Thursday, June 29, 2006

ERHC Hires New PR Firm, Comments On Investigation; Documents To Be Returned

As promised by CEO Walter Brandhuber a few weeks ago, ERHC Energy has hired a crisis-oriented public relations firm, a set of top-notch Washington-based defense attorneys, gotten many of its documents back (and all the rest are expected soon) and filed suit against the government to open the sealed affidavit underlying the May 4 search warrant served on its Houston offices.

The company also revealed, rather belatedly, that is has been subpoenaed by the U.S. Securities Exchange Commission, to which many stockholders have earlier complained - although more often against manipulators than against the company.

The SEC subpoena is likely the other tine of a two-pronged investigation sought by the Attorney General of Sao Tome and Principe, which called on both the Justioce Dept. and the SEC to investigate possible payments by the company to Sao Tomean and Nigerian officials.

The company issued a press release after closing today that communicated a shift in its approach to the complaints:

Contact: Dan Keeney, APR
DPK Public Relations

Thursday, June 29, 2006 16:31 ET

ERHC Energy Update on Investigation into Activities in Joint Development Zone

HOUSTON, June 28, 2006 – ERHC Energy Inc. (OTCBB: ERHE) continues to work with the U.S. Department of Justice in connection with the Department’s investigation into questions surrounding the Company’s activities in the Joint Development Zone (JDZ). The JDZ rests approximately 200 kilometers off of the coastline of Nigeria and the island nation of Sao Tome & Principe, and is adjacent to areas where there have been several large petroleum discoveries.

Recently, the Department of Justice agreed to return to ERHC a complete copy set of all paper documents seized in the Government’s May 4, 2006 search of the ERHC’s Houston office. ERHC has already received a substantial portion of these business documents and expects to receive the remaining copies shortly.

The Company has retained the nationally recognized law firm, Akin Gump Strauss Hauer & Feld LLP, to assist it in connection with the Justice Department’s investigation. Akin Gump also will assist the Company respond to a related U.S. Securities and Exchange Commission (SEC) subpoena issued on May 9, 2006. ERHC intends to comply fully with the SEC subpoena.

Akin Gump has filed suit in federal district court in Texas on behalf of ERHC. The lawsuit seeks to protect the Company’s attorney-client privileged documents and to allow ERHC counsel to determine the factual basis for the Justice Department’s search warrant affidavit, which is currently under seal.

ERHC continues to pursue its business plan and the opportunity to develop its rights in the JDZ.

“We are working to minimize potential distractions and focus on commercializing the Company’s interests in the JDZ,” said Chief Executive Officer Walter Brandhuber. Earlier this year, the company announced that a subsidiary had entered into production sharing contracts in Blocks Two, Three and Four of the JDZ.


About ERHC Energy

ERHC Energy Inc. is a Houston based independent oil and gas company focused on growth through high impact exploration in the highly prospective Gulf of Guinea and the development of undeveloped and marginal oil and gas fields. ERHC is committed to creating and delivering significant value for its shareholders, investors, and employees; sustainable and profitable growth through risk balanced smart exploration, cost efficient development and high margin production.

Safe Harbor Statement

This press release contains "forward-looking statements," including statements about ERHC Energy Inc.’s future operating milestones, financing plans, as well as other matters that are not historical facts or information. These forward-looking statements are based on management's current assumptions and expectations and involve risks, uncertainties and other important factors, specifically including those relating to the Company’s ability to exploit its commercial interests in the JDZ and the exclusive territorial waters of Sao Tome and Principe, that may cause the Company’s actual results to be materially different from any future results expressed or implied by such forward-looking statements. The Company undertakes no obligation to update or revise any such forward-looking statements, whether as a result of new information, future events or otherwise, nor is there any assurance that the contemplated financing will be effected, under the terms set forth herein or any other terms.

ERHC Has Risen Again

As we said on June 9 ("ERHC Will Rise Again"), ERHC Energy's dismal share price has improved by $0.15, or 37.5 percent from $0.40 to $0.55 - but it may be stuck there, at least for a little while.

Our last discussion of share price turned out to be extremely accurate. We said it would "hang around" the $0.55 level for a while, but with new installments of the old news about the search warrant that was served on May 4, the price would fall to $0.38, and then stall around $0.40.

It did all that, and we now anticipate that the prime mover for future changes in share price will be the future developments - due soon - in the investigation of alleged payments to West African officials at least four years ago.

A hearing on two proposed orders - one from each side - was scheduled for today in Houston Federal Court, but we are unaware of any news that has been generated - if the hearing took place at all. Documents in the case, including proposed orders and a motion, are available at

However, the impact on share price will be progressively less as the case progresses and discounts due to the unpleasant news are reflected permanently in the share price.

ERHC On The Move had a four-minute conversation with U.S. Atty. Mary Kit Dimke on June 20 but was unable to wrest any informationfrom her, including the Year 2000 and 2004-2005 shareholders lists we sought (which are supposed to public, but were seized).

We did learn that she is not based in Houston but in Washington, D.C., and apparently came to Houston solely for the search of the company's offices on Westheimer Blvd.

Regrettably, we were no longer holding ERHC when it made its move, having moved over to Vion Pharmaceutical {VION), which has a promising orphan drug for leukemia in seniors we think is heading towards FDA approval.

I am grateful to all of you who sent me contributions for my campaign for Manatee County Commissioner, and I will wager a guess that you enjoyed my thank-you notes a lot!

Contributors must state their name, address and occupation, and make checks payable to "Elect Joe Shea" at 4119 61st Ave Ter W, Unit 305 C, Bradenton, Fla.

Pd. Pol. Advt. Paid for and Approved by Elect Joe Shea, Democrat for County Commissioner, District 4.

Thursday, June 22, 2006

ERHC Not Implicated In Jefferson Probe, Jeter Says

Former US Ambassador to Nigeria Howard Jeter joined ERHC On The Move and many investors today in publicly discounting the possibility that ERHC Energy is tied to the bribery probe of Rep. William Jefferson, the Louisiana Democrat whose offices were searched a day after those of the company in Houston in what now appear to be separate probes.

Jeter, an ERHC Energy director, spoke to New Orleans Times-Picayune Washington reporter Bill Walsh and Bruce Alpert, according to a story published on the newspaper's Website today.

ERHC is mentioned only in the last paragraph of the story, which for the first time identifies at least three of the seven firms that are suspected of involvement in Jefferson's bribery case, according to court records obtained by the newspaper.

Also mentioned is Noreen Wilson, a former ERHC Energy executive, who told the newspaper that although Jefferson may have spoken up for ERHC Energy in conversations with Sao Tome President Fradique de Menezes, the congressman asked for nothing in return.

Wilson and her family's $14,500 in campaign contributions to Jefferson have been a key element in suspicions that ERHC Energy might be involved in the probe, along with the unfortunate proximity of the two searches.

Wilson's husband also rented a home on Merritt Island, a posh community on Florida's Atlantic coast, to Jamilla Jefferson when the latter fled Hurricane Katrina. But Wilson has been deeply involved in other ventures, including the company known lately as GEEC, whose bankruptcy sparked a torrent of accusations and a Federal probe.

GEEC's registered agent is or was Phil Nugent, Jr., of New Orleans, according to news reports, and information about his father's role in the company has sometimes surfaced in connection with the Sao Tome Attorney General's probe of ERHC conducted by a well-connected for Democratic deputy assistant secretary of energy, R. Dobie Langenkamp. His father's Frontier Technology Corp. in Belair, Tex., was also mentioned in court filings in the ERHC case.

Here is the Times-Picayune story by Bill Walsh with Bruce Alpert:

Satellite radio firm provided records
Exec's loan to Jefferson in 2001 remains unpaid

Thursday, June 22, 2006

By Bill Walsh

WASHINGTON -- A Maryland-based global satellite radio company is the latest firm with foreign business interests to surface in the federal bribery investigation of Rep. William Jefferson, D-New Orleans.

A spokeswoman for Worldspace Inc. said the company has provided documents to the Virginia grand jury that is investigating Jefferson and that CEO Noah Samara has turned over records and given testimony.
"Worldspace and Mr. Samara have cooperated fully with the Department of Justice's ongoing investigation of Congressman William Jefferson," the company said in a statement recently released.

The 15-month-long probe has focused on assistance Jefferson gave to iGate Inc., a small Kentucky company that began trying in 2001 to establish a foothold in the emerging telecommunications markets in West Africa. The FBI has said in court filings that Jefferson received bribes for his official assistance to iGate Inc. In an Aug. 3 search of Jefferson's Washington home, agents reported finding $90,000 in cash they say was meant to pay off Nigerian government officials.

Jefferson has not been charged and has denied any wrongdoing. Two of Jefferson's associates have pleaded guilty to bribery-related charges in the case.

7 other business deals

Court documents say the investigation extends beyond iGate and includes references to seven other business deals, most unnamed, that are being reviewed by the Department of Justice.

