Thursday, February 02, 2006

Y-e-e-e-s!! Addax OKed At Summit, Upstream's Barry Morgan Says

Apparently turning aside any last-minute entreaties from cash rich ExxonMobil CEO Rex Tillerson, President Olusegun Obasanjo of Nigeria and Prersident Fradique de Menezes of Sao Tome and Principe have apparently cleared the decks for a quick signing of Production Sharing Contracts for Blocks 2, 3, 4 and 5 with the status of Block 6 still up in the air, veteran oil industry reporter Barry Morgan of UpstreamObnline reveals exclusively tonight.

It is extraordinary news and capped an extraordinary four days of trading that has seen ERHC Energy's share price (OTC BB symbol: ERHE) rise from the low .30s to $0.50 for a few trades on Thursday. The company gained operatorship of two blocks and significant chunks of three more when the Nigeria-DRSTP Joint Development Zone Se3cond Licensing Round awards were formally announced on May 31, 2005.

After closing during regular trading on a down-tick Sell at $0.47 on volume of 5,534,000 shares - after a run of more than 200,000 shares of Buys at $0.48 - one more after-hours trade pulled the price to $0.46, up $0.4 for the day.
It is likely to open in the low $0.50's Friday morning, and could shoot to $0.60 within an hour of the news of the JMC meeting gaining formal confirmation, if it comes, from a Joint Development Authority press release promised by I-Hub poster Mark St. Amour.

Friday's trading, and that of the next five days, ought to be equally lucrative for traders who have waited many long and loony days for positive movement ever since a poorly-executed probe of the JDZ awards by University of Tulsa law professor R. Dobie Langenkamp, turned up "no evidence" of wrongdoing on ERHC Energy's part.

The report dropped ERHC's share price from $0.45 to $0.365 in a matter of days, giving smarter investors (like this one) who disbelieved it time to bulk up on the shares at the best prices in recent memory.

The report was probably at the behest of ExxonMobil and Anadarko, working through their 10 lawyers on the Energy Law Instute's Executive Advisory Board and the Senior Lawyers Project, funded by Pioneer Natural Resources minority stakeholder George Soros, the Hungarian billionaire.

Top-level meeting set to ease JDZ blocks gridlock

By Upstream staff

Final resolution of the continuing uncertainty surrounding the allocation of key blocks in the Joint Development Zone administered by Nigeria and Sao Tome & Principe may come when the Joint Ministerial Council (JMC) meets on 6-7 February in Abuja, writes Barry Morgan.

The JMC will set a date for the official signing of PSCs for blocks 2, 3, 4, 5 and perhaps also Block 6.

Most controversial has been the swift action of preferential rights holder ERHC Energy to sign a memorandum of understanding with Addax Petroleum replacing Noble Energy, which pulled out of a joint operatorship agreement for Block 4.

Addax had not even bid the block and critics in Sao Tome castigated Nigeria for its swift approval of the deal, arguing that second-highest bidder Anadarko Petroleum should have been consulted first.

Sao Tome finally approved the deal last week, enabling the JMC meeting to be brought forward a few days. It is understood from Joint Development Authority sources that "no big issues remain to be overcome and the matter is in its concluding stages", with PSC signatures expected shortly after the JMC.

To underscore the urgency of the process, President Fradique de Menezes flew into Abuja for talks with his counterpart Nigerian head of state Olusegun Obasanjo this week.

The stunning turn of events brought a flood of visitors to ERHC On The Move. Here's the Site Summary, which has given us an update every day since installed it about six weeks ago:


Total 51,490
Average Per Day 920
Average Visit Length 2:12
Last Hour 52
Today 1,481
This Week 6,437


Total 71,019
Average Per Day 1,217
Average Per Visit 1.3
Last Hour 66
Today 2,021
This Week 8,518

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