head of the Company's international operations, "unveiled a catalogue of dubious dealings by existing and former employees, including possible improper payments and bid-rigging in Nigeria, Bolivia, Ecuador and possibly Mexico."

The company said in a statement that Mr. James Tillery, its former president of international operations, some 12 other employees who reported to him and possibly six consultants, "may have falsified reports, compromised the company before government authorities and clients and violated U.S and foreign laws."

It said the audit discovered that Tillery and other Willbros International employees or consultants owned interests in enterprises with whom Willbros International did business, and may have usurped corporate opportunities, received payments and other improper benefits from consultants, suppliers or competitors.

"Mr. Tillery and other Willbros International employees or consultants may have directly and indirectly promised to make, made, caused to be made, or approved payments to government officials in Bolivia, Nigeria and Ecuador," the statement said.

The company said that it had reported its findings to both the US Securities and Exchange Commission (SEC) and the US Department of Justice, which have already launched investigation into the allegations.

"Bad behaviour and collusion defeated our system of internal controls," said Willbros chief executive Michael Curran. "It is like a spread of cancer that has gone to different places in our organisation," he added.

The company said that as as a result of the problem, it would have to restate its financial statements for the 2002 and 2003 fiscal years and the first three quarters of 2004.

For the first quarter, it expects to post bewteen $5 million to $7 million loss, including the $4 million cost of the investigation.

"Until the investigation is complete, Willbros will not be able to fully assess the impact of these actions on the Company. The Company is working diligently to complete this investigation in the near term," it said.

The Willbros' WAGP project includes the installation of custody transfer metering in Nigeria and a 30-inch natural gas pipeline from the existing Escravos Lagos gas pipeline system, near Itoki, Nigeria, to the initial compressor station at Lagos Beach, and the point of departure for the offshore section.

Additional pipelines and regulating and metering facilities for the onshore portions of the project in Benin, Togo, and Ghana are included in the project scope, as well as the engineering, procurement, construction and tie-in of the initial compressor station and land pipeline section.

Groundbreaking ceremonies for the project were held at Takoradi, Ghana, on December 3, 2004. Engineering and procurement activities for the onshore portions were expected to commence in January, 2005, with field activities scheduled to begin in the fourth quarter of 2005, and project completion in the fourth quarter 2006.

For the EGP 3 Project, the contracts cover the construction and installation of offshore platforms and pipelines, as well as an onshore gas plant expansion and floating storage and offloading modifications, the statement said.

The third phase of the plant is expected to provide about 330 million cubic feet of natural gas per day for the Escravos Gas-To-Liquids project.

The House of Representatives is currently investigating alleged payment of $180 million bribe by a unit of the US oil services firm Halliburton, KBR, to Nigerian officials, to clinch gas contracts.

U.S. Govt. Report Says Nigeria Will Vanish Within 15 Years

The United States National Intelligence Council, a body of senior intelligence community officials, has issued a report flatly stating that Nigeria will have vanished from the roster of nations within 15 years, the ThisDay Online Website reported. President Olusegun Obasanjo sharply criticized the report.

Since the appearance of CIA Director Porter Goss, a former Congressman from Florida and onetime CIA analyst, before the Senate Intelligence Committee last Fall, the nation's intelligence community has been warning of an imminent collapse of Nigeria, the world's fifth-largest oil producer and the largest in Africa.

ERHC On The Move believes the report's emergence was likely the work of lobbying by ExxonMobil, which is angry that its non-bid for Block 4 of the Joint Development Zone was not accepted by the Nigeria-Sao Tome and Principe Joint Development Authority because it was months late, and in a fit of pique declined to exercise its right to two 25 percent preferential options in any of the five blocks currently on offer.

Update, 9:35pm EDT, 5/26/05: In a response from the American consul in Nigeria, the federal government was urged not to merely dismiss the report or consider it an affront. In essemce, the American official said, things can change. Here is the response story:

U.S. urges Nigeria to take intelligence report seriously
The United States (US) has urged the Federal Government to take the recently released report of its National Intelligence Council (NIC) very seriously and not consider it as an affront of any sort. The report entitled, mapping Sub Saharan Africa's future which had already drawn a presidential remark, had among others hinted of a high possibility of a break up of Nigeria. Briefing reporters in Abuja on Thursday, the U.S. country public affairs counsellor for Nigeria, Mrs Claudia Anyaso, said that grave as the 17 paged report appears, there are always the time honoured "interventions along the line that could change and save things provided well meaning citizens, do not just sit back and do nothing." The American counsellor's detailed clarification were elicited at a joint briefing with Democracy and Governance Officer of the US Agency for International Development (USAID) Mr. Stephen Herbaly which sought to x-ray USAID's support for civil society in Nigeria and a new programme budgeted to hit $8 million in the next five years.

Thursday's Vanguard also had a story on the report. Here are the first two paragraphs of that story:

Obasanjo denounces US intelligence reports
by Emmanuel Aziken
Posted to the Web: Wednesday, May 25, 2005

ABUJA — President Olusegun Obasanjo has denounced a United States Intelligence assessment of Nigeria as a nation heading towards failure, and vowed to prove the lowly report on Nigeria as a product of the prophets of doom among the US intelligence community.

President Obasanjo reacted in a letter conveying to the Senate the report of the United States Intelligence Council in which Nigeria was rated as being managed by leaders at war with one another and headed towards possible self-implosion.

A high-ranking official in the region hinted earlier this week that "major oil interests" were behind much of the disruption being experienced in the JDA's second licensing round of oil-rich blocks located in the Gulf of Guinea Joint Development Zone, where ownership is shared on a 60:40 basis by Nigeria and Sao Tome and Principe under a 2001 treaty.

Here is the ThisDay Online story from May 25 editions:

US Intelligence: Nigeria 'll Fail in 15 Years
They are living in the past, says Obasanjo
by Kola Ologbondiyan
05.25.2005

ABUJA --The United States National Intelligence Council in a document entitled "Mapping Sub-Saharan Africa's Future" has predicted "outright collapse of Nigeria" as a nation-state within the next 15 years.

In a swift response, President Olusegun Obasanjo described the prediction as "glib(ly) talk" arising from "dubious or diabolical benchmarks."

On page 17 of the report under the heading "Downside Risks," the US Intelligence claimed that "while currently Nigeria's leaders are locked in a bad marriage that all dislike but dare not leave, there are possibilities that could disrupt the precarious equilibrium in Abuja.

"The most important would be a junior officer coup that could destabilize the country to the extent that open warfare breaks out in many places in a sustained manner. If Nigeria were to become a failed state, it could drag down a large part of the West Africa region.

"Even state failure in small countries such as Liberia has the effect of destabilising entire neighbourhoods. If millions were to flee a collapsed Nigeria, the surrounding countries, up to and including Ghana, would be destabilised. Further, a failed Nigeria probably could not be reconstituted for many years - if ever - and not without massive international assistance.”

According to the introductory part of the report captioned "summary", "the National Intelligence Council recently convened a group of top US experts on Sub-Saharan Africa to discuss likely trends in the region over the next 15 years. The group discussed several major issues or drivers that will affect Africa, including globalization and its impact on political development and economic growth, patterns of conflict, terrorism, democratisation, etc.

Obasanjo's 7-paragraph reaction to the document dated May 17, 2005, which was addressed to Senate President Ken Nnamani, and read on the floor was titled "Report of the US Intelligence Council."

It read: "As a means of informing ourselves, I hereby forward a copy of the United States National Intelligence Council document on "Mapping Sub-Saharan Africa's Future" for your attention. I am sending this to you not because I am alarmed by the report but because if we know what others think of us and about us, we can prevent what they project for us.

"As a person who has participated in similar so-called "expert group" on issues, situations and regions, I know that the predictions and projections can be wide off the mark because both politics and economics cannot be absolutely predicted and their dynamics can fool the greatest and best expert. But it is important for us to know that we are being rated low, not because of what is happening to us from outside but because of what we do to, for and by ourselves internally.

"I believe that it is only God and ourselves that can map our present and future. No outsider can do that accurately for us. I know that some people glibly talk of the probability of Nigeria as a failed State. I believe that they are living in the past and incapable of noticing and appreciating the positive strides we are making on all fronts and the determination of the Nigerian people to join hands to consolidate democracy and promote sustainable growth and development.

"Because they are stuck to old ideas and dreams as well as stereotypes about us and our capabilities, they cannot see the New Nigeria that we are building collectively as we move beyond the past but allowing the past and present to strengthen and sustain our future.
"Similar experts at the beginning of the second half of the 20th Century predicted worse scenarios for South East Asia. In fact, at the dawn of independence in Africa, Africa's chances were rated much better than that of South East Asia, but because they pulled themselves together, the predictions and projections about them have been proven false. In the case of Africa, the reverse has been true as the early favourable predictions and projections for the continent have remained largely unattained.

"If our detractors cannot see our far-reaching reforms, our fight against waste and corruption, the new culture of prudence and service delivery that is gradually emerging, the various political reforms including the on-going National Political Reform Conference as well as the sacrifices our people are making to ensure economic progress and democratic consolidation as indicators of progress and a radical departure from the past, then they must have some dubious or diabolical benchmarks for measuring efforts at ensuring oneness, unity, stability, indivisibility, prosperity, development and growth of our dear country.

"Our performance in the last three years has, in my view, been very good just as our performance in ensuring stability, peace, economic progress and good governance in West Africa and, indeed, the whole of Africa.

"I believe that we can and should disprove the modern experts of the United States Intelligence Council who are like the prophets of doom and by the Grace of God, for Nigeria in this first decade of the 21st Century, we must be determined to show that we are neither a basket case nor walking on a banana peel.

"I wish you well as you read the report and would very much appreciate your reactions, perspectives and suggestions. For me, it is a challenge and it calls for extra work. We owe that much to our people, to Africa, humanity and to God Almighty, our Creator. May God bless Nigeria and Africa.”

Money.net Reports 1.2 Million Shares Traded After Hours; Bad Data Suspected

The Level II financial reporting system Money.net says about 1.2 million shares traded well after closing today and brought the price down to $0.695, erasing the small gain the stock had enjoyed on the day. However, the data could not be substantiated on other financial sites, however, including the New York Times, E*Trade and ADVFN, and a poster in our Comments section points out the figure matches last Friday's volume, not today's.

According to the site, which does have service interruptions at times, 2,067,200 shares traded, but the site puts the time of the last trade at 23:59:47, or 13 seconds before midnight, which has not yet arrived.

Extended hours trade reporting is spotty throughout the financial world. The New York Times Business page on its Cybertimes Website (www.nytimes.com, by registration only) does not confirm the trade, but both the Times and the ADVFN system say some 7,500 shares traded after hours. ADVFN and Money.net at the closing showed the Bid and Ask at $0.702, but Money.net reduced it to $0.69 x $0.695 well afterwards.

After hours trading can occur up to 8pm in most stocks on E*Trade, but that broker showed no after-hours trading in ERHE at all. The broker accepts only limit orders in extended hours and charges a fee of $0.005 per share on top of its regular commission.

JDA Could Be Dissolved, Tanko Hints

The Nigeria-Sao Tome and Principe Joint Development Authority could be dissolved if Sao Tome does not move towards a consensus with Nigerian delegates to the Joint Ministerial Council, a high-ranking Nigerian foreign affairs official said as the second day of JMC meetings with Sao Tome and Principe officials got underway this morning.

JMC member and Nigerian deputy foreign minister Abubakar Tanko said the "bond of partnership" with Sao Tome would be "seriously affected" if Sao Tome and Principe delegates continued to delay announcement of the block awards negotiated by the JMC three weeks ago after a five-month delay in announcing them.

The last licensing round, for nine blocks, ended in chaos as one block got awarded and the rest were put out for rebid more than a year after awards were anticipated.

Meanwhile, there was no announcement at the end of the business day in Abuja, and a press release promised by the Joint Development Authority has not appeared on its Website. It is common for the JDA to promise things but fail to deliver for days, weeks or even months, and it has done so countless times since last year through its spokesman Sam Dimka and its official Secretary.

News reports published by Reuters and others said the "integrity of the process" was at stake. The endless delays have frustrated investors and outraged Nigerian officials, who signed off on the proposed award of Blocks 2 through 6 in the oil-rich Gulf of Guinea's Joint Development Zone at the beginning of the month and expected Sao Tome President Fradique de Menezes to do the same.

Instead, upon receipt of the award documents de Menezes was forced to follow a circuitous legal path mandated by a new petroleum law through the National Petroleum Council, the National Petroleum Agency and Sao Tome's parliament, and began shedding officials through resignations and firing as soon as the process began.

Even de Menezes resigned as head of the NPC after he had also accepted the resignations of oil minister Arlindo Carvalho and foreign minister Mateus Meira Rita, and he fired Equator Exploration lobbyist Patrice Trovoada, the son of the immediate past president of Sao Tome, as his special presidential advisor on oil after agreeing that Trovoada had a serious conflict of interest as a member of the country's Joint Ministerial Council delegation which negotiated the awards.

Sao Tome borrowed $44 million from Nigeria based on its expectation of getting a $49 million share of the $123 million Block 1 signature bonus fee paid into a Nigerian bank account by ChevronTexaco, ExxonMobil and two independents, Norway's financially-troubled Energy Equity Resources (EER), which originally had a 9 percent share of Block 1, and Afren, a Nigerian firm that bought half of EER's share when the former was forced to sell. The bank deposit broke the rules of the JDA agreement, known as the Abuja Accords, and Nigerian foreign ministry officials have stated that payment of the funds, which they now control, is contingent on Sao Tome's signature on the awards document.

The two spokesmen for the delegations went head-to-head in the press via a Reuters interview in which Carvalho said that "when we went home after a deep analysis we came to the conclusion that some things needed to be done," while Tanko seemed determine to preserve the original list of award-winners.

"If we continue to allow extraneous factors to guide our thoughts and decisions it will seriously affect the bond of partnership," Tanko told Reuters ahead of the the second day of meetings.

The consequences of dissolving the rickety, almost unworkable partnership between Nigeria and Sao Tome would slow the awards process and permit lawsuits to prosper as the two countries fought for their fair share of the Gulf of Guinea Joint Development Zone. That is likely a battle that Nigeria would eventually win.

Victory could come at a difficult time for Nigerian President Olusegun Obasanjo, however, as his party faces new presidential elections in 2007, as does de Menezes' MDFM party in Sao Tome.

Obasanjo may soon become embroiled in an impeachment trial, and de Menezes faces a thoroughgoing investigation he has ordered into the failure of the first awards decision three weeks ago due to conflicts of interest alleged against him and several members of his cabinet. He in turn has charged that corruption was involved in earlier opposition party decisions about the JDA and has vowed to uncover it.

A "transparency" law written by students at Columbia University has become the nexus for political maneuvers that could now kill the "golden goose" that oil was expected to become for Sao Tome. There is little doubt that the former Communist Party officials who run the Movement for the Liberation of Sao Tome (MLSTP), now the ruling party in Sao Tome's parliament, who are avowed Marxists, would forego the money to gain political power through embarassing the MDFM president ahead of elections.
That is not true in Nigeria, where corruption is an accepted way of life and where an effort to stem it has backfired with potentially serious consequences for Obasanjo.

Opposition to both men is well-organized in their respective countries, so that a failure to deliver awards now could well mean they would not be made within the coming year but would await the outcome of the 2007 elections in both countries when officials could determine who has the upper hand in the political process and then proceed accordingly.

Phil Nugent Sues To Break Up His Partnership As GEECF Heads South

Phil Nugent, the man who claims to have introduced Emeka Offor to Sao Tome and who was tied in a recent Barron's Weekly article to attorney Donald Mintmire, a Palm Beach stock promoter arrested by IRS officials last May, claims in a letter to ERHC On The Move that he filed suit May 9 in Federal Court to break up his partnership with the company that has burned through $210 million in a matter of months and seen its share price drop from a recent high of $2.88 to $0.40.

The New Orleans-based oilman also threatened to sue ERHC On The Move for intimating he had a management or equity role in the company. ERHC On The Move mistakenly reported that Nugent "is battling to save his newest enterprise, Global Environmental Energy Corp." In fact, he is apparently fighting to undo his relationship with it after former Irish Prime Minister Albert Reynolds bailed out of the company,as posted here on May 14. Our headline correctly said he "faces issues" with the company.

In a letter posted in our Comments section and then reprinted last week, Nugent's lawyers says, "For you to flatly state that Mr. Nugent or his company, ERHC, has any management or ownership interest in Global Environmental, a company that is described as insolvent and facing numerous punitive damage and director/investor actions against it, as well as possible tax liability actions, is not only patently libelous but could be characterized as an intentionally tortuous act... ."

Nugent's lawyer, Cameron Gamble, apparently cannot spell "tortious" correctly. The letter was posted as received and is still available below.

The Barron's article on GEECF linked Nugent to a Palm Beach lawyer who was convicted of stock fraud and lying to the Securities Exchange Commission, saying that Nugent and another ERHC Energy investor were part of the same cast of characters who have invested in ERHC Energy.

Today, when we suggested that his problems with GEECF as evidenced by the lawsuit he claims to have filed may have led to substantial losses that could require him to sell his ERHC Energy holdings, someone posted the letter again, this time with a valid local address and signed by an apparent lawyer, Cameron Gamble. No hard copy of the letter has been sent to us, That response reinforces the possibility we suggested that Nugent himself is behind the selling that has continually depressed the share price.

Nugent had earlier thanked ERHC On The Move for an article that distanced him and GEECF from ERHC Energy, and had instructed his son, lawyer Phil Nugent, Jr., of New Orleans, to ask if we would be interested in co-authoring a book with the elder Nugent and a Cambridge, Mass.-based academic writer, Daniel Yergin, on the history of his role in ERHC Energy (formerly Environmental Remediation Holdings Corp.), and sent us a small box of pecan pralines in gratitude.

We are unsure what turned him against us, but we now intend to publicize his relationship with GEECF and the attendant lawsuit at every opportunity.

Here is a portion of a year-old Mintmire story from a Florida newspaper:

Palm Beach Lawyer Arrested In Alleged Citrus-Stock Scam

POSTED: 12:27 pm EDT May 21, 2004
UPDATED: 12:42 pm EDT May 21, 2004

WEST PALM BEACH, Fla. -- A Palm Beach attorney will be arraigned for his role in what the Internal Revenue Service is calling a citrus-stock scam.

Donald Mintmire was taken into custody on Thursday at his Palm Beach law office, where investigators took out more than a dozen boxes filled with records. Mintmire is accused of dissuading potential witnesses from telling the truth.

IRS officials said Skip Clements, the owner of Clements Citrus blew the whistle on Mintmire.

Clements made a fast climb in the citrus business with sales skills that convinced even the Chinese government to buy his orange juice.

"I mean, that's pretty damn good. So, there's a lot of people around town saying 'I want a piece of that dream,'" Clements said.

The dream vanished for Clements and investors a short time after the company went public. Money intended for the company's growth seemed to disappear.

Clements said he discovered what investors had never been told: that their Stocks couldn't be traded for two years and, it appeared the money had gone to the pockets of only a handful of executives.

"I was sick to my stomach," Clements said. "I didn't know what to do."

Clements, the company's founder and the man with his name on the label, filed a complaint with the Securities and Exchange Commission and federal prosecutors.

"I couldn't let (the executives) get away with it. I couldn't let them beat people that trusted me," Clements said.

Board members fired Clements for making the complaint. Clements aid Chief Financial Officer Joseph Rizzuti made sure Clements would not receive unemployment.

But federal officials listened to Clements' story and launched a grand jury investigation that lasted almost a year.

A grand jury will decided whether criminal activity led to the company's failure.

"The prosecutor told me once there was only one mistake these people made when they did this whole thing and I said 'What's that?' He said, 'They didn't count on you walking away,'" Clements said. "That paper trail will put them all in prison for a long time. That paper trail will prove they're all lying."

Trading Updates: Both Sides Ready For Results

Both sides in the new Nigeria-Sao Tome and Principe Joint Ministerial Council meeting indicated they were ready for results from the second licensing round of choice oil blocks in the Gulf of Guinea Joint Development Zone, and ERHC Energy (OTC BB symbol: ERHE) investors are even readier.

Trading should be brisk today - but we'll know in a moment.

Trading Updates
Update, 5/25/05, 4:01 EDT: Volume has climbed sharply since the 3:15 Surge, to 777,940, and the price is $0.702 and the Bid and Ask $0.70 x $0.702. ERHE gained $0.002 on the day. ADVFN reports that as of 3:40, there were 146 trades today running strongly to the Buy side, but not as strongly as earlier. There were 383,250 Buys and 206,650 Sells and 30,360 shares unidentified.

Update, 5/25/05, 3:08 EDT: Volume has slowly climbed to 558,525, while the Bid and Ask remain $0.695 x $0.70, and the price is $0.70 just five minutes for the 3:15 Surge..

Update, 5/25/05, 12:47pm EDT: Buyers are becoming still more dominant. In the first 105 trades of the day at 12:28pm EDT, there were 301,175 Buys and 73,025 Sells, with 30,360 unidentified, according to ADVFN, which has a 15-minute delay. Volume at 12:47 is 462,560, and the price is $0.70, with both Bid and Ask improved to $0.70 x $0.702.
.
Update, 5/25/05, 12:35pm EDT: Please read my latest Comment if you want to know what I think about today's meeting. The price is unchanged at $0.70, with volume now at 409,560 and the Bid and Ask unchanged at $0.696 x $0.70. Nothing new on the JDA Website. Now I'm going to Morty's for lunch.

Update, 5/25/05, 12pm EDT: With trading stalled at noon, and the JDA PR still not online, we're headed to Morty's Bagels in Palmetto, Fla., for lunch of great homemade bagel sandwiches and pastries from Tim and Antonieta O'Dea.

The volume is still 337,275, and the Bid and Ask remain at $0.696 x $0.70, with the price at $0.70.

The U.S. Senate has just started voting on Priscilla Owen's nomination to the U.S. Court of Appeals.

Update, 5/25/05, 11:48am EDT: The price is $0.70 in ho-hum trading, Volume has climbed just 7,000 shares in 30 minutes. The Bid and Ask are unchanged at $0.696 x $0.70.

Update, 5/25/05, 11:18am EDT: The price is $0.696, the new Bid, and the Ask remains at $0.70. Volume is tepid at 330,395. We have a picture of the crowd outside the JDA offices awaiting the news that will display here shortly.


SwingingK, ever vigilant...
A crowd has gathered outside the offices of the Joint Development Authority in Abuja, where members of the Nigeria-Sao Tome Joint Ministerial Council are debating block awards for the second time this month. A JDA PR is expected today or tomorrow. Photo credit: "La Lucha," a new DVD documentary of the Mexican sport of "lucha libre" wrestling.

Update, 5/25/05, 10:56am EDT: The last 18 trades ran 15 Buys to three Sells, or 5:1, according to ADVFN. The price is still $0.70, and volume has now reached 311,332. The Bid and Ask are unchanged at $0.695 x $0.70.

Update, 5/25/05, 10:48am EDT: In the last 41 of 66 trades, only 8 are Sells. There are 33 Buys, and the Buy - Sell ratio still is better than 3:1. That's according to ADVFN, which is on a 15-minute delay.

Update, 5/25/05, 10:45am EDT: Volume is 298,042 shares, with the price still at $0.70.

Update, 5/25/05, 10:41am EDT: I hear a distant voice saying, "We have bad news." I need to get more sleep. Volume is 285,542 and all else is unchanged.

Update, 5/25/05, 10:40am EDT: We're back at $0.70, with volume still slow at 275,042. The Bid and Ask are unchanged.

Update, 5/25/05, 10:37am EDT: The Buy - Sell situation is remarkably tilted to the long side, with 126,357 Buys to 39,400 Sells in 51 trades as of 10:17; there are 20,360 shares unidentified. The price has fallen to $0.699, and the Bid to $0.695, while the Ask is lower at $0.70.

Update, 5/25/05, 10:34am EDT: This yawning $0.002 "gap" frustrates me. Why doesn't some market maker demand what ERHE is worth? Volume has climbed to 261,542, suggesting that as the end of today's meeting and a JDA PR grow closer, there will be a rush for the rafters.

Update, 5/25/05, 10:27am EDT: We're at $0.702, the Ask, with the Bid still at $0.70 and volume approaching 200K, at 198,117. It's Dullsville out there, folks.

Update, 5/25/05, 10:25am EDT: GEECF, where ERHC investor Phil Nugent is trying to dissolve his partnership agreement, hit $0.40 this morning and is now at $0.41, off $0.07. So much for resistance at $0.48.

Update, 5/25/05, 10:20am EDT: The Buy - Sell ratio has swung more firmly to the Buy side now. In 30 trades, 24 are Buys, and just six are Sells.

Update, 5/25/05, 10:18am EDT: The price is $0.7020, a twentieth of a cent lower, with volume at 186,117 and the Bid now at $0.70. The Ask is $0.702.

Update, 5/25/05, 10:14am EDT: The price is $0.7025, a healthy innovation. The Bid is still $0.695, but the new Ask is $0.704, as if that made any sense. Volume is 164,017, moving at last.

Update, 5/25/05, 10:09am EDT: Buyers are outrunning sellers 3:1 this morning, with ADVFN (on a 15-minute delay) reporting 59,590 Buys and 18,150 Sells in the first 23 trades. Someone's got brains.

Update, 5/25/05, 10:03am EDT: The price has slipped four-tenths of a cent to $0.695, and then come back to the Ask at $0.699. Volume is a meager 88,940 shares.

Update, 5/25/05, 10:03am EDT: About 5K shares have traded, with volume now at 82,940 and the price, $0.699, the Bid (the same) and Ask, $0.699, all unchanged. It appears traders are not chomping at the bit, but the JDA PR will spark a riot (i.e., a really strong rally), we think.

Update, 5/25/05, 9:58am EDT: We think the following update from SwingingK is probably the real thing this time. His named source declined to say when awards will be, but says we can expect a Joint Development Authority press release:

*********YEAH**********

Just got off the phone with Kashim Tumsah, He is the JDA's Legal guy. Was asking him some PSC questions regarding Blk 1, & how that would affect the Drafting of Blk's 2-6, He responded, " We are so glad to finally have settled the matter of whom actually is awarded which block, the PSC should be a snap, 90% of it is Boilerplate from the Block 1 PSC."

I then asked him if Awards will be anounced today since in your own words you finally settled on whom gets awarded what. KT responded, " A PR will be issued as soon as the JMC Draws to a close."

Update, 5/25/05, 9:51am EDT: Very, very slow trading today, but we think the meeting may yet be a short one. Volume price, Bid and Ask are unchanged. It reminds me of July, 2003.

Update, 5/25/05, 9:47am EDT: A fresh and much appreciated Update from Anonymous (you know him):

****UPDATE AWARDS****

Just spoke with Secretary of JDA. I asked him if the Gomes quotes about awards this week and the Reuters article were accurate and he said they were indeed accurate. I asked him if awards would be announced this week and he said yes and that there would be a PR most likely today/tomorrow. JMC is to start meeting in about an hour.

Price, Bid and Ask are unchanged as volume reaches 77,740.

Update, 5/25/05, 9:42am EDT: We added an extra "3" to the volume figure - sorry. Now it's 47,040 and motionless. The price, Bid and Ask are unchanged.

Update, 5/25/05, 9:37am EDT: The price is a tenth-cent lower at $0.699, 44,450 shares trading so far. The new Ask is $0.699.

Update, 5/25/05, 9:34am EDT: Well, not brisk as only 24,040 shares trade in the first three minutes. The price is $0.70, the fallen Ask, and the Bid is $0.695.

Reuters: Carvalho Wants Changes

The Reuters news agency quotes resigned-and-rehired Sao Tome oil minister Arlindo Carvalho as saying Sao Tome wants to close the books on the long-delayed results of the second Nigeria-Sao Tome Joint Development Zone licensing round, but that that "some changes" are needed to bring that about.

When Carvalho talks about changes, it resonates to most investors as "ERHC Energy." But some Sao Tomese were known to be upset about awards to Nigerian indies Godsonic, A&Hatman, Momo Petroleum and Conoil, each of which has a powerful Nigerian figure as its sponsor and none of which have drilling experience, nor, some say, the financial wherewithal to support a drilling regime.

With the knowledge and consent of his government, the oil minister is apparently a shareholder in sme of the companies involved in the JDZ bids, and he is a member of the ADI party associated with fired Sao Tome presidential oil advisor Patrice Trovoada, a "still-powerful" figure who lobbied too hard for larger participation by Equator Exploration (EEL) and was fired for it.

On Monday, Sao Tome President de Menezes said Carvalho needs to stay on the job, among other reasons, so that investigators can examine his portfolio.

Meanwhile, a veiled warning to the Sao Tome delegation was apparent in the words of Abubakar Tanko, a Nigerian deputy foreign minister and JMC member who is apparently saying, "Don't push us too far."

Here is the Reuters piece, slightly truncated:

Wed May 25, 2005
8:28 AM GMT+02:00
Sao Tome/Nigeria to award oil blocks after delay
By Felix Onuah

ABUJA (Reuters) -- Sao Tome and Nigeria expect to make a final decision on the long-awaited award of oil exploration licences at a meeting in Nigeria that began on Tuesday night, a Sao Tome official said.

A five-month delay in awarding five licences, located in a highly prospective offshore region in the Gulf of Guinea which is jointly administered by the two countries, has raised questions over the integrity of the process, Nigeria said.