Worldspace's name surfaced publicly last week when Jefferson reported on his annual House financial disclosure report that Samara had lent him between $50,001 and $100,000. Although the loan was just recently disclosed by Jefferson, Worldspace spokeswoman Judith Pryor said that it was actually was made in 2001 and had a three-year term. She said it was extended one year and remains unpaid.
In a written statement Wednesday, Jefferson said that he didn't know until recently that personal loans had to be reported to the House.

"The omission was purely one of error as I was not previously aware that private loans needed to be disclosed," Jefferson said. "I am in the process of amending past disclosures to correct the mistake."

Lawmakers frequently amend their annual financial disclosure forms, sometimes years after they have been filed, without any fine or penalty from the House. Failure to disclose would be a violation of House rules and potentially open a member up to criminal prosecution.

Members of Congress are allowed to receive loans from individuals, but in an advisory opinion in 1997 the House Committee on Standards of Official Conduct said they must be at "commercially reasonable" terms. The committee urged members to seek its guidance before accepting such loans. House rules require members to disclose loans other than primary mortgages, but not the rates or term of the borrowing.
Samara and Jefferson have declined to say what the loan was for.

Satellite radio

Samara, who was born in Ethiopia, launched Worldspace in 1990 to provide satellite radio in Africa and Asia. At the end of 2005, the firm reported 115,000 subscribers with a broadcast signal that could reach 130 countries. The company operates studios in Washington, D.C., India and Kenya.

In 2001, the year the loan was made, Jefferson was named chairman of the Congressional Black Caucus Foundation, the fund-raising and philanthropic arm of the 43-member African-American caucus in Congress. Samara was named to the board of directors and donated money to the organization.
Early this year, Worldspace won approval from the Federal Communications Commission to launch a satellite without having to post a $3 million bond. Samara said at the time that the FCC ruling would allow the company to extend radio coverage through Europe.

Other firms mentioned in court documents connected to the investigation are:

-- Netlink Digital Television, NDTV, a Nigerian-based company, which agreed in 2003 to invest $6.5 million in iGate's telecommunications venture, but then backed out. According to the FBI, Netlink's U.S. lawyers wrote in a letter obtained by agents that on Jefferson's instructions, the company paid money into bank accounts controlled by his family.
-- Enterprise Information Management, EIM, whose CEO Bruce Lyman was mentioned in FBI wiretaps in the Jefferson case. A former Jefferson aide, Brett Pfeffer, who has pleaded guilty to two bribery counts, was overheard telling an EIM investor that Jefferson would want something of value to help the company land business in the Middle East.

Last month, according to federal court documents in Texas, the FBI raided the Houston office of a small energy company called ERHC Energy Inc. Noreen Wilson, who has invested in ERHC, said last year that Jefferson helped the company hold onto drilling rights off the West African coasts of Sao Tome & Principe and Nigeria. But, she said, Jefferson never asked for anything in return. A company director and former U.S. ambassador to Nigeria, Howard Jeter, said he didn't know whether the May search of the company's headquarters had anything to do with the Jefferson probe.

Bill Walsh can be reached at or at (202) 383-7817. Bruce Alpert can be reached at or at (202) 383-7861.

Monday, June 19, 2006

New Silverstein Piece Plays Down ERHC Role After FBI Search List Shows No Interest In Jefferson Ties

A new article by Ken Silverstein at today seems to insist a little less than before on ties between Rep. William Jefferson and ERHC Energy, after we reported that no such ties were reflected in the six-page search list offered by the FBI to support their request for a warrant, and neither were any Jefferson documents seized, according to a 13-page list of those documents prepared by ERHC Energy in a July 9 motion in Federal district court in Houston that sought to have the papers returned.

What is becoming clearer, however, is the role of two former ERHC associates, Noreen Wilson and Phil Nugent, Sr., of Houston and his son, Phil, Jr., of New Orleans, in a probe that apparently does examine ties between GEECF and Jefferson through an intermediary - a disbarred lawyer who is a brother of Rep. Jefferson. As each new installment of this story appears, those three names appear with greater frequency.

Journalist Ken Silverstein of Harper's has written a series of articles that suggest ties between ERHC Energy and Rep. William Jefferson, but a six-page FBI search list that supported its request for a search warrant aimed at the company's Houston offices did not mention Jefferson, and neither did ERHC's 13-page list of documents seized.

Joe Shea/The American Reporter

Today's article is a strong, well-written and very explicit piece that does not rely on the gossamer web of connections that earlier seemed to suggest ties between Jefferson bribes and ERHC Energy. Instead, for the most part it traces real connections between real people involved in oil negotiations with President Fradique de Menezes of Sao Tome.

Silverstein reveals, among other things, that Noreen Wilson's husband owned the home on Merritt Island in Florida that Jamilla Jefferson, the congressman's wife, fled to after Hurricane Katrina destroyed New Orleans. But the question remains, even though the Justice Dept. probe goes back to 1997, who is Noreen Wilson to ERHC today?

Silverstein clearly has a good Justice Dept. source, and now appears to be headed for paydirt.

Here is Monday's effort by Ken Silverstein:

The Companies They Keep: Congressman Jefferson, family, and friends
By Ken Silverstein
Posted on Monday, June 19, 2006


I know I've written several articles on Congressman William Jefferson (nickname: “Dollar Bill”) and his ties to several small oil-rich African countries, but please indulge me once more. I've learned that Rep. Jefferson's brother Archie L. Jefferson solicited business in São Tomé a few years ago. Not long after that, his brother was meeting with São Toméan president Fradique de Menezes to discuss business opportunities for American firms in the tiny African island country. I've also uncovered interesting details about how several of Rep. Jefferson's key aides and close family members are tied to small, previously undisclosed energy companies.

Let's start with Archie, a man with a great deal of legal experience as both a lawyer and a defendant. He began practicing law in 1987 and, according to stories in the Louisiana press, was temporarily disbarred a few years later for violations that “included using clients' money and settling cases without clients' knowledge.” According to one story, Archie didn't dispute the charges but accounted for his bad behavior by saying that “he was dealing with a drug problem.” Since then, news accounts say, Archie has: pleaded guilty to making a false statement on a credit application; been found guilty of practicing law without a license; and has been convicted of three counts of “issuing worthless checks.” In 2004 the Louisiana Supreme Court permanently disbarred Archie, citing “indisputable evidence of a fundamental lack of moral character and fitness.”

You probably know by now that Archie's congressman brother, William, is currently under investigation by the FBI for allegedly taking a bribe from the owner of iGate Inc. to arrange deals for that company in Nigeria and other African countries. According to court records, the FBI is also looking into “at least seven other schemes in which Jefferson sought things of value in return for his official acts.”

I've already written about Jefferson's ties to the island nation of São Tomé. And now, a source has told me, the FBI has learned that at some time between February and April 2002 Archie Jefferson wrote a letter to a senior government official in São Tomé in which he identified himself as managing director of a firm called The Jefferson Group. In his letter, Archie offered The Jefferson Group's services, for a fee, in helping manage and oversee the construction of roads, harbors, medical facilities, and telecommunications installations in São Tomé. (I found no record of The Jefferson Group on file at the Louisiana Secretary of State's office. It may have been a generic term.)

Other members of the Jefferson family have had a hand in dozens and dozens of small-business ventures over the years, some still active and many long defunct. But Archie Jefferson is remarkable for being a serial entrepreneur—a Louisiana database lists him as Director, Manager, or Registered Agent for a remarkable number of corporations, from “Fresh Manna, Inc.” to a mental health clinic. Over the years he has formed companies with various members of congressman Jefferson's family and staff, including Angela Coleman, his campaign treasurer. (At the same time that he was pitching the São Tomé deal, a source told me, Archie had a telecommunications venture that included the participation of Jefferson's wife, Andrea, and Jamila Jefferson, one of the couple's five daughters.)

Archie's letter to the São Tomé official made no direct reference to the congressman, but government officials there already knew Jefferson well, both because of his role as co-chair of Congress's Africa Trade and Investment Caucus and because he had visited the country in 2000. Jefferson was also a leading backer of the African Oil Policy Initiative Group, which called for the United States to increase energy imports from Africa. In Washington on January 25, 2002, he spoke at a symposium supported by the group and called for stronger ties to West African oil producers, who, Jefferson said, were America's “best [energy] partners” because of their “commitment to democracy.” That's an astonishing statement given that the West African regimes rank among the most corrupt on earth.

Four days after his speech in Washington, Jefferson's old friend Jack Swetland was listed as the registered agent for two new New Orleans firms, Providence International Petroleum Company and Providence International Construction Company. (Stephanie Edwards Butler, the manager of the two firms, ran Jefferson's law office before he joined Congress and has been his district manager in New Orleans ever since he took office.) As I previously reported, President Fradique de Menezes of São Tomé met with Jefferson at least four times between 2002 and 2003. A source told me that their first meeting was on May 14, 2002, a few months after Archie wrote his letter, and was held in the congressman's Washington office.

Jack Swetland is an accountant who has long handled Jefferson's campaign and business finances. Swetland, according to a Times-Picayune report of August 4, 2005, has also managed the campaign finances of a number of Jefferson's closest political allies, including several of Jefferson's relatives. In August of 2005, when the FBI raided Jefferson's home in Washington (where they found $90,000 in a freezer), federal agents simultaneously raided Swetland's New Orleans office and home.

