Friday, February 03, 2006

Trading Updates: Volume Surge Resumes, But Wary Investors Wait For Hard Facts

The startling volume surge that propelled 5.6 million shares to trade yesterday was matched by this morning's action in the first 15 minutes, but the failure of the Nigeria-Sao Tome and Principe Joint Development Authority so far to provide the press release it has repeated promised to an I-Hub poster, Mark St. Amour, and of other confirming information from either official Nigeria or Sao Tome, has kept the price's upward movement well in check.

Some 230,000 shares in three 10K Buy and four 50K Sell lots traded just before the open, although a 9 p.m. purchase of 10,000 shares clouded the issue by lifting the price $0.02 before the open. Many shares, as a result, were listed as Unidentified due to the back-and-forth on the Bid and Ask that followed.

Once the stock opened, the movement was initially positive, but soon investors began to pull back slightly, fearing the volume surge may be based on hot air flowing forth from everyone but the authoritative sources, who remained silent overnight.

Since 9:30 a.m. EST, the Bid has slipped from a high of $0.49 to $0.47, which was yesterday's close, while the Ask is two cents lower at $0.475 from the pre-open $0.495 high. Volume at 10:10 a.m. is 1,860.212 shares.

Update, 4:01pm, 2/3/06: Volume closed at 4,856,319, below yesterday's, and the share price improved only one cent to $0.48, the Bid, despite Buys outnumbering Sells by 1.5 million shares, per ADVFN. The Ask ended at $0.49, a half-cent below the high of the day set early in the morning. The day's high Bid was $0.493 during the noon hour.

It was also another good day for our blog readership:


Total 52,462
Average Per Day 998
Average Visit Length 2:25
Last Hour 82
Today 970
This Week 6,989


Total 72,388
Average Per Day 1,331
Average Per Visit 1.3
Last Hour 126
Today 1,361
This Week 9,319

Have a great weekend!

Update, 3:32pm, 2/3/06: It's rare that trading comes to a near-complete halt in the final hour of a booming day of volume, but only 14 of today's 466 trades have occurred since 3 p.m, at least as of 3:34. Volume has barely budged in the last hour, and now stands at 4.65 nillion, with the Bid at $0.48 and the Ask at $0.489. The last few trades have been Buys, albeit small ones. And no, no hard news yet.

Update, 2:57pm, 2/3/06: Going into the critical final hour of trading, ERHE is still below its high of the day, now at $0.485 Bid and $0.489 Ask. The drag on trading today has not been selling, which has lagged 1.5-million-plus behind the Buys, but the lack of reliable news. Unless it comes in the final hour, a sell-off by day traders may sink us back to $0.46 or so, where we ended after-hours yesterday. Notably, Platts and Reuters have not reported a date, either, although Lusa has - quite ambiguously.

Volume has reached 4.58 million and may match Thursday's 5.6 million bevfore the end of trading.

Update, 11:30am, 2/3/06: Volume has reached 3.5 million as the share price climbed back to the high of the day, The Bid is now $0.49 and the Ask $0.495. That lends credence to the old traders' chestnut that market makers are retracing the price to fill any "gaps" and build a solid foundation for the launch to higher prices that would follow official confirmation of the UpstreamOnline story.

That official confirmation - i.e., publicy announced information one way or the other - would likely catalyze a meteoric price rise if it acknowledges the ERHC Energy/Addax Petroleum operatorship in Block 4.

Update, 10:37am, 2/3/06: Someone is buying - nearly back to back, Buys of 236,760 and 100,000 went through. Mark St. Amour says the JDA promised a press release after, not before the JMC meeting as we said here, to reveal the PSC signing dates.

Meanwhile, the Bid has improved to $0.481 and the Offer is now at $0.49 as Buys out pace Sells 1,753,507 to 832,684, with 314,950 shares unidentifiable as either, according to ADVFN.

But there appears to be some problem with the dates the JDA has given him for the meeting in Abuja, as the Portuguese news agency Lusa says there is no confirmation of the Feb. 6-7 dates (although there could be later, they indicate).

Lusa's reporting has been contemptuous of objectivity (much like our own) and always weighs in on the negative side of the debate surrounding the JDZ awards to ERHC Energy.

One odd note is that Foreign Minister Ovidio Pequeno, who tendered his resignation two weeks ago - which President Fradique de Menezes has not yet accepted, we gather - is described as Foreign Minister again in Lusa's story and will represent the nation at the meeting, whenever it is held.
It's hard to imagine him providing any help to the party leaders who have denounced ERHC Energy at this point.

Here is the Lusa story:

STP NEWS: Scheduled JMC Abuja meet still awaits confirmation - Oil Minister

Sao Tome, Feb. 3 (Lusa) - The oil minister of Sao Tome and Principe confirmed Friday that the islands' Joint Ministerial Council (JMC) with Nigeria has a key meeting scheduled for next week, but that Sao Tome still awaited final word from Abuja.

"Everything is foreseen for Monday and Tuesday" in the Nigerian capital, "but we still don't have the confirmation because of a request by the Joint (Development) Authority" (JDA) for a delay due to technical and logistical factors, Natural Resources Minister Deolindo da Costa told Lusa without elaboration.

The oft delayed meeting of the JMC is widely viewed as the crucial next step towards approval of production sharing contracts for five offshore blocks awarded last May in the Joint Development Zone shared by Sao Tome and Nigeria.

Plans for the meeting have been postponed before by political faction fighting in Sao Tome, amid allegations of corruption and "serious flaws" in last year's awards process.

Da Costa said the meeting's agenda would center above all on approving the Abuja-headquartered JDA's annual budget.

Also on the table, he added, would be discussions aimed to conclude the production sharing contracts with oil companies that won the five block awards.

Beyond himself, da Costa said the Sao Tomean delegation to the JMC meet would include Foreign Minister OvĂ­deo Pequeno, Defense Minister Oscar Sousa and two economic and financial aides of President Fradique de Menezes.



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