"We hope this meeting will conclude our decisions for the award of the oil blocks," said Sao Tome Minister of Natural Resources Arlindo Carvalho. "We could not achieve this in earlier meetings because when we went home after a deep analysis we came to the conclusion that some things needed to be done," he added, without saying what.

. . .

Nigeria's junior minister of foreign affairs, Abubakar Tanko, said the delays were eroding credibility in the licensing process.

"If we continue to allow extraneous factors to guide our thoughts and decisions it will seriously affect the bond of partnership," Tanko told reporters before the meeting.

Trading Updates: Platts Reports On JMC Meet; ERHE's Price Is Higher On Low Volume; Sao Tome Delegation Arrives In Abuja; The Latest Lusa Report

With little action in the first half hour, ERHC Energy (OTC BB symbol: ERHE) shares have risen slightly this morning as investors await more news from Abuja of the reconvened Joint Ministerial Council meeting on block awards.

There is also a new report from Platts Oil, one of the world's most reliable sources of information on the energy industry. The new item in the Platts story is that Sao Tome officials had told the paper the awards could be delayed "two months." That news was never reported in anything we've ever seen. It appears below the Trading Updates.

Trading Updates

Update, 5/24/05, 4:25pm EDT: Buys narrowly edged out Sells today in 132 trades, with 328,337 to 320,694 and 12,500 unidentified shares there to make the difference. For the first time in a while, trading closed at 5:57:04, about three minutes ahead of the bell. All of this points to a balance of expectations that is very near even. In the final few minutes ERHE traded more Buys than sells, but the last big trade was a 22,500 sell. The blue flag was apparently a pumper's trick - no news has appeared by 4:25pm EDT.

Update, 5/24/05, 4pm EDT: No news yet, although some on RB says a blue news flag is lit beside our symbol. Pumpers often say that to escape with an extra few cents in day trading. The price is $0.70, and volume has climbed - mostly in Sell volume - to 661,531 shares. The Bid is still $0.695 but the Ask has risen near the close to $0.703. Buys still lead Sells by about 13,000 shares today, per ADVFN on 15-minute delay. Of the last 41 trades recorded by ADVFN at 3:38pm EDT, 29 were Sells and 12 were Buys, with the Sells totalling 205,296 shares against Buys of just 59,385. It's hard to say if that was the sound of day traders exiting, margin calls falling or just a plain ol' sell-off. No news by 4:11 to back up that blue flag business.

Update, 5/24/05, 3:40pm EDT: Okay, we're back at $0.70, the Ask, on 617,581 shares of volume. The Bid is still $0.695.

Update, 5/24/05, 3:36pm EDT: I think "ironed out" may be the operative phrase about bid disputes. Let's see - hopefully soon.

Update, 5/24/05, 3:32pm EDT: We're at $0.685 again, and the Bid has improved to $0.695 while the Ask has risen to $0.70 on volume of 610,066 shares, a noticeable leap at last.

Update, 5/24/05, 3:29pm EDT: Volume is up a few thousand shares to 562,439, while the price is better at $0.69, the imporved Bid, with the Ask better at $0.695. I feel the JMC meeting could end quickly, even after just one meeting.

Update, 5/24/05, 3:26pm EDT: A 3K surge? I don't think so. Turns out the big trading after lunch was mostly due to a margin call that left oilman down 88,000 shares, he says. Meanwhile, it's 8:25pm EDT in Abuja: Do You know where your block awards are?

The price is $0.6810, the Bid, the Ask is at $0.69, and volume is 558,819 shares.

Update, 5/24/05, 3:11pm EDT: Buying has dominated trades today, although sellers have produced some volume in the past two hours. The ADVFN systen, reporting with a 15-minute delay, shows 295,752 Buys to 252,162 Sells with 7,500 undecided in a total of just 116 trades as of 2:47pm EDT.

Update, 5/24/05, 3:05pm EDT: I dreamed I invited a nun to lunch. Borrrrinnnnggg!

205 shares traded. The price has fallen to $0.6810, the Bid, and the Ask is at $0.69. The 3:15 Surge looks like a losing proposition.

Update, 5/24/05, 2:52pm EDT: Trading has livened up as I snoozed, but the price is just $0.69, the Ask, while the Bid has fallen to $0.681 and volume has reached 555,414 shares.

Update, 5/24/05, 1:59pm EDT: 2K more shares traded, bringing volume to 340,650, and the price to the current Ask, $0.699. The Bid stays at $0.695.

Update, 5/24/05, 1:56pm EDT: After an hour of inactivity, 11,500 shares have traded. The first was a 1K trade which dropped the price to $0.695, the current Bid, and the Ask to $0.699. The current price is also $0.695. Volume is 336,350.

Update, 5/24/05, 1:48pm EDT: There are 300 shares missing from the ADVFN count, but other than that, nothing at all has happened in a solid hour.

For those going to Sao Tome to celebrate their newfound fortunes, here is inside info on the drinking situation, from South Africa's daily Mail & Guardian:

In the postage-stamp-sized country of Sao Tome and Principe is an idyllic Garden of Eden island where you walk along a suspended bridge to get to the dining room on an even smaller island. Here both vodka and tonic are plentiful. Beer? Yup. Wine? Forget about it.

Update, 5/24/05, 1:31pm EDT: Nothing has changed in the past 40 minutes. Volume may finish at a record low for the month so far, unless news emerges from the JMC meeting if it breaks up before 9pm Abuja time (4pm in New York).

Update, 5/24/05, 12:51pm EDT: We're still at $0.70, and the volume, remains unchanged as well. The Bid is $0.69.

Update, 5/24/05, 12:51pm EDT: The price is $0.70 again, up a penny from yesterday's $0.69 close, and the Ask is slightly better at $0.70. Volume remains slow at 325,435, but most of the action remains definitively on the Buy side, with 212,152 Buys to 89,783 Sells in 67 trades as of 12:31 this afternoon.

Update, 5/24/05, 12:34pm EDT: The price is slightly improved to the Bid, $0.693, and the Ask remains at $0.695. Volume has only now reached 301,935, lagging far behind recent days.

Update, 5/24/05, 12:10pm EDT: On ADVFN 15-minute delay, the Buys are more than double Sells, 198,052 to 84,783 in just 62 trades (with none unidentified).

Update, 5/24/05, 12pm EDT: The volume is a mere 282,835 and the price remains at $0.69, with the Ask at $0.695. Trading is unusually static today, undoubtedbly because of the uncertainty associated with the reconvening of the JMC to revisit the block awards. We expect the meetings to be somewhat perfunctory and to ratify the original awards, possibly excepting the percentage to EEL.

Update, 5/24/05, 11:04am EDT: We would appreciate it if readers would forward us any reporting that suggests Arlindo Carvalho is an ERHE shareholder. We believe such comments are in error, and may have been confused with ERHE shareholder Mateus Meira Rita, another Sao Tome official who resigned from the JMC.

The price is $0.69, the Bid, and the Ask remains at $0.695, while volume is still low at 263,135 shares.

Update, 5/24/05, 11:31am EDT: The price is $0.695, the Ask, and the Bid remains $0.69 on continuing sluggish volume of 259,135 shares.

Update, 5/24/05, 10:15am EDT: An update from Abuja lets us know that the Sao Tome delegation has arrived for this evening's meeting of the Nigeria-Sao Tome and Principe Joint Ministerial Council. Thanks!

The price is $0.695, the Ask, and the Bid is at $0.69. Volume has reached a slow 229,895 shares.

Update, 5/24/05, 10:15am EDT: The price is $0.70, the Ask, and the Bid is close at $0.698, with volume of 184,250 in the first 45 minutes.

Here is the Platt's Oil report:

Nigeria, Sao Tome meet in Abuja to resolve block awards row

Paris (Platts) 24May2005 -- Nigerian and Sao Tome authorities plan to hold a meeting in Abuja later Tuesday to patch up frazzled relations between the two countries over the award of five oil blocks in a shared zone that is believed to hold up to 6-bil bbl of oil. "There is a meeting of the Joint Ministerial Council today in Abuja. At this stage, I don't know what the situation is in Sao Tome. Our only hope is that we can resolve the issues," Carlos Gomes, chairman of the Joint Development Authority, set up to manage the oil licensing round, told Platts.

Sao Tome authorities are unhappy with JDA's recommendations allocating various stakes in the blocks to several Nigerian indigenous companies, which they allege have close ties to the presidency, and have called for a review of the proposals. The JDA, according to Nigerian reports, awarded a 20% stake in the most-sought after Block 4 to Mike Adenuga's Conoil and a 5% interest to a company called Godsonic. Momo Oil and Gas picked up a 5% in Block 2, while Equinox Oil and Gas was awarded 10% in Block 3.

Nigeria's president Olusegun Obasanjo has endorsed JDA's recommendations, while his oil adviser Edmund Daukoru traveled to Sao Tome last Friday where he accused the country of "politicking with purely technical matters," the Nigerian ThisDay newspaper said. Gomes dismissed the claims by Sao Tome, adding that the JDA had followed the rules guiding the 2004 Licensing Round of the Joint Development Zone. "We have done our job at the JDA, the technical work has been done. It is now up to the ministerial meeting this afternoon," he said.

Daukoru, speaking to Platts before he left Abuja on Friday, said the JMC, made up of 12 members drawn from the two countries, had endorsed the recommendations as they stand and he was confident the awards would soon be announced. "If as a result of these political developments, they want to take a better look, I think our position would be to urge them not to delay too much," Daukoru said.

Senior Sao Tome officials last week said the announcement could be delayed by up to two months after Arlindo Carvalho resigned as natural resources ministry amid corruption allegations. The resignation came days after president Fradique de Menezes sacked oil adviser Patrice Trovoada, son of the Miguel Trovoada, a former head of state. Trovoada's Independent Democratic Action political party has nominated to prime minister Damiao Vaz d'Almeida both a geologist and a lawyer as a replacement for Carvalho.

Trovoada, whose party retains control of the petroleum and trade and industry sector under the nation's coalition government and who remains a powerful figure despite his
unexpected dismissal, last week told Platts that Sao Tomean authorities were hoping to get the process for awarding the blocks back on track but both legal and transparency issues had to be dealt with first. Under the terms of a treaty signed in 2002, Nigeria, which is already Africa's largest oil producer, will take 60% of all oil and gas revenues. Sao Tome will take 40%.

This story was first published in Platts real-time news and market reporting
service Global Alert - http://www.globalalert.platts.com

Here's the latest English-language report from Lusa, the Portuguese news agency that lately has been bashing ERHC Energy, but doesn't do so today:

24-05-2005 13:44:00.
Fonte LUSA.
Notícia SIR-7027360
Temas:

Sao Tome: Ministers in Abuja for talks on delayed oil-block allocation

Sao Tome, May 24 (Lusa) - A ministerial delegation leave Sao Tome and Principe Tuesday for two-way talks in Nigeria on the delayed process to allocate offshore oil exploration rights in the two countries` Joint Development Zone.

Natural Resources Minister Arlindo Carvalho told Lusa that a meeting of the Joint Ministerial Council has been requested by Sao Tome to review the awards of exploration rights to five offshore oil blocks in the delayed 2004 licensing round.

The talks in Nigeria will start later Tuesday, he added.

Carvalho, heading the Sao Tomean delegation, said he was traveling to Abuja with Foreign Minister Ovidio Pequeno, Defense Minister Oscar Sousa and Planning Minister Adelino Castelo David, in addition to an adviser of President Fradique de Menezes.

"We will review the whole process to dispel all the controversies that have surfaced in Sao Tome", said Carvalho, referring to a row that has erupted in the archipelago in recent weeks on how to allocate the handful of offshore oil blocks.

Last week Carvalho said he was exiting Sao Tome's government due to allegations of irregularities in the overdue block allocation, but President Menezes rejected his resignation Monday, saying the minister had "valuable knowledge" in the process.

Nigerian President Olusegun Obasanjo visited Sao Tome last weekend and expressed his displeasure at the hold ups in the awards of the offshore blocks.

Allegations of private oil interests of a number of senior Sao Tome officials emerged about a month ago and have already forced Menezes to sack his personal oil adviser and another presidential counselor.

Menezes also agreed to take a back seat on the country+s National Petroleum Council.

RCN/CJB.

Lusa

www.lusa.pt

Carlos Gomes Tells 'ThisDay' He Expects Sao Tome To Approve Awards; Hints 'Oil Majors' Are Behind The Crisis; 'Punch': Awards This Week

Showing no signs of regret for the JDA's choice of bid winners in the Nigeria-Sao Tome and Principe Joint Development Authority's second licensing around, JDA chairman Carlos Gomes told ThisDay Online Monday that he expects Sao Tome to approve those choices when the JDA's Joint Ministerial Council meets again today in Abuja.

Another article, posted by Ruby1100 from the Nigerian daily Punch, says the JMC is expected to ratify the original awards before the end of the week (see below).

Gomes suggested that some disappointed "oil majors," such as ExxonMobil, were behind the crisis manufactured in Sao Tome:

"Although no local companies showed interest from Sao Tome, I think some people there may be protesting on behalf of some oil majors which they have interest in," he added.

Gomes talked Monday to the paper's Mike Oduniyi, a veteran reporter on the oil industry.

Oduniyi also reveals that Nigerian businessman Mike Adenuga's Conoil may be the winner of a 20 percent chunk of Block 4, where he would be partnered with Noble Energy and ERHC Energy, and possibly with Equator Exploration.

Protests Stall Award of Oil Blocks
by Mike Oduniyi
05.24.2005

The hitherto smooth administration of the Joint Development Zone (JDZ) of the Gulf of Guinea by Nigeria and Sao Tome and Principe has run into stormy waters as the two countries are now sharply divided over the award of oil acreages in the region to companies that participated in the 2004 licensing round.

At the heart of the disagreement is a loud protest by Sao Tome against the recommendations of the Joint Development Authority (JDA), the body administering the Zone, to allocate various equity interests in the five oil blocks on offer to Nigerian indigenous companies, including Conoil owned by Dr. Mike Adenuga.

THISDAY checks revealed that following the Sao Tomean protest, President Olusegun Obasanjo, who visited the tiny Archipelago Island last Friday, warned that the country was "politicking with purely technical matters."

The Joint Ministerial Council (JMC), the highest ruling organ in the Zone made up of 12 members drawn from the two countries, had met in Abuja late last month to deliberate on the recommendations of the JDA on the structure and composition of companies in the blocks namely 02, 03, 04, 05 and 06.

It was gathered that while Obasanjo had already approved the recommendations as presented by Nigeria's representatives on the JMC, his Sao Tomean counterpart, Fradique de Menezes, has withheld assent. This, THISDAY gathered, followed objections raised by that country's National Petroleum Agency, citing the preponderance of Nigerian indigenous companies holding "uncomfortable" equities in the oil blocks.

According to the complaint by the Sao Tome petroleum agency, most of the Nigerian local firms are connected in one way or the other to the Nigerian Presidency.

The agency cited for instance, allocation of 10 percent equity in Block 02 to A&Hartman, and 5 percent equity in block 04 to a company named Godsonic, both allegedly linked to Chief Tony Anenih. There are also allocations of 5 percent in Block 02 to Momo Oil and Gas as well as 10 percent shares in Block 03 to Equinox Oil and Gas, both linked to Mohammed Asibelua.

Adenuga's Conoil got 20 percent equity in Block 04 for which the company had submitted bids offering to pay $150 million signature bonus, when tenders were called late last year.

According to the position of the oil block allocation as presented by Nigeria's representatives in the JMC as at April 26, 2005, US-based Environmental Remedial Holding Company (ERHC), where Nigerian businessman, Emeka Offor's Chrome Energy holds 50 percent clinched 70 percent equity in the most promising Block 04 in partnership with Noble Oil Company.

ERHC, which exercised its preferential rights in the JDZ, used the rights to clinch equity interests in three of the five blocks put on offer. The other firm also with preferential rights in the Zone, ExxonMobil, declined last month to exercise its right.

Opposition from Sao Tome to this arrangement has been linked to the recent crisis that has rocked the country's government. First, President Menezes sacked his Oil Adviser, Patrice Trovoada, while the country's Minister of Natural Resources Arlindo Carvalho tendered his resignation last week, citing pressure over delays in awarding the JDZ Blocks.

Speaking in an exclusive interview on the matter, the Deputy Director Monitoring and Inspection of the JDA, Dr. Carlos Gomes, yesterday dismissed the claims by Sao Tome, adding that the Authority had followed clearly the rules laid down for guiding the 2004 Licensing Round of the JDZ.

Gomes listed the criteria, including:

• Companies with good, sound and solid foundation in oil exploration and production
  
• Need to diversify operatorship of the oil blocks, whereby no one company because of its strength (financial and technical) controls more than two blocks
  
• Offering opportunities to independent players, as against the presence of dominant oil majors, and
  
• Offering opportunities to local companies to own equities in the oil blocks.
  According to the JDA Chairman, while Nigerian indigenous companies participated in the bidding, none came from Sao Tome.

"The criteria are there, clearly stated, which we followed religiously. We have guidelines, which we published and we have followed. Any party in doubt can check them out," said Gomes.

"Although no local companies showed interest from Sao Tome, I think some people there may be protesting on behalf of some oil majors which they have interest in," he added.

The JMC meets again today in Abuja. According to Gomes, he expects Sao Tome to have approved the recommendation. "If they have observations they must state on what technical grounds. But if it has to do with political matters, then that is beyond us. The two Heads of State will have to deal with that."

The JDA was originally scheduled to announce winners of the five oil blocks namely 02, 03, 04, 05 and 06 last January. This was later postponed to April 2005 to enable the JDA conclude screening of the bids as well as allow ExxonMobil exercise its rights.

Under the JDZ arrangement, Nigeria's share of the reserves in the region put at 10 billion barrels of crude is 60 per cent and the remaining share of 40 per cent is held by Sao Tome and Principe.

Here is the article (with emphasis added) posted by Ruby11oo, a trusted poster, from Punch:

The Punch, Tuesday May 24, 2005

Nigeria, Sao Tome ministers meet on oil blocks winners
Michael Faloseyi

ABUJA -- The Joint Ministerial Council of the Nigeria, Sao Tome and Principe will reconvene in Abuja on Tuesday (today) to ratify the winners in the five oil blocks it placed on offer in the joint development zone.

Our source in the Joint Development Authority confirmed the meeting in Abuja on Tuesday when he said that the major agenda of the meeting would be clearing outstanding issues on the bids for the oil blocks.

While declining comments on the possible announcement of winners in the bids received for the five oil blocks that were placed on offer in December, the source said that the meeting would also address any other matter.

Media reports indicated last week that President Olusegun Obasanjo and his Sao Tome counterpart, Mr. Fradique des Menezes, have ratified the recommendations of the technical committee on winners in the bids.

It is, therefore, expected that the JMC will this week announced winners in the bid exercise at the end of its meeting.

The highest offer of $175 million was received on block four from ECL, one of the indigenous oil companies that participated in the bid exercise.

Another indigenous oil company, Conoil Producing Limited, placed $150 million on the same oil block that was the toast of most bidders.

Analysis of the bid received indicated that $135million from Vintage Oil and Gas was the highest bid placed on block two, while $41million by Energy Equity Resources was the highest received on block three.

A joint bid of $37million from ICC-OEOC was the highest bid placed on block five, while $45million was the only bid received on block six.

Meanwhile, the handling of the bids had sparked off reactions in the international community, a development that led to the resignation of three ministers in Sao Tome and Principe.

Homeport: Carvalho Is Back As STP Oil Minister; Lusa Now Blames ERHC For His Resignation - But Only In English Version

Sao Tome and Principe's natural resources minister - and they often spell that "oil" - has had his much-reprinted resignation story altered in the Presidential Palace, according to a Portuguese-language story from Lusa that was "synthesized" for us by Homeport.

President Fradique de Menezes has rejected Arlindo Carvalho's resignation, citing the pressing need for his knowledge of the awards process, his prominent role in the second licensing round for five blocks of the Nigeria-Sao Tome and Principe Joint Development Authority, and the need for someone to serve through the investigative process that is currently underway there.

The English-language Lusa story (below Homeport's post) says Carvalho quit because of ERHC Energy's deal, but in Lusa's earlier coverage of the resignation, ERHC was not mentioned in connection with it. According to a post from rancho of the Portuguese Lusa story translated into English (below Lusa's English story)), the original Portuguese story (very last, below) makes no mention of ERHC's role. It appears the agency is talking out both sides of its mouth.

Here is Homeport's latest:

Posted by: Homeport
In reply to: None Date:5/23/2005 4:26:55 PM
Post #of 2805

FYI, Portuguese Lusa agency reporting STP Pres Menezes rejected Oil Min Arlindo de Carvalho´s resignation. Agency makes nono mention of JMC meet in Abuja.

Lusa cites presidential communique issued this p.m. as saying Carvalho, who tendered resignation last week, should stay on 'cause:

• has "precious info" about awards process;
  
• is "co-author" of 2nd licensing round; and
  
• must await conclusion of ordered inquiry into the process.

News in Portguese - at www.lusa.pt -- but should move in English shortly on LusaNews at same address.

Bests,

Homeport

Update Now we have the English-language story:

23-05-2005 23:02:00.
Fonte LUSA.
Notícia SIR-7026009
Temas:

Sao Tome: Menezes rejects oil minister's resignation

Sao Tome, May 23 (Lusa) - President Fradique de Menezes of Sao Tome and Principe said Monday that he has refused to accept the resignation of the archipelago's natural resources minister, who quit last week amid allegations of irregularities in the award of offshore oil exploration rights.

In a communiqué, Menezes said he had rejected the resignation of Arlindo Carvalho, because the minister "has valuable information" on the award of the oil blocks.

Carvalho, who had cited in his resignation the previous government signing unfavorable accords with Nigerian-controlled oil firm ERHC, should stay in office, as he has vital knowledge and is the "co-author of the second offshore licensing round", said Menezes` statement.

Sao Tome's president added that Carvalho should also keep his portfolio until an official inquiry is concluded into allegations of wrongdoings by state officials in the allocation of the offshore blocks.

Allegations of irregularities in the awards process for exploration rights to five offshore blocks in the delayed 2004 licensing round emerged earlier this month.

In his resignation letter to Menezes last week, Carvalho said commitments entered into by earlier administrations were damaging the process to award the new exploration acreage in Sao Tome's Joint Development Zone with Nigeria.

The row over the process of deciding how to allocate the offshore blocs has already led to Menezes sacking his personal adviser on oil matters, Patrice Trovoada, within the last month.

Menezes has been forced to step down from the National Petroleum Council and one of his former advisers, Manuel Rita, resigned after it was revealed he owned shares in ERHC.

The president's decision to block Carvalho's resignation comes three days after the visit to Sao Tome of Nigerian President Olusengu Obasanjo for talks on the stalled allocation process.

RCN/CJB.

Lusa

Note also that in this translation of the Lusa story from rancho, a trusted poster, there is also no mention of ERHC:

Rough translation
The President of Sao Tome and Principe, Fradique de Menezes, rejected today the resignation of Natural Resources, Arlindo Carvalho, because he is the "holder of precious information" in the licensing of the oil blocks.

The rejection of his resignation of the Oil Minister was made public this afternoon, in a communique distributed by the Sao Tome leader via the state press agency.

The Minister of Natural Resources, Arlindo Carvalho, tendered his resignation a week ago after allegedly feeling pressured in regards to the conclusion of the process to award five oil blocks in the joint exploration zone with Nigeria.

According to the presidential communique, "the minister of Natural Resources, Arlindo Carvalho should remain in his functions (stay at his post) because he holds precious (vital) information and is the co-author of the entire process related to the second licensing round of the oil blocks."

Also in the document, President Menezes stated that Carvalho should not leave the Ministry of Oil until the conclusion of the inquiry of alleged irregularities denounced in the process of the award of blocks.

The denounced irregularities in the awards process were made public three weeks ago in the capital of Sao Tome following press allegations of favoritism to oil companies, in which some Sao Tome leaders are stock holders and involves individuals close to President Menezes.

The decision of President Menezes to refuse the resignation of the Oil Minister occurs three days after his Nigerian counterpart, Olesegun Obasanjo, arrived in the Sao Tomean capital to discuss/debate questions related to the award of the oil blocks in the JDZ.

Here is the Portuguese-language story rancho translated:

São Tomé e Príncipe: PR recusou pedido de demissão de ministro dos Petróleos

São Tomé, 23 Mai (Lusa) - O Presidente de São Tomé e Príncipe, Fradique de Menezes recusou hoje o pedido de demissão do ministro dos Recursos Naturais, Arlindo de Carvalho, por ser "detentor de informações preciosas" na adjudicação de blocos de petróleo.

A rejeição do pedido de demissão do titular da pasta dos Petróleos foi tornada pública esta tarde, num comunicado do Chefe de Estado são-tomense distribuído aos órgãos de comunicação social.

O ministro dos Recursos Naturais de São Tomé e Príncipe, Arlindo de Carvalho apresentou há sete dias o seu pedido de demissão do cargo por alegadamente sentir-se pressionado na condução do processo que visa a adjudicação de cinco blocos de petróleo de uma zona de exploração conjunta com a Nigéria.

Segundo o comunicado presidencial, "o ministro dos Recursos Naturais, Arlindo de Carvalho deverá manter-se em funções (...) por ser detentor de informações preciosas e co-autor de todo processo dessa segunda licitação de blocos de petróleo...".

Ainda no documento, o Presidente Fradique de Menezes argumentou que Arlindo de Carvalho não deve deixar o ministério dos Petróleo antes de se concluir um inquérito mandado instaurar face as alegadas irregularidades denunciadas no âmbito deste processo de adjudicação de blocos.

A denuncia de irregularidades na adjudicação de blocos foi tornada publico há três semanas na capital de São Tomé através imprensa por alegado favoritismo de petrolíferas, nas quais alguns dirigentes são-tomenses são accionistas, envolvendo, figuras próximas do Presidente da República, Fradique de Menezes.

A decisão de Fradique de Menezes de recusar o pedido de demissão do ministro dos Petróleo acontece três dias depois do seu homologo nigeriano Olusengu Obasanjo ter se deslocado a capital são- tomense, onde debateram questões relativas a adjudicação de blocos desta zona de exploração conjunta.

Assinado em Fevereiro de 2001, o tratado de exploração conjunta entre os dois Países estabelece 60 por cento de receitas para Nigéria e 40 para São Tomé e Príncipe.
http://noticias.uol.com.br/ultnot/lusa
/2005/05/23/ult611u62915.jhtm

So what's going on with that? Will Lusa retract the English version?

Trading Updates: Where Do We Go From Here? Post Says Sao Tome 'Ready To Sign"

When we wrote a few months ago in anticipation of the awards process that there would be a lot of huge issues suddenly thrown at us in the last days, we might have been prescient but we never expected all that has happened recently.

Investors have little verifiable English-language news to guide them day to day and have to proceed by the seat of their pants, letting atrophied arts of intuition and divination do the job that good information usually does.

Thus, today's uncertainty produces the caution, worry and depression that usually combine for a stock share price downdraft.

But there is nothing predictable about ERHE. You always have to wait for the opening bell, and today, we do so with unusual interest. Good luck, everyone!

Update, 5:10pm EDT, 5/23/05: The 3:15 Surge saw about 87,000 shares traded and a close of $0.69, a half-cent loss at the end of the day - which is pretty damned good considering the tentative nature of the awards as the day started, hitting $0.65 shortly after the open. However the closing Ask was just $0.69, and the closing Bid is also lower, at $0.681.

Update, 3:06pm EDT, 5/23/05: Volume is snagged at 1,088,100, with the price at $0.68, the Bid, and the Ask at $0.69. The 3:15 Surge seems more likely to take us down a notch, perhaps to an $0.675 close.

Update, 2:30pm EDT, 5/23/05: The PopTop contest deadline is hereby extended to May 3, four days after the presumed awards. Send your real name, address, telephone number and guess to amreporter@aol.com. We've had some great entries for our $100 prize, and my gut tells me I already know the winner. Some predictions go up to the $8 range, while others are under $2.

Update, 2:30pm EDT, 5/23/05: The price is $0.68, reflecting slow volume until we draw closer to the close. The Bid is $0.67 and the Ask $0.69, so market-makers are splitting the difference. Volume is 1,050,000.

Update, 1:54pm EDT, 5/23/05: At $0.695 now, we are trading at the Friday close. Volume is a trickle at 1,019,000, and the Ask has fallen to $0.70.
Update, 1:42pm EDT, 5/23/05: Volume is 1,001,800 as the Bid and price slip to $0.695 and the Ask falls to $0.70.

Update, 1:31pm EDT, 5/23/05: Volume just creeping now, but we'll hit a million soon. The price is still $0.704, the Ask, and the Bid still $0.70.

Update, 1:26pm EDT, 5/23/05: Volume is now 966,825, picking up substantially.
The Bid and Ask are $0.70 x $0.704, and the price is also $0.704. Looks like there was a 100K buy at the Ask.

Update, 1:23pm EDT, 5/23/05: The price is at $0.704 again, with the Bid also rising to $0.70, on volume of 863,092 shares.

Update, 1:15pm EDT, 5/23/05: The price is $0.699, midway between the $0.695 Bid and the $0.704 Ask.

Update, 1:14pm EDT, 5/23/05: The price is $0.704, the Ask, with the Bid unchanged at $0.695. Volume is unchanged.

Update, 1:11pm EDT, 5/23/05: The awards were supposed to have been today, I believe, until the Sao Tome hijinks and the Obasanjo-MLSTP meeting. I expect the new JMC meeting to be a very short one.

The price is $0.70, and volume is 852,892. The Bid has dropped to $0.695.