There are a number of other New Orleans firms tied to Congressman Jefferson's close associates, and Jack Swetland seems to be key. He was the registered agent for Worldwide Energy and Environmental Resources, which was founded in March 2003, as well as for the ANJ Group, which was founded in January 2001. The manager of the ANJ Group is listed as Andrea, the congressman's wife; Jamila Jefferson and her four sisters are reportedly company members, too. The owner of iGate has said that he paid Jefferson more than $400,000 between 2001 and 2005 to promote his business in Africa, and that the money was funneled through ANJ Group.

I've suggested in past posts that federal investigators were examining Jefferson's ties to São Tomé and to companies doing business there—in particular ERHC, the controversial firm that has a large stake in São Tomé's oil fields. A woman named Noreen Wilson has worked closely with ERHC and is the president of a Louisiana-registered company called GEEC, which also has ties to Jefferson. People affiliated with those two firms have made at least $17,500 in political contributions to Jefferson.

Remember Worldwide Energy and Environmental Resources, which is linked to Swetland? The manager of that firm is Jamila Jefferson's husband, Phillip E. Jones Jr, who is also listed as a member of a firm called OPEC LLC, which was created in January of 2005 (with offices at Jones Jr's home address). Phil C. Nugent, another member of Jones Jr's OPEC LLC, is the registered agent for GEEC. Nugent's father, Phil H. Nugent, is an oil and gas consultant and a long-time shareholder and booster of ERHC.

Anecdotal evidence shows that the relationship between the Jefferson family and ERHC-GEEC is more than casual. In September 2005, a month after the FBI raid on Rep. Jefferson, Hurricane Katrina pounded New Orleans. Jamila Jefferson fled for safety to a home in Merritt Island, Florida, according to contact information she posted on a website run by her old sorority house at Harvard, Delta Sigma Theta. Property records show that Jamila's temporary refuge in Merritt Island is owned by Noreen Wilson's husband, William Wilson, a man who kicked in $4,000 of the campaign contributions to Congressman Jefferson cited above.

It's not clear exactly what the Jefferson-linked firms I've mentioned here were up to or how successful they were —I left messages for Swetland, Butler, Jamila Jefferson, and her husband and didn't hear back, and when I told Archie Jefferson I wanted to talk to him about his business plans in São Tomé he declined comment. But the names of the firms make patently clear that they were in the energy business, and we know that a number of the people involved shared Congressman Jefferson's interests in Africa.

It's been reported that at least two Jefferson staffers—each of whom had a management role at small Louisiana companies—have been subpoenaed by federal investigators. First is Stephanie Edwards Butler, who managed the two Providence firms mentioned above. Also subpoenaed is Ericka Edwards, who is related to Stephanie Edwards Butler and, based on their difference in age, might be her daughter. Ericka joined Jefferson's Louisiana staff last year and is the listed manager for International Petroleum LLC, which was formed on May 24, 2002—ten days after the congressman met with São Tomé's president in his congressional office. I expect we will learn more about these companies as the Jefferson investigation continues.

Saturday, June 17, 2006

Justice At Last! SEC Probes Exxon, CVX Payments To Equatorial Guinea

In a serious case of bribery allegations again major oil companies including ExxonMobil and Chevron, the Securities Exchange Commission is finally looking* [see Editor's Note below] at possible charges two years after evidence of bribes paid to officials of the West African dictatorship surfaced in the Senate Commerce Committee chaired by oil company surrograte Republican Sen. Ted Stevens of Alaska. The hearings came to an abrupt halt.

Action against the oil giants has been topic of discussion here at ERHC On The Move ever since a three-paragraph news brief ran in the Los Angeles Times Business section several years ago.

There has been virtually no follow-up outside of this column until Washington correspondent Ken Silverstein mentioned the charges in a column last week for

Here is the article published today* by the Associated Press:

*Editor's Note: We have learned, via Ken Silverstein, that the article below is in fact three years old. We regret not pursuing its origins further.
We are not aware - and neither is Ken Silverstein, he said - of any further action on the investigation that was announced in the article below. The investigation of the majors came about only after he revealed questionable payments by them in the Los Angeles Times, prompting the Senate Commerce Committee hearings (and the SEC probe) that followed.

SEC eyes oil payments to Equatorial Guinea

WASHINGTON (AP) — The Securities and Exchange Commission is examining payments by four big U.S. oil companies to officials of Equatorial Guinea and businesses they controlled, as government inquiries related to the Riggs Bank affair proliferate.
Spokesmen for the companies — Amerada Hess (AHC), ChevronTexaco (CVX), ExxonMobil (XOM) and Marathon (MRO)— confirmed Friday that they had recently received letters from the SEC requesting information in a preliminary investigation. They said the companies were cooperating in the inquiry, which is being conducted by the SEC's office in Fort Worth.

SEC spokesman Matt Well in Washington declined to comment.

At issue is whether U.S. anti-bribery laws were violated in the companies' activities in Equatorial Guinea, a poor West African country cited by the State Department for human rights abuses, corruption and diversion of oil revenue to government officials.

In the course of an overall investigation of account transactions at Riggs, Senate investigators discovered large payments made by the oil companies to officials of Equatorial Guinea and their relatives. That raised concerns about possible corruption, voiced by senators at a hearing last month.

Executives defended the companies' actions in Equatorial Guinea, testifying that they have strictly complied with the Foreign Corrupt Practices Act and have entered only into legitimate business ventures there.

Spokesmen for Amerada Hess, ChevronTexaco and Houston-based Marathon reiterated that position Friday.

"Our policy is for all ChevronTexaco employees to fully comply with the law at all times," spokesman Stan Luckoski said from the company's headquarters in San Ramon, Calif.

Exxon spokeswoman Susan Reeves would say only that company received the request from the SEC on Thursday and planned "to cooperate fully."

The SEC and the Justice Department have pursued a number of cases recently under the law, which bars U.S. companies and individuals from bribing foreign officials.

The SEC has been formally investigating, for example, allegations that a Halliburton (HAL) subsidiary was involved in paying $180 million in bribes to get a natural gas project contract in Nigeria. The SEC and the Justice Department have asked Halliburton to cooperate and provide information.

The SEC inquiry concerning the four oil companies and Equatorial Guinea is preliminary and not formal and the companies' furnishing of information is voluntary.

News of the inquiry, first reported Thursday by The Washington Post, comes about a week after the disclosure that the Justice Department is investigating the federal regulator who oversaw Riggs during a period of deficient money-laundering controls and later became a senior executive at the bank.

The ethics investigation of R. Ashley Lee was triggered by a referral of the matter on July 20 by the Office of the Comptroller of the Currency — where Lee was the lead examiner for Riggs — to the Justice Department. Inquiries into activities of current or former federal employees by Justice's Office of Professional Responsibility can sometimes develop into criminal investigations.

A report issued last month by the Senate investigators revealed that senior Riggs managers helped former Chilean dictator Augusto Pinochet conceal millions of dollars in assets from international prosecutors and U.S. regulators. The report said that when he was overseeing Riggs as an examiner, Lee instructed agency staff who had looked into the Pinochet accounts not to put their examination memos or supporting paperwork into the electronic files of the comptroller's office.

He denied having done so at the hearing, saying "I made no (such) instructions to anybody."

Also, a former Riggs senior vice president who was in charge of the Equatorial Guinea accounts, Simon Kareri, is the subject of a federal grand jury investigation. He invoked his Fifth Amendment privilege against self-incrimination at the hearing and declined to answer questions on the bank's handling of the accounts, which have since been closed.

With $700 million in accounts and certificates of deposit for the Equatorial Guinea government, its officials and their relatives, the country easily became Riggs' biggest single customer. Using wire transfers, about $35 million was drained from an account that held oil revenue for the country's people and into offshore companies, according to the report by Senate investigators.

Riggs, an old-line Washington institution with deep roots in the diplomatic community, was fined a record $25 million in May by the comptroller's office for allegedly failing to report suspicious transactions in the Equatorial Guinea accounts and those controlled by Saudi diplomats in Washington. Riggs' parent agreed last month to be acquired by PNC Financial Services Group of Pittsburgh in a $779 million deal that will shutter the embassy and international businesses that were Riggs' hallmark.

Friday, June 16, 2006

Proposed Order Asks Judge To Return ERHC Docs, Enjoin Feds' Review And Unseal Griffin Affidavit

A proposed order offered by ERHC Energy attorneys Brewer & Pritchard of Houston would have a Federal judge order the FBI and U.S. Attorney's office to return copies of all documents seized on a search warrant May 4, not to review them and open the sealed affadavit from FBI Special Agent Dana Griffin that underlies the warrant, according to a June 9 court filing.

The affidavit, along with any recent new research by the FBI, may be comprised largely of the special report of the Attorney General of Sao Tome and Principe, who last Fall requested a Dept. of Justice and Securities Exchange Commission investigation of its claims, which were not supported by evidence. All of those claims were rejected "in their entirety" by both the Nigeria and Sao Tome governments.

