Alleged company payments to Sao Tomean and Nigerian officials are under investigation by the FBI and the Dept. of Justice, an 8K report filed with the SEC last Thursday indicates.
In response, shares of ERHE fell to $0.68 before recovering to $0.81. There was no public comment from the company.
Shares opened Monday at $0.82 and have traded as low as $0.75 before beginning to climb once again, probably in anticipation of a fruitless investigation whose aims have already been rejected by the highest officials of both governments this year, and the probability that a portion of a Chevron discovery in adjoining Block 1 will vastly increase the value of ERHC Energy's Block 2 due to a substantial "straddle" of both blocks.
The straddle has been rumored but not yet announced by Chevron, which is historically closed-mouthed about its discoveries and their potential. OPEC President Edmund Daukoru has said the find may have to be revised upwards from the billion-barrel level, however. He is also oil minister of Nigeria.
The apparent Dept. of Justice probe, which would probably be conducted under the provisions of the Foreign Corrupt Practices Act (FCPA), is unrelated to a pending case against Chevron, ExxonMobil, Devon Energy and Noble Energy, among others, arising from alleged payments for oil leases to officials of Equatorial Guinea. After hearing some testimnony, the pro-oil Senate Commerce Committee chaired by Alaska Republican Sen. Ted Stevens has sat on that probe for years.
According to information received by ERHC On The Move, however, there may a connection between the search warrant served yesterday and an investigation into the bribery allegations concerning Rep. William Jefferson, Democrat of Louisiana.
This blog has received several requests for information in association with that investigation from Washington-based investigative reporters, who have focused their inquiries on ERHC Energy investor Phil Nugent. It is not known whether Nugent or Jefferson is a target of the current investigation.
Here is the document filed:
Item 8.01 Other Events
On May 4, 2006, a search warrant issued by the U.S. District Court of the Southern District of Texas, Houston Division, was executed on ERHC Energy Inc. ("Company") for various records including, among other matters, documents related to correspondence with foreign governmental officials or entities in Sao Tome and Nigeria. The Company cooperated fully with the government in respect to this matter.
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
ERHC Energy Inc.
By: /s/ Walter F. Brandhuber
Walter F. Brandhuber, President
DATE: March 4, 2006