Update, 1:08pm EDT, 5/23/05: To my surprise, the price is not slipping noticeably, and in fact has risen to $0.704, again probably in anticipation of a large buy. The price is also the Ask for the moment, and the Bid is now back at $0.70. Volume is moving along at 849,592 shares.

Update, 1:00pm EDT, 5/23/05: Other than to pay $1K of bills or so, I am not going to sell, I have pretty much decided. I'd like to get the dough in my hand, but I feel very good about the following weeks. I would look to exit in late June, keeping about 60,000 shares.

The price is $0.70, and the Bid and Ask are unchanged at $0.69 x $0.70. Volume is 804,331 and picking up.

Update, 12:54pm EDT, 5/23/05: The Bid has dropped back to $0.69, with the Ask still at $0.70. Volume is steady at 748,246.

Update, 12:47pm EDT, 5/23/05: The price is $0.70, with the Bid and Ask unchanged and volume at 758,246. It looks to me like the buying is driven by anticipation of awards much like those first revealed by Barry Morgan in UpstreamOnline.

Update, 12:47pm EDT, 5/23/05: The Bid falls back to $0.69, and so does the price; the Ask is $0.70, a quarter-cent lower now.

Update, 12:43pm EDT, 5/23/05: The Bid has improved to $0.70, which is a very good sign, and the Ask is still at $0.7025. Perhaps a big trade is pending. Volume is now 744,746 - maybe it just went through.

Update, 12:39am EDT, 5/23/05: Volume has reached 683,746. The price is $0.69 and the Ask is $0.70.

Update, 12:33pm EDT, 5/23/05: I don't think this last post was from mutwadadi. It sounds like SwingingK to me.

Update, 12:25pm EDT, 5/23/05: The price is $0.70, the Bid and Ask $0.69 x $0.70. Volume is 668,746.

Update, 12:11pm EDT, 5/23/05: The price is $0.705, and the Bid and Ask are $0.70 x $0.7025. Our little run may be over, but it was nice to see.

Update, 12:11pm EDT, 5/23/05: The Ask is at $0.705 and the Bid at $0.695, so ERHE is doing the unpredictable and amazing things it usually does. There's a Comment from mutwadadi, I understand, in our Comments section, and I understand it's very hot. Update: Not sure it's from him now.

Update, 11:59am EDT, 5/23/05: We're at $0.70, and volume is 530.312, and the Bid has risen to $0.68 again.

Update, 11:50am EDT, 5/23/05:The Ask has leapt with the price to $0.699, while the Bid is now at $0.67. Volume is 520.012.

Update, 11:44am EDT, 5/23/05: The Ask has risen to $0.69, and the Bid to $0.685. The price is $0.685, and volume is at 510,012. I'm in our PalTalk.

Update, 11:39am EDT, 5/23/05: A response to SH70 on the process. My gut tells me they will not go back to the Sao Tome side again as they did the first time, but logic tells me they must. So I think there will be som pro forma consideration. But come to PalTalk right no and I'll tell you what I really think!

Update, 11:35am EDT, 5/23/05: The price is $0.685 and volume has just topped 500,000 shares at 500,372. I've got something I'd like to share with a smaller group (we've got 4,000+ visitors a day here now), so I'm going to PalTalk to our ERHC On The Move voice- and video-enabled site, under Groups/Miscellaneous and down at the bottom of the list. I'll be there by about 11:37, and want to be out after 12. See ya!

Update, 11:27am EDT, 5/23/05: There is a new update from SwingingK, minus anything new, and a huge round of congratulation for him. How very supportive everyone is! :)

The price is $0.68 and the Bid is $0.68, while the Ask is $0.685 and volume stands at 447,374.

Update, 10:44am EDT, 5/23/05: The price is $0.665, the Bid, and the Ask is still at $0.67, with volume meandering to 361,174 at a very slow pace.

Update, 10:30am EDT, 5/23/05: The price has hit a low today of $0.65 and a high of $1.14, according to trading information from both Ameritrade and my own independent, London-based ADVFN. Yahoo, TD Waterhouse and MSNBC also confirm a trade of 5,00 shares at $1.14 at 9:57am. There seemed to be no trouble executing, either, but the High and Low figures have not updated.

Does this have to be an error? Not at all. It's quite likely with awards so near that someone will be the first to pay what the stock is worth before awards, and $1.14 is certainly reasonable. The interest is mostly on the Sell side in the last 30 minutes, according to ADVFN, which has a damnable 15-minute delay (for $45 a month!) The current price is $0.67 and volume is at 354,674.

Update, 10:21am EDT, 5/23/05: The price is $0.665, the Bid, and the Ask remains at $0.67, with volume at a modest 342,885.

Update, 10:13am EDT, 5/23/05: The price is rangebound for now, with volume petering out at 332,585 and the Bid and Ask at $0.665 x $0.67. All we can do is wait for a three-day weekend. :)

Update, 10:08am EDT, 5/23/05: The price is $0.67 as volume hits 319,385, slowing. The Ask is $0.67 and the Bid $0.665.

Update, 10:05am EDT, 5/23/05: The price is $0.665 on volume of 313,385. Here's another Sam Dimka update, this one from Greg, known as gvw2 and also first posted on Raging Bull:

*******News Update, JMC meeting again tomorrow*********

Just got off the phone with Sam Dinka and he is very optimistic (his words) that the process will be complete this week. The JMC will arrive in Abuja from STP tomorrow afternoon and meet through Wednesday. He did not elaborate on the discussions at the meetings. He feels that we can start to look for awards possibly Thursday. He is extremely upbeat!!!

Sam said that there are two separate forms of government between the two countries and they need to be respected. The process is good for STP to go through, because of the lack of experience that they have in these matters. Sounded like talking points from Obasanjo.

Update, 9:52am EDT, 5/23/05: The price is $0.67, the new Ask, with the Bid also better at $0.665, and volume at 311,385.

Update, 9:52am EDT, 5/23/05: Looks like the "shake" has already found its bottom at $0.66. The price is now $0.665, the Ask, and volume has reached 175,855, not especially impressive.

Update, 9:47am EDT, 5/23/05: The price is $0.66, down $0.035, and the Ask is $0.665. Another "buying opportunity" has developed for traders weary of them. Volume is 163,815.

There were several other updates, and a note directly from Sam Dimka posted in our Comments section, and the only thing they varied on is the date of the JMC's new meeting.

In the one posted under this article in our Comments section, the spokesman for the Joint Development Authority gives Wednesday and Thursday as the JMC meeting dates, but the update from markvol10 and this one below from jake at Raging Bull gives a "Tuesday and Wednesday meeting date, as mutawdadi told us:

------- UPDATE -------

Just spoke with Sam Dimka. He confirmed that the updates that we have been getting here are legit. And, he confirmed the meetings Tuesday and Wednesday and he also confirmed his optimism. I asked him if there were any reasons why STP or Nigeria would not go along with the agreements as is and he could think of none.

I tried to ask more questions but he kept resorting to the quote, "They are meeting and wait until Wednesday or Thursday for official news." He sounded very busy (many voices in the background) and professional.

Update, 9:26am EDT, 5/23/05: There's a new and optimistic update from Markvol10 confirming our report yesterday from mutawdadi - who gave us all a scare by suddenly changing his style a bit - and it looks like the awards process is "back on track," as a newspaper report put it on Saturday:

****Confirmation UPDATE****

Just spoke with Secretary of JDA. He confirmed that JMC would be meeting later tomorrow and Wednesday. I asked him what was the main purpose of the meeting and he said "it is to conclude this whole process of awards, of course."

He did not want to commit to exact day and time for awards announcement. He basically conveyed to me that they were not permitted to speak on behalf of JMC members. But he did he best to make it clear to me that awards would be announced this week.

Just goes to show you that the best information available comes from this blog and its reliable posters.

Update, 9:35am EDT, 5/23/05: The price opens at $0.68, with the Bid at $0.67 and the ASsk $0.68, on volume of 54,900 shares.

Update, 9:26am EDT, 5/23/05: The opening Bid appears to be $0.69, and the opening Ask $0.695.

Joint Ministerial Council To Meet Again Tuesday At Sao Tome's Behest, A Comment Says

At the behest of the ruling party in Sao Tome and Principe, the Marxist-oriented Movement for the Liberation of Sao Tome and Principe, the Nigeria-Sao Tome and Principe Joint Ministerial Council will meet once again on Tuesday to determine the course of the awards process in which ERHC Energy has emerged as the biggest single winner of valuable acreage in the Nigeria-DRSTP Joint Development Zone in the Gulf of Guinea, a comment on the blog revealed Sunday.

That was the word today in a comment to ERHC On The Move apparently from mutwadadi, one of the most reliable posters ever to emerge on the three major message boards that serve the ERHC Energy investment community.

The note came shortly after ERHC On The Move suggested, also in our Comments section, that precisely that course of action might be taken by the MLSTP.

We must offer a caveat concerning this note: The note was not in the style of mutwadadi's previous posts except in its declarative style. He has never capitalized his name or written complete and formal sentences, and this current note is formally composed and all the capitalizations are grammatically correct but - again - are not in the style of muwadadi's earlier posts. His name is not capitalized, however.

This note could have been the work of someone hoping to confuse the process; for instance, the fact that the meeting is said to be on Tuesday would allow the person responsible for a false posting time to take advantage of a reduced stock price resulting from the post on Monday. Such individuals, who post under many aliases, try to never reveal their own identity.

A Fable Of Failure

The endless frustration that has characterized the Nigeria-Sao Tome and Principe Joint Development Zone's two licensing rounds entered a new, more intense phase in the first week of May, when most expected the awards to be announced. Following transmittal of the awards document to Nigeria, President Olusegun Obasanjo immediately signed it.

When it was sent to Sao Tome and Principe, however, a huge brouhaha developed that led to three high-level resignations and the firing of a former president's son. The President of Nigeria made a last-minute, desperate bid o save the process in a closed-door meeting with the government and leaders of Sao Tome, all to no avail.

Investors watched gains evaporate, watched officials make fools of themselves - and of journalists - as they predicted the time of awards again and again and were universally proved wrong - and watched themselves turning "slowly, slowly in the wind," hanged men and women powerless to alter the course of events half a world away, and as strange, exotic and unknowable in its political and economic culture as the landscape of Saturn might look to a resident of Earth.

At stake, clearly, are tens of billions of dollars in oil rights in which our own ERHC Energy has earned not only the preferential choices it made in December, but won additional exploration rights granted because we had partnered with financially sound and technically competent major players in the petroleum industry, Noble Energy, Pioneer Natural Resources and Devon Energy.

Our prize, however, like the golden ring that once glistened on a fantasy carousel, has proved just as elusive, and some would say as illusory as well.

The ring is not golden after all, but a tarnished piece of brass. We are invited to step off the carousel and let someone else ride and let them reach out and up with the joyful hope of seizing the precious rights that once belonged to us and seemed as guaranteed as a rainy day in Portland.

But in a triumph of bribery over law, of corruption over right, our company's sole asset has become a thing of loathing.

We are surrounded by giant corporations now charged before the United States Senate with bribing African leaders - among them ExxonMobil, the biggest player of all - who have used the vast power of their financial wealth to destroy us and take for themselves the priceless property we once, by right, had owned.

It has happened countless times in history, as big countries marched right over little ones, as a fiercer army of barbarians rampaged over the sophisticated soldiers of Rome, as the great Mongol hordes ranges across the thousands of miles of Asian landscape and laid waste to all of it. As in history, the larger take, and the smaller fall. Whether by war or bribery or political betrayal, the weak are vanquished and the strong contend.

Every confidence game known to man has precisely the same elements; the bait, and the switch. We lunge for the golden ring, and grab the brass one; we earn rights engraved in treaty stone, and the stone is crushed to sand. Our screams, our anguish, our pain are merely background noice to a century of outrage and lies; we are like static in the soundtrack of an ensemble film. No one hears us, no one cares.

We were small-time gamblers who took a bet and lost it; we played where all are warned not to play; we believed whatever we wanted to hear; we were seduced and betrayed by a promise that has become a prayer, one that is just as likely as our screams to go unheeded.

Yet in the darkest of nights, in the deepest of despair, some small, still light shines. That is God's promise to us. Whether we have lost our life's savings, our children's college tuition, or even our home, we remain only the victims, not the barbarians, not the bribe-payers or bribe-takers, not the corrupt, not the heedless giants who have stolen our wealth. We retain our character, our integrity, our dampened hope for the future, our imaginations and daring, and we soon will bet again. We will hit again.

And one day, one shining day when the blue sky and the bright sun and the singing, joyful birds of the sky bless us all at once, we will seize that golden ring, lift it triumphantly over our heads and cry, "Look! We have done at last what they said we could not do!"

But out in the crowd, they will nudge one another, grin, and point at us. Look, they will say: He's still thinks it is golden.

Homeport: Two reports From Radio RDP; One Quotes Obasanjo, Saying Meeting Went Well; Daukoru Was Also There

Our latest briefings from poster Homeport quickly recap the two-hour meeting today of President Olusegun Obasanjo of Nigeria and Sao Tome and Principe President Fradique de Menezes in Sao Tome's Presidential Palace, and then some of the reaction to it from fired Sao Tome presidential oil advisor Patrice Trovoada of the rival ADI party.

It seems to fall far short of the "very, very good news" promised yesterday by the Secretary of the Nigeria-Sao Tome and Principe Joint Development Authority.

Here is his report:

'Very Good Meet...with Everyone': Obasanjo

FYI, RDP-Africa radio just reported from Sao Tome and Principe that bilateral oil talks in Sao Tome are over and Obasanjo has departed homewards.

Radio RDP Africa says their talks lasted about two hours, ending with a very brief statement by the Nigerian leader.

Obasanjo said, in English, he'd "discussed cooperation between" the two countries "with everyone" in "the same room."

He described the meeting as a "very good" one.

Obasanjo said he'd talked to STP President, Prime Minister, members of the Sao Tome delgation to the Joint Development Authority, and members of parliament.

And that's it, folks, for tonite! Look forward to reaction/analysis from you veteran ERHC watchers.

Boa Noite!

By Homeport, at 5:15 PM

Here's a second brief from Homeport, posted Saturday morning:

Obasanjo Brokering STP Compromise?
by Homeport

FYI, Portugal's RDP-Africa radio is carrying perceptive comments on Friday´s
Nigeria-Sao Tome and Principe "summit" from Patrice Trovoada, Menezes' recently sacked presidential oil adviser.

Trovoada, the leader of junior ADI governing party, told Portugal's RDP-Africa that "No decision" on awards had been taken at the Sao Tome meeting on Friday.

But, he added, "the process may be getting back on track," especially given Obasanjo´s concern for "transparency," particularly with everything having to do with oil.

"People can't lose face", he said, apparently referring both to STP's president-government feud and to strains appearing between the islands and Nigeria over the awards process.

Obasanjo's visit had been very "discreet", especially in regards to the media, and it was "very healthy" that the nature of the talks had not leaked out, Trovoada said in his heavily French-accented Portuguese.

NB: It is not clear to me whether Trovoada, who's reportedly linked to ERHC-Energy rival EEL, participated in the meeting or not. But his comments to RDP appeared to indicate he had, or at least had inside knowledge.

Off for a day of wild-flowering.

Bests,

By Homeport, at 5:43 AM

Here's a Portuguese News Service story from the start of the meeting, courtesy of Ruby1100, and notes that Nigerian Oil Minister Dr. Edmund Daukoru accompanied the President:

Presidente da Nigéria já chegou a São Tomé para reunião com Fradique de Menezes

President of Nigeria has arrived for meeting with Fradique de Menezes
2005-05-20 18:14:59

São Tomé - O Presidente da Nigéria, Olusegun Obasanjo, chegou esta sexta-feira à capital de São Tomé, estando neste momento reunido, no Palácio do Povo, com o seu homólogo são-tomense, Fradique de Menezes, para debater questões relacionados com a exploração conjunta de petróleo.

Obasanjo, que deverá permanecer apenas algumas horas no país, é acompanhado nesta deslocação ao arquipélago pelo ministro nigeriano do Petróleo.

A visita ocorre numa altura em que a Nigéria responsabiliza São Tomé e Príncipe de estar a bloquear o processo de adjudicação de blocos por questões internas.

A questão do petróleo tem levantado polémica no arquipélago nos últimos tempos, devido ao suposto favorecimento de algumas companhias. E resultou já em demissões e afastamentos de cargos: o ministro dos Recursos Naturais e Meio Ambiente, Arlindo Carvalho, demitiu-se na passada segunda-feira, pouco depois de Fradique de Menezes ter abandonado o cargo de presidente do Conselho Nacional de Petróleo de São Tomé e Príncipe.

De acordo com a imprensa nigeriana, os dois Presidentes irão formalizar a atribuição de blocos petrolíferos na zona de exploração conjunta, já aprovada na última reunião de ministros dos dois países que decorreu em Abril, em Abuja, na Nigéria.

O tratado de exploração conjunta entre os dois países foi assinado em Fevereiro de 2001 e estabelece 60% para Nigéria e 40% para São Tomé e Príncipe.

PNN Portuguese News Network

Sao Tome Ready To Sign Awards, Energy Compass Says

Energy Compass, which sells its stories for $24 each, says in a 141-word story dated yesterday, May 20, that Sao Tome is now ready to sign the JDA awards after months of delay. Energy Compass published the same article late last week at the same price, so I think they are selling the same information twice, under different headlines.

There is no indication in the report that the authors knew anything about the outcome of the meeting between Nigerian President Olusegun Obasanjo and Sao Tome and Principe's leader, President Fradique de Menezes.

The article is available at the Energy Compass site (http://www.energyintel.com/) after searching for "erhc."

However, the information is identical to that which was published earlier in the week. It was just redated. The original article is available at Raging Buill, Investor's Hub and elsewhere. It was purchased by stockhocker70 and provided to ERHCC On The Move as well.

Energy Compass is not always accurate or even near the mark, but it's usually not deceitful, either. They had some original material in two articles ago, including a useful quote from energy officials in Sao Tome. However, this iteration is a wasted $24, because the article has been posted many times since Thursday and its contents do not reflect any current information.

Sao Tome set to sign JDZ awards
Energy Compass May 20, 2005 (141 Words) $24

Trading Updates: Energy Intelligence Affirms Awards To ERHC

The Energy Intelligence subscription Website is the latest to openly state that ERHC Energy (OTC BB symbol: ERHE) and its partners Noble Energy in Block 4 and Devon Energy and Pioneer Natural Resources in Blocks 2 and 3 have won operatorships in Blocks 2 and 4.

The publication's report says the awards:

... are expected to give Nigerian-owned, US-listed ERHC chunky stakes in the most popular blocks, beefed up through alliances with US companies. On Block 2, ERHC is expected to get a 35% joint stake with US Devon and Pioneer, and a separate 30% stake of its own, after exercising preferential rights acquired through a controversial deal negotiated with Sao Tome in 2003, sources say. On Block 4, ERHC will share 35% with US Noble Energy, while exercising rights to 25% under the 2003 agreement.

An earlier report from Upstream Online's Barry Morgan said ERHC would also get 35 percent of Block 3, where it is also partnered with Devon Energy and Pioneer Natural Resources.

Earlier, Scott Sheffield, the CEO of Pioneer, said he expected two blocks in the JDZ to be awarded to the company's venture "very soon."

We note that the EI report contains no mention of a share for Equator Exploration, the firm favored by fired Sao Tome presidential oil advisor Patrice Trovoada of Houston, whose father - ex-Sao Tome President Miguel Troviada - signed the accords creating the Joint Development Zone. The stock of EEL suffered a fall yesterday, with many large blocks changing hands. The decline appears to have moderated this morning. The Upstream Online report, however, indicated that the company would get a piece of one block, albeit 10 percent or less.

For traders, the visit to Sao Tome by Nigerian President Olusegun Obasanjo today and the multiple confirmation of a stunning ERHC Energy victory in the awards proces ought to translate into string buying interest, and perhaps a sharp gap up at the the open, much as we expected yesterday, when it did not materialize.

Trading Updates

Update. 9:35, 5/20/05: We closed at $0.695 after 328 trades, with the closing Bid $0.695 and the closing Ask $0.705. Volume barely topped 2 million at 2,067,300. There were 1,297,356 Buys and 797,300 Sells, with 60,600 unidentified.
The perspective on that is that a lot of investors sold their shares far too cheaply,
and they were quickly snapped up by bottom-feeders.

Buying was dominant at the close, with 26 of the last 41 trades between 2:18:05 and 3:59:52 Buys totaling 66,312 shares, and 13 Sells totalling 50,200, with the last two trades totalling 10,000 both unidentified.

Update. 2:39pm, 5/20/05: The price is $0.69, the Bid, and the Ask is $0.695, with volume now nearing 2 million at 1,947,300 shares.

In 291 trades recorded by ADVFN as of 2:21pm today, 1,235,044 were Buys and 661,800 were Sells, with 50,500 unidentified. There is more action on the Sell side in the last half hour.

Update, 2:20pm EDT, 5/20/05: The price is $0.69, the Bid - a cent better now - and the Ask is $0.695. Volume is 1,947,300 shares.

Update, 2:20pm EDT, 5/20/05: We're at $0.695 with the 3:15pm Surge still almost an hour away. Volume is 1,942,100 shares, and the Bid and Ask are $0.68 x $0.695.

Update, 2:16pm EDT, 5/20/05: The price hits a new low of the day, $0.68, as the Ask stays at $0.695.
Update, 2:12pm EDT, 5/20/05: In 267 trades recorded today, 1,216,664 were Buys and 584,100 were Sells, with 30,000 unidentified as of 1:53, per ADVFN, which suffers from a 15-minute delay. There are a lot more blocks of 20K - 30K (lots of those) Buys than there are similar Sells.

The price is now $0.695, the Ask, while the Bid is $0.69. Volume is 1,896,600 shares. The guy who sits there and says "Take it down" is winning for the moment, as he won't have to buy your shares for a couple of bucks.

Update, 1:55pm EDT, 5/20/05: We're a tiny bit higher, at $0.705, the Ask, with the Bid also slightly better, at $0.70, as wait-weary and delay-wary investors await the good news from Sao Tome. Volume is cresting to 1,830,300 shares.

Update, 1:46pm EDT, 5/20/05: The price is at the low of the day, $0.697, the Bid, with the Ask lower, too, at $0.704, and volume just 300 from 1.8 million, at 1,799,700 shares.

Update, 1pm EDT, 5/20/05: Another snooze, and I lose a cent. We're at $0.70 now, with volume climbing to 1,752,800, a million more than yesterday. The Bid and Ask are unchanged at $0.697 x $0.705.

Update, 12pm EDT, 5/20/05: At noon, we're at $0,71, with the Bid at $0.705 and the Ask at $0.705. I took a snooze, and didn't lose; my Mom came to me in a dream and gave me a big smile and said, "After." There is a cupola in my future. At 12:02, the volume is 1,427,600.

Update, 10:45am EDT, 5/20/05: Volume is 1,247,300, with all else unchanged.

Update, 10:37am EDT, 5/20/05: Volume is better at 1,230,800. The price is $0.70 and the Bid improves three-tenths to $0.70, then slips back three-tenths to $0.697, while the Ask at $0.705 slips to $0.70.

Update, 10:34am EDT, 5/20/05: The first reports from Sao Tome should be circulating soon, possibly durng the noon hour. Volume has climbed to 1,132,300, but nothing else is new.

Update, 10:30am EDT, 5/20/05: The volume runs to 1,119,300 and the price climbs back to $0.70, but the Bid stays at $0.697.

Update, 10:27am EDT, 5/20/05: Nothing moves.

Update, 10:25am EDT, 5/20/05: 500 shares trade. The price and $0.697 Bid, and the Ask, are unchanged.

Update, 10:22am EDT, 5/20/05: The price slips below the opening price, to $0.697, as the Ask falls to $0.70 and volume rises to 1,092,900 shares.

Update, 10:21am EDT, 5/20/05: We break a million and keep gong to 1,066,300 shares, with all other indicators unchanged.

Update, 10:19am EDT, 5/20/05: We're close to 1 million shares traded in the first 47 minutes at 996,297. The price is $0.70 and the Ask $0.705. Perhaps the Sao Tome meeting is coming to an end, as it's 3:15pm over there.

Update, 10:14am EDT, 5/20/05: Just 2K shares trade, bringing volume to 983,097. The Bid is back up to $0.70 once again, and the Ask $0.705.

Update, 10:10am EDT, 5/20/05: Volume is 981,097 and the price is $0.705. The last time volume was high but the price was so tightly rangebound was in early November, when Chairman Sir Emeka Offor went to the market to purchase shares after he settled 63 million on First Atlantic Bank. At that time, the market makers refused to move the price, and by selling strategically small amounts, the price was kept artificially low as the accumulation occurred. With talk of a buyout and accumulation at present, it doesn't seem to be far-fetched to say this may be happening again; note, please, that there are no non-expired Form 144 filings that would permit selling by insiders at this time, so it is not coming from the company, and the bank's stock registrar will not let it sell for another six months. Thus, this is likely strategic manipulation to acquire and accumulate large blocks of ERHE. Be alert.

Update, 10:01am EDT, 5/20/05: Volume hits 892,797 a half-hour into the trading day. This stranded price reflects selling and uncertainty about the Sao Tome talks, but remember: historically, just before the big news, this stock gets a rough shake. It's had quite a few in the past several weeks, so there should be little more to discount from an already battered price. Volume is now 959,097 and the price is just $0.705, with the Bid now falling to $0.697 and the Ask at $0.705.

Update, 9:59am EDT, 5/20/05: Volume is just 2K higher at 834,597, and the price, at $0.70, the Bid, is unchanged. The Ask stays at $0.705.

Update, 9:56am EDT, 5/20/05: The buying weakens, and so does the price, to $0.70. There is no "bad" news to justify the tight $0.015 price range. Volume is 832,547 and we expect a decline below the open over the next few minutes.

Update, 9:53am EDT, 5/20/05: The price slips back to $0.705 as volume jumps to 827,547. The Bid slips to $0.70 and the Ask to $0.705.

Update, 9:50am EDT, 5/20/05: The price is $0.71, with all else unchanged. We're not sure how the price changed without a Buy or Sell.

Update, 9:49am EDT, 5/20/05: The price slips to $0.705, the Bid, with the Ask still at $0.71 and volume hitting 807,047.

Update, 9:48am EDT, 5/20/05: We see signs of trouble in the trading pattern.

Update, 9:47am EDT, 5/20/05: Huge volume without price movement equals trader uncertainty. We are pushing 800K shares at 792,965, and the price is $0.71 while the Bid and Ask have slipped to $0.705 x $0.71.

Update, 9:44am EDT, 5/20/05: The Bid and Ask recover to $0.71 x $0.715, the price, while volume hits three-quarters of a million shares and climbs to 768,965.
.
Update, 9:41am EDT, 5/20/05: Volume is 742,965 and the price remains $0.715, suggesting that a few big blocks are selling while many smaller ones are purchased.
The Ask has dropped to $0.709, and the price to $0.705, the Bid.

Update, 9:38am EDT, 5/20/05: Volume is 584,898 with the the Bid and Ask unchanged from the opening at $0.71 x $0.715. The price is $0.71.

Update, 9:35am EDT, 5/20/05: The first five minutes saw 474,400 shares trade, so look for a very, very big day, and hugely positive one. The price is at the Ask, $0.715, and it looks like someone is selling. If you're not loaded up, it's time to get ready for big, big gains, we think.

Update, 9:29am EDT, 5/20/05: 142,500 shares trade before the opening at $0.715, and in the opening seconds volume shoots up to 232,700.

Update, 9:30am EDT, 5/20/05: 71,000 shares trade before the opening at $0.70, below the Bid.

Update, 9:27am EDT, 5/20/05: The Bid is $0.71 and the Ask $0.715 as the opening bell grows closer.

Update, 9:15am EDT, 5/20/05: The Bid and Ask closed yesterday at $0.70 x $0.705, and are now at the same.

Bad News, Nigeria's Vanguard Hints, If De Menezes Rejects JMC Awards

An article posted by gigwoof at Investors Hub is perilously close to saying President Fradique de Menezes of Sao Tome and Principe will "reject" the awards recommended by the Joint Ministerial Council of the Nigeria-Sao Tome and Principe Joint Development Authority, but concludes by suggesting that will not happen:

However, further investigations revealed that De Menezes may toe the Nigerian line after-all for fear of losing support for his government.

Last year, while on a visit to Nigeria, some coup plotters sacked his government, but he was reinstated after intervention of the Nigerian government.

That little Gigwoof is just a bundle of joy today.

Here's the article from one of Nigeria's best newspapers:

Posted by: Gigwoof
In reply to: None Date:5/20/2005 9:47:26 AM

Nigeria, Sao Tome JDZ licensing round under threat
by Hector Igbikiowubo with agency reports
Posted to the Web: Friday, May 20, 2005

LAGOS—THE licensing round of the Nigeria, Sao Tome and Principe Joint Development Zone (JDZ) for crude oil and gas blocks is now under threat of abortion following criticisms from the Sao Tome National Petroleum Agency, that country’s petroleum regulatory body.

Inexperienced Nigerian independents have also been fingered by the Sao Tome regulatory agency as being capable of frustrating seasoned operator companies.

This was contained in a report compiled by the Sao Tome regulatory agency and there are indications that the development may force President Fradique de Menezes to reject awards recommended by the JDZ’s administrator, the Joint Development Authority (JDA). Under the JDZ arrangement between Nigeria and Sao Tome, De Menezes and Nigeria’s President Olusegun Obasanjo have to approve the awards.