The Court has not adopted the order. It is in draft form for the judge's signature, probably after counsel was asked by the judge to prepare it. In this case, oral arguments have yet to be sscheduled on the order. A source told ERHC On The Move a hearing must occur before it takes effect, if ever. The judge can modify the order as he chooses.

We received the document from Jeff Smurlick with the subject header, "ERHC to get DOCS and Computers back." That was an error we repeated in an earlier post, regrettably.

Many have written to ask me for my opinion of the merits of the case. Without more information, I cannot say with any certainty.
Here is the proposed order:

In The Matter Of The Search Of 5444

Westheimer Road, Suite 1570, Houston

Texas on May 4, 2006

Case No.


Having considered the Motion For Return Of Property, to Enjoin Government Review of Seized Documents and Computer Images, and to Unseal Affidavit in Support of Search Warrant, the Response of the United States, and the Reply of Movants, IT IS HEREBY ORDERED, ADJUDGED, AND DECREED as follows:

1. The United States is enjoined from review of seized ERHC material, pending final judicial determination of a privilege review procedure;

2. No later than 10 days from the date of this Order, the United States shall allow ERHC to obtain a copy set of all of its seized documents currently in the Government's possession;

3. No later than 10 days from the date of this Order, the United States shall return all facially privileged paper documents to ERHC's counsel for review;

4. No later than 45 days after receipt of all facially privileged paper documents from the United States, ERHC shall have reviewed all facially privileged paper documents seized by the Government and shall produce to the Government all non-privileged documents;

5. No later than 45 days after receiving all facially privileged paper documents from the United States, ERHC shall produce a privilege log setting forth the following information for any documents withheld based upon an assertion of privilege:

(a) the date of the document;

(b) the author(s) of the document;

(c) the recipients of the document;

(d) the nature of the privilege asserted; and

(e) a description of the document;

6. No later than 10 days from the date of this Order, the United States shall return all imaged computer hard drives and other electronic data to ERHC's counsel for review;

7. No later than 45 days after receipt of all imaged computer hard drives and other electronic data from the United States, ERHC shall produce to the Government all non-privileged documents responsive to the Government's search warrant at Schedule B;

8. No later than 45 days after receipt of all imaged computer hard drives and other electronic data from the United States ERHC shall produce a privilege log setting forth the following information for any material withheld based upon an assertion of privilege:

(a) the date of the document;

(b) the author(s) of the document;

(c) the recipients of the document;

(d) the nature of the privilege asserted; and

(e) a description of the document;

9. As of the date of this Order, the Court will appoint a special master to review all remaining seized ERHC material currently in the Government's possession, and within a time period established by the special master, any privileged materials reviewed by the special master shall be returned to ERHC and logged on a privilege log to be provided to the Government; and

10. No later than 10 days from the date of this Order, the United States shall provide ERHC's counsel with a copy of the Affidavit filed in support of the Search Warrant executed on ERHC's premises on May 4, 2006;

So ORDERED in Houston, Texas, this ___ day of _____, 2006
United States Judge

cc: All Counsel of Record

Donald J. DeGabrielle, Jr.
United States Attorney's Office
Southern District of Texas
P.O. Box 61129
Houston, TX 77208

Mark F. Mendelson
Mary Kit Dimke
Department of Justice
Criminal Fraud Division
1400 New York Avenue, NW
Washington, DC 20005

Gregory V. Brown
Akin Gump Strauss Hauer & Feld, LLP
1111 Louisiana Street
44th Floor
Houston, TX 77002-5200
Michael J. Madigan

Facts Emerge About ERHC Energy Investigation; No Jefferson Link Seen

First the good news: Ken Silverstein is wrong. The FBI investigation of ERHC Energy has nothing to do with Rep. William Jefferson. But it has to do with the heads of state of Nigeria and Sao Tome, and much, much more.

That's the key conclusion we reached from a partial review of an 83 pages of documents - including a six-page list of items sought by the government, and a 13-page list of items seized compiled by ERHC, and several ERHC affadavits - filed in Federal District court in Houston that describes the FBI's all-day search on March 4, 2006.

Acting on a sealed affidavit from FBI Special Agent Dana Griffin and a search warrant signed by a Texas magistrate, early on Thursday morning, March 4, 2006, 15 or more armed FBI agents led by Special Agent Robert Wolosyzn and "armed with guns and wearing bulletproof vests" entered ERHC's offices at 5444 Westheimer Blvd. in Houston. Receptionist Jane Barker immediately got on the phone to Breward & Pritchard, the company's attorneys, and lawyers Alison Baker and John Clay arrived "at or slightly before 9 a.m." to find ERHC Energy President Walter Brandhuber leaving the conference room in the company of U.S. Attorney Mary Kit Dimke.

The two lawyers were told to sit in a corner of the office after Clay advised Dimke that he was advising his clients not to speak to her or the agents without counsel present. Until after 6 p.m. that night, they watched as agents carted some 118 boxes of evidence away.

The search was conducted pursuant to criminal violations of the Foreign Corrupt Practice Act and various other statutes related to business and wire fraud, the search documents say. ERHC has asked that the government's review of the documents be enjoined and that all be returned, and the government offered to let a "taint team" of prosecutors determine what was attorney-client privileged information, an ofer the company rejected. Now, the government has "broken off negotiations" about the documents, the lawyers say.

Here is ERHC Energy attorney C. Alison Baker's description of the search:

"Over the course of an entire business day, agents conducted a wholesale vacuuming of vitually all original files contained in ERHC's office (over 118 boxes worth of documents), as well as a complete and total electronic "imaging" of all ERHC computer hard drives and computer data including all ERHC email communications."

Included in the documents seized were shareholder lists from 1997-2000 and a Dec. 7, 2004 shareholder list, along with a disc taken from the company's safe filled with seismic data from Blocks 1 - 9, many other discs, and images of all the computer hard drives in the office and on a Sony Vaio laptop.

In a six-page list of everything the FBI and Dept. of Justice hoped to find, there were some interesting names - an in a folder that was seized were even more, including that of Phil Nugent and another entitled "Life Energy & Tech Holding, Inc.," that company that would eventually become Global Environmental Energy Resources (GEECF) and which may figure in campaign contributions totaling $4,500 Silverstein said were made by former ERHC executive Noreen Wilson to Rep. Jefferson.

But neither the government search list nor the ERHC complaint filed in response on June 5 mentioned Wilson or Jefferson, lending a substantial foundation for counterclaims against Ken Silverstein's Harper's articles claiming Jefferson's dealings with ERHC Energy, if any, were implicated in the May 4 search.

But key names on the government's search list are compelling.

The list includes a request for any correspondence Nigerian President Olusegan Obasanjo, Alhaji Atiku Abubakar, Sao Tome and Principe President Fradique de Menezes, former Sao Tome President Miquel Trovoada and his son Patrice, Sao Tome energy officials Joaquim Rafael Branco and Gabriel Arcanjo Ferreira Da Costa, JDA chief Carlos Braganca Gomes, and former Sao Tome foreign minister Mateus "Nando" Meira Rita, and a First Atlantic Bank director who was also a competing bidder for Joint Development Zone blocks, Emmanue Efoby, the head of Foby Engineering.

Notably, Jefferson and Wilson are absent from the government's wish list, and so is GEEC.

Documents related to Frontier Technology Ltd., Texas, "care of Phil Nugent, 5619 Innsbruck, Belair, Texas were sought were sought by the Feds, though.

The search list sought evidence concerning "things of value" given to Nigerian and Sao Tome officials, owners of ERHC stock from 1997 to the present, all records of stock transfers, and documents concerning oil negotiations between ERHC, Chrome Energy, STP Energy Corp., Procura Financial Consultants and both countries, along with expense and travel records, were sought.

The search also sought information concerning ERHC's dealings with a number of "marketing" companies in Miami, Mauritius, Belize and London, including Capital Management Group in Miami, Commodore Marketing Assn., Derby Development Ltd. and Supreme Marketing (all three companies are headquartered on the seventh floor of the Happy World House in Mauritius), and Conquest Consultants and Falcon Commercial Investments in Belize. Lyndhurst Holdings Ltd. in London's St. Johns Wood was also on the FBI's search list.

Also on both lists were requests for and folders of correspondence about due diligence issues with Pioneer Resources, including a letter from ERHC's file drawer No. 4 marked "Personal and Confidential" and refwerencing the JDZ and and a Justice Dept. advisory opinion. The implication arising - since the statutes under which the materials sought include the FCPA from that document is that Pioneer may face an issue concerning as to whether or not it adequately disclosed to the government, as required under the FCPA, information about any suspect payments it may have learned of during its due dilgence process. Pioneer eventually withdrew from its partnership with ERHC. Its shares were up 11 percent, or $4.69, on Friday.

The documents seized included several folders concerning a possible move by the company to the American Stock Exchnage, something many investors have long hoped for.