The Energy Intelligence Group disclosed that in the report, Sao Tome’s National Petroleum Agency said the JDA did insufficient checking into bidders’ backgrounds. The report of the agency also noted that there were too many awards to inexperienced Nigerian independents and that this also could frustrate operators.

The process has been subject to tension for months, as Nigerian power brokers applied relentless pressure on Sao Tome officials to award coveted Block 4 to US Noble, a partner of ERHC Energy, run by Sir Emeka Offor, and to relegate US independent Anadarko to Block 3.

Sao Tome officials appear to favour Anadarko, which offered $90 million for Block 4, compared to Noble’s $57 million offer. Anadarko also put in a $40 million bid for Block 3, the second highest bid. Dr. Mike Adenuga, the billionaire Nigerian businessman also put up the highest bids for Blocks 2 and 4 through various companies.

Influential Sao Tomeans are not too happy about the list of proposed winners which has a prevalence of well-connected Nigerian independents. Most of the influential Sao Tomeans claim that the Nigerian independents are largely profiteers who seem very unlikely to add value to the process.

Some of these Nigerian independents include Momo Petroleum and Equinox Oil and Gas, which are thought to be controlled by Mohamed Asebelua, a power broker once linked to trader Arcadia.

Investigations revealed that Nigerian companies have started cashing in already, with funds from the first bonuses paid by Chevron and ExxonMobil for Block 1 deposited in Island Bank, an affiliate of Nigeria’s Hallmark Bank.

The bank is controlled by the family of recently sacked Senate president, Chief Adolphus Wabara and there are indications that the bank got its operating license after intervention from the Nigerian presidency.

The Energy Intelligence Group further said the deposit flouts JDA rules, which call for cash to be paid into triple A-rated banks, Sao Tomeans said.

De Menezes has clearly been subject to pressure from Nigerians, too, and a key question is whether he’ll reject the awards or toe the Nigerian line. The report could enable his opponents to force the presidential hand. De Menezes is thought to be concerned that former presidential oil adviser Patrice Trovoada, whose family has political influence in Sao Tome, could make common cause with opposition parties in parliament.

However, further investigations revealed that De Menezes may toe the Nigerian line after-all for fear of losing support for his government.

Last year, while on a visit to Nigeria, some coup plotters sacked his government, but he was reinstated after intervention of the Nigerian government.

Under the JDZ arrangement, Nigeria’s share of the reserves in the region is 60 per cent and the remaining share of 40 per cent is held by Sao Tome and Principe. Sao Tome and Principe is a tiny island nation located in the oil-rich Gulf of Guinea, off the coast of Nigeria, Africa’s largest oil producer with a daily output in excess of 2.5 million barrels. In earlier 2002, the Nigerian government offered Sao Tome and Principe a loan of $50 million to develop its oil and gas


http://www.vanguardngr.com/articles/2002/cover/
may05/20052005/f520052005.html

Phil Nugent Has No Role In GEECE

The following is a letter puplished by chcr, a co-moderator in IHUB, and presumably from Phil Nugent, whom we apparently got wrong information about, or his lawyer. No hard copy has been delivered to us.

We apologize, withdraw, rescind, retract and regret any errors we made concerning his ownership of GEECF.

As we would have had he called us and told us he was no longer a partner in it.
We're glad he read our blog, but we won't make the mistake of thinking he's a friend of ours again.

Posted by: chcr
In reply to: None Date:5/20/2005 12:19:41 PM
Post #of 2606

I wonder if Joe Shea will answer this letter I found???

May 16, 2005

Mr. Joe Shea, Editor-in-Chief joeshea@cal.net
The American Reporter joeshea@netcom.com
1812 N. Ivar Ave., no.5
Hollywood, CA 90028-5026

Dear Mr. Shea:

You are hereby notified that the factual content of your Internet posting entitled “Phil Nugent, ERHC Founder, Faces Issues With New Company” is FALSE. A public retraction to this posting is expected.

Mr. Nugent is not “battling to save his newest enterprise, Global Environmental Energy Corp”. Global is not an “enterprise” of Mr. Nugent’s; he does not have any interest in this company; he is not battling, fighting, struggling, or otherwise exerting himself to “save” this company; and, most importantly, the Sunday London Times article quoted does not mention Mr. Nugent!

For you to flatly state that Mr. Nugent or his company, ERHC, has any management or ownership interest in Global Environmental, a company that is described as insolvent and facing numerous punitive damage and director/investor actions against it, as well as possible tax liability actions, is not only patently libelous but could be characterized as an intentionally tortuous act made with the intention of causing financial harm to Mr. Nugent who is a stockholder of ERHE along with thousands of other people around the world. In fact, Mr. Phil H. Nugent filed a lawsuit on May 9, 2005 against GEECE in Civil District Court in the Parish of Orleans, state of Louisiana; specifically it is civil action Number 2005-6260 Division N-8. This is a suit for Breach of Contract and Dissolution of Partnership Agreement

Consequently, demand is made upon you to publicly withdraw and rescind these allegations and falsehoods. We expect you to print a public retraction on your website blog using the same size and style print as the original article. Failure to publicly retract these falsehoods within the next 3 business days will cause my client to seek redress against you in the Federal Court System of the United States of America.

Your immediate attention to clearing up this matter is appreciated.

Trading Updates: Energy Intelligence Affirms Awards To ERHC

The Energy Intelligence subscription Website is the latest to openly state that ERHC Energy (OTC BB symbol: ERHE) and it's partners Noble Energy in Block 4 and Devon Energy and Pioneer Natural Resources in Blocks 2 and 3 have won operatorships in Blocks 2 and 4.
The publication's report says the awards:

... are expected to give Nigerian-owned, US-listed ERHC chunky stakes in the most popular blocks, beefed up through alliances with US companies. On Block 2, ERHC is expected to get a 35% joint stake with US Devon and Pioneer, and a separate 30% stake of its own, after exercising preferential rights acquired through a controversial deal negotiated with Sao Tome in 2003, sources say. On Block 4, ERHC will share 35% with US Noble Energy, while exercising rights to 25% under the 2003 agreement.

An earlier report from Upstream Online's Barry Morgan said ERHC would also get 35 percent of Block 3, where it is also partnered with Devon Energy and Pioneer Natural Resources.

Earlier, Scott Sheffield, the CEO of Pioneer, said he expected two blocks in the JDZ to be awarded to the company's venture "very soon."

We note that the EI report contains no mention of a share for Equator Exploration, the firm favored by fired Sao Tome presidential oil advisor Patrice Trovoada of Houston, whose father - ex-Sao Tome President Miguel Troviada - signed the accords creating the Joint Development Zone. The stock of EEL suffered a fall yesterday, with many large blocks changing hands. The decline appears to have moderated this morning. The Upstream Online report, however, indicated that the company would get a piece of one block, albeit 10 percent or less.

For traders, the visit to Sao Tome by Nigerian President Olusegun Obasanjo today and the multiple confirmation of a stunning ERHC Energy victory in the awards proces ought to translate into string buying interest, and perhaps a sharp gap up at the the open, much as we expected yesterday, when it did not materialize.

Trading Updates

Update, 1pm EDT, 5/20/05: Another snooze, and I lose a cent. We're at $0.70 now, with volume climbing to 1,752,800, a million more than yesterday. The Bid and Ask are unchanged at $0.697 x $0.705.

Update, 12pm EDT, 5/20/05: At noon, we're at $0,71, with the Bid at $0.705 and the Ask at $0.705. I took a snooze, and didn't lose; my Mom came to me in a dream and gave me a big smile and said, "After." There is a cupola in my future. At 12:02, the volume is 1,427,600.

Update, 10:45am EDT, 5/20/05: Volume is 1,247,300, with all else unchanged.

Update, 10:37am EDT, 5/20/05: Volume is better at 1,230,800. The price is $0.70 and the Bid improves three-tenths to $0.70, then slips back three-tenths to $0.697, while the Ask at $0.705 slips to $0.70.

Update, 10:34am EDT, 5/20/05: The first reports from Sao Tome should be circulating soon, possibly durng the noon hour. Volume has climbed to 1,132,300, but nothing else is new.

Update, 10:30am EDT, 5/20/05: The volume runs to 1,119,300 and the price climbs back to $0.70, but the Bid stays at $0.697.

Update, 10:27am EDT, 5/20/05: Nothing moves.

Update, 10:25am EDT, 5/20/05: 500 shares trade. The price and $0.697 Bid, and the Ask, are unchanged.

Update, 10:22am EDT, 5/20/05: The price slips below the opening price, to $0.697, as the Ask falls to $0.70 and volume rises to 1,092,900 shares.

Update, 10:21am EDT, 5/20/05: We break a million and keep gong to 1,066,300 shares, with all other indicators unchanged.

Update, 10:19am EDT, 5/20/05: We're close to 1 million shares traded in the first 47 minutes at 996,297. The price is $0.70 and the Ask $0.705. Perhaps the Sao Tome meeting is coming to an end, as it's 3:15pm over there.

Update, 10:14am EDT, 5/20/05: Just 2K shares trade, bringing volume to 983,097. The Bid is back up to $0.70 once again, and the Ask $0.705.

Update, 10:10am EDT, 5/20/05: Volume is 981,097 and the price is $0.705. The last time volume was high but the price was so tightly rangebound was in early November, when Chairman Sir Emeka Offor went to the market to purchase shares after he settled 63 million on First Atlantic Bank. At that time, the market makers refused to move the price, and by selling strategically small amounts, the price was kept artificially low as the accumulation occurred. With talk of a buyout and accumulation at present, it doesn't seem to be far-fetched to say this may be happening again; note, please, that there are no non-expired Form 144 filings that would permit selling by insiders at this time, so it is not coming from the company, and the bank's stock registrar will not let it sell for another six months. Thus, this is likely strategic manipulation to acquire and accumulate large blocks of ERHE. Be alert.

Update, 10:01am EDT, 5/20/05: Volume hits 892,797 a half-hour into the trading day. This stranded price reflects selling and uncertainty about the Sao Tome talks, but remember: historically, just before the big news, this stock gets a rough shake. It's had quite a few in the past several weeks, so there should be little more to discount from an already battered price. Volume is now 959,097 and the price is just $0.705, with the Bid now falling to $0.697 and the Ask at $0.705.

Update, 9:59am EDT, 5/20/05: Volume is just 2K higher at 834,597, and the price, at $0.70, the Bid, is unchanged. The Ask stays at $0.705.

Update, 9:56am EDT, 5/20/05: The buying weakens, and so does the price, to $0.70. There is no "bad" news to justify the tight $0.015 price range. Volume is 832,547 and we expect a decline below the open over the next few minutes.

Update, 9:53am EDT, 5/20/05: The price slips back to $0.705 as volume jumps to 827,547. The Bid slips to $0.70 and the Ask to $0.705.

Update, 9:50am EDT, 5/20/05: The price is $0.71, with all else unchanged. We're not sure how the price changed without a Buy or Sell.

Update, 9:49am EDT, 5/20/05: The price slips to $0.705, the Bid, with the Ask still at $0.71 and volume hitting 807,047.

Update, 9:48am EDT, 5/20/05: We see signs of trouble in the trading pattern.

Update, 9:47am EDT, 5/20/05: Huge volume without price movement equals trader uncertainty. We are pushing 800K shares at 792,965, and the price is $0.71 while the Bid and Ask have slipped to $0.705 x $0.71.

Update, 9:44am EDT, 5/20/05: The Bid and Ask recover to $0.71 x $0.715, the price, while volume hits three-quarters of a million shares and climbs to 768,965.
.
Update, 9:41am EDT, 5/20/05: Volume is 742,965 and the price remains $0.715, suggesting that a few big blocks are selling while many smaller ones are purchased.
The Ask has dropped to $0.709, and the price to $0.705, the Bid.

Update, 9:38am EDT, 5/20/05: Volume is 584,898 with the the Bid and Ask unchanged from the opening at $0.71 x $0.715. The price is $0.71.

Update, 9:35am EDT, 5/20/05: The first five minutes saw 474,400 shares trade, so look for a very, very big day, and hugely positive one. The price is at the Ask, $0.715, and it looks like someone is selling. If you're not loaded up, it's time to get ready for big, big gains, we think.

Update, 9:29am EDT, 5/20/05: 142,500 shares trade before the opening at $0.715, and in the opening seconds volume shoots up to 232,700.

Update, 9:30am EDT, 5/20/05: 71,000 shares trade before the opening at $0.70, below the Bid.

Update, 9:27am EDT, 5/20/05: The Bid is $0.71 and the Ask $0.715 as the opening bell grows closer.

Update, 9:15am EDT, 5/20/05: The Bid and Ask closed yesterday at $0.70 x $0.705, and are now at the same.

Lusa Says Obasanjo Likely To Meet 'Gamut' Of Sao Tome Leaders Today

An English-language article from Portugal's Lusa news agency spe;;s out a tough agenda for Nigerian Presidnet Olusegin Obasanjo as he traverls to Sao Tome today to met with "a gamut" of the nation's top elected officials and political leaders.

Sao Tome less than an hour by jet from Abuja, but the Gulf of Guinea may not be as deep nor as broad as the cultural gap between these two nations, which only made peace in recent years to exploit their mutual interest in vast reserves of oil believed to lie several thousand feet below its surface.

The relationship has been marked by relatively little cross-national criticism, and President Obasanjo's visit is to a friend an ally who is facing a politically-motivated revolt at home. As in any such uproar, the motives have more to do with a desired political outcome - in this case in the race next year for the presidency - than with the incontrovertible facts of the hostage ssue, which is the award of five oil blocks by the Nigeria-Sao Tome and Principe Joint Development Authority on recommendations from its Joint Ministerial Council.

Here is the Lusa story:

20-05-2005 13:16:00.
Fonte LUSA.
Notícia SIR-7017321
Temas:

Sao Tome: Obasanjo's oil-crisis visit may involve gamut of islands' leaders

Sao Tome, May 20 (Lusa) - Nigerian President Olusegun Obasanjo is scheduled to holds talks with Sao Tome and Principe's leaders Friday in an effort to break the logjam blocking awards of five offshore oil exploration blocks in the two countries' shared Joint Development Zone (JDZ).

President Fradique de Menezes' office confirmed Thursday that he would be meeting with Obasanjo, but Nigeria's ambassador to the Gulf of Guinea islands said the talks could be broader, involving more Sao Tome leaders.

Ambassador Saidu Pindar told Lusa Friday morning that Obasanjo was expected to arrive in early afternoon for a visit of several hours.

Beyond talks with de Menezes, Pindar said Obasanjo might also meet Prime Minister Damião Vaz d'Almeida, Parliament Speaker Dionísio, and the chief justice of the Supreme Court, Alice de Carvalho.

The bilateral Joint Ministerial Council met in the Nigerian capital, Abuja, late last month and reportedly approved awards in five JDZ blocks worth millions in signature bonuses.

While Abuja has signed off on the awards, their announcement has been held up for more than three weeks by political gridlock in Sao Tome, where the president and government are fiercely at odds over the issue.

The feuding, including accusations of corruption, has led to the de Menezes resigning from the islands' key National Petroleum Council and sacking his personal oil adviser, Patrice Trovoada, the leader of one of the two government parties.

Natural Resources Minister Arlindo de Carvalho, who led the archipelago's delegation to the JMC meeting in Abuja, has also stepped down.

While the prime minister has remained silent in public over the controversy, his MLSTP/PSD party has repeatedly blasted the president for alleged mismanagement and corruption in the oil scheme, leading de Menezes to file libel suit against the party's chief spokesman, Carlos Tiny.

RCN/SAS.

Lusa

Barry Morgan: ERHC & Cos. Get Blocks 2 and 4, And 35 Percent of Block 3; World Bank Advised JDA On Awards

There's great, solid news from Barry Morgan at UpstreamOnline, who has been silent for two weeks until the paroxysm of political puerility passed in Sao Tome.

Morgan, a reliable veteran of the oil industry press, says ERHC and its partner Noble Energy have captured 70 percent of Block 4 by promising to fast-track three wells in a year as against Anadarko's vow to slow-track one well in three years.

The World Bank is said to have approved of the outcome in Block 4 and two other key blocks.

In Block 2, ERHC and its partners Devon Energy and Pioneer Natural Resources win 70 percent, Morgan said, while in Block 3 ERHC's patience and the same partnership is rewarded with 35 percent of the block.

The outcome should please even the most dispirited investor, and ERHC On The Move predicts it will quickly move the stock above $1. I still see $1.28 as a bottom post-awards price, and will settle on $3.58 as the top (and I believe the price will rise to that number from Monday all the way through Thursday morning).

Here is the new Barry Morgan story, with thanks again to Ruby1100:

New fish on hook for JDZ awards

The second licensing round in the Joint Development Zone (JDZ) administered in disputed waters in the Gulf of Guinea by Nigeria and Sao Tome&Principe is finally drawing to a close.

At stake are five deep-water licences for blocks 2, 3, 4, 5 and 6 of varying prospectivity. It is understood all will be awarded before the end of this week.

The Joint Ministerial Council is constrained by bilateral treaty provision to conclude the round within a set period and this has long since expired, according to Nigerian officials. Abuja is keen to see the gridlock resolved.

Equity stakes in the three most attractive blocks have been agreed and some minor details are being finalised for the less popular blocks 5 and 6, but latest indications are that the two presidents Olusegun Obasanjo of Nigeria and Fradique de Menezes of Sao Tome are agreed on the main players.

Nigeria in particular is keen to see the operatorship of Block 2 go to US explorer Pioneer Natural Resources. Pioneer bid with Devon Energy and US minnow ERHC Energy, linked to Nigerian indie Chrome Energy, which also bid directly and already enjoyed preferential equity rights on this and several other blocks.

The Pioneer group as a whole will likely be awarded 70% of Block 2 with 10% going to Bermuda-registered Equator Exploration (EEL), recently listed on London's Alternative Investment Market, which also enjoys entitlement to a share of licensing fees from JDZ seismic data sales under a joint operating agreement with Petroleum Geo-Services. Another 20% will be awarded to two unidentified Nigerian indies.

An operating stake of 50% in Block 3 will be awarded to Anadarko Petroleum, with ERHC landing 35% and EEL 10%. Spare equity on the block will go to a Nigerian indie.

Noble Energy, in partnership with ERHC, also fought hard for Block 4 where Noble has now convinced the Joint Development Authority that its drilling budget and clear commitment to three wells outplays Anadarko's one-well bid. The Noble/ERHC tie-up will likely be rewarded with a 70% stake, with Noble operating and a minimum of 20% awarded to local indies.

It is understood the PSCs will bear a strong resemblance to terms signed earlier this year for Block 1 with operator ExxonMobil, Chevron and Dangote-Energy Equity Resources. All players want to drill without delay and even the World Bank is understood to have advised Sao Tome that the above line-up was the best commercial deal.

Hardest to convince was Houston-based Patrice Trovoada, the son of former Sao Tomean President Miguel Trovoada and until last week Menezes' Special Adviser on Oil Affairs. Patrice Trovoada was ousted from office last week after pushing hard for EEL and its partner ONGC Videsh to operate Block 4, but to no avail.

Meanwhile, Sao Tome's Natural Resources Minister Arlindo Carvalho tendered his resignation this week, citing pressure over delays in concluding the round amid allegations of "irregularities" in negotiating awards.

Photo caption: Catch of the day: Nigeria and Sao Tome are set to reel in big exploration players on blocks to be awarded under the second JDZ licensing round. Photo: ELIN HOYLAND

Pick The ERHE Pop Top And Win $100!

$100 To The Best Player Of ERHE "Pop Top"

That's right! A crisp $100 bill to the person who most precisely predicts the top of the post-awards pop for ERHC Energy shares, traded on the Over The Counter Bulletin Board market as ERHE.

The contest ends on Friday, May 27, 2004, and entrants' predictions may suggest any time up to the last after-hours trade on May 31, 2005 at approximately 4:02pm EDT.

The rules: One entry per person; entries must be made no later than 11:59:59pm EDT, Sunday, May 22. Every entrant must supply a real name, address and phone number; you will be contacted by phone if you are the winner.

The prize of $100 will be divided among all winners in the evnt of a tie. There are two prices spoken for by ERHC On The Move: $1.28 and $3.57 No other predictions involving those prices will be accepted.

Send entries to Joe Shea c/o amreporter@aol.com. You may use the envelope icon at the bottom of any post to send entries. Include just the price, your name, address and telephone number, in that order, and nothing else.

No contact information you provide will ever be used for any other purpose than to contact you if you win. The selection of the winner(s) is at the sole discretion of ERHC On The Move. The winner can choose to be identified in subsequent posts and publicity by a nickname.




All prizes are to be mailed to winners by May 31, 2005. "Pop Top" is the exclusive Copyright and property of ERHC On The Move's author, Joe Shea. Copyright 2005. All rights reserved.

Vitrina, Lusa Suggest Obasanjo Visit Is Fence-Mending Only

There is a new article on Sao Tome's Vitrina Website that puts a different spin on Friday's visit of President Olusegun Obasanjo to Sao Tome and Principe, where most expect to watch President Fradique de Menezes sign awards and carry away a $49 million check as Sao Tome's share of Block 1's $123 million signature bonus fee.

Lusa has also issued an English language version if its story on the meeting.

The Vitrina spin is that the visit is purely a business meeting to discuss the awards, not a ceremonial event. We believe Vitrina is wrong, and we think most news organizations have reported otherwise on good information.

Here is the late-breaking Lusa report on the Obasanjo-de Menezes meeting:

19-05-2005 14:45:00.
Fonte LUSA.
Notícia SIR-7014351
Temas:

Sao Tome: Nigeria's Obasanjo expected in Sao Tome Friday - presidential aide

Sao Tome, May 19 (Lusa) - Nigerian President Olusegun Obasanjo is expected in Sao Tome and Principe Friday for talks with his island counterpart, Fradique de Menezes, on the stalled awarding of five oil exploration blocks in the two countries' offshore Joint Development Zone (JDZ), a Sao Tome presidential aide confirmed Thursday.

De Menezes' aide, asking to remain unidentified, confirmed to Lusa rumors Obasanjo was heading to Sao Tome to discuss the delayed announcement of awards.

The official declined to elaborate further on Friday's agenda, but said the two presidents would discuss their bilateral "oil dossier" that has been bogged down by political gridlock in Sao Tome.

Confirmation of Obasanjo's visit came less than 24 hours after Nigeria's ambassador to the islands denied accusations by Sao Tome and Principe's leaders that Abuja was bullying the archipelago in the bilateral process of awarding JDZ oil exploration blocks.

Ambassador Saidu Pindar also used a Wednesday news conference to blame the archipelago's authorities for hobbling the transfer of USD 123 Mn from an earlier signature bonus award.

Pindar, dismissing charges made last week by the islands' president, de Menezes, said that decisions on JDZ block awards were "taken by consensus" in the bilateral Joint Development Authority (JDA) and the senior Joint Ministerial Council (JMC).

The JMC reportedly approved the awarding of five shared offshore blocks at a late April meeting in Abuja, but the announcement has been delayed by political infighting in Sao Tome.

Under fire over the awards from the islands' two governing parties, de Menezes defended his oversight of the process by saying Sao Tome had "mortgaged" its decision-making prerogatives to Nigeria in "disastrous accords" agreed by a preceding Sao Tome administration.

De Menezes, whose partisan backers sit on opposition benches in the archipelago's parliament, resigned last week as chairman of the National Petroleum Council, saying he wanted to "avoid confusion".

At the news conference Wednesday, Pindar warned the islands' governing coalition that its virulent denunciations of the awards process risked jeopardizing bilateral relations and cooperation between the region's major power, Nigeria, and their micro-state.

Questioned on the fate of the USD 123 Mn signature bonus paid by ChevronTexaco for the only JDZ block awarded so far, the ambassador said it lay in a Nigerian bank awaiting the signatures of Sao Tome authorities in order to be transferred.

"We are waiting on Sao Tome and Principe's authorities to distribute the money", he said, indicating that the lacking signatures referred to the JMC awards decision on five blocks taken in Abuja at the end of April.

Nigeria "has already signed the document", the ambassador said.

Under a bilateral treaty signed in 2001, revenues from the JDZ are shared 60:40 in Abuja's favor.

RCN/SAS.

Lusa

Here is the Vitrina report, followed by a machine translation that is mostly nonsensical:

Ano I I I Edição n.º 803 Sexta-feira, 20 de Maio de 2005

Olusengo Obasanjo faz visita S. Tomé 24 horas depois do embaixador da Nigéria advertir os dois partidos da coligação governamental de que podem pôr em causa as relações entre os dois países
by Manuel Barros

20.05.2005-J.Vitrina-(S. Tomé) -- O presidente nigeriano Olusengo Obasanjo chega na tarde desta sexta-feira a S. Tomé para uma visita de algumas horas. Obasanjo tem encontro marcado apenas com o presidente santomense Fradique de Menezes e o seu regresso está previsto para a noite. A deslocação de Obasanjo a S. Tomé surge 24 horas depois do embaixador da Nigéria em S. Tomé em Príncipe ter advertido os partidos MLSTP/PSD e Acção Democrática Independente que formam a actual coligação governamental de que podem pôr em causa as relações entre os dois países. Saidu Shettima Pindar diz que a controversa interna em S. Tomé no dossier petróleo não pode servir de protesto para os responsáveis destes dois partidos porem em causa o bom nome da Nigéria e o seu investimento em S. Tomé e Príncipe.

Saidu Pindar fazia referência ao comunicado do MLSTP/PSD de 17 de maio último e as declarações do líder do ADI que na sua opinião constituem erros e comentários graves e muito “pouco lisonjeiros” que põem em causa um dos principais bancos nigerianos com enormes investimentos em S. Tomé.

Numa extensa declaração de imprensa seguido de respostas aos jornalistas o diplomata nigeriano acusa o MLSTP de faltar com a verdade relativamente aos bónus de assinatura do bloco 1, diz que os 123 milhões de dólares deste bloco já foram depositados no banco nigeriano denominado Hallmark Bank Plc e que o principal bloqueio para o desbloqueamento desta verba está sendo colocado actualmente por S. Tomé e Príncipe.

O comunicado do MLSTP de 17 Maio considera este banco como uma instituição bancaria de segunda classe. Mas Saidu Pindar recorda que a decisão de depositar os 123 milhões de dólares neste banco saiu de uma reunião do Consenso Ministerial Conjunto realizado em 2003 em que estiveram presentes os ministros santomense do planeamento e finanças, Eugénio Soares e da agricultura de desenvolvimento rural, Jorge Amado bem como o ex conselheiro do presidente da republica para o petróleo, Patrice Trovoada.

Entretanto, hoje na plenária da Assembleia Nacional de interpelação do governo o ex- ministro da agricultura reagiu dizendo que em 2003 ainda não existia 123 milhões de dólares, pelo que não pode ser verdade as informações dadas a conhecer pelo embaixador da Nigéria, que também reagindo as declarações do presidente da republica segundo as quais S. Tomé e Príncipe não tem voz nas discussões sobre o dossier petróleo, disse que todas as decisões são tomadas por consenso.

Here is a machine translation, which we will try to replace with a real one this evening:

>b>***Olusengo Obasanjo makes visit S. Tomé 24 hours after the ambassador of the Nigéria warning the two parties of coalition the governmental one of that they can put in cause the relations between the two countries

20.05.2005-J.Vitrina-(S. Tomé) -- The president Nigerian Olusengo Obasanjo arrives in the afternoon of this friday the S. Tomé for one visits of some hours. Obasanjo has meeting marked only with santomense president Fradique de Menezes and its return is foreseen for the night. The displacement of Obasanjo the S. Tomé appears 24 hours after the ambassador of the Nigéria in S. Tomé in Prince to have warned the parties MLSTP/PSD and Independent Democratic Share that form current coalition the governmental one of that they can put in cause the relations between the two countries. Saidu Shettima Pindar says that controversa internal in S. Tomé in dossier oil cannot serve of protest for responsible of these the two parties to put in cause the good name of the Nigéria and its investment in S. Tomé and Príncipe.

Saidu Pindar make reference to reference the official notice of the MLSTP/PSD of the 17 of last May e declarations of the leader of the ADI that in its opinion constitutes serious errors and lisonjeiros commentaries very and "little" that they put in cause one of the main banks Nigerians with enormous investments in S. Tomé.

In an extensive declaration of the press followed of answers to the journalists the diplomat Nigerian accuses the MLSTP to lack with the truth bónus of signature of block 1 relatively, says that the 123 million dollar of this block already had been deposited in the bank called Nigerian Hallmark Bank Plc and that the main blockade for the desbloqueamento of this mount of money is being currently placed for S. Tomé and Príncipe.

The official notice of the 17 MLSTP of May considers this bank as an institution would bank of second classroom. But Saidu Pindar remembers that the decision to deposit the 123 million dollar in this bank left a meeting of the carried through Joint Ministerial Consensus in 2003 where the ministers santomense of the planning and finances had been gifts, Eugénio Soares and of the agriculture of agricultural development, Jorge Loved as well as the former council member of the president of the republica for the oil, Patrice Thunderstorm.

However, today in plenária of Assembleia National of interpellation of government former minister of agriculture reacted saying that in 2003 still not dollar existed 123 million, for that cannot be truth the given information to know for the ambassador of the Nigéria, that also reacting the declarations of president of the republica according to which S. Tomé and Príncipe does not have voice in the quarrels on dossier oil, said that all the decisions are taken by consensus.

Trading Updates: Lusa Talks Investors Out Of Their Shares; JDA Secretary Again Vows Awards This Week And 'Very, Very, Very Good News'

The negative slant on the Sao Tome Shuffle from the Portuguese national news agency Lusa has apparently dampened the market for ERHC Energy shares, making the low end of post-market price predictions more likely.

ERHC On The Move came up with a post-awards target of $1.28 some time ago, long before all the turmoil erupted, and brighter prospects for a while raised that target first to $1.78 and later to a possible $3.00. Now, regardless of the outcome of awards, we feel rangebound by the infighting that has gone before, so it can be said - as far as we see it - that Mongo, monkeytrots and the other bashers have won.

There is new information we cannot disclose that may point to a connection between one of our partners in the Nigeria-Sao Tome and Principe Joint Development Zone and accumulation of ERHC Energy shares at this deeply discounted price. The information is tenuous at best, and should not be relied upon, but it indicates that an executive of one of those companies may in fact be Mongo and may have accumulated as much as 12 million shares, far below any reporting threshhold.

The rumored accumulation by several Raymond James Financial clients of a total of 42 million shares could well be connected to a buyout offer that is hinged on the awards process Mongo and fellow bashers are trying so desperately to diminish. It could explain why the price of our partners' shares have been rising counter to oil prices in the past week, while ours has fallen.

More confirmation from the Secretary of the JDA, this from Anonymous - our friend Markvol10- in our Comments section:

**********UPDATE**************

Just spoke with Secretary of JDA. I asked him if he could confirm Obansanjo was meeting with Menenzes tomorrow and he said they are indeed meeting. I asked him if awards would be announced tomorrow and he said it is very possible but he does not want to speculate on exact day as does anyone else at the JDA. They are gunshy. He said what he told me yesterday still stands "end of week" which could mean Friday, Sat, or Sunday. He told me to call back tomorrow and he would be able to give me "Very Very good news." I asked him why he would say that and he laughed and just repeated that I should call him back tomorrow for "very very good news."

IMO. JDA is being somewhate tightlipped with dates and meeting details because of what has happened in the past. But, this all points to awards anyday now. Call JDA if you like. Here are some numbers:
011 234 9 524 1064
011 234 9 524 1069
011 234 9 524 1065
011 235 9 524 1055

By Anonymous, at 11:29 AM

There's also a new article from the United Nation's IRIN agency, which again exposes its bias against ERHC Energy. The NGOs who have invested a lot of time and money in drawing up "transparency" laws to avert corruption are often funded by the multinationals whom they want to win the block awards. Such measures throw the process into the bureaucratic tangle of the courts and prevent only the wealthiest companies from being successful.

The NGOs have failed this time only because ERHC Energy's partners are substantial players who won't be pushed around by ExxonMobil and the other giant crybabies who have not gotten their way in the awards process because they arrogantly believed they didn't have to bid to win.
The multinationals call in all the favors due from the NGOs when crunch time comes, but it appears those will not suffice for them to carry the day.

Here is the garbage from IRIN, which tries to smear Sir Emeka Offor by association with the odious Sani Abacha regime, ignoring his equally close ties to the anti-corruption Obasanjo administration and the good offices of the African-American ex-U.S. Ambassador to Nigeria that sits on our board.

I have tried to correct some of the errors and false impressions left by the article, in boldface, below:

IRIN News 18/5/2005

SAO TOME AND PRINCIPE: Oil minister resigns as
controversy dogs award of second offshore block

SAO TOME, 18 May (IRIN) -- Arlindo Carvalho has
resigned as Minister of Natural Resources of the tiny
island state of Sao Tome and Principe amid allegations
of irregular procedure and high-level corruption in
the award of offshore oil exploration rights.

This row is continuing to delay the award of fresh
acreage in offshore waters shared with Nigeria.

Carvalho quit on Monday, citing the existence of
private interests in the oil business which had
resulted in previous governments signing unfavourable
accords with the Nigerian-controlled oil company
Environmental Remediation Holding Corporation (ERHC).

Obligations entered into by previous administrations
were having a negative impact on current negotiations
to award new offshore blocks for exploration, he
added.

Two weeks earlier, President Fradique de Menezes
sacked his personal adviser on petroleum issues,
Patrice Trovoada.

Menezes accused Trovoada of using his official post to
further his own private business interests. The
president said in a statement there was "a clear
situation of conflict between his own interests and
those of the country".

Another of Menezes' former advisers, Manuel Rita, has
also been forced to quit after revelations that he
owned shares in ERHC. [Editor's Note: The president's
current advisor and cabinet member, not "former" advisor,
is Mateus Meira Rita, not "Manuel" Rita.

Menezes, meanwhile, has been accused of taking money
from interests close to the Nigerian-controlled
company in the past.

This row simmers on and has forced the president to
take a back seat in deciding how offshore blocks
should be allocated to competing oil companies, as he
prepares his campaign to run for a second five-year
term in 2006.

Menezes announced at the weekend that he would stand
down from Sao Tome's National Petroleum Council, which
is charged with recommending which bids should be
accepted.

The president said that in future he would simply
exercise a watchdog role over the award of exploration
rights at arm's length from the process of detailed
decision making.

Sao Tome and Nigeria signed a first contract awarding
exploration rights in their Joint Development Zone to
a consortium led by US oil giants ChevronTexaco and
Exxonmobil on 1 February.

The deal triggered a front-end bonus payment of US
$123 million, of which Sao Tome is due to receive $49
million.

However, the award of a further five offshore blocks
to companies, which took part in a second licensing
round last year, has been delayed by a row over the
status of ERHC. [Editor's Note: The National Petroleum
Council says that ERHC's rights were guaranteed by the
Abuja Declaration and therefore non-negotiable; they
specifically said that it was not ERHC Energy at issue.]

The US-registered company is controlled by Sir Emeka
Offor, a wealthy Nigerian businessman who is widely
reported to have enjoyed close links with Nigeria's
former military ruler Sani Abacha. [Editor's note:
As one of his nation's most important businessmen,
Emeka Offor has had to work with a succession of
governments whether they are to his liking or not.
He supports the Obasano government and was a major
contributor to Obasanjo's last campaign, and is a
strong supporter of the president's anti-corruption
initiative.]

Offor owns 35 percent of ERHC and is chairman of the
company. It has no tangible oil assets and has never
drilled a single oil well. [Editor's Note: Sir Offor's
Chrome Energy own 42 percent of ERHC Energy, and the
Nigerian bank First Atlantic owns 9 percent; they are
the only two reporting shareholders; Sir Offor owns no
shares directly. ERHC has one oil asset: Rights to an
estimated $28 billion worth of oil in the Joint Debelopment
Zone that are ensured by a treaty signed in February 2001
and renegotiated in 2003. ERHC is partnered with three
of the most important U.S. drilling companies, all of
which have extensive offshore experience in Africa, and
is headed on a day-to-day basis by CEO Ali Memon, the
former chairman of Marathon Oil's African exploration
subsidiary.]

However, in 1997, ERHC negotiated a deal with Sao Tome
which gave it preference rights to equity stakes in
six different blocks in the Joint Development Zone,
including all five currently up for grabs. [Editor's
Note: In 1997 the Joint Development Zone did not exist,
and ERHC's rights were far more subtantial.]

That agreement, signed by former president Miguel
Trovoada, was renegotiated by Menezes in 2003, two
years after he was elected president. But it still
leaves ERHC with preferential rights to equity stakes
varying in size from 15 to 30 percent in the different
offshore blocks. [Editor's Note: It also gives ERHC
100 percent preferential rights to two blocks in the the
Sao Tome Exclusive Exploration Zone, or EEZ, that are
potentially far more valuable.]

The present row focuses on opposition allegations that
ERHC has been given unfair advantages in the current
bidding process for offshore acreage.

As a result, the critics say, Sao Tome is likely to
receive less money up front from any oil exploration
and production agreement in which the company becomes
involved. [As a result of the agreement with ERHC,
the nation is due to receive vastly greater sums than
it would have, only after it sought to exploit its oil
resources at the behest of ERHC Energy.]

Antony Goldman, an oil analyst with Clearwater
Research in London, said Menezes had been able to
wring some concessions out of ERHC when he
renegotiated its agreement with Sao Tome.

But he said the deal was still "ruinously
unfavourable" to the government. [Clearwater Research
has never had ERHC as a client, but it is funded by
contracts with several multinationals.]

"Sao Tome tried to extricate itself from the deal, but
just couldn't. I think they are stuck with the deal,"
he told IRIN.

ERHC has formed a series of partnerships with three
different US oil companies with a respectable track
record of exploration and production to bid for all
the blocks currently on offer.

International oil companies had been expecting Nigeria
and Sao Tome to award these blocks [Editor's Note:
"to them" should be inserted here] in January, but
four months later, the deals are still held up by
political wrangling. [Editor's Note: The principal delay
was caused by ExxonMobil's lengthy consideration of the
block awards they did not like and had the right to
delay.]


Goldman said the crux of the problem was block four,
where EHRC and is partner Noble Energy have offered a
front-end bonus of $57 million along with pledges to
take an ambitious drilling programme.

Its rival, the US oil company Anadarko, has offered a
much higher bonus of $91 million, but has committed
itself to drilling fewer wells over a longer period of
time, he said.

The Joint Development Zone was established in 2001 and
is administered by a bi-national authority based in
the Nigerian capital Abuja.

Under the terms of the agreement, Nigeria will receive
60 percent of the revenues from any oil and gas found
in the deep offshore waters, while Sao Tome will
receive 40 percent.

The Joint Development Zone is widely believed to
contain an extension of Nigeria's existing offshore
oilfields. ChevronTexaco is expected to start
exploration drilling in 2007.

Update, 4:03pm, 5/19/05: The closing price was $0.70, with the Bid and Ask $0.70 x $0.705 and volume of 769,665 shares, about a third of yesterday's trading.

Update, 3:57pm, 5/19/05: Looks like a disappointing close in the $0.705
range, a gain of a half-cent for the day. Volume is 762,265, shotting up about 92K in the past quarter-hour. The Ask is $0.705 and the Bid $0.70.

Update, 3:40pm, 5/19/05: The price is $0.70 and the volume 669,334, and little is happening. The Bid is improved at $0.70, and the Ask remains at $0.702.

Update, 3:17pm, 5/19/05: At the 3:15 Surge there is some new volume, now at 614,134 shares, and the Ask and price are at $0.702, three-tenths below the high of the day, while the Ask is a little higher at $0.695.

Update, 1:38pm, 5/19/05: The volume is jammed at 452,006, with the price $0.70, the Ask, and the Bid at $0.69.

Update, 1:36pm, 5/19/05: An incoming jet approaching Tel Aviv International is the subject of an Israeli red alert. Stay tuned.

Update, 1:36pm, 5/19/05: The well-known shareholder Ruby1100 has generously offered us an insight that has been missing from our debate here: Why haven't insiders registered to sell? Here is the post:

Joe
One big point many ERHC'ers are missing which to me speaks volumes
is that last year, just prior to the JMC BL 1 Awards, there were 11 Million Shares registered to sell by ERHC insiders via FORM 144k Filings, i.e., John Coleman 4 Mill, Chude Mba [former ERHC President] 3 Mill etc.

Q: Why have these "In the Know" folks NOT registered to blast their shares this time ?????

Perhaps they are not interested in $0.70 or anything close and very, very Good things are about to happen to ERHC

just a thought
Ruby

Update, 12:27am, 5/19/05: The price is $0.70 and the Bid and Ask are $0.69 x $0.70, with volume at a slow 450,506 shares.

Update, 12:02am, 5/19/05: We're still at $0.70 going into the lunch hour, with volume moving very slowly to 447,806 and the Bid and Ask unchanged at $0.69 x $0.70.
Update, 11:50am, 5/19/05: Volume is slow, with just 3,000 shares trading in the past 25 minutes. The price is $0.70, the Ask, and the Bid is at $0.685.

Update, 11:24am, 5/19/05: We're at $0.685, with volume at 439,161 and the Bid and Ask at $0.685 x $0.70.

Update, 11:03am, 5/19/05: The price is $0.694, the Ask, just after hitting the low of the day at $0.68, and the Bid is $0.69. Volume is 410,489 shares. ERHE investors, unable to buy, are - in plain langauge - getting royally screwed by the skillful management of events in Sao Tome.

Obasanjo Headed To Sao Tome, Lusa Says, To Help Resolve Issues

An article posted by Dadd17 on Raging Bull's ERHE message board confirms and elaborates on Nigerian President Olusegun Obasanjo's visit tomorrow to Sao Tome. The report, again, is from Lusa>, which has covered the story closely but has never reported both sides of it.

ERHC On The Move believes the real reason for the Obasanjo visit is to sign the awards.

It is unclear whether their reporter even asked if Obasanjo was headed there to annonce awards with President Fradique de Menezes, and just mentions the friction that it hints has grown up between the countries laregly as a result of its reporting on the bilateral Joint Development Zone awards, which until now have been delayed in Sao Tome.

As we said earlier, late in the second licensing round Portugal approached Sao Tome about becoming involved in the round, but was necessarily rebuffed and invited to become a bidder in the third round and a later round for award of Nigeria's EEZ blocks.

Portugal is a small country that has lost an empire and speaks a Romance language that is slowly becoming archaic; its sensitivities and fondness for "Lusaphone" stories - i.e., stories friendly to Portugal's interests and culture - may well underlie Lusa's journalistic slant.

In fact, we feel that the government news agency is playing a patriotic tune throughout its reporting that carefully blocks any balancing or favorable light that might fall on ERHC Energy and the Nigerian role in the process. Now, everything out of Sao Tome from Lusa> further elaborates the first story they did that touched off the 12-day dispute and forced three resignations and firing among high-ranking Sao Tome officials.

It is not, we should stress, that there is no merit to what Lusa> says, but that it says only what improves their own story line.

Here is the Lusa story:

Sao Tome: Nigeria's Obasanjo expected in Sao Tome Friday - presidential aide

Sao Tome, May 19 (Lusa) - Nigerian President Olusegun Obasanjo is expected in Sao Tome and Principe Friday for talks with his island counterpart, Fradique de Menezes, on the stalled awarding of five oil exploration blocks in the two countries' offshore Joint Development Zone (JDZ), a Sao Tome presidential aide confirmed Thursday.

De Menezes' aide, asking to remain unidentified, confirmed to Lusa rumors Obasanjo was heading to Sao Tome to discuss the delayed announcement of awards.

The official declined to elaborate further on Friday's agenda, but said the two presidents would discuss their bilateral "oil dossier" that has been bogged down by political gridlock in Sao Tome.

Confirmation of Obasanjo's visit came less than 24 hours after Nigeria's ambassador to the islands denied accusations by Sao Tome and Principe's leaders that Abuja was bullying the archipelago in the bilateral process of awarding JDZ oil exploration blocks.

Ambassador Saidu Pindar also used a Wednesday news conference to blame the archipelago's authorities for hobbling the transfer of USD 123 Mn from an earlier signature bonus award.

Pindar, dismissing charges made last week by the islands' president, de Menezes, said that decisions on JDZ block awards were "taken by consensus" in the bilateral Joint Development Authority (JDA) and the senior Joint Ministerial Council (JMC).

The JMC reportedly approved the awarding of five shared offshore blocks at a late April meeting in Abuja, but the announcement has been delayed by political infighting in Sao Tome.

Under fire over the awards from the islands' two governing parties, de Menezes defended his oversight of the process by saying Sao Tome had "mortgaged" its decision-making prerogatives to Nigeria in "disastrous accords" agreed by a preceding Sao Tome administration.

De Menezes, whose partisan backers sit on opposition benches in the archipelago's parliament, resigned last week as chairman of the National Petroleum Council, saying he wanted to "avoid confusion".

At the news conference Wednesday, Pindar warned the islands' governing coalition that its virulent denunciations of the awards process risked jeopardizing bilateral relations and cooperation between the region's major power, Nigeria, and their micro-state.

Questioned on the fate of the USD 123 Mn signature bonus paid by ChevronTexaco for the only JDZ block awarded so far, the ambassador said it lay in a Nigerian bank awaiting the signatures of Sao Tome authorities in order to be transferred.

"We are waiting on Sao Tome and Principe's authorities to distribute the money", he said, indicating that the lacking signatures referred to the JMC awards decision on five blocks taken in Abuja at the end of April.

Nigeria "has already signed the document", the ambassador said.

Under a bilateral treaty signed in 2001, revenues from the JDZ are shared 60:40 in Abuja's favor.

RCN/SAS.

Lusa

Awards Friday, Nigeria's Daily Independent Says; Obasano Visit Confirmed; Lusa Says Nigeria Uses Block 1 Funds As Leverage; Devon Funds Lagos Project

The well-regarded Daily Independent tells readers in Thursday morning's editions there are "strong indications" the Nigeria-Sao Tome and Principe Joint Development authority will announce the winners of Blocks 2, 3, 4, 5 and 6 on Friday, ending a long wait for ERHC Energy investors who have rights to substantial options in all of the offered blocks and is partnered with major American firms in three of them.

The news is likely to ignite a rally in the stock, which has fallen over the past two weeks from a high of $0.89 to a low of $0.60, and closed Wednesday at $0.70. The awards had been delayed repeatedly after they were supposed to hhave been announced on Dec. 31, 2004.

The paper quoted an unnamed JDA offical as saying President Fradique de Menezes had signed off on the awards after 12 days of non-stop, gut-wrenching political turmoil that often seemed ready to derail the entire process.

This story has some original material, including the information that President de Menezes has signed the diocument, and an original quote. There are none of the obvious mistakes that usually accompany the nuttier Nigerian newspaper reports. And it is consistent with reports in four other publications Wednesday as well as the statements of the Secretary of JDA we reported yesterday.

JDZ oil block winners emerge on Friday
by Charles Okonji
Senior Business Correspondent

(With news agency report)

ABUJA -- There are strong indications that the Joint Development Authority (JDA), the body vested with the responsibility of overseeing the Nigeria-Sao Tome and Principe Joint Development Zone (JDZ), will on Friday announce the winners of five oil blocks put on offer last November.

An official of the Department of Petroleum Resources that disclosed this said: “The winners will be announced before the end of the week. ExxonMobil has exercised its 40 per cent option right on Block One and reserve. It has 25 per cent option on two blocks for the next licensing round.”

Winners, he said, had been chosen based on competence and wherewithal to operate in the deep offshore waters, adding that the Joint Ministerial Council (JMC) of the JDA met in April and decided the winners that had been approved by President Olusegun Obasanjo and his Sao Tome and Principe counterpart, Fradique Des Menezes.

Exxon-Mobil reserved its 25 per cent options on two blocks among the five on offer in the 2004 bid round because it could not be given the operatorship of the blocks in line with its desire.

But a Portuguese-language Lusa news agency report suggests there may still be problems ahead as Nigeria uses its custody of Sao Tome's $49 million share of the Block 1 signature bonus fee - at least according to Lusa, which cites the Nigerian Ambassador to Sao Tome as its source - to push for a conclusion to the second round of licensing.

We're unsure why the Nigerian Ambassador would have spelled out the terms of the impasse in such stark language for an international audience, and we therefore find it suspect.

In our opinion, the story is an effort to further divide Sao Tome and Nigeria and complicate the awards process. Portugal's national oil company, of course, has been trying to horn in on the licensing process but came too late to the party to offer a bid. Now Lusa can keep the fracas going in Sao Tome with one-sided reporting and hope to fare better against ERHC in the Sao Tome EEZ round.

However, the story may offer some insight into why the dispute was apparently resolved, as the Independent says.

Here's a "synthesis" of the Lusa report from Homeport, with his homemade (note his use of "Hard Ball" instead of "Hardball") headline:

Abuja Playing Hard Ball:

FYI, Portuguese Lusa agency carrying story ex-Sao Tome with Nigerian ambassador saying Wednesday that Block One signing bonus funds blocked due to STP inaction. And that political gridlock in islands could jeopardize bilateral awards process.

Ambassador Saidu Pindar told Sao Tome news conference that "the distribution and use of the funds" from first round award of B-1 "can't proceed because STP authorities have not yet signed a resolution agreed between the two states."

Pindar, Lusa added, also said: "We are waiting on STP's authorities to distribute the money," $123-million the ambassador said was in Nigeria´s Hallmarb (sic) Bank.

By treaty STP will get 40% of the signature bonus.

Agency cites Ambassador Pindar as lamenting the recent declarations of "the two STP parties" and acknowledging that such could "compromise the process."

Lusa does not make clear what "resolution" is yet to be signed nor does it specify whether the "two parties" are the two sides in the debate in Sao Tome or the two government parties - MLSTP-PSD and ADI - which have been most critical of the awards dynamic underway and President de Menezes' handling of the affair.

No reference to possibility of Obasanjo visit.

Story seeable at www.lusa.pt in Portuguese service. Imagine English LusaNews will carry later today.


By Homeport, at 2:30 AM

And now, here's an update from Homeport, in which Lusa's RDP Radio says Obasanjo is going to Sao Tome tomorrow:

Hardball-2nd Inning: Obasanjo Enters the Game

FYI, Portugal´s RDP-Africa radio reporting this morn ex-STP that it "has learned" Nigerian President Obasanjo will be in STP Friday.

It gives no source for the info.

RDP-Africa also updates Ambassador Pindar´s comments at Sao Tome news conference yesterday:

-- islands' two ruling parties - MLSTP/PSD and ADI - place bilateral "relations and cooperation" in jeopardy by hobbling advance of awards process; and

-- denies comment he attributes to President Menezes that STP has no decision-making power in framework of Joint Ministerial Council.

Looks to me as if the clock is finally ticking COUNTDOWN.

Thanks for correcting my spelling, Joe: I've played soccer all my life, rather than any form of baseball.

Cheers,

By Homeport, at 5:41 AM

And, finally, also from Homeport, confirmation that Obasanjo is going to Sao Tome:

FYI, LusaNews carrying confirmation Obasanjo expected in STP tomorrow. Cites unidentifies Menezes' aide.

-- www.lusa.pt --

Bests,

By Homeport, at 9:49 AM

In other news released today from Nigeria, our partner in Blocks 2 and 3, Devon Energy, is spreading the wealth around by aiding schools and education in Nigerian communities, the Financial Standard reports Thursday:

Ocean Energy spends N53m on community development projects
by Samuel Ibiyemi

LAGOS -- Ocean Energy Nigeria Limited, a subsidiary of Devon Energy Corporation of the United States of America, has spent N53 million on the building and installation of educational facilities in three primary and secondary institutions in Lagos State as part of its community development programme for last year.

A breakdown showed that the company invested N25 million on four educational facilities at Fagba Junior Grammar School; N20 million on provision of seven education facilities at Archbishop Taylor Memorial Nursery and Primary School; and N7.5 million on rehabilitation and supply of infrastructure at Methodist Boys High School, all in Lagos State. Some of items financed at Fagba include two blocks of five classrooms, a multi-purpose laboratory and a staff room.

The donation made by the exploration firm is expected to improve condition of learning in the affected institutions. It would also encourage existing oil producing firms to improve on their community development strategies.

Mr. Raymond Marchand, managing director, Ocean Energy Nigeria Limited said at the handing-over of community development projects executed at Fagba in collaboration with the Nigerian National Petroleum Corporation (NNPC) last week, that the projects were financed to assure government and communities that the company was in Nigeria for a long haul.

"It is our interest globally to improve conditions of living in communities where we operate", he said.

Governor Bola Tinubu of Lagos State said at the handing over ceremony that executives of the state are pleased with the performance of Ocean Energy in terms of making huge investment on community development projects, which he noted are vital for building manpower capacity, within its two years of exploration activities in the country.

"This investment is the right thing to do by any corporation because education is the only right investment that would tackle poverty, which is a menace in Africa", he said, enjoining other oil firms to emulate the gesture. He said the contributions of the private sector, especially in Lagos was very crucial because of the state’s peculiar socio-economic status.

"Since we cannot catch up with all the needs of the population as a result of the high growth rate, the contribution of private sector players would always be appreciated by the state government", he said.

It appears to us that Devon and Ocean Energy, which it acquired last year, plan to build a productive and propserous relationship with Nigerian communities.

Trading Updates: Obasanjo Headed To Sao Tome Friday; ERHE Opens Strong, Up $0.03; JDA Confirms Awards This Week; Menezes Files Libel Suit

ERHC Energy (OTC BB symbol: ERHE) leapt at the opening bell today as the prospect of awards this week predicted by four different news organizations gave fresh hope to investors that their long political nightmare may now be over.

The latest comes from mutwadadi's 3:14pm Comment. He tells us Nigerian President Olusegun Obasanjo is going to Sao Tome on Friday; for most if us, that's the signal that awards are really coming by the end of the week. Many thanks, mutwadadi; you have been our most reliable poster on such matters from the very first.

PetroleumAfrica is the latest to weigh in with a May 18 story promising awards this week, and there's a solid mention of ERHC Energy. Here is their take:

JDZ Awards Coming Soon
For companies waiting to hear if they were successful in their bidding for the five oil blocks put on offer by the Nigeria-Sao Tome and Principe Joint Development Authority, the wait may soon be over. According to an official from the JDA, winners of the five blocks will be announced before the end of the week.

The Joint Ministerial Council (JMC) of the JDA met in April and decided on the winners that had been approved by Nigerian President Olusegun Obasanjo and his counterpart Fradique Des Menezes of Sao Tome and Principe. According to the official, the winners are chosen based on competence and ability to operate in deep offshore waters.

ExxonMobil reserved its 25% options on two blocks among the five on offer in the 2004 bid round because it could not be given the operatorship of the blocks in line with its wishes. American oil firm ERHC Energy, in which indigenous firm Chrome Energy has a major stake, had similar options which it exercised and validated with the JDA.

An update from Markvol1 on Raging Bull's ERHE message board reconfirms the good news we heard in three separate news reports last night that awards will be announced this week:

********UPDATE*************

Just spoke with 2 sources at the JDA.

1st Source: Secretary of the JDA 011 234 9 524 1064

I asked him about the DRP's quote, "The winners will be announced before the end of the week." The Secretary of the JDA responded by saying this is accurate. I asked for the exact date and time of the awards announcement. He said it would be "at week's end." I asked if that meant Friday, Sat, or Sunday and he said to me "at week's end. Take it like that. It will be announced."

2nd Source: Source did not want to be named.

I asked about the news from last night stating that awards would be announced by end of this week. Source told me, "(JDA) is seeing the light at the end of the tunnel." When I asked about the day of awards announcement they said Friday is "MOST LIKELY."

Trading Updates: An $0.08 Gain
Update, 4pm, 5/18/05: ERHE closes at $0.70 on what may be the last day of "normalcy" before awards are announced. Closing volume is 2,192,500, and the ERHC On The Move portfolio of 123,040 bought an average of $0.4394 had a gain today of $4,306.40, and enjoys an overall gain of $31,880.52, or $0.26 a share. We've faced intense pressure on the home front to sell this week, amid all the doom 'n gloom, but we're glad we're going to be here when the price tops a dollar on Friday, May 20 (or so we believe).

Of 345 trades recorded by ADVFN at 4:01pm, 1,120,446 were Buys and 932,299 were sells, with 139,790 unidentified. Of the last 16 trades, only four were sells totaling 32,500 shares; the rest, and the last five trades, were buys totaling about 65,000 shares, with three of those Form T after-hours buys. Why anyone at all would sell after waiting so long for awards is a mystery to us.

Update, 3:58pm, 5/18/05: The price is $0.70, as lucky buyers get cheap shares and volume rises to 2,165,500. Now the price clicks up to $0.701, then to $0.70 as the Bid falls back to $0.695. Volume is 2,180,500, coming in fast and furious as the close grows near.

Update, 3:54pm, 5/18/05: Look for a big gap up tomorrow as word of President Obasanjo's Friday trip to Sao Tome for awards is formally announced. The price is $0.705, the Ask, while the Bid is slightly higher at $0.70 and volume has crossed the 2.1 million mark.

Update, 3:32pm, 5/18/05: No price change, but volume has climbed to 1,932,600. The Bid and Ask are $0.695 x $0.70.

Update, 3:15pm, 5/18/05: The 3:15 Surge brings a 14K trade but no price change yet.

We see our friend Phil Nugent's GEECF is now at $0.48, probably near the bootom of this latest fall, and we expect it would be a good price to buy. The stock's shown a lot of resistance at this level. Luncn is served - be back soon.

Update, 3:08pm, 5/18/05: Volume is 1,787,800 shares and the price is $0.70, the Ask, and the Bid remains at $0.695 with nine minutes to got the 3:15pm Surge. It ought to be interesting today.

Update, 2:36pm, 5/18/05: The price has fallen to $0.695, the Bid, while the Ask is now $0.70. Volume has climbed to 1,768,000 shares.

Update, 2:13pm, 5/18/05: At 2pm with 267 trades under our belts, Buyers continue to lead seller by 845,647 Buys to 788,259 Sells, with 90,200 shares unidentified.

Update, 2:13pm, 5/18/05: Volume is 1,726,600 and the price is $0.70, the Bid, while the Ask returns to $0.705.

Update, 2:02pm, 5/18/05: The price is $0.705, and the Bid and the Ask are both at $0.70. Volume has climbed to 1,721,600 shares as investors finally see the light at the end of the tunnel.

Update, 11:19am, 5/18/05: The price has retreated from its $0.748 high to $0.70, while the Bid has dropped back to $0.70 and the Ask to $0.705. Volume is 984,415. Gotta go to the doctor's now.