Among the items seized were one concerning Amerada Hess, which ERHC On The Move believed at one time was a potential partner, and a letter from Anadarko, along with folders for Devon Energy, Noble Energy and Anadarko Petroleum Corp. Two other Sao Tome officials, Hassan Tukur and Hashim Tumsa, were also named on the search list.

The two lawyers went downstairs after talking with Dimke and Brabndhuber and an affadavit by one of them says they "crossed elevators" with the company's newly-appointed accountant and CFO and then rushed back uypstairs to advise him not to speak with the government people. Dimke later wrote the two lawyers saying they had committed "obstruction of justice" in telling both Brandhuber and the CFO not to talk with her.

Th impact of the search, the lawyers stated in the motion, has been great. The government's blanket refusal to allow its lawyers o review the cocuments "has left the company completely in the dark as to the factual basis for an apparent Dept. of Justice investigation that has left the company subject to an uncononsented search and without any of its business records" and "unable to function in a normal manner."

That's certainly consistent with our share price, which is now at $0.42, up $0.019 for the day on volume of 1,077,314 shares.

Thursday, June 15, 2006

Soros Conviction On Insider Trading Charge Upheld By French High Court

George Soros, the Hungarian billionaire who provided funding for the Earth Institute's International Senior Lawyers Project that hired Tulsa oil law professor R. Dobie Langenkamp to conduct the investigation last year of ERHC Energy on behalf of the Sao Tome Attorney General's office, on Wednesday lost an appeal of his conviction for insider trading in the takeover of French banking giant Societe Generale 20 years ago.

He'll have to pay a fine in the millions of dollars, the nation's high court ruled.

Here is the latest, from the Associated Press:

French Court Uphold Soros Conviction

The highest court in France on Wednesday rejected a bid by George Soros, the billionaire investor, to overturn a conviction for insider trading in a case dating back nearly 20 years, leaving the first blemish on his five-decade investing career.

The panel, the Cour de Cassation, upheld the conviction of Soros, 75, an American citizen, for buying and selling Société Générale shares in 1988 after receiving information about a planned corporate raid on the bank.

Ron Soffer, his lawyer, said Soros planned to take the case to the European Court of Human Rights, saying that the length of the proceedings had prevented his client from having a fair trial.

"The investigation started in 1989," he said. "The appeals trial occurred in 2004. How can you call witnesses and ask them about what happened in 1988?" The French stock market regulatory authority investigated the matter separately and concluded that Soros had not violated the law or any ethical rules, Soffer said.

The French authorities have not yet determined what fine Soros will pay.

In a March 2005 ruling, a French appeals court confirmed a fine of €2.2 million, or $2.8 million, set by a lower court for the illegal purchase of 95,000 shares in Société Générale. The Cour de Cassation ruled that the fine would be adjusted to reflect Soros' profits, and it ordered the case returned to the appeals court to clarify the amount.

Soros, a Hungarian-born businessman, has acknowledged that he was told about a Paris financier's plans to take over Société Générale in late 1988 and began independently acquiring shares in the bank just days later.

But he denied that knowledge of the raid had amounted to insider information or influenced his transactions, which he said were part of a broader, documented strategy of investing in newly privatized French companies. Soros' lawyer said he had cooperated in the case from the beginning.

A spokesman for Soros, Michael Vachon, called the decision "an absurd miscarriage of justice" and said Soros was confident he would be cleared by the European court.

"As he has from the beginning, George Soros maintains that he engaged in no illegal or unethical conduct," Vachon said in a statement.

Soros, who emigrated to the United States in 1956 and set up Soros Fund Management 17 years later, has billions of dollars under management in his Quantum Fund.

He remains the only person convicted in the Société Générale affair. Two others, Samir Traboulsi and Jean- Charles Naouri, were acquitted.

At an appeals hearing in 2005, Soros told the court his insider trading conviction had been a "gift to my enemies" in the United States and elsewhere. "My reputation is at stake," he said.

Soros has often drawn criticism for speculating heavily on the collapse of fragile currencies. In 2004 he also angered many conservatives in the United States by pumping millions of dollars into election campaigns to try to unseat President George W. Bush.

Ken Silverstein Strikes Again

The former Los Angeles Times writer who is now the Washington reporter for Harper's Magazine has yet another article about the murky connections between ERHC Energy and Rep. William Jefferson, and this one proves his contention in our email exchange (see below) that there was far more to the connection than just what we had originally suggested. He trots out the information his source gave him for the first time.

Ken Silverstein traces connections between Noreen Wilson, an early ERHC investor, and Phil Nugent, Sr. of Houston and Phil Nugent, Jr., of New orleans to crooked Palm Beach attorney Donald Mintmire, Jr., another Kentucky man now in prison, the bankrupt Global Environmental Energy Corp. (GEEC), the former Sao Tome Secretary of State Mateus Rita and finally to President Ferdinand de Menezes and on to Rep. William Jefferson (D-La.) himself.

Much of the piece indicts the players by association, and Silverstein admits that there's nothing but a former executive's camapign contributions to allege against ERCH Energy's long-ago executives and consultants. Wilson has not been active in the company for years, and neither have the Nugents, but both are said to still have substantial stakes in ERHC securities.
It is unclear why no one has obtained a shreholder's list to ascertain those investments.

The inference is that some $4,500 in donations Wilson made to Jefferson shaped Jefferson's approach to President de Menezes at a time when he was allegedly considering voiding awards to ERHC of valuable oil concessions in the Nigeria-Sao Tome and Principe Joint Development Zone.

Whenever De Menezes, who got a $100,000 contribution to his 2002 campaign from ERHC chairman Sir Emeka Offor, met with Jefferson (on four occasions recently), Jefferson allegedly countered De Menezes' desire to void the rights with encomiums for ERHC, a source - either Doc, Meridian or Mutwadadi, I suspect) told Silverstein.

The problem with that, of course, is that it is far more likely that De Menezes was on the take and that Jefferson met with him to pay him off than that De Menezes was really planning to revoke the rights. Silverstein seems to want to make De Menezes an honest player for strategic purposes. If they can make the Sao Tome cocoa exporter look clean enough, he might be the critical figure in the drama to come.

Sao Tome's parliament voted against voiding the rights in 2005, and it's unlikely that De Menezes would lead the charge to do so again (unless I get him mad), even given his public statements about ERHC's rights costing Sao Tome a lot of money they would have otherwise earned. To keep the issue in perspective, just keep remembering that he said so with $100,000 of our CEO's money in his pocket.

And whose strategic purposes? It's sad to say that Harper's now owes its existence to companioes like Conoco Phillips, without whose full-color back-page ads the magazine would not survive, and other philanthropic energy giants that want ERHC's rights so very desperately - and whose own crooked history in Nigeria, Sao Tome and especially Equatorial Guinea dwarf the unproven allegations against ERHC.

It all shows the Machiavellian academic side of R. Dobie Langenkamp, who is probably stirring the high-brow Harper's pot on Big Oil's behalf with just enough factoids to make it seem interesting to the Justice Dept., the real audience for the piece.

Next we should expect Anadarko's proxy, Senate Energy chief counsel Judy Pensabene (a Langenkamp student married to APC's governmental affairs lobbyist), to start whispering about a Senate investigation.

Every journalist worth his salt can play the game Silverstein has, establishing (as much as a castle in the air can said to be established) gossamer webs of connections between "colorful" characters and an appearance that someone, somwhere in all of it, did wrong.

What Silverstein has really done this time, however, is to concretely tie Wilson to Jefferson, although whether on behalf of her former role and any present investment in ERHC Energy or her cloudy ties to GEEC is unknown.

One of the sources feeding him information had a calendar from De Menezes' office to work from or managed to trace his meetings with Rep. Jefferson through the Sao Tome press or Jefferson's own press releases. The assault was nicely shaped, like the Attorney General's report, even though it lacked real bullets Somewhere in Oilville, a crafty corporate communications director is being toasted by the boss.

The meetings are new stuff insofar as the entire investigation, and while we never learn how proximate in time Wilson's contributions to Jefferson were relative to the meetings, and no link from ERHC to Jefferson is established except by his source's saying (as unprovable hearsay) that the company was discussed - and indeed the whole web remains unsupported by more than association - the piece is a better insight into the various relationships than we have ever had before, and the Wilson contributions provide a concrete foundation for investigators to work through if they choose.

I'm anxious to see how Phil Nugent, Sr.'s accountant, Norma Reynolds, plays it in her role as moderator chcr on the I-Hub ERHC Energy board. It's positively fascinating that even with all her deletions, the site is still visited more often than Gordon Stamper's honest and upright JDZ board next door.

Here is Ken's piece:

Meet William Jefferson's Political Supporters
Posted on Wednesday, June 14, 2006.
By Ken Silverstein

Congressman William Jefferson of Louisiana is currently under investigation by the FBI for allegedly taking bribes from a company seeking business in Nigeria and, as I reported last week, the feds are apparently also looking at his ties to São Tomé and to some Americans doing business in that African country. Since then, I've received additional information that points even more strongly to a São Tomé-Jefferson connection.