Update, 11:03am, 5/18/05: The price is $0.745, the new Bid $0.74, and the Ask is $0.741 as the dramatic improvement continues. Volume is running to a healthy 772,645.

Update, 10:45am, 5/18/05: My friend Antonio Villaraigosa has been elected Mayor of Los Angeles! Vaya con Dios, Antonio!

The price is $0.71 now, the Ask, with the Bid at $0.70 and volume of 411,385.

Update, 10:37am, 5/18/05: The price is $0.70, the Ask, while the Bid is at $0.69 and volume is 369,785. My father fell and cut his arm, so I have to bring him to the ER. I'll be back in an hour or so, I hope.

Update, 10:20am, 5/18/05: Devon, Pioneer and Noble are up $01.00, $0.52 and $1.11, respectively - as good news leaks to their investors first? ERHE is at $0.69, the Bid, while ther Ask has slipped to $0.695.
Update, 10:08am, 5/18/05: We're back at $0.70, with the Bid and Ask unchanged a tenth-cent apart and volume 205,585 shares.

Update, 10:06am, 5/18/05: All unchanged.

Update, 10:03am, 5/18/05: Volume soars to 200,885 as the price hits $0.70 and then slips back to $0.699, the new Bid, with the Ask still a tenth-cent higher at $0.70.

Update, 9:57am, 5/18/05: The price slips to $0.69, the new Bid, but the Ask stays at $0.70 as volume reaches 182,885 shares.

Update, 9:54am, 5/18/05: We're at $0.70 now, on volume of 176,885.

Update, 9:53am, 5/18/05: Voila, ici! The Ask is at $0.70 and the Bid at $0.695, on volume of 171,885 shares.

Update, 9:50am, 5/18/05: Now 20 minutes into the day, we're up 5 percent and in our opinion likely to improve much more. Volume is 169,385, with the Bid and Ask $0.695 x $0.698.

Update, 9:46am, 5/18/05: The price is $0.698. Volume hits 161,185 with the Bid higher at $0.695 and the Ask at $0.698.

Update, 9:43am, 5/18/05: All indicators unchanged.

Update, 9:37am, 5/18/05: The price goes to $0.695, the new Ask, while the Bid is unchanged and volume hits a respectable 137,500.

Update, 9:37am, 5/18/05: The price is up $0.03 at $0.69, the Ask, with volume at 133.200 and the Bid at $0.685.


The tide has apparently shifted in Sao Tome, with President Fradique de Menezes going on the offensive today as he filed a slander suit against Carlos Tiny, the Sao Tome left-wing politician who noisily charged that Menezes is a shareholder of ERHC Energy.

The report is from the globe-spanning Portuguese news agency Lusa:

18-05-2005 12:09:00.
Fonte LUSA.
Notícia SIR-7010368
Temas:

Sao Tome: Menezes to sue main party leader who alleged oil wrongdoings

Sao Tome, May 18 (Lusa) - President Fradique de Menezes of Sao Tome and Principe said Wednesday that he is filing a slander suit against a leader of the largest MLSTP party over allegations that he made personal financial gain from the allocation of offshore oil blocks.

In a presidential communiqué, Menezes said Carlos Tiny, an influential member of the MLSTP and the president's main rival in 2001 elections, had made the defamatory comments at a press conference earlier this month.

The remarks by Tiny had "affected the honor and dignity of the president", added the statement.

Tiny had alleged that Menezes breached legislation over transparency in the management of Sao Tome's Gulf of Guinea oilfield shared with Nigeria.

The MLSTP grandee's complaints were that Menezes had steered negotiations to derive personal gain and also created conflict of interests by naming his chief of staff, a shareholder in a small US company involved in the award process, to take part in negotiations.

The announcement on which companies will be chosen to operate the offshore oil blocks in Sao Tome and Nigeria's Joint Development Zone has been successively held up due to political infighting in the microstate and allegations of high-level corruption in the process.

Natural Resources Minister Arlindo Carvalho resigned Monday, saying it was "impossible to work in a climate of allegations of irregularities in the oil negotiations".

Menezes himself stood down from the country's National Petroleum Council last weekend, saying he wanted to "avoid confusion", but would continue to exercise a "gatekeeper" role in the awarding of offshore exploration rights.

RCN/CJB.

Lusa

News, News, News: Oil Daily Says Sao Tome's NPA Chief Predicts Awards This Week, And So Does China's Xinhua; MDFM Responds To MLSTP Letter; EEL Falls

Oil Daily, a respected industry journal, claims it managed to get an interview with the head of Sao Tome and Principe's National Petroleum Agency, and - good news for ERHE investors - he says awards will be made this week.

China's Xinhua News Agency also quotes a Nigerian official saying the awards will be this week. Rigzone publishes that Tuesday story from the official Chinese news agency in which an Abuja-based official from the Dept. of Petroleum Resources also promises that awards are to be anounced "before the end of the week," but the official who tipped them off "refused to be identified."

And in the latest of the back-and-forth from the two major-party coalitions, there's now a response on Tela Non to today's 9-point message from the MLSTP/PSD from the president's MDFM/PCD.

That message talks about a debate on Thursday on issues including oil, and promises a regular weekly Q&A session as in Britain's parliament thereafter. If the debate is the end of the road, awards could indeed come Friday, we suppose.

The Oil Daily said the NPA chief told them President Fradique de Menezes would not "reject" the awards, as he has the power to do, and as the Energy Compass article of May 13 also suggested he might do.

The NPA executive director said instead that De Menezes is likely to sign the awards document and allow them to go forward sometime later this week.

Here is the paragraph of relevance, from a post by kerry_lass on Raging Bull's ERHE message board:

"Luis dos Prazeres, executive director of Sao Tome's administrative National Petroleum Agency (NPA), told Oil Daily Tuesday that the latest developments might bring delays. But at this crucial stage of the process, he said de Menezes was unlikely to reject the awards recommended by the JDA. "A decision will be taken to finalize the process by the end of the week," dos Prazeres added. De Menezes was expected to appoint a new natural resources minister late Tuesday."

Here is the story from Xinhua:

Nigeria, Sao Tome to Announce Winners of Oil Blocks
Xinhua News Agency
Tuesday, May 17, 2005

The Nigeria-Sao Tome and Principe Joint Development Authority (JDA) is to announce winners of five oil blocks put on offer last November this week, an official from the Department of Petroleum Resources (DPR) of Nigeria said Tuesday.

"The winners will be announced before the end of the week," said the official who refused to be identified.

"Exxon-Mobil has exercised its 40 percent option right on Block One and reserved its 25 percent option on two blocks for the next licensing round," he added.

According to the source, the winners are chosen based on competence and wherewithal to operate in the deep offshore waters.

The Joint Ministerial Council (JMC) of the JDA met in April and decided the winners that had been approved by Nigerian President Olusegun Obasanjo and his counterpart Fradique Des Menezes of Sao Tome and Principe.

Exxon-Mobil reserved its 25 percent options on two blocks among the five on offer in the 2004 bid round because it could not be given the operatorship of the blocks in line with its desire.

American oil firm, ERHC Energy in which indigenous firm Chrome Energy has major stake, had similar options and had already exercised them and validated by the JDA.

Oil activities are imminent in the JDZ after the Production Sharing Contract (PSC) on Block One was signed between Chevron- Texaco, Exxon-Mobil, Dangote EER and the JDA in February.

We are a little more inclined to rely on Mr. Dos Frazeres than the Chinese, but the truth is that a stormy meeting of Parliament lies ahead and a lot of harsh words are yet to be heard, so we counsel patience. We're not at all certain the meeting is germane to the awards process, however.

Awards could come this week - or come six months from now, depending on a lot of little things that no one but the good Lord can control.

In another development covered by Tela Non, the Sao Tome and Principe daily news Website, the major opposition party, MDFM - which is the party of President Fradique de Menezes, not of Prime Minister Vaz de Almeida, who is elected by the MLSTP/PSD ruling coalition in Parliament (in case you were confused as to how the President would not be in the ruling party, as he is in America) - has responded to Tuesday's lengthy missive from the MLSTP/PSD with its own air-clearing statement.

I have translated it below:

MDFM/PCD dá nota negativa ao governo

MDFM/PCD Will Give A Failng Grade To Government
by Vladimir Antonio

SAO TOME -- A coligação MDFM/PCD, a maior força política na oposição são-tomense, dá nota negativa ao desempenho do elenco governativo de Damião Vaz d’Almeida e admite votar uma moção de censura, caso o executivo não crie condições que melhorem a vida das populações.

SAO TOME -- The MDFM/PCD coalition, a major politcal force in the Sao Tome Opposition, has condemned the charade of the elected government of Damiao Vaz d'Almeida and vows to offer a motion of censure against the executive for not having cvreated conditions that improve the lives of the people.

Pois, segundo a aliança partidária, oito meses após a tomada de posse do IX governo constitucional de São Tomé e Príncipe pouco foi feito para melhorar a vida dos cidadãos.

Now, the party alliance continued, eight months have passed since the ninth constitutional Sao Tome and Principe government took office, and little has been done to better the life of its two cities.

O abastecimento de água às populações, a distribuição regular de energia, o saneamento do meio, a agricultura e a forma como tem sido conduzido o dossier petróleo, são entre outras, algumas das questões que mais preocupam os deputados do MDFM/PCD.

The supply of water to the population, the regular distribution of energy, the health of the average person, agriculture, and the way the petroleum dossier has been handled, among other issues, are some of the questions that most concern the deputies of MDFM.PCD.

Para procurar respostas junto do elenco de Damião Vaz d’Almeida, a coligação agendou para quinta-feira próxima, um debate sobre o estado da nação.

In order to get answers, together with the government of Damiao Vaz D'Almeida the coalition has arranged a debate for this Thursday onr the state of the nation.

“Vamos dar uma nota negativa ao governo porque o governo andou a dizer que precisava de um orçamento do estado, matéria fundamental para gerir e governar. De boa fé a nossa bancada fez um esforço para aprovar o orçamento do estado, mas desde então tem-se notado um desorientação completa por parte do governo do MLSTP”, garantiu Tozé Cassandra, deputado do MDFM/PCD.

We are going to give a failing grade to the government because the government goes forward without saying precisely what the national budget is, a fundamental matter [for those who] manage and govern. In good faith our side will demand an effort to approve the national budget, more so since have taken noticed of the complete disorientation of the MLSTP government," guaranteed
Toze Cassandro. a MDFM.PCD deputy.

Os deputados advertem por outro lado que o debate parlamentar vai ser só o primeiro passo na luta pela melhoria das condições de vida dos cidadãos são-tomenses.

The deputies warned the other side that the parliamentary debate was going to be only the first step in their fight to impriove the conditions under which Sao Tome citizens live.

“As regras democráticas devem ser seguidas, senão pode-se ir eventualmente para uma moção de censura, questionar o governo, e a oposição deve denunciar as coisas que estão erradas”, explicou Sebastião Santos.

"The rules of democracy are going to be followed; we are eventually going to pass a motion of censure, to question the government, as it is the duty of the opposition to denounce those things that are wrong," said Sebatian Santos.

Após o debate de quinta-feira, a coligação MDFM/PCD, diz que vai agendar com regularidade sessões de perguntas ao governo ao mesmo tempo que vai intensificar o contacto com o eleitorado para explicar o papel da Assembleia Nacional.

After the debate on Thursday, the MDFM/PCD coalition said it would agendize regular question and answer sessions with the government and at the same time intensify contacts with the electorate to explain the political platform of the National Assembly.

And in an indication the news is not so good for Equator Exploration, which was Patrice Trovoada's horse in the race, look at these end-of-day trading results from London's AIM, where the stock trades as EEL:

Last 5 trades

Time/Date Price Volume Trade value Type
17:00:51 18-May-2005 126.25 110,100 138,997.95 Single protected transaction
17:00:51 18-May-2005 126.25 110,100 138,997.95 Cancelled
16:59:31 18-May-2005 126.50 189,900 240,223.50 Single protected transaction
16:59:31 18-May-2005 126.50 189,900 240,223.50 Cancelled
16:26:11 18-May-2005 128.85 587,410 756,883.66 Single protected transaction

Trading Update: Ignoring Good News, ERHC Dives and Recovers On Complex News From Sao Tome; MLSTP Statement Calls For Legal Action

The complex, fast-moving political turmoil in Sao Tome has confused, aggravated and disaffected some investors this morning, and the result is a falling share price on low volume.

At 10:33am, the price was $0.645, the Bid, both down 6.5 percent or $0.05 from yesterday's $0.695 close, with the Ask set at $0.664 and modest volume of 305,251 shares.

Despite that, investors were ignoring some good news: a formal statement from the National Petroleum that specifically finds that the Council had no problem with ERHC's proposed awards "because its rights were granted by treaty" and are not subject to debate (nor is any part of the treaty).

In that statement, the NPC set up a special committee to review the awards and make recommendations to Parliament, which apparently will meet today or tomorrow, not yesterday as first reported here.

Update, 4:00pm, 5/17/05: The close appears to be $0.665, accounting for some late-posting but timely trades. The volume ended at 1,115,00 shares.

Update, 3:59pm, 5/17/05: The price is $0.67, which looks like where it will close today. The Bid is still $0.665, and the Ask has dropped to $0.67. Volume is 1,110,500.

Update, 3:55pm, 5/17/05: The price is $0.673, the Ask, and the Bid is unchanged as volume lifts to 1,108,300.

Update, 3:53pm, 5/17/05: A major statement from the MLSTP, the ruling party in Parliament, has been posted "To The Press." It argues for a decision in Sao Tome's courts concerning Block 4, in particular, which ERHC and Noble Energy have won with their fast-track drilling program. Here it is:

NOTA DE IMPRENSA

O MLSTP/PSD acompanhou atentamente os últimos desenvolvimentos que tiveram lugar com relação ao dossier petróleo, nomeadamente a reunião do Conselho Nacional do Petróleo de 13 de Maio e as declarações de Sua Excelência o Presidente da República Fradique de Menezes, na sequência dessa reunião.

O MLSTP/PSD analisou detidamente o Comunicado do Conselho Nacional do Petróleo bem como as declarações do Senhor Presidente Fradique de Menezes e procurou colher mais informações que pudessem lançar alguma luz sobre os meandros desse processo, permitindo-lhe definir o seu posicionamento em defesa dos interesses da nação santomense, tendo chegado às seguintes conclusões:

1. O Sr. Presidente da República, ao anunciar, na passada sexta-feira, a sua saída do Conselho Nacional do Petróleo, veio, finalmente, dar razão ao nosso partido. Com efeito o MLSTP/PSD sempre disse que o Presidente da República não tinha nada que fazer num organismo deste tipo e que a sua presença no CNP estava ferida de inconstitucionalidade. O Sr. Presidente da República, infelizmente, recusou-se sempre a ouvir a voz da razão, assenhorou-se do processo que vem um papel de subalternidade. Se a decisão do Senhor Presidente da República peca apenas por ser demasiado tardia, cabe ainda perguntar porque é que só agora esta decisão é tomada pelo Senhor Presidente da República e o que estaria por detrás dela precisamente neste momento, após os males que essa presença terá eventualmente causado à Nação?

2. O MLSTP/PSD entende que é chegado o momento de parar com as improvisações e ilegalidades que vêm marcando a gestão do dossier petróleo e, por isso, apela ao Governo para, assumindo as suas reais responsabilidades, tomar medidas no sentido da definição de uma Política Nacional do Petróleo que inclua as estruturas mais adequadas para a gestão de um processo tão complexo quão importante.

3. O MLSTP/PSD nota que, com pertinência, o Conselho Nacional do Petróleo constatou que, "houve insuficiências formais e de procedimento no processo de adjudicação"; todavia, reafirma a sua posição em como houve irregularidades (não apenas insuficiências de forma e de procedimento) e que essas irregularidades viciaram o
processo.

4. Com efeito no relatório de avaliação das propostas para o leilão de 2004 feito pelo Comité especializado da Autoridade Conjunta afirma-se claramente no seu ponto 21.1. que, devido a limitações de tempo, "a due diligence de 2003 foi adoptada". Isto é grave quando se sabe que a due diligence é uma investigação rigorosa que permite saber quem, dentre as empresas que se candidatam ao leilão tem ou não tem capacidade técnica, comercial e financeira para participar no concurso claro que todo o processo está viciado por falta de bases essencial para uma adequada tomada de decisão. Como então falar de "insuficiências formais", que não "viciaram o processo"?

5. Entretanto pergunta-se como é que um organismo como o Conselho Nacional do Petróleo, após mais de dez horas de reunião, passa por cima do facto essencial que é o de o seu Presidente, no caso o Presidente Fradique de Menezes, estar a violar a Lei-quadro das receitas petrolíferos, a Lei 8/2004 quando nomeou e manteve em altos cargos pessoas com expressos no negócio do petróleo.

6. Será que o "bater com a porta" do Ministro dos Recursos Naturais, Chefe da Delegação Santomense à última reunião do Conselho Ministerial Conjunto, Eng. Arlindo de Carvalho, encerra elementos de explicação que permitiriam à Nação uma melhor compreensão de todo este imbróglio? Como entender, de facto, os "enormes interesses
particulares e obscuros que o processo do petróleo tem vindo a conhecer." a que o Ministro se refere? Quais os "enormes constrangimentos que o mesmo vem conhecendo" . e que lhe "têm impedido de dar passos rumo ao desenvolvimento pretendido para o
nosso pequeno país" como ele próprio diz na sua carta?

7. O MLSTP/PSD manifesta ainda a sua perplexidade perante a existência de um sem número de "coincidências" que exigem muito mas muito esforço para se poder entender e explicar. Trata-se concretamente do um conjunto de negócios, todos eles articulados e em volta de São Tomé e Príncipe e do dossier petróleo e que não é nada
fácil entender e explicar convenientemente:

* Se bem que há mais de seis meses, repetimos seis meses, o Conselho Ministerial Conjunto tivesse instruído a Autoridade Conjunta para abrir uma conta num banco de 1.ª categoria onde pudessem ser depositados os 123 milhões de dólares do 1.º leilão de blocos petrolíferos, esse dinheiro encontra-se até hoje, inexplicavelmente, depositado num banco nigeriano de 2.ª categoria e até há dias sem render juros;

* Curiosamente o referido banco pertence ao mesmo grupo financeiro que instalou recentemente um novo banco em São Tomé e Príncipe e terá criado uma empresa a quem, no quadro deste último leilão, se pretenderia atribuir 5% de interesses participativos exactamente no bloco 4 considerado como o melhor e o de maior potencialidade dentre os seis blocos postos a concurso.

8. Finalmente a questão dos interesses nacionais. Após tudo o que dissemos deixamos a cada um dos cidadãos deste país a conveniente ponderação e o julgamento sobre essa questão.

9. O MLSTP/PSD renova por isso e uma vez mais o seu apelo de 9 de Maio ao Procurador-geral da República e estende igualmente este apelo aos demais órgãos com competência legal para o efeito e nomeadamente à Assembleia Nacional e aos Tribunais. Nesse sentido, o MLSTP/PSD instruiu já o seu Grupo Parlamentar para que faça diligencias no
sentido da criação de uma Comissão Parlamentar de Inquérito que possa esclarecer completamente toda esta questão, apurar responsabilidades e informar devidamente a Nação.

São Tomé, 17 de Maio de 2005.

Here is Homeport's "synthesis" wjat it all means:

In nine points, the STP´s main governing party basically rehashes its criticism of the awards process and the president's handling of the affair.

It concludes (P-9) by renewing its call to Attorney General for full inquiry and extends the challenge to all "competent bodies", including the courts and parliament. For its part, the MLSTP says it's instructed its bench for action to create a Parliamentary Inquiry Commission to "completely clarify" the issues and "determine responsibilities."

P-1: President de Menezes resignation from National Petroleum Council justifies party's earlier criticism. "Why only now?" has he stepped down, it asks.

P-2: It's time to end "improvisations and illegalities" in awards process. Govt must "assume its responsibilities" and "define" a National Oil Policy.

P-3: While NPC acknowledged "formal and procedural insufficiencies" in the process, the MLSTP reaffirms its view that there were "irregularities" that "perverted" the process.

P-4: Tis "grave" that JDA based its Round 2 findings on DD from first 2003 round due to a "lack of time."

P-5: The NPC passed over Menezes´ violation of the oil revenue managemenet law in his naming persons with vested interests to "high posts" in process.

P-6: Questions nature of the "huge and obscure interests" Natural Resources Min Arlindo Carvalho cited in resigning yesterday.

P-7: Questions deposit of B-1 USD 123 Mn signing bonus in "2nd category" Nigerian bank, where it's gained no interest in six months; bank belongs to group that recently opened STP branch and would be awarded 5% stake in coveted B-4 in current round.

P-8: MLSTP calls on nation to "ponder and pass judgement" on recent developments.

"Boa noite," as one'd say at this time of day in STP.

By Homeport, at 6:03 PM

Update, 3:40pm, 5/17/05: We have hit 1,102,300 shares of volume, one of the better days lately, with the Bid and Ask unchanged and the price still at $0.665.

Update, 3:27pm, 5/17/05: A note to investors: Judging from the protracted silence in the Nigerian press about the awards and the turmoil in Sao Tome, I think we can anticipate that when we do start hearing from them again, the awards will be imminent. There has been nothing at all for almost two weeks now in the 15 Nigerian newspapers we visit daily.

Update, 3:24pm, 5/17/05: The 3:15 Surge has not been notably surgeful; the price has slipped to $0.665, the Bid, and the Ask is at $0.673. Volume is 1,076,300 shares.

Update, 3:11pm, 5/17/05: A Florida jury has awarded financier Ron Perelman $604 million in his long-running suit against Morgan Stanley. The firm hopes to settle.

The price is $0.673, with the Bid at $0.665 and the Ask at $0.675. Volume is now 1,071,300 shares.

Update, 2:57pm, 5/17/05: The price is $0.675, the Ask, as we move close to the 3:15 Surge. The Ask is lower, at $0.673, and volume has reached 1,037,500 shares.

Update, 2:46pm, 5/17/05: We had 14 people in our first ERHC On The Move PalTalk chat session. Unfortunately, I need to get my mike up to speed, and also need to be able to hear folks better. The chat was especially useful for he discussion on Exxon; no one could indicate any knowledge of any drilling they've done in the JDZ.

Update, 2:19pm, 5/17/05: The price is $0.67, athe Bid, and the Ask is $0.675 as volume moves over 1 million to 1,000,300.

Update, 1:17pm, 5/17/05: The price is $0.66, the Ask, and the Bid is $0.655. Volume has reached 950,209 shares.

The volume so far indicates that there may be heavy trading near the close. Which way will it go? Will it push ERHE's share price up or down? Chat with us at PalTalk ("ERHC On The Move," under Groups and Miscellaneous, down at the bottom) and discuss what may influence the price movement at the close today.


Update, 1:12pm, 5/17/05: Anyone who would like to join me PalTalk can do for the next 15-20 minutes at ERHC On The Move, which is under Miscellaneous in the Groups list on PalTalk. Video is enabled.

Update, 12:52pm, 5/17/05: Lots of talk about a sale of 20,000 shares at exactly 12:15pm at $0.60, when the Bid was $0.655. Panic does that to people. Volume is now 929,922 shares and climbing.

Update, 12:37pm, 5/17/05: The price is still $0.66 and volume has shot up to 920,272 shares, while the Bid has slipped to $0.655.

Update, 12:11pm, 5/17/05: ADVN, on 15-minute delay, shows us that of the 40 trades between 10:37 and 11:31, 203,677 were Buys and just 10,875 were Sells. Anyone who thinks bashers are not using this crisis to get their shares cheaply should be educated by that. The Buys began at $0.625 and continued all the way up to $0.665.

The current price is $0.66, the Bid, and the Ask is $0.665, with the volume now at 782,750.

Just got off the phone with Ambassador Howard Jeter's office, and expect our PalTalk chat to occur shortly. We will require registration so as to avoid the mess in other chatrooms. Some readers note that I was just bounced from the PalTalk room run by Dadd1, who also runs the IHUB site, and who for competitive reasons won't allow me to take part in discussions on either site. Better investors would wonder what he has to hide, and better Americans would protest the censorship of my views. Ironically, I won the US Supreme Court case Shea v Reno to combat censorship, and am nonetheless now the victim of it.

Update, 11:57am, 5/17/05: Volume now tops 700K, with the last trade a 20K buy at the $0.665 Ask. The Bid is stuck at $0.66, and volume is 721,435 shares.

Update, 11:35am, 5/17/05: Volume has slowed to a trickle, and now stands at 681,435, with the price $0.655, the Bid, and the Ask at $0.66. Investors have stuck their feet out of the downhill runaway train and managed to stop the decline.

Update, 11:08am, 5/17/05: ERHE has pulled back from its sharp decline, climbing to $0.66, the Bid, with the Ask at $0.665 and volume soaring to 660.883 shares. The prospect that the turmoil in Sao Tome will end with the meeting of parliament and the availability of unusually cheap shares is apparently driving the price back up.

Update, 10:54am, 5/17/05: The price is $0.625, the Bid, while the Ask is at $0.63 and volume has climbed quickly to 587,435 with a substantial selloff underway.

Update, 10:41am, 5/17/05: The price is $0.64, the Bid, and the Ask has fallen to $0.645. Volume is moving more quickly, now to 413,001.

Reuters: CIA Says Nigerian Violence Could Disrupt All But Offshore Drilling; ExxonMobil's Sour Grapes: JDZ Drilling 'Disappointing'

An article from Reuters that came out late Monday afternoon says the CIA is predicting more trouble ahead for Nigeria, which faces presidential elections in 2007, and that gang violence expected by the agency could disrupt the flow of onshore oil from Africa's largest oil producer and America's fifth-largest source of petroleum.

Meanwhile, a rumor is spreading that Prime Minister Vaz de Almeida, a member of the ruling MLSTP/PSD party coalition that opposes Present Fradique de Menezes, is planning to address the country about the current crisis.

The CIA analyst said offshore areas in the Gulf Of Guinea enjoy some insulation from the violence. Helima Croft, an analyst with the CIA, said "Offshore production could be Nigeria's 'salvation' because offshore platforms are harder to damage than their onshore counterparts," Reuters said.

The CIA's new director, former Florida Republican congressman Porter Goss, told a Senate Intelligence Committee hearing last fall that Nigeria's stability is a wild card. A post concerning that hearing is available in the ERHC On The Move archives at the lower right of this page.

The article was posted on Raging Bull's ERHE message board by larry113 just after the closing bell yesterday.

One interesting note about the article: in it, a "top geologist" working for ExxonMobil is said to have called the initial drilling by the company "disappointing."

"Recent drilling in Nigeria's new offshore oil exploration area, the focus of a big new licensing round, has been disappointing, a top geologist for ExxonMobil said last month," Reuters reported.

That sounds like the sour grapes one would expect of ExxonMobil, which has not done any drilling at all in the "new offshore oil exploration area" that "has been the focus of a big new licensing round."

The company has already decided not to drill in Block 1, former U.S. Ambassador to Nigeria Howard Jeter "heard," he told ERHC On The Move earlier this month.

The sour-grapes comment, which is based on a lie as XOM has not yet done any drilling in the JDZ, makes it sounds like the rumor Jeter heard is based on fact.

Many presume the company is behind the all-out effort to embarrass President Fradique de Menezes that has led to three resignations - including de Menezes' own, as head of the National Petroleum Council - and a top-level firing in recent weeks.

At the same time, there is an all-out effort on Raging Bull by some posters to offend the Sao Tomean government and people with vulgar and insensitive comments about its poverty. Many of the most respected posters from the board have removed themselves or been removed and are now posting on IHUB, a moderated message board from which this reporter is barred for competitive reasons.

Here is the Reuters story:

CIA: Oil flow threatened ahead of Nigeria election
by Chris Baltimore
Mon May 16, 2005 03:18 PM ET

WASHINGTON, May 16 (Reuters) - Gang violence ahead of Nigeria's 2007 presidential election threatens to disrupt exports from Africa's biggest crude oil producer, an analyst with the U.S. Central Intelligence Agency said on Monday.

Nigerian President Olusegun Obasanjo's second term ends in 2007, when he must leave the presidency, according to the constitution rewritten in 1999.

That election will be "very contentious" and could bring a repeat of violence and attacks against Western-owned oil installations that marked the run-up to the 2003 election, said Helima Croft, an analyst at the Central Intelligence Agency.

"There are few signs that the region will be more stable in the near-term," Croft said at an event sponsored by the Council on Foreign Relations, where she is a fellow.

Unrest in Nigeria, the world's eighth largest exporter, has been one of the many factors that have kept global oil market traders on edge, along with violence in war-torn Iraq and rampant demand in China and India.

Nigeria is an OPEC member and the fifth biggest foreign oil supplier to the U.S. market, shipping an average 1 million barrels a day, according to the Energy Department.

Obasanjo's election in 1999 spelled the end of 15 years of military rule in the poverty-stricken nation.

But Nigeria under nonmilitary rule has been marred by violence in the nation's oil-rich Niger Delta region, including sabotage and seizure of oil facilities.

"You have a growing criminal element in the oil producing regions," said Croft, pointing to gangs armed with automatic weapons and portable missile-launchers. "There are few signs this criminal enterprise will go away any time soon."

At the depth of the 2003 crisis, 40 percent of the country's output of more than two million bpd was shut.

U.S.-based Chevron (CVX.N: Quote, Profile, Research) was by far the worst hit and 30 percent of its former production is still shut because of extensive vandalism.

Offshore production could be Nigeria's "salvation" because offshore platforms are harder to damage than their onshore counterparts, Croft said.

Recent drilling in Nigeria's new offshore oil exploration area, the focus of a big new licensing round, has been disappointing, a top geologist for ExxonMobil (XOM.N: Quote, Profile, Research) said last month.

Nigeria is one of the few members of the Organization of Petroleum Exporting Countries to have fully opened its oil reserves to the private sector. It aims to increase output from 2.5 to 4.0 million barrels daily by 2010.

UN Tale Of Sao Tome's Woe Omits Cost Of Multiple Delays; New Vitrina Article Recaps Turmoil, Tells Of 10-Hour NPC Meeting

A warm and fuzzy story from the United Nation's independent IRIN news agency casts a knowing eye over the poverty and disease that litters the otherwise lovely landscape of Sao Tome and Principe, a country composed of two islands freed by the Portuguese in 1970 and again by Angola in 1990, and 165,000 people who are trying hard to find their own way in a world full of hurt.

But the story omits any mention of the incredibly tedious and debilitating process in the form of a 2004 "transparency" law devised by foreign academics and buureaucrats that has led in recent days to the resignations and firing of four high-ranking government officials and new fears among investors that political in-fighting will once again deepen the shadows of corruption and delay that the law's unintended consequences has cast on their hopes of investing for profit in the nation's tired economy.

Here is the IRIN story:

SAO TOME AND PRINCIPE: Mercenaries, corruption and poverty complicate the road to an oil boom

[This report does not necessarily reflect the views of the United Nations]

SAO TOME, 16 May 2005 (IRIN) -- Staff sergeant “Peter” helped himself to another bottle of beer from the plastic dustbin full of ice beside him and wrenched the cap off with his teeth.

“I wanted to kill the man. He was this close to me,” the veteran Sao Tome mercenary said, before taking a generous slug from the bottle and gazing down the beach where children were playing in the sea.

He was referring to Teodoro Obiang Nguema, the president of nearby Equatorial Guinea, who visited Sao Tome and Principe a few months ago.

Obiang is an authoritarian ruler who enjoys one of the least enviable reputations in the world for corruption, human rights abuse and the failure to pass on the benefits of his country’s oil boom to his own people.

He had come to seek support from the government of Sao Tome as part of a drive to build better relations with his neighbours following the latest attempt to unseat him.

In March 2004, a group of Peter’s former comrades in South Africa’s notorious Buffalo Batallion tried unsuccessfully to invade Equatorial Guinea and overthrow Obiang.

Peter, a man with the solid build of a gorilla, said he made no attempt to actually harm Obiang and he had nothing to do with the plot to overthrow him.

That was nipped in the bud when a plane carrying more than 60 mercenaries towards Equatorial Guinea was detained during a stopover in Zimbabwe.

A short-lived coup

But the former soldier of fortune freely admits to having been one of 14 former members of the Buffalo Batallion who led a coup against Sao Tome President Fradique de Menezes on 16 July 2003 while he was visiting Nigeria.

The retired Sao Tomean mercenaries seized control of the twin-island state with the help of disgruntled officers in the country’s small and poorly paid army. Peter said his own job was to go and arrest the prime minister.

Denouncing rampant corruption in Menezes’ government, the "Buffalos" hung on for a week, until international pressure, led by Nigeria, forced them to capitulate.

Menezes, a prosperous cocoa trader who was elected president in 2001, then flew home, accompanied by Nigerian President Olusegun Obasanjo to make sure there was no funny business.

Nigeria has a strategic interest in Sao Tome since the two countries have decided to share the proceeds of oil exploration in their formerly disputed offshore waters, where international oil majors are queuing up for the right to sink exploration wells.

The first deep-water block was awarded to a consortium led by Exxonmobil last year after it agreed to pay US $120 million for exploration rights in a block that adjoins prolific oilfields in Nigeria’s own offshore waters.

Sao Tome, which straddles the equator, is due to receive $49 million of that deal, which was finally signed on 1 February.

The hefty signature bonus will provide as much money as the former Portuguese colony could expect to earn from 10 years of exports of cocoa, its main cash crop.

Cocoa is the main export, but will be superseded by oil

The United States and the United Nations have pressured Menezes and his government into adopting an oil law designed to guarantee that all of Sao Tome’s windfall income from petroleum is transparently spent on improving the lives of the tiny country’s 140,000 inhabitants.

There is no such law in nearby Equatorial Guinea, where Obiang last year spent $55 million on buying a brand new presidential jet, even though his 500,000 people still lack a reliable electricity supply and clean drinking water.

Allegations of corruption

In Sao Tome, Peter and his pals from the Buffalo Batallion are not the only ones who fear that a large chunk of the country’s future oil revenues may have been mortgaged by those in power in return for large and immediate payments which have gone straight into their private pockets.

Many people point to the mysterious ability of senior government officials earning meagre salaries of only a few hundred dollars per month to erect luxury villas in the Campo do Milho, a new suburb springing up on the road from Sao Tome city to the nearby airport.

Many of these same people can also miraculously afford to import four-wheel-drive cars.

No-one has ever been jailed for corruption in recent times and one exasperated diplomat noted that Sao Tome did not even have a law obliging the government to put public sector contracts out to tender.

But there has been a stormy debate about alleged irregularities in the award of the second offshore block in the Joint Development Zone shared with Nigeria. Last week, President Menezes parted company with his personal adviser on petroleum issues, Patrice Trovoada, after public allegations that some of Trovoada's private business deals were incompatible with his role as a public servant.

Peter said he left Sao Tome soon after independence in 1975, when he was just 17, because he disagreed with the Marxist government that assumed power in Sao Tome, entrenching its rule with the assistance of 1,000 troops sent from nearby Angola.

After initially travelling to Gabon, 300 km to the east, Peter and several other young Sao Tomean dissidents ended up in Walvis Bay in what was then South African-ruled Namibia.

“We were arrested and they gave us a choice,” Peter said. “Either go to prison or join the army.”

So Peter and his friends joined the Buffalo Batallion, apartheid South Africa’s equivalent of the French Foreign Legion. Based in the Caprivi Strip of northern Namibia, they were frequently used as special forces on clandestine operations inside Angola.

Shortly after Namibia achieved independence in 1990, the Buffalo Battalion was disbanded and Peter, along with his several hundred of his former comrades in arms became a free-lance mercenary. Many of them worked for the now disbanded South African security company, Executive Outcomes.

Peter said he was first sent to Sierra Leone, where he became the personal bodyguard of Valentine Strasser, an army captain who seized power in a 1992 coup.

Then he went to Liberia to support the regime of former president Charles Taylor.

“There were 300 ex-Buffalo people in Liberia at one time,” Peter said.

From there he drifted to Papua New Guinea, where in 1998 the government hired mercenaries to try and quell an insurrection on Bougainville Island, where a large copper mine is situated.

Returning to Sao Tome in 2001, “Peter” as he is universally known, eventually found work as a paramedic for a local non-governmental organisation (NGO) involved in public health campaigns.

Now aged 47, the former mercenary says that his soldiering days are over. Any further political activity by the "Buffalos" will be channelled peacefully through their small political party, the Christian Democratic Front (FDC), he added.

But many Sao Tomeans are not so sure. They fear that the Buffalos might still cause trouble on this volcanic forest-covered island with picture postcard beaches fringed by palm trees.

Poverty is increasing

In a country where the minimum wage is just US $25 per month and a graduate civil servant earns $60 to $70, corruption is rampant and there is plenty of resentment against the ruling elite for stuffing money in its own pockets, while leaving the vast majority of the population mired in poverty.

The local trade union movement recently demanded that the government use its first oil cheque from ExxonMobil to implement a four-fold increase in the minimum wage to $110 per month. Ministers have rejected this as unfeasible.

Despite the increasing prosperity of an affluent minority in Sao Tome, overall living standards have fallen steadily in recent years, leaving the country with a per capita income of just US$390 per year, according to the International Monetary Fund (IMF).

More than half of the population lives below the poverty line and many of the problems associated with chronic poverty, such as disease and malnutrition, have begun to re-emerge.

Last month, the island of Sao Tome suffered its first cholera outbreak in 15 years.

By mid-May 131 people had been hospitalised with acute diarrhoea suspected of being cholera and three had died.

One of the hotspots of the epidemic was Ferreira Governo, a run-down cocoa estate four km outside the capital.

There, 26 of the 135 people who live in squalid plantation workers’ huts lining a large square, fell victim to the disease and one died.

The community’s water supply had become heavily polluted due to lack of maintenance, while its latrine block was knocked down years ago after its drains became blocked.

The water pipe which spurts muddy brown water into a washing trough in the middle of the square comes from a small dam further up the mountain that has not been maintained properly since the estate was nationalised soon after independence.

And with no proper toilet facility, local people now just defecate anywhere among the cocoa trees that surround the village.

Since the epidemic began, a fire engine has been bringing clean water from the nearby city every day for the inhabitants of Ferreira Governo to drink.

But they still bathe and wash their clothes in the polluted water that gushes out of the standpipe and use it to irrigate small plots of tomatoes and beans that are sold in the market in Sao Tome city.

And they still lack hygienic toilet facilities.

Many of the inhabitants of Ferreira Governo blame their misery on Oscar de Barbosa, a prosperous local businessmen whose company, Mantero Agricultura Comercio Internacional, has leased the cocoa estate from the government for the past eight years, but has not invested a cent in maintaining or repairing its crumbling infrastructure.

Barbosa also happens to be the Minister of Defence.

“All he wants is the cocoa,” Miguel Brito, one resident of Ferreira Governo complained. “He doesn’t even bother to show his face here.”

Barbosa was out of the country when IRIN tried to contact him, but Jose Andrade Boa Morte, the manager of his plantation company, said it was the government’s responsibility - not Mantero’s - to repair the decaying infrastructure at Ferreira Governo.

He also accused the inhabitants of the estate of failing to take action themselves to make sure that intake of their water supply was clean.

In the early years of the 20th century, Sao Tome was the world’s biggest supplier of cocoa. But some argue that the local cocoa estates have been in decline since the 1920s when British traders began to boycott Sao Tome beans in protest at the harsh conditions endured by the contract workers brought in to replace slaves on the island’s colonial plantations.

The decline of the cocoa estates accelerated after the estates were nationalised at independence and since then, people have emptied out of the island’s rural areas into the capital.

Sao Tome city and the surrounding district now contain two thirds of the population of the entire country.

Many of the more remote cocoa plantations have been abandoned entirely and have reverted to bush. Annual cocoa production has fallen to about 4,000 tonnes per year and everyone is looking to oil – and to a lesser extent tourism – for economic salvation.

Fortunes to be made in construction

Money related to oil development is already pouring into Sao Tome and there are fortunes to be made.

Martinho Tavares, a former member of parliament who has given up politics and journalism to launch his own construction company, says the United States has drawn up plans to invest $500 million in extending the airport runway and building a brand new deep-water port.

Washington commissioned a feasibility study for both projects last year as part of its strategy of securing new sources of oil in West Africa to reduce the United States’ continuing heavy dependence on the volatile Middle East.

Tavares’s company is already putting up a new office block for ExxonMobil in the sleepy centre of Sao Tome city, which is graced by clean tree-lined avenues and brightly painted colonial era buildings.

And on the outskirts of this tranquil seaside town, new houses are being thrown up to let to the expected influx of foreign oilmen.

Exploration drilling is expected to start in 2007 and oil analysts say the country is likely to produce its first oil three to five years later.

Despite Washington’s strategic interest in Sao Tome, there is still no resident US ambassador in the tiny country, whose entire population is smaller than that of a medium-sized city on the African mainland.

The US ambassador is based in nearby Gabon and can be seen on his frequent visits to Sao Tome jogging along the quiet streets in a tee-shirt and shorts, his ears plugged into a walkman, with no need for a bodyguard to tag along beside him.

Nigeria’s presence, on the other hand is far more marked. Africa’s number one oil producer has replaced Angola, whose troops departed in 1990, as the country’s African guardian.

There is a fully-fledged Nigerian embassy in Sao Tome, several Nigerian banks have opened branches in the city and aggressive Igbo traders from south-eastern Nigeria are rapidly taking over the control of business in its main market.

They have a reputation for selling more cheaply than their Sao Tomean competitors and for keeping their shops open longer.

Discontent in Principe

Meanwhile, potential trouble is brewing in Principe, a small sleepy island of 5,000 people 150 km to the north of Sao Tome, in whose offshore waters the oil companies hope to strike it rich.

A small, but vocal lobby is emerging in Principe to protest that although this autonomous island will produce all the oil from the Joint Development Zone shared with Nigeria, it is unlikely to attract much economic development out of the hoped for oil boom. Nearly all the planned infrastructure to support offshore activities is due to be built on the island of Sao Tome.

There have even been murmurings of separatism.

Some of the malcontents on Principe have compared the island’s situation to that of Cabinda, an oil-rich enclave of Angola on the north side of the Congo River, whose neglect by central government has fanned sympathy for the idea of secession.

However, the international community has taken action to head off this problem in Sao Tome.

The country's new oil law, drafted with the help of legal experts from Columbia University in New York and a former governor of Alaska, reserves seven percent of all oil revenues for spending on Principe.

Back on the beach, Peter cracked open another beer.

“I hate communism,” he said, pausing to hand another bottle for his friend, a Cuban-trained judge.

Sao Tome has enjoyed a multiparty democracy for the past 15 years and it seems to work, even though local journalists complain that they will be quietly frozen out of a job unless they practice self-censorship.

The opposition has already established a track record for winning parliamentary elections and the last three presidential polls have all resulted in a new head of state coming to power.

In this pint-sized country, family ties and friendship often count for more than ideology.

“Have some whisky?” Peter said, pulling yet another bottle out of the blue plastic dustbin.

There's also a new story on Vitrina, mostly recapping the events of the past few days. The second paragraph notes that the meeting of the National Petroleum Council at the presidential palace last Friday was a fiery one that lasted 10 hours. We are hoping for a decent translation later on:

Confusão a volta do petróleo já provocou duas demissões
by M. Barros

17.05.2005-J.Vitrina-(S. Tomé) O Ministro dos Recursos Naturais e Meio Ambiente, Arlindo Carvalho demitiu-se das sua funções. A demissão de Arlindo Carvalho surge cerca de 72 horas depois do presidente da republica, Fradique de Menezes ter-se ele também afastado, por decisão própria, da presidência do Conselho Nacional do Petróleo.

O afastamento de Fradique de Menezes foi anunciado no final de uma reunião inflamada deste conselho que decorreu no palácio presidencial e que durou mais de 10 horas. Quanto ao ministro dos recursos naturais, ainda não é conhecido o motivo que levou o titular do dossier petróleo a pedir ao primeiro ministro Damião Vaz a sua demissão.

Mas já relativamente ao chefe do estado, o seu afastamento da presidência do conselho nacional do petróleo foi justificado pelo próprio com a necessidade de pretender ficar acima das querelas e tomar as suas decisões apenas enquanto órgão de soberania, não participando directamente nas discussões do dossier.

A verdade, é que essas duas demissões surgem como consequência de uma semana de intensa polémica e acusações algumas figuras com responsabilidade acrescida no polémico dossier petróleo. Arlindo de Carvalho é um dos quatro membros que o partido Acção Democrática Independente, ADI, tem no actual governo liderado pelo primeiro ministro Damião Vaz de Almeida.

Por isso mesmo, o líder do ADI, Patrice Trovoada já veio ao publico elogiar o seu ministro demissionário que considera de “um dos mais importantes quadros do ADI” e alertar que nas próximas 48 horas vai apresentar ao chefe do governo a proposta de dois candidatos aos cargo de ministro dos recursos naturais para substituir Arlindo de carvalho.

Patrice Trovoada entende que é necessário avançar com este dossier para o bem da nação e deixa nas entrelinhas que o lugar deve continuar a ser preenchido pelo membro do seu partido, único coligado com o MLSTP no actual governo. Ao que tudo indica, a polémica a volta deste dossier ainda não tem fim a vista.

Basta dizer que um comunicado saído da reunião do conselho nacional do petróleo deste último fim de semana não colheu o consenso de alguns órgãos de soberania, tais como a Assembleia nacional que aguarda mais elementos para tornar publica a sua posição relativamente a todo este conflito que já culminou com duas demissões.

Trading Updates: Fourth Official Resigns In Sao Tome; Equinox, Momo, Hatman And Godsonic Said To Win Indie Shares In JDZ

The Dow Jones News Service's ace reporter in London, Norval Scott, weighs in with the latest news from Sao Tome: Natural resources minister Arlindo Carvalho, who recently defended the JDA awards has resigned, becoming the fourth official to bite the dust in the past two weeks, Scott reported.

The news was first reported in an anonymous comment to ERHC On The Move on Saturday.

The growing toll has some observers worried that the Sao Tome government may collapse, but others tell Norval Scott that's just how politics works in Sao Tome, a nation of just 165,000 people, according to the 2004 U.N. census.

Opposition figures who have relentlessly pounded the presidency of Fradique de Menezes have now won a raft of concessions, including President de Menezes' resignation of president of the National Petroleum Council, cabinet member Mateus Meira Rita's resignation as Sao Tome's lead negotiator on the Nigeria-DRSTP Joint Ministerial Council, the firing of special presidential advisor on oil Patrice Trovoada, and now the resignation of Carvalho, who just last week defended the outcome of the JMC's "exhaustive" analysis and recommendations on the winners of five blocks that drew 26 bids in the Joint Development Zone's second licensing round.

The round ended Dec. 15 and the JDA was supposed to announce winners on Dec. 31, but the announcement has been delayed monthly, weekly and now daily since then.

The Dow Jones story was recently updated, and here it is with some new comments:

DJ UPDATE: Sao Tome Oil Min Resigns Ahead Of Block Awards
by Norval Scott
05/16/2005
Dow Jones News Services

(Updates an item timed at 1503 GMT with additional comments.)

LONDON (Dow Jones) -- Sao Tomean Oil Minister Arlindo de Ceita Carvalho has resigned, just days before the country's long-running oil licensing round was expected to be concluded.

A spokesman from the Sao Tomean Ministry of Natural Resources and Environment confirmed to Dow Jones Newswires via telephone that Carvalho had stepped down.

The resignation follows hard on the heels of the firing of Patrice Trovoada, the country's oil adviser, who was sacked by President Fradique de Menezes earlier this month.

Carvalho, like Trovoada, is a member of the Independent Democratic Action (ADI) party, which forms part of the ruling coalition with the Movement for the Liberation of Sao Tome and Principe-Social Democratic Party (MLSTP).

While no official reason for Carvalho's resignation has yet been given, it's thought that his departure is connected to the country's oil licensing round, for which awards were expected to be made this week.

Five blocks are set to be awarded imminently in the Joint Development Zone, a region jointly operated by Nigeria and Sao Tome that's believed to have very good oil prospects. The award of blocks has run into ongoing delays, with sources close to the negotiating process indicating that the ruling parties in Sao Tome disagree on which companies the JDZ oil blocks should be awarded to, hence the discord.

The recent turmoil has led some observers to question whether the political status quo in Sao Tome is on the verge of breaking down.

"These resignations will deal a major blow to the stability of the Sao Tomean government," said Manuel Paulo, a researcher at London's Royal Institute of International Affairs.

He noted that the government was also likely to be affected by President de Menezes stepping down on Friday from his tenure as chairman of the country's National Petroleum Council over the weekend.

However, Chris Melville, an analyst at Global Insight, said that the unrest was more a reflection of the perpetual crisis that Sao Tomean politics exists in, rather than an indication that the government was breaking down.

"Sao Tome's political landscape is very fragmented. It's all about temporary alliances and coalitions of convenience; these agreements do break down from time to time, but the state never collapses," he said.

How the resignation of Carvalho might affect the oil licensing round is as yet unclear. Sao Tome's National Petroleum Council met on Friday, with sources close to the negotiating process saying that it looked likely to back the recent recommendations of the Joint Ministerial Council over which companies the oil blocks should be awarded to. That appeared to pave the way for the licensing round to be concluded this week.

However, Carvalho's resignation could mean that that process encounters further delays, said Antony Goldman, an analyst at London's Clearwater Research Servives.

"The resignation of the oil minister from government creates a political crisis that has to be resolved," he said.

Sources close to the Sao Tomean government said that the ADI would put two candidates forward for the vacant oil minister position on Tuesday, potentially providing a solution to the problem.

-By Norval Scott, Dow Jones Newswires; +44-20-7842-9344; norval.scott@dowjones.com

(END) Dow Jones Newswires

05-16-05 1349ET

We've just gotten a reply from Gerhard Seibert, the influential and distinguished Sao Tome expert who has written extensively on the oil blocks and the awards process. He urges us to read the 428-word Energy Compass article (for sale for $24) posted May 13, and helpfully offers us this information:

Joe,

See the Energy Compass of May 13 on the question if
STP's national interests were harmed by the proposed
awards.

EC writes, among others, that " ...Nigerian power
brokers applied relentless pressure on São Tomé
officials to award coveted Block 4 to US Noble, a
partner of ERHC Energy, run by influential Nigerian
Emeka Offor, and to relegate US independent Anadarko
to Block 3. Most São Tomé officials appear to favor
Anadarko, which offered $90 million for Block 4 to
Noble's $57 million.

...Influential São Tomeans are piqued at the
prevalence on the list of proposed winners of
well-connected Nigerian independents who seem unlikely
to bring much to the party. They include Momo
Petroleum and Equinos Oil and Gas, which are thought
to be controlled by Mohamed Asebelua - a power broker
once linked to trader Arcadia."

Mr. Asebelua has been appointed as President Menezes'
special advisor for external investments.

Besides, the participation of Mr. Rita, a shareholder
of ERHC Energy Inc., in the NPC was possibly a
violation of art. 30 of the Oil Revenue Management
Law.

Regards

Gerhard

Here is that full Energy Compass report, courtesy of stockhocker70, now posting on IHUB:

Sao Tome runs into more problems in JDZ
Energy Compass Friday, May 13, 2005

Nigeria and Sao Tome and Principe ran into more problems in their Joint Development Zone (JDZ) this week, when Sao Tome regulators criticized the way the latest licensing round was handled. The move could force President Fradique de Menezes to reject awards recommended by the zone's administrator, the Joint Development Authority (JDA). Both De Menezes and Nigeria's President Olusegun Obasanjo have to approve the awards.

In a controversial report, Sao Tome's National Petroleum Agency said the JDA did insufficient checking into bidders' backgrounds. The JDA relied on due diligence done during the first licensing round in 2003 on the grounds similar companies bid, but that meant some second-round bidders went unchecked, sources say. The report also says too many awards to inexperienced Nigerian independents could frustrate operators.

The process has been subject to tension for months, as Nigerian power brokers applied relentless pressure on Sao Tome officials to award coveted Block 4 to US Noble, a partner of ERHC Energy, run by influential Nigerian Emeka Offor, and to relegate US independent Anadarko to Block 3. Most Sao Tome officials appear to favor Anadarko, which offered $90 million for Block 4 to Noble's $57 million. Anadarko put in the second highest Block 3 bid at $40 million. Mike Adenuga, another influential Nigerian, bid highest for Blocks 2 and 4 through various companies.

Influential Sao Tomeans are piqued at the prevalence on the list of proposed winners of well-connected Nigerian independents who seem unlikely to bring much to the party. They include Momo Petroleum and Equinox Oil and Gas, which are thought to be controlled by Mohamed Asebelua -- a power broker once linked to trader Arcadia. Others are Hatman and Godsonic, which have been linked to political strongman Tony Anineh, a close adviser to Obasanjo.

Nigerians are cashing in already, with funds from the first bonuses paid by Chevron and Exxon Mobil for Block 1 deposited in Island Bank, an affiliate of Nigeria's Hallmark Bank (EC Apr.15,p9). The latter is controlled by the family of Nigeria's recently fired Senate president, Adolphus Wabara. The deposit flouts JDA rules, which call for cash to be paid into triple A-rated banks, Sao Tomeans say.

De Menezes has clearly been subject to pressure from Nigerians, too, and a key question is whether he'll reject the awards or toe the Nigerian line. The report could enable his opponents to force the presidential hand. De Menezes is thought to be concerned that former presidential oil adviser Patrice Trovoada, whose family has political influence in Sao Tome, could make common cause with opposition parties in parliament.

Here is the Lusa story on Carvalho's resignation in the original Portuguese:

by Inacio Amorim

São Tomé -- O ministro dos Recursos Naturais e Meio Ambiente de São Tomé e Príncipe, Arlindo Carvalho, apresentou na manhã desta segunda-feira o seu pedido de demissão ao chefe do Governo do arquipélago, Damião Vaz d´Almeida.

Na origem do pedido de demissão apresentado por Arlindo Carvalho está a polémica em torno do «dossier petróleo» que se instalou no país e a Empresa de Água e Electricidade de São Tomé e Príncipe (EMAE).

Ao que tudo indica, o pedido de demissão - de que já se ouvia falar desde o início do mês - já terá sido aceite pelo primeiro-ministro são-tomense.

Para ocupar o cargo deixado vago pelo ministro demissionário, o seu partido, a Acção Democrática Independente (ADI), avançou já dois nomes, por enquanto ainda não revelados.

O anúncio surge poucos dias depois do anúncio do afastamento do chefe de Estado são-tomense, Fradique de Menezes, do cargo de presidente do Conselho Nacional de Petróleo de São Tomé e Príncipe, na sequência de acusações de irregularidades na adjudicação de blocos petrolíferos.

«O Presidente da República deve estar afastado destas negociações para evitar confusões», disse este fim-de-semana à imprensa Fradique de Menezes, acrescentando que passará apenas a «fiscalizar o processo».

Trading Updates

Update, 6:55pm EDT, 5/16/05: The price closed at $0.695, indicating investors have more confidence in the near-term outcome of the awards debate in Sao Tome than we might have thought. The final volume was 1,115,200, and the Bid closed higher than that, at $0.699, while the Ask closed at $0.70 where it spent much of the day.
This evidence of investor confidence bodes well for the rest of the week.

Update, 3:36pm EDT, 5/16/05: Investors have given up most of their gains today as the price hits $0.675, the Bid, while the Ask stays at $0.69 and volume rises to 1,072,300. This is the last update of the trading day. We expect a $0.66 close.

Update, 3:15pm EDT, 5/16/05: The price is $0.69 at the Surge, but the Bid and Asl are unchanged and little new volume has emerged. 1.069.800 shares have traded so far today.

Update, 2:55pm EDT, 5/16/05: Just 20 minutes from the 3:15 Surge, the price has bounced back a little to $0.69, while the Bid has fallen further, to $0.67, and the Ask remains at $0.69 while the volume hits 1,060,900 shares.

Update, 2:28pm EDT, 5/16/05: The price is at the low of the day, $0.68, after a series of developments, including a fourth resignation, a Dow Jones story, circulation of an Energy Compass article that names Nigerian independents who won the bids, and a note from the widely recognized expert Gerhard Seibert, all published here. The Bid has fallen to $0.675 and the Ask to $0.69, while volume has just crossed the 1 million mark to 1,034,600 shares.

Update, 10:59am, 5/16/05: Still at $0.71, with the Bid improving to $0.705 and the Ask staying at $0.70. Volume is 392,620 shares.

I've got to take my Mom to the doctor, so I'll be back around 1pm or earlier.

Update, 10:44am, 5/16/05: The price is $0.71, up $0.04 or 6 percent, and Bid and Ask are unchanged as volume reaches 361,770.

Update, 10:33am, 5/16/05: The price is $0.71, the Bid $0.70 and the Ask $0.71 as volume hits 354,670 shares.

Update, 10:12am, 5/16/05: The price is still $0.70, and the Bid and Ask are unchanged. Volume is 349,010 shares.

Update, 10:10am, 5/16/05: All unchanged.

Update, 10:08am, 5/16/05: All unchanged.

Update, 10:07am, 5/16/05: The price slips to $0.695 as volume reaches 300,648, with the Bid and Asj unchanged at $0.695 x $0.70.

Update, 10:04am, 5/16/05: The price slips back to $0.70, while the Bid and Ask are unchanged on volume of 297,148.

Update, 10:02am, 5/16/05: The price is back to $0.71 again, below the current Ask of $0.70 and the Bid of $0.695, while volume is a modest 294,148.

Update, 9:57am, 5/16/05: Volume is stopped for 3 minutes, the lifts to 289,048, while the Bid slips to $0.69 and the Ask goes to $0.70, the current price.

Update, 9:53am, 5/16/05: All unchanged as volume slows.

Update, 9:51am, 5/16/05: The price slip[s back to $0.70, the Bid, while the Ask stays at $0.70, and volume hits 273,573 shares.

Update, 9:49am, 5/16/05: Share price jumps to $0.715, then falls back to $0.71, with the Ask there and the Bid at $0.70 on volume of 271,073 shares. Despite modest volume, the morning's uptrend seems to be holding.

Update, 9:44am, 5/16/05: The Bid was momentarily at $0.705, its high, but slipped back to $0.70, while the Ask is at $0.705, a half cent below its $0.71 high. The price is $0.705 and volume is 233,623.

Update, 9:42am, 5/16/05: 10 minutes into the day we're up 4.5 percent and volume is 16,583. The Bid has risen to $0.70 and the Ask to $0.705.

Update, 9:39am, 5/16/05: The Ask rises to $0.705 while the Bid stays at $0.695, and the price is $0.70 as volume lifts to 156.058 shares.

Update, 9:37am, 5/16/05: Volume rises to 118.058, while the price is $0.70, the Bid is $0.695 and the Ask is $0.70.