It gets complicated, but stay with me. First I'll explain the history of a small energy firm called ERHC, which was born in Lafayette, Louisiana but is now based in Houston. Next, I'll discuss a few people connected to the firm and to a second company called Global Environmental Energy Corp. (GEEC), whose president, Noreen Wilson, has played a key role in ERHC. The cast of characters here includes a Texas wildcatter, a convicted felon, and a reverend whose company invested in an adult entertainment firm. Lastly, we'll get back to Jefferson, who has curious ties to both ERHC and GEEC.

It all starts in 1997, when ERHC—despite having no revenue and just a single full-time employee—won extensive energy rights in the tiny island nation of São Tomé. In exchange for a $5 million payment to the government for the right to market the country's oil potential, ERHC was awarded a minimum of four oil fields, exempted from all taxes, and granted half the future profits in STPetro, a state oil company created by the deal. Noreen Wilson, a lobbyist who helped negotiate the deal for ERHC and who became a major shareholder, was appointed to STPetro's board and made ERHC's chief financial officer.

In 2003, I wrote about ERHC's agreement in São Tomé for the Los Angeles Times. “Was the deal a little rich?” Wilson said in an interview. “Yeah, it probably was, but who else was going to take the risk back then? They couldn't give their oil away, let alone get someone to pay them for it.” But Andrew Latham of Wood Mackenzie, an energy-consulting firm in Edinburgh, Scotland, said the original deal was far out of line with industry standards and said he'd never seen a company “get a stake like ERHC obtained in São Tomé.”

In São Tomé, plenty of people have questioned the deal. A December 2005 report by São Tomé's attorney general said that the country's lead negotiator on the agreement, Carlos Gomes, a nephew of the prime minister, was awarded an executive position at STPetro and a salary of thousands of dollars a month paid by ERHC. The report said that Mateus “Nando” Meira Rita, a former São Toméan Secretary of State, became STPetro's general manager and also received a generous salary as an ERHC consultant. SEC records show that in 1998 ERHC named Rita as its Vice President of International Affairs and granted him 500,000 shares of company stock valued at $158,203.

Such was the controversy that the agreement was subsequently renegotiated twice, first in 2001 and again in 2003—that second time under President Fradique de Menezes, who had initially pledged to revoke ERHC's privileged position (which he described as “unconscionable”). The current deal is less favorable to ERHC than the original—the company has relinquished its rights in the state oil company in exchange for other benefits—but still favorable enough that when it was signed, dozens of civic and political leaders in São Tomé issued an open letter that accused President de Menezes of selling out the national interest. “As a shareholder, I'm thrilled,” Noreen Wilson told me at the time. “Everyone was focused on what we gave up and no one added up what we got.”

After the renegotiation was concluded it was discovered that the Nigerian owner of ERHC—a reported billionaire with close ties to his government—had made a secret $100,000 contribution to a company controlled by President de Menezes; the president said that the money was for his political campaign. According to the attorney general's report, “several São Toméans holding interests in ERHC” participated in the renegotiations, including the above-mentioned “Nando” Rita, who was then São Tomé’s Foreign Minister and who “still owned 500,000 shares in ERHC.”

Here's what the attorney general's report said about the contract:

[A]t every stage there is the suggestion that ERHC and its [Nigerian parent company] Chrome may have made improper payments to government officials or provided benefits to their families in order to secure the assistance of such officials in continuing the contract . . . [The contract,] if enforced, will result in the possible loss of nearly $60 million in signature bonus revenue which would otherwise flow to the government of São Tomé . . . This amount compares to São Tomé’s total annual budget of $50 million.
After the attorney general's report came out, the Joint Development Authority (JDA), which oversees energy development in a zone controlled by Sao Tome and Nigeria, put a statement on its website that rejected the report “in its entirety.” The JDA's chairman and executive director is Carlos Gomes, the former STPetro official whose salary was paid by ERHC and whose son, Noreen Wilson told me back in 2003, was provided an academic scholarship at the University of Louisiana at Lafayette from ERHC.

ERHC has an unusual history and a host of colorful characters have been involved with the firm, such as ex-CEO Sam L. Bass Jr. (now deceased), a former wildcatter who had done business in Nigeria and put out oil fires in Kuwait after the Persian Gulf War, and Phil H. Nugent, a Houston-based oil and gas consultant who was a major shareholder in ERHC and big promoter of the firm.

Then there's Reverend Ernie Chu, who, according to SEC records briefly served as treasurer and chief financial officer of ERHC in 1999. Chu is now an assistant minister with Religious Science of Fort Lauderdale (“The Infinite,” reads his bio, “is always loving and supportive in allowing us to create lives filled with prosperity, fulfillment and love.”) and has undergone miraculous “surgery” at the hands of Brazilian faith healer John of God, apparently with good results. In addition to his religious pursuits, SEC records show that Chu and someone named Vito Lamonco are the beneficial owners of Corporate Builders L.P., which was a major shareholder in Jill Kelly Productions, “one of the first adult entertainment movie production company created by an adult film star.” (You may not want to click on that last link if you're at work or bothered by the image of a mostly naked woman in a cowboy hat.)

In an interview by phone, Chu said that he got involved with the ERHC through Noreen Wilson and that he and a group of investors “put some money into the deal. I sold most of my stock. We did okay after it looked like we were going to get wiped out.” Chu described his own company, Corporate Builders, as “venture builders,” and explained that the company helps firms bring money in and provides management assistance. He said the firm acquired its shares in Jill Kelly Productions from an investment bank that was a client of Corporate Builders and that “the intention was to distribute the shares to individuals” associated with Corporate Builders, but that never happened because the porn company went bankrupt. Chu said that the activities of Corporate Builders are currently “winding down” and that ERHC and Jill Kelley “were both quite unusual and different from our core business,” which he said was working with medical and technology firms.

The story of GEEC formerly known as Life Energy & Technology Holdings Inc., is perhaps even more remarkable. That firm is registered in Louisiana but lists its principal office in the Bahamas. As I mentioned above, GEEC's president is Noreen Wilson, the mover and shaker involved with ERHC. Its registered agent is Phil C. Nugent, the son of Phil H. Nugent, the latter who also has ties to ERHC. Nugent Sr. is also listed as chairman of a firm called Green Energy Management, which has been a partner of GEEC. (If you check the Louisiana Secretary of State's website you find that the two Phil Nugents have had a hand in a number of small companies.)

According to its corporate filings, the company had plans to turn solid waste into electricity with its revolutionary Biosphere ProcessTM, which would also produce a “pulverized powder” that could be sold as a by-product for the building industry; part of the plan at one point was to introduce the Biosphere Process in Libya, followed by other installations in sub-Saharan Africa. GEEC has over the years claimed to have billions of dollars worth of contracts (in China, among other places) but its ship never came in and the company filed for bankruptcy last year. In a post-bankruptcy story about the company, Barron's, which has also reported on some of the odd characters involved in the story, said GEEC “has reported no revenue for 2 1/2 years, and its latest balance sheet showed a total of $3 in cash.”

But just a year earlier, GEEC/Life Energy still had high hopes. It announced that it would receive $450 million in financing arranged by Diamond Ridge Advisors, a company controlled by a man named William Kent Trumble. That money never materialized, which is perhaps not surprising given that Trumble, according to a recent story in the Fort Mill Times, is currently under investigation in Pennsylvania for failing to deliver “on a $3.5 million pledge to help build a YMCA” and for possibly taking “$22,000 earmarked to help a Bible college” and not following through “on his pledge to convert it into $2.5 million.”

The Fort Mills newspaper reported that records from the Kentucky State Reformatory showed that:

Trumble was sentenced to five years in jail for two felony counts of second degree forgery and five felony counts of theft by deception. His sentence started there in March, 1978, and he was transferred to the Frankfurt Career Development Center in May, 1978, and stayed there until he was paroled in January, 1979 . . . Trumble's roots in Fort Mill extend to the waning days of the PTL, Jim and Tammy Faye Bakker's former religious empire and theme park based in what's now Regent Park. He befriended people tied to the PTL.
A second person affiliated with the company has also had problems with the law, namely Donald Mintmire, a Palm Beach, Florida, attorney who did legal work for GEEC/Life Energy. SEC filings show that Mintmire had also done work for ERHC and for a firm called Power Interactive Media, where Noreen Wilson was a consultant. Mintmire, according to various news accounts, was sentenced to jail time earlier this year for obstructing a grand jury investigation into the collapse of a company called Clements Golden Phoenix. A 2005 story in the Stuart News said that Golden Phoenix “was supposed to get rich exporting Florida citrus to China but instead cost investors millions.”

Now we come full circle to Congressman Jefferson, who apparently went to bat for ERHC in regard to its controversial stake in São Tomé. A well-placed source who provided detailed information said that President de Menezes of São Tomé met with Jefferson at least four times in the United States: in the congressman's office in May and September of 2002, in June of the following year in New Orleans, and at the Ritz-Carlton Hotel in Georgetown that same month. The source said that the above-mentioned “Nando” Rita—the ERHC shareholder who worked with the company when it was negotiating its deal and who later became a member of de Menezes's government and close advisor to the president—pushed de Menezes to meet with Jefferson.