Update, 9:33am, 5/16/05: The opening sees the share price hit $0.71 on volume of 81,008, but it immediately falls back to the $0.70 Bid, and is now now at $0.705. The Ask is $0.705.

Update, 9:29am, 5/16/05: The Bid rises to $0.705 before the opening, a nice $0.04 improvement from Friday's close. The Ask goes to $0.71.

Update, 9:23am, 5/16/05: The Ask gapped up sharply this mroning to $0.70, while the Bid remains at $0.67 a few minutes before the opening. Normally, that's a good sign, but with Dimka basically unresponsive this morning, it's likely the euphoria won't last. The last step of the approval process in Sao Tome could come today, however, and there's always the possibility we will take off.

"Soon, and very soon, we're going to see the King..." That was the song this morning in a conversation posted by Ruby1100 between Markvol10 and JDA spokesman Sam Dimka. We can't confirm this with markvol10, unfortunately, because someone has TOS'd him from Raging Bull's ERHE message board.

****Spoke to JDA****

Markvol10: Spoke with Dimka. He said he is waiting on a briefing from Sao Tome and documents before end of business (Abuja time) today. I asked him about the LUSA article regarding the Oil Council meeting and he agreed with me that this was "very very good news." I asked him if this means that award process is moving forward and he said yes.

I asked him several times when exactly the awards would be announced and each time all he would say was that he was waiting on briefing and documents from Sao Tome. I think Sam is tired of giving out dates. LOL. He did agree awards would be announced very soon and this whole process is just about over.

The Battle For Awards Moves To Sao Tome's Parliament

With the second-to-last step in the Nigeria-DRSTP block awards completed, the focus now turns to Sao Tome and Principe's fractious Parliament, where a group of politicians more concerned with their political futures than their nation's financial health prepare a last-ditch effort to stop the awards.

The outcome of the debate scheduled for Monday on the floor of the Parliament may not be known tomorrow; it is anticipated that the naysayers will try to blocks the awards for as long as possible, and therefore would want to block any vote, much as the filibuster technique sometimes blocks votes in the U.S. Senate floor, for at least several days.

Notably, Parliament was not mentioned on the list of three separate bodies which President de Menezes said on May 5 must achieve unanimity in order for the awards to go ahead, unless Parliament reconstitutes itself (as sometimes happens) as the National Petroleum Agency for the purpose of passing on awards. On this point, he used the following phraseology in the Portuguese-language story published by Lusa on May 6:

Fradique de Menezes explicou ainda que as decisões para a adjudicação de blocos são tomadas por unanimidade em parceria com as instâncias petrolíferas do país: o conselho nacional de petróleo, a agência nacional de petróleo e a parte são-tomense pertencente a autoridade conjunta de exploração São Tomé e Príncipe - Nigéria.

A translation of that would be something like, "President Fradique de Menezes explained that the decisions on the adjudication of the blocks needed unanimity from the three oil authorities of the country: the National Petroleum Council, the National Petroleum Agency and the Sao Tome part of the Nigeria-Sao Tome and Principe Joint Development Authority."

We know virtually nothing of the Sao Tome parliament's predilections, other than that they rebuffed an attempt to curtail the rights of ERHC Energy last Summer, and that it is controlled by the two-party coalition known as MLSTP/PSD that elected Prime Minister Vaz de Aleida.

President Fradique de Menezes' own two-party coalition, MDFM/PL, won the presidency in national elections which are due again next year, and much of the posturing on either side of this issue is related to that election and one of its leading candidates, Patrice Trovoada, the son of former President Miguel Trovoada who signed the "disastrous accords" guaranteeing ERHC its prefential option rights on February 21, 2001.

Unfortunately, there is very little coverage of Sao Tome's parliament in any venue, including the nation's major press organs, the Nigerian press, Reuters, Dow Jones or even Lusa, the Portuguese news agency that does carry several stories a week on Sao Tome. It may be hard for investors here in the United States to get any reliable word of the events there until several days have passed.

That said, it is worth noting that the President has taken some extraordinary steps to appease the apparent anger in Parliament that has developed over the role of his Joint Ministerial Council negotiator, Mateus Meira Rita, as a shareholder and apparent former executive or advisor to ERHC Energy while negotiating the block awards. The President accepted Rita's resignation from the JMC, saying it "obviously" violated the country's 2004 "transparency" law, while retaining him in his presidential cabinet.

President de Menezes himself has also been accused of being an ERHC shareholder, but appears to have denied it, yet has taken the step of removing himself from the chairmanship of the National Petroleum Council. Finally, he fired his special counselor on oil, Patrice Trovvoada, who was said to hold stock in a rival bidder that did not win anything in the block awards.

Whatver one might wish to say, it is clear that Monday will be a day of great challenge for President de Menezes, for ERHC shareholders and for the Nigeria-DRSTP Joint Development Authority, which promised awards last week to ERHC Energy but has been unable to deliver. All of them have to await the deliberations of Parliament with bated breath.

Indeed, while the de facto approval of the awards by the National Petroleum Cuncil seemed like a great basis for exuberance on Saturday, as we go to press Sunday night the mood is once again dampened by the prospect of yet more days of fierce political infighting whose outcome, regrettably, can only be described as "unknown."

If we pass that hurdle, the final step remains: President Fradique de Menezes affixing his signature to the awards document, and sending it back to Abuja for the awards announcement by the JDA.

Breaking News: There's No News Today From Nigeria

Why have the incredible goings-on in Sao Tome and Principe over the nation's oil process been ignored in the Nigerian press?

Sao Tome and Principe President Fradique de Menezes has just removed himself from the chairmanship of the National Petroleum Council to avoid a conflict of interest his critics say has long been in existence; the President's special advisor on petroleum, Patrice Trovoada, himself the son of immediate past president Miguel Trovoada, has been fired by President de Menezes for holding stock in an oil company that bid unsuccessfully for oil blocks in the Nigeria-Sao Tome and Principe Joint Development Zone; and the former Foreign Minister and Secretary of State, now a member of the President's cabinet, was forced to resign from the Nigeria-DRSTP Joint Ministerial Council that decided the awards because he was a shareholder and former executive of another oil company, this one a successful bidder, seeking block awards.

Isn't that the kind of toll that made "Saturday Night Massacre" headlines back during Watergate when it happened here?

Yet day after day, the Guardian, ThisDay Online, The Punch, Vanguard, Daily Independent, Sun, Daily Champion, New Age, Financial Standard, Triumph, Daily Trust, Business Day, Observer, Telegraph and Newsday - all dailies with some following - are innocent of even the slightest mention of a governmental crisis that is delaying the delivery of hundreds of millions of dollars to Nigeria.

In Sao Tome, the Portuguese-language Jornal da St. Tome is just as bad, and while Tela Non and Vitrina, the country's main daily press outlets (and also in Portuguese), have each had several stories lately, they went weeks without any at all on events that are likely to shape their nation's future for centuries to come.

While Nigeria's press is known for its ultra-corruptibility, can someone have bought off 15 different newspapers, plus the official News Agency of Nigeria (NAN)?

When we talked recently with former US Ambassador to Nigeria Howard Jeter, himself now a member of the Board of Directors of ERHC Energy, one of the winning bidders that is awaiting an official awards announcement, Jeter said that the newspapers had to be taken with a grain of salt.

"I don't think you can rely on the newspapers" in Nigeria, he said, to keep you informed. In fact, it is sometimes rather the opposite: you can rely on them to misinform you.

The only real source of news on the powerful collisions of national and private interests that is taking such a toll on Sao Tome's leadership is the Portuguese-language global press agency, Lusa. Oil industry journals like UpstreamOnline suddenly pulled their reporters from the story, and the Dow Jones News Service and Reuters, too, have provided only skimpy coverage of the raging debate.

You can forget the New York Times, Los Angeles Times, Chicago Tribune, Houston Chronicle and Washington Post, or CNN, MSNBC, FoxNews, and whatever it is that used to be the financial news channel on cable; they apparently wish they had never heard of Sao Tome and Principe, which is going to be the lifeblood of their oil supply a few years from now, providing an estimated 25 percent of this nation's oil by 2020.

And that's after the L.A. Times, Houston Chronicle and the premium Dow Jones News Service did huge features on the tiny company, ERHC Energy, that is said to be the front-runner for the block awards with its mid-tier partners, Devon Energy, Pioneer Natural Resources and Noble Energy.

What's the problem? Well, time after time, newspapers and wire services and trade journals have taken the word of Sao Tomean and Nigerian officials that an awards nnouncement would be made "by the end of the month," "by the end of the week," and even "in the next few days." They have gotten burned on those dates, again and again, every single time. It's like a multibillion-dollar Nigerian 419 advance-fee fraud scheme on steroids - except that the underlying treaties, agreements, oil and dollars at stake are very, very real.

In both the first licensing round that was launched in April 2003 and now in the second, launched in November 2004, dates for the awards announcement were repeatedly pushed back, usually without any explanation whatsoever from the governments and officials involved.

Investors who had backed one or more of the 26 oil companies bidding for the Joint Development Zones blocks in the Gulf of Guinea that are rumored to hold between 10 and 14 billion barrels of oil, have seen the value of their shares repeatedly drop 15 percent to 25 percent or more in a day or several days, only to rise once again, as the cycle of news and no-news repeats itself.

These days, they find themselves having to rely on "Updates" offered by investors who have called the Joint Development Authority and relayed the upshot of their conversations with officials to the Raging Bull ERHE message board, where someone usually gets them bounced for spurious "violations" of the Raging Bull terms-of-service agreement, or on my blog, ERHC On The Move, where I try comb the world for news about the block awards and post it with my analysis, often earning myself scatological comments from frustrated - actually, "infuriated" is a better word - investors.

But I started the blog precisely because of the paucity of news, and if I now find myself arguing with readers over my translations from the Portuguese and my sometimes gloomy predictions of more delays, which usually hurt the share price, I've never been wrong when I predicted more delays. But the why and how of at least 15 local newspapers are ignoring the same huge story continues to mystify me.

I have no explanation; I just know it happens.

Sao Tome Petroleum Council Approves Block Awards

In the first clear sign that the clouds have lifted over the long-delayed Nigeria-Sao Tome and Principe Joint Development Zone block awards, the Sao Tome National Petroleum Council has issued a finding that the proposed awards of blocks to ERHC Energy and its partners "at no moment injures the interests of Sao Tomé and Príncipe," even if some procedural irregularities appeared amid the awards process, and President Fradique de Menezes has declared he is ready to assume the role in which he would "monetize the process," i.e., sign the awards document delivered to him on May 6. and leave the NPC's leadership to others.

The powers pf the NPC (the Petroleum Oversight Commission in the draft law) are spelled out in the final part of this post. We have asked Gerhard Seibert for his comments on the matter, as well, and will report them when we receive a response.

Thus, as best we can determine, the final barrier to the awards process has apparently been lifted, allowing them to go forward as early as Sunday.

Once again, we are especially grateful to Homeport for having taken the time to reword the essence of the Portuguese-language story into English on this outcome from Lusa, the news agency that serves the islands and the Portuguese-speaking world.

Here is the "synthesis" and the original story from Homeport:

The National Petroleum Council spokesman, Ovidio Pequeno, told a Sao Tome news conference Saturday that there were "procedural insufficiences" in the JDZ block awards process, but nothing that violated STP's legal framework.

"The process at no time damaged STP´s interests", Pequeno, who also serves as Foreign Minsiter, said, according to a Lusa news agency dispatch.

The news conference was held to report on the meeting Friday of the oil council.

Also at a news conference Saturday (not sure if the same one), President Fradique de Menezes announced he was stepping down as chairman of the national oil council.

De Menezes said the head of state should keep his distance from the negotiations to avoid confusion.

He said he would "cease presiding" over the council meetings and "move solely to a supervisory role", according to the Lusa dispatch.

(It may be read at www.lusa.pt in the reserved service.)

Cheers,

Homeport, at 11:51 AM

And here is the Portuguese-language story Homeport characterized above, which I have edited from its machine translation:

Sao Tomé and Príncipe: President resigns from the National Pteroleum Council

Sao Tomé, 14 May (Lusa) -- The Sao Tome Head of State, Fradique de Menezes, today announced his resignation from the chairmanship of National National Petroleum Council of Tomé and Príncipe, responding to accusations of irregularities in the adjudication of oil blocks.

Fradique de Menezes made the announcement that rocked the meeting of the National Petroleum Council that he presided over Friday, following alleged irregularities noted in the process that aims at auctioning oil blocks in the Joint Development Zone with Nigéria.

The "self-removal" of Fradique de Menezes comes five days after the Movement for the Liberation of Sao Tomé and Príncipe and the Social Democratic Party (MLSTP-PSD), which are in the power, accused the President of violating the "frame" of regulations concerning oil to benefit himself.

In his declaration to the press, Fradique de Menezes underlined that "the President of the Republic must be moved away from these negotiations to prevent confusion," and added that "leave presiding over the meetings of the National Petroleum Council to others (...) and only pass on the monetization of the process."

Beyond the MLSTP-PSD, that supports the government of prime minister Damião Vaz de Almeida and is also the main party of the opposition, the Party of Democratic Unity (PCD) said the oil negotiations with Nigéria were "wildly disorganized."

The denunciation of irregularities in the adjudication of oil blocks became public in the capital of Sao Tomé through a report by the Portuguese-language radio network RDP-Africa of alleged favoritism regarding the oil, in which some Sao Tome leaders are shareholders, including figures close to the President of the Republic, Fradique de Menezes.

On the other hand, the spokesman of the National Petroleum Council, Ovidio Pequeno, declared the existence of an "insufficiency of procedure" in the process of auctioning blocks, but he rejected the allegation that any laws were broken.

Pequeno underscored that "The process at no moment injures the interests of Tomé and Príncipe." He also is the minister of the Foreign Affairs and Communities.

Denunciations of irregularities appeared several days after the last meeting in Abuja, the Nigerian capital, of the Joint Ministerial Council between Are Tomé and Príncipe and Nigéria, relative to the various bids for the five blocks offered in the auction.

A note on my translation, which has generated some dissent on Raging Bull: The word "monetization" was "fiscalization" in the original. I think the two words mean the same thing. As for the idea that the awards were "approved," in fact the work of the NPC is to determine if the awards as proposed treat Sao Tome's interests fairly. While the NPC's finding as stated by the chairman is couched in the negative - i.e., the awards do not harm Sao Tome's interests - that is the sum total of all findings the NPC needs to make, and is "approval" in the sense that the awards as constituted meet the standards set by the operant Sao Tome codes.

And here is the story in the original Portuguese. You will note it does not put as much emphasis on the lack of damage to Sao Tome's interests as we do above, but instead focuses on the President's self-removal from the NPC chairmanship:

São Tomé e Príncipe: Presidente afasta-se do Conselho Nacional Petróleo

14-05-2005 15:21:00.
Fonte LUSA.
Notícia SIR-7000233
Temas: política justiça economia são-tomé energia

São Tomé, 14 Maio (Lusa) - O Chefe de Estado são-tomense, Fradique de Menezes, anunciou hoje o seu afastamento do cargo de presidente do Conselho Nacional de Petróleo de São Tomé e Príncipe, face a acusações de irregularidades na adjudicação de blocos petrolíferos.

Fradique de Menezes fez este anúncio no balanço da reunião do Conselho Nacional de Petróleo que presidiu sexta-feira, na sequência de alegadas irregularidades registadas no processo que visa a venda de blocos petrolíferos de uma zona conjunta de exploração com a Nigéria.

O "auto-afastamento" de Fradique de Menezes surge cinco dias depois do Movimento de Libertação de São Tomé e Príncipe - Partido Social-democrata (MLSTP-PSD), no poder, ter acusado o Presidente de estar a violar a lei-quadro das receitas de petróleo em benefício próprio.

Na sua declaração à imprensa, Fradique de Menezes sublinhou que "o Presidente da República deve estar afastado destas negociações para evitar confusões", tendo acrescentado "deixar de presidir as reuniões do Conselho Nacional de Petróleo (...) e passar somente a fiscalizar o processo".

Além do MLSTP-PSD, que sustenta o governo do primeiro- ministro, Damião Vaz de Almeida, também o principal partido da oposição, o Partido da Convergência Democrata (PCD) disse que as negociações petrolíferas com a Nigéria estão descontroladas desorganizadas.

A denúncia de irregularidade na adjudicação de blocos de petróleo foi tornada público na capital de São Tomé através da RDP- África por alegado favoritismo de petrolíferas, nas quais, alguns dirigentes são-tomenses são accionistas, envolvendo, figuras próximas do Presidente da República, Fradique de Menezes.

Por outro lado, o porta-voz do Conselho Nacional de Petróleo, Ovídio Pequeno, declarou existência de "insuficiência de procedimento" no processo de leilão de blocos, mas afastou qualquer violação a lei-quadro de petróleo.

"O processo em nenhum momento lesa os interesses de São Tomé e Príncipe," sublinhou Ovídio Pequeno, que exerce também as funções de ministro dos Negócios Estrangeiros e Comunidades.

Denúncias de irregularidades surgiram poucos dias depois da última reunião em Abuja, capital nigeriana, do conselho ministerial conjunto de petróleo entre São Tomé e Príncipe e a Nigéria, no âmbito das propostas petrolíferas relativas a cinco blocos postos em leilão.

RCN.

Fim/Lusa

Update, 5/16/05:And finally, here is the Lusa report on De Menezes' resignation as head of the National Petroleum Council, which didn't get published until today, Monday, May 16.

16-05-2005 13:07:00.
Fonte LUSA.
Notícia SIR-7004297
Temas:

Sao Tome: Under fire, President leaves oil council chair, but remains watchdog

Sao Tome, May 16 (Lusa) -- President Fradique de Menezes has stepped down as chairman of Sao Tome and Principe's National Petroleum Council, while maintaining a watchdog role, in the wake of accusations by government and opposition parties of presidential wrongdoing in the process of awarding offshore exploration blocks.

De Menezes told journalists Saturday he was resigning as chair of the oil council to "avoid confusions", but that he would continue to "oversee the process".

His initiative followed a meeting Friday of the oil council.

The council's spokesman, Foreign Minister Ovídio Pequeno, told a news conference Saturday that, while "procedural insufficiencies" had been detected in the awards process, "at no moment have (the archipelago's) interests been prejudiced in the process".

Earlier last week, a presidential spokesman strongly denied allegations from the main governing MLSTP party and the biggest opposition PCD party that de Menezes was seeking personal benefit in the process to award five blocks in the islands' Joint Development Zone with Nigeria.

The bilateral Joint Ministerial Council, meeting in Abuja at the end of April, appeared to have agreed on the awards, but political infighting in Sao Tome has delayed their announcement.

RCN/SAS.

Lusa

Here is the relevant section of the draft "transparency" law that relates to the approval of awards, which is not specifically contemplated in the law, but may fall under the broad language "in any way related to the oil sector or related activities" in it.

That broad language doesn't encompass the section requiring that all "transaction instruments" be made public, but it could be argued that the law, which says "All Oil Contracts or other transaction instruments mentioned in paragraphs 1 and 2 above shall be made public by the State or by any Person, no less than ten days prior to execution," requires the awards document that is now a secret to be published upon request.

With that, we could learn which companies the Joint Ministerial Council decided should win what parts of the five blocks offered in this round.

"Approval" requires the vote of six of 11 members of the NPC, but the powers spelled out by the law do not enumerate approving the awards document.

The law does seem to require a finding - and a vote seems required whenever a finding is made - that no agreement signed by the Head of State does harm to state interests.

Interestingly, insofar as the legal process is concerned, the mechanism for an injunction against a Head of State's action, which would provide for a stay of any such action, prevents any injunction that would do grave harm to Sao Tome's interests, and it is stated that any injunction taken against a decision of the National Petroleum Council is itself a grave harm. Just below is that injunction section in its entirety:

Article 28
(Court actions)

1. Any Person whose rights are protected under this law may appeal final decisions made by any Administration body to judicial courts with jurisdiction.

2. Any appeal filed pursuant to paragraph 1 above shall stay the appealed decision unless such stay results in grave injury to public interest and the court so declares in a reasoned decision.

3. In the case of appeal of decision made by the Petroleum Oversight Commission in the exercise of its oversight power, it is presumed that any stay of any Petroleum Oversight Commission’s decision constitutes grave injury to public interest.

Here are sections of the transparency law relating to the NPC's powers (underlining added):

Article 22
(Public Competition)

1. All Oil Contracts or other transaction instruments to be entered into with the State Administration concerning Oil Resources or Oil Revenues, services relating to Oil Resources or in any way related to the oil sector or related activities, shall be preceded by public competitive tender pursuant to general law.

2. In the absence of legislation applicable to public tender, Oil Contracts or any other instruments mentioned in paragraph 1 above shall be approved by the Petroleum Oversight Commission prior to execution.

3. All Oil Contracts or other transaction instruments mentioned in paragraphs 1 and 2 above shall be made public by the State or by any Person, no less than ten days prior to execution, without prejudice to the terms of paragraphs 2, 3 and 4 of Article 20.

4. Oil contracts and other transaction instruments entered into in violation of this Article shall be considered void and without any effect, without prejudice to the liability of Officials and Persons perpetrating such violation.
5. The provisions of this Article shall not exempt any Person or State Administration Official of any legal obligation, except those obligations that are not consistent with this Article.

CHAPTER V
ENSURING PUBLIC OVERSIGHT AND ENFORCEMENT
SECTION I
PETROLEUM OVERSIGHT COMMISSION
Article 23
(Establishment of the Petroleum Oversight Commission)

1. A Petroleum Oversight Commission having legal entity status and administrative and financial autonomy shall be established to ensure the permanent oversight of all payment, management and use of the Oil Revenues and Oil Resources.

2. The Petroleum Oversight Commission shall be composed of eleven members, appointed or elected as follows:

a) One member appointed by the President of the Republic;
b) Three representatives of the National Assembly, one necessarily appointed by the
parliamentary groups from the opposition;
c) One counselor judge with at no less than five years of professional experience, appointed by the Superior Judiciary Council;
d) One representative from the Autonomous Region of Principe;
e) Two representatives from local governments;
f) One representative from Business Associations;
g) One representative from the Unions;
h) One representative from Non-Governmental Organizations.

3. The decisions of the Petroleum Oversight Commission shall require the affirmative vote of at least six of its members.

4. The organic law regulating the Petroleum Oversight Commission shall regulate the form of appointment and dismissal of the members of the Petroleum Oversight Commission, the duration of their terms, their compensation, and internal rules and conflicts of interests, as well as the organization and operation of the Petroleum Oversight Commission.

Article 24
(Authority and Powers of the Petroleum Oversight Commission)

1. Without prejudice to the oversight powers provided by the law to other government bodies, the Petroleum Oversight Commission shall have the authority to oversee the compliance of all activities with this law, namely:

a) The verification and regularity of the expenditures of the Annual Funding Amount;
b) Management and investment of Oil Revenues, including the exchange operations to the credit and debit of the Oil Accounts and their respective flow of funds in accordance with the Operation Rules and the criteria defined in the Investment Policy;
c) The enforcement of the transparency rules;
d) The external auditing firm’s audit;
e) The certification of the Production Commencement date.

2. To carry out its duties, the Petroleum Oversight Commission shall have the power to:

a) Request relevant information and documents from any Person;
b) Inquire about violations of any nature related to oil resources or oil revenues;
c) Initiate investigations and inquiries based on its own knowledge or on third parties’ complaints of irregularities or violations of the requirements of this law;
d) Carry out searches, inspections, and seizure of any documents or personal property that are the object, tool or product of any infraction, or that are necessary to the opening of the respective process;
e) Present reports that may include detailed description of any act subject to oversight, the investigation process, and inquiries initiated and closed, as well as recommendations as to the appropriateness of the adoption of new procedures;
f) Hear, judge and enforce administrative proceedings and minor infractions consisting of violations of this law;
g) Report to the competent authorities any irregularities or apparent violations of the provisions of this law that are subject to disciplinary, civil or criminal sanctions;
h) Act as a party to judicial actions.

Before we begin debating the meaning of this law, it might be wise to obtain a copy of the one which was actually enacted. This is the draft law.

Phil Nugent, ERHC Founder, Faces Issues With New Company

The ERHC Energy investor who played a leading role in the formation of the company, Phil Nugent of New Orleans, is battling to save his newest enterprise, Global Environmental Energy Corp., a manufacturer of plants that turn garbage into fuel that has contracts with several Central Asian nations, the Sunday Times of London business pages say.

GEEC has lost its influential chairman, former Irish prime minister Albert Reynolds, and faces a hefty tax bill in Delaware and millions in judgments, the paper says, after burning through more than 200 million British pounds since 2000.

The stock has been recovering somewhat since hitting $0.49, and closed at $0.58 on Friday, unchanged, after trading earlier in the day at $0.66.

Here is their report:

The Sunday Times - Business
May 08, 2005

Debts soar for troubled GEEC
Douglas Dalby

LONDON -- Problems seem to be mounting for Global Environmental Energy Corp (GEEC), the listed company chaired by Albert Reynolds until the announcement two weeks ago that the former taoiseach had stepped down on the grounds of ill health.

Following the publication of its latest accounts two weeks ago, which showed the company had no cash in the bank, it has emerged that GEEC is fighting fires on several more fronts.

The company has lost a multi-million-dollar court case against former directors, is being pursued by the American state of Delaware over $368,000 (€287,000) in unpaid back taxes and is facing a petition by certain former investors to have it wound up.

GEEC stated last week that its main asset in Delaware was an approximate $25m loss carry forward, which it was negotiating to sell. In February 2001, according to a filing it made to the American Securities and Exchange Commission, it had total assets of more than $186m. Since 2000, it would appear the waste-to-energy company has burned through more than $200m.

The latest liabilities include judgments against the company on April 28 in Virginia for $1.974m, $700,000 against its legal team and a further $5m in punitive damages for former directors who were denied entitlement to shares. The company and its lawyers said they would appeal.

On Friday, GEEC’s shares closed near a 52-week low of 49c.

Trading Updates: Even With Good News, Investors Wait And Watch

Even with the good news provided by the letter of Sao Tome's MDFM secretary-general (posted below) that awards will be made first and the consequences weighed later, investors dropped the opening Bid for ERHC Energy (OTC BB symbol: ERHE) a cent to $0.675, while the Ask has remained at $0.69, down half a cent.

Update, 4:07pm EDT, 5/13/05 The price closes at $0.67, off $0.02, on closing volume of 829,136 shares - probably the slowest Friday in recent memory. For longs, it's baffling why anyone would sell, but for those who've been promised "the check's in the mail" by the JDA and all the pumpers for so long, it's not surprising some would. We got a last-minute Comment from Anonymous that awards were Sunday, and true or not, they probably are coming tomorrow, Sunday or Monday, I think. ERHC On The Move, which last traded for our own account on Jan. 20, still has all its 123,040 shares averaged at $0.4394 and now valued at $82,436, a $28,189.33 profit. Just two weeks or so ago, that number was $110,000, but in a few weeks from now - $300,000, maybe.

Update, 3:59pm EDT, 5/13/05 Last-minute trades bring volume up to 810,436 and the price down to $0.66, with the Ask at $0.67.

Update, 3:57pm EDT, 5/13/05 The price is $0.67 and the Ask lower at $0.675, with volume running up to 782,636 shares.

Update, 3:47pm EDT, 5/13/05 There a 426-word article in Energy Intelligence on the problems in Sao tome:

Sao Tome runs into more problems in JDZ
Energy Compass May 13, 2005 (428 Words) Their price is $24.

Update, 3:44pm EDT, 5/13/05 The second 30K buy of the afternoon fails to move the price from $0.675; the first at 2:13 was part of a 10-minute burst of buying from 2:04pm to 2:14pm that rolled up more than 80,000 shares between $0.68 and $0.685.

The price is now $0.675, with the Bid at $0.67 and the Ask still $0.68, as volume hits 737,486 shares.

Update, 3:36pm EDT, 5/13/05 The Buy/Sell data from ADVFN is delayed 15 minutes, but it shows the Buy interest has increased substantially; earlier this morning it was running at a 3:1 ratio in favor of Sells. At 3:17pm EDT, that balance had started to shift, and there were 285,700 Buys to 333,186 Sells, and 81,500 unidentified shares. That the buy interest has come after Abuja closed down is possibly significant. Our price at 3:35 is $0.675, the Bid, with the Ask at $0.68 and 707,486 shares changing hands.


Update, 3:23pm EDT, 5/13/05 Nice Surge today to 700,386 shares, with the price, Bid and Ask all unchanged. Not.


Here's the price/volume data from Raging Bull ERHE, a little premature perhaps, but very nice to see:

12:16 AM ET
73.55
+0.94 (+1.29 %)
Volume: 3,029,605
- - - - -
Full quote | LiveChart

Get real-time streaming quotes

Update, 3:10pm EDT, 5/13/05 "Awards Sunday," one Comment says, but it's from Anonymous, who said he "Spoke to the JDA. Awards Sunday local time." Would that it were so, and perhaps it is. The price is $0.68, the Bid $0.675, and the Ask $0.68 as we approach the 3:15 Surge.

Update, 1:27pm EDT, 5/13/05 According to ADVN, where results are delayed 15 minutes, Sels and Buys have improved the earlier 3:1 ration to 3:2. That accounts for the preprandial surge in price, we suppose, reflecting (momentarily) improved expectations of awards. Whenever Sam Dimka says to call back in an hour for an update, that means he's going home in 30 minutes.

Update, 1:25pm EDT, 5/13/05 The price at $0.681 is higher than the Ask, at $0.68, while the Bid is se