“ERHC, through ‘Nando’ Rita,” said the source, “kept telling [de Menezes] that Jefferson would help São Tomé, and Jefferson, in turn, kept telling him that ERHC was a wonderful outfit, just as the president was considering voiding their previously-acquired rights in a review he did of all the oil-related agreements signed by the previous administration. He was ready to void the ERHC deal. Then he didn't move forward. I cannot say it was Jefferson who changed his mind. But I cannot say it wasn't a factor either.”

On April 16, 2003, six days after São Tomé and ERHC concluded the final renegotiation of the company's energy rights, Wilson donated $500 to Jefferson, as did two other people, Wayne Hartke and Weldon Rougeau. Hartke, the son of former Indiana senator Wayne Hartke, was an ERHC shareholder and once served as its general counsel. Rougeau is the former head of the Congressional Black Caucus Foundation, which, several months after the donation was made, signed an agreement with São Tomé that called for the Caucus Foundation to promote development in the country. This deal was made with the backing of Jefferson, who was then the Caucus Foundation's chairman. (Rougeau, according to the source cited above, later visited São Tomé on at least two occasions, as did several other members of the foundation.)

As to Jefferson and GEEC, as I mentioned in my last story, the company helped cover the costs of the congressman's February 2004 trip to Nigeria, São Tomé and two other African countries in his capacity as co-chair of the Africa Trade and Investment Caucus. Several other firms also pitched in, including iGate, the Kentucky firm whose owner recently pleaded guilty to bribing Jefferson to promote deals for the company in Nigeria, and Verizon. According to Africa Energy Intelligence, GEEC “won a concession in Nigeria's offshore last year but had to abandon it because it was unable to pay the front-end bonus.”

In 2004 and 2005, Noreen Wilson made an additional $4,500 in contributions to Jefferson. The donations were made through a company called HSW Group and a number of other people affiliated with the firm —all but one with the last name of Wilson—kicked in another $11,500 to the congressman over the same period. (The one non-Wilson to contribute was June Nichols, Deputy Administrator of the U.S. Small Business Administration under Ronald Reagan. HSW was retained in 2003 by GEEC/Life Energy to represent it in Washington, and Nichols was placed on its advisory board.)

None of this shows that Jefferson received anything more than campaign contributions and a travel subsidy from people linked to ERHC and GEEC. What it does suggest, along with other published accounts and what I've been told by a source familiar with the ongoing investigation, is that Jefferson's ties to the companies and to Sao Tome, and ERHC's involvment in that country, are of interest to investigators. Most suggestive of all is that a U.S. District Court issued a search warrant last month for “documents related to [ERHC's] correspondence with foreign governmental officials or entities in São Tomé and Nigeria.”

Note: Noreen Wilson, ERHC, Rougeau and Robert Trout, Jefferson's attorney, did not reply to phone calls or emails requesting comment.

Tuesday, June 13, 2006

Discovery? Daukoru Talks Of 'Next Thing' In JDZ

Has OPEC President and Nigerian Oil Minister Dr. Edmund Daukoru dropped a broad huint about coming good news gfrom the JDZ?

Maybe, but it hasn't helped our share price much, which has fallen from around $0.48 late last week all the way back to $0.40 this morning.

Just before 1pm, the price is $0.407 x $0.415, with ERHE down $0.03 for the day on modest volume of 794,589 shares. At 12:59pm, Sells of 553,389 outnumber Buys of 221,200, with 20,000 shares trading on the cusp.
Dr. Daukoru's comment to the Nigerian daily newspaper Vanguard of Nigeria are a little too general for our tastes, but it does sound faintly like he's saying that an announcement about the true dimensions of the discovery iomn Block 1 may be forthcoming from Chevron. My gut tells me that would come in about a month.

Here is the Daukoru comment, lifted from the I-Hub board:

Q:) The JDZ has been quiet lately. What is really happening there?

[Daukoru:] JDZ has been quiet, that is no news, it could indeed portend good things. After awarding blocs, they blocs have to be administered through the nitty gritty. How far of a success, we are yet to establish. The initial signals are good. We have signed the PSCs like you know very well. So we are into the quiet stage and the next thing should be the announcement of a big discovery and that would be the time for popping champagne.

Saturday, June 10, 2006

Joe for Manatee County Commissioner (Who's that handsome guy?)

My dear friend Walldog was the first to propose a fitting campaign poster for my race for Manatee County, Fla., County Commissioner, and he even managed to get my pal Umbra to pose for it.
Joe Shea/The American Reporter
If you're the creative (or political) type, please don't hesitate to send me your proposed poster for publication here.

I will be deeply grateful for any campaign contributions. Make checks payable to Elect Joe Shea, 4119 61st Ave Ter. W., 305C, Bradenton, FL 34210. The maximum donation by cash or money order is $100; anything larger must be made by check. The maximum allowable contribution is $500. For campaign reporting purposes, all contributions must include your name, address and type of employment.

This message Paid for and Approved by Elect Joe Shea, Democrat for Manatee County Commissioner, Dist. 4.

Friday, June 09, 2006

ERHE Will Rise Again

It must be frustrating for Exxon, Anadarko and the rest of the majors who'd like to see ERHC Energy out of the picture - here we go again, shrugging off some heavy blows and corporate reluctance to blow our horn while rising from the rubble once again.

ERHC Energy's share price is up again this morning, hitting $0.49 in one small (2K) purchase in the first trade of the day. Volume is a modest 228,000 shares at 10:21am, and the price has fallen back to $0.451 x $0.47.

But whatever the current price, the amazing resilience of this stock is the real story. Investors have seen it drop nearly $0.20 in one day and then recover that amount and more - on the same day!

So to those who follow it closely over time, this week's performance - a modest gain of 26 percent from its low of $0.38 to its high of $0.48 (we'll let that one $0.49 sale go) - as amazing as it is, is not all that unusual or even unexpected.

Who got in one the ground floor at $0.38, $0.39. $0.40?

Well, at least some of those folks will be crowing over on I-Hub and Raging Bull.

Even if ERHC Energy becomes caught up in the Jefferson investigation, as some seem to think it will, there's not much basis for our remaining a $0.50 stock much longer.

Consistent with my theory that we will ape the two-to-three-year performace of stocks like FEEC, HDY, TMY, and IVAN, I believe it will rise substantially before the year is out even if aspects of the investigation do bust out into the news.

I am not certain, actually, that we are over the hump yet; we still could fall way back on a bad day and feel some real hurt, but the likelihood is that after a much less dramatic pullback (such as we're seeing now, at 10:40am ET), we'll start that long, slow, agonizing climb into $1.50 range that we have so long anticipated.

You know what they - you can't keep a good man down. ERHC will rise again.

Thursday, June 08, 2006

Back And Forth With Ken Silverstein

As the following exchange will attest, Ken Silverstein is making an honest effort to report what he's learned about any association between the Jefferson case and the warrant served on ERHC Energy. I can't assess the quality of his non-AEI source on the issue, but I would always take his own assessment as a secure and careful one.

Our back and forth on this issue may prove to be a little enlightening:

You know I respect you as lot, Ken, but your tie-to-Jefferson angle ( is awfully weak. All the "African Energy Intelligence" (sic) article says is "We understand the operation was linked to the FBI investigation into Jefferson."

They only understand it because I thought it was, and said so long before either of you did, in ERHC On The Move. You think there's a tie because they think there's a tie because I think there's a tie. I think there is, but that doesn't lay much of a foundation for a statement that will cost lots of investors lots of money (10 percent of their holdings today), but won't cause the folks at Exxon and Chevron and all the others the LA Times reported are being investigated by Senate Commerce for huge bribes to Obiang to lose a minute of sleep.

It just seems unlike you to pile on the little guy when the giants are far worse. And I may be wrong, but I think you have conflated two different publications, both of which are unreliable, one being African Energy ( and the other Energy Intelligence (


Joe Shea

Ken responded:


you are wrong on all of this. i did not conflate the two newsletters, AEI, as the link shows, has nothing to do with the others. and aei is a good solid publication that i trust.

more importantly, i would never publish something because you -- or AEI or anyone -- said it. i published the item on jefferson based on reporting and interviews. in fact, the EG section was much longer. it's offensive for you to suggest that i'm simply reporting something because someone else said it.

whether you believe it or not, i never read what you wrote. no disrespect to you, as you apparently do some reporting, but i assiduously avoid all the stuff on erhc on the web because in my view much of it is rumors and garbage by self-interested parties. (the only thing i came across of your was that nugent's lawyer had sent you a letter saying he had no links to geec, which i don't believe for a second is true).

what's really odd about your letter is that you apparently, based on your email, seem to be repudiating your original story. first you tell me that i stole the story from your original report, which i did not do, and then you tell me that my story is wrong.


I had to admit my eror about AEI, yet I still had questions, and responded:

I learned that you were right that AEI is a real publication; there are those two well-known letters I mentioned and this one is not very well-known at all. However, as the portion I published stated, they just expressed an
opinion and there was no foundation for it. You said you had one other source and AEI, which apparently had no source.

I suggested a connection to Jefferson on May 5, based on comments from Bruce Alpert of the Times-Picayune and others. But when I suggested it, I emphasized two or three times that there was no other foundation for my surmise. I doubt that your source had any any other source than that, esecially if it was from the Justice Dept., as they read my site as well (the server info shows that).

I didn't say I was wrong or that you were wrong, if you look carefully; I said neither of us had a foundation for asserting it as fact, as you did in going beyond what AEI said - turning it from "we think" to "they said" - and citing another unnamed source.

I appreciate your candor as to my reporting. The real problem is that you and so many others, among them Chip Cummings, ignore the AG's conclusion that there was no evidence against ERHC and the two governments' formal repudiation of his findings, as well as the huge bribes asserted against Exxon, Chevron, Devon Energy and others - our competitors or former partners - which are the real story.



Ken responded with a well-crafted comment:


sorry, but aei is well know, it's based in paris which may be why you are not as familiar with it, but it is highly regarded and has broken news over there.

aei does have a source or sources, it did not just make the story up.

I wrote in story that there was "strong evidence pointing to a São Tomé connection." and there is. my source may or may not read your stuff, i have no idea, but i am certain his information does not come from whatever you wrote.

i have no idea who cummings is. as to the majors, of course they are not white knights, i have reported numerous times on their unscrupulous ties to africa, including in yesterday's story. but if you think erhc is a bunch of white knights, i think you are sadly mistaken.

as to your reporting, if it was unclear, i am not that familiar with it, know you mostly thru our emails over the years, and can't really say much. but you at least seem to have some interest in looking for information. i was not trying to lump you in with the people who simply throw up garbage as i assume based on our correspondence that you are not one of those people (they send me endless crazy emails, it is pathetic and sad.)


Again, I want to emphasize that evidence that the ERHC search warrant is related to the Jefferson affair is thin; obviously, though, beyond the warrant, there are connections with Phil Nugent and Noreen Wilson that are being pursued by the press, if not the Justice Dept.

Those who read of deletions from the ERHC Energy board should be aware that the moderator, chcr, is Phil Nugent Sr.'s accountant, and according to Doc she is the person who attacked this site with thousands of obscene emails last year, ultimately forcing us to turn off our Comments feature.

Yesterday's dramatic 10 percent drop in share price reflects both the AEI and Ken's articles, I think, and today's rise in price may be temporary. In fact, despite substantial volume, I do see it dropping on my ADVFN screen now. Volume is certainly picking up, but only time will tell the consequences of that.

Currently, at 10:21:35am, Buy volume outpaces Sells by 899,326 to 500,857 with 168,626 unidentified. The current price is $0.426 x $0.43, down $0.015 in the past 20 minutes, and down $0.04 from the $0.47 high earlier today.

Nugent, Wilson, The Kitchen Sink Figure In Jefferson Probe, Silverstein Says

If you read the last post, you will see that former LA Times Washington bureau reporter Ken Silverstein, whose article in the Times put ERHC Energy of the map back in May 2003, picked up on the African Energy Intelligence article and said he thinks the search warrant is linked to Rep. William Jefferson because African Energy said they thought it was linked.

The only reason they think it was linked, I told him in a note tonight, is because ERHC On The Move said we thought they were linked
on May 5.

Yesterday, I'd written, "The article is given away when a personal opinion that ERHC is linked to Jefferson awkwardly peers out of a long, allusion-filled paragraph:

We understand the operation was linked to the FBI investigation into Jefferson.

And today, Ken said:

On May 22, I reported that investigators recently hit ERHC with a search warrant for “documents related to correspondence with foreign governmental officials or entities in São Tomé and Nigeria.” According to my source and to the report in African Energy Intelligence, the warrant is linked at least in part to the Jefferson investigation.

And here is what I said in my May 5 post:

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 Ken's June 7 article from the Harper's Magazine Website blog, in full:

William Jefferson: Tollbooth Operator on the Road to Africa
Posted on Wednesday, June 7, 2006. By Ken Silverstein.

SourcesUpdate: the item we reported yesterday on the home jointly owned by Letitia White, a lobbyist and former staffer to Representative Jerry Lewis, and an owner of defense contractor Trident Systems, has become part of a much larger unfolding story. Check out TPMuckraker [1][2][3], which also reported the story yesterday, and the New York Times, and look in your newspaper tomorrow. A number of reporters will likely be weighing in.

As has been widely noted, Rep. William Jefferson, the Louisiana Democrat who reportedly keeps his cash in the icebox, is under investigation by the FBI for allegedly taking a bribe from the owner of iGate Inc. to arrange deals for the high-tech company in Nigeria and several other African countries. According to court records, the FBI is also looking into “at least seven other schemes in which Jefferson sought things of value in return for his official acts.”

The invaluable African Energy Intelligence, a Paris-based newsletter, reported this week that several of the seven cases “involve oil groups seeking to establish themselves” in Nigeria and other African countries, including Equatorial Guinea, Congo-Brazzaville, and São Tomé. Jefferson frequently met the leaders of all those countries, the newsletter said. I hadn't previously heard anything on a Congo-Brazzaville–Jefferson connection, but I have been told by a source familiar with the investigation that the congressman's links to Equatorial Guinea are under scrutiny. There's strong evidence pointing to a São Tomé connection as well.

With the support of lawmakers like Jefferson, Africa has emerged as a major American oil supplier in the last decade. Jefferson and his staff strongly supported the African Oil Policy Initiative Group (AOPIG), an ad hoc panel of U.S. government and energy industry officials that described African energy as a “vital interest” of the United States. In an article in 2003, Alexander's Gas & Oil wrote that Jefferson was calling for a “full-fledged makeover of the U.S. strategic relationship with Africa” to take advantage of its “petroleum potential.”

In November of 2000, Jefferson led the first-ever Congressional delegation to Equatorial Guinea, taking along representatives from Baton Rouge–based Shaw Global Energy Services and from CMS Energy, which had extensive interests in the country that were later sold to Marathon. When it got involved in Equatorial Guinea in the mid-1990s, CMS allowed a company controlled by the country's president, Teodoro Obiang, to obtain a stake in two joint ventures. Even by the standards of Equatorial Guinea, a textbook kleptocracy, this was a friendship with remarkable benefits. Obiang put no money down for his stake—which was worth about $29 million as of 2004—and received $1 million in dividend payments between 2003 and 2004 alone, according to a Senate investigation.

The government of Equatorial Guinea was so pleased with Jefferson's visit that it presented him with a key to the capital city of Malabo. Jefferson also stopped in São Tomé and Nigeria on the trip; Shaw Global picked up the congressman's travel tab, which came to $6,872. After he returned home, Jefferson began lobbying for the U.S. to reopen its embassy in Equatorial Guinea—it had been closed in the mid-1990s, in part because the government threatened the American ambassador—a step the Bush Administration reauthorized in late 2001.

Another Louisiana firm with ties to Jefferson is Schaffer Global Group. Back in 2002, according to interviews and documents I have received, Schaffer Global was unsuccessfully chasing potential business deals in Equatorial Guinea in conjunction with several other firms, including a lobbying and business-development company called AfricaGlobal that worked for the Obiang regime (and which is now owned by Schaffer). In addition to trying to drum up American investment in Equatorial Guinea, AfricaGlobal also sought to improve ties between Obiang and the United States. At least three people from Schaffer or AfricaGlobal made modest campaign contributions to Jefferson; one of them, Warren Weinstein, served on the AOPIG with Melvin Spence, an aide to the congressman.

Gustavo Envela, an Equatoguinean national who lives in the United States and who briefly served as a consultant to AfricaGlobal, said that Jefferson was a key congressional ally of AfricaGlobal and was enlisted to help in Equatorial Guinea “because of his close relationship” with the Obiang regime. (I'm not suggesting that any of these firms bribed Jefferson, only that the congressman was close to the hideously corrupt government of Equatorial Guinea.)

A second source familiar with Equatorial Guinea told me that when Obiang came to Washington for visits, Jefferson would meet with the dictator at his hotel (which on at least one occasion was the Hay-Adams). This person also said that one of Jefferson's Hill aides was always assigned to accompany government officials from Equatorial Guinea when official delegations were in town.

Jefferson also has interesting ties to São Tomé and to some Americans doing business there, specifically people linked to ERHC. That's the small Texas-based firm that had zero revenue, one full-time employee, and a controversial Nigerian owner (whom I'll discuss below), but which obtained lucrative oil rights in tiny São Tomé. On May 22, I reported that investigators recently hit ERHC with a search warrant for “documents related to correspondence with foreign governmental officials or entities in São Tomé and Nigeria.” According to my source and to the report in African Energy Intelligence, the warrant is linked at least in part to the Jefferson investigation.

Here's what ties Jefferson to people from ERHC and suggests that the warrant slapped on the firm might be part of the Jefferson story:

In February 2004, Jefferson again traveled to Nigeria, São Tomé, Equatorial Guinea, and Cameroon. That trip was paid for by iGate, the firm at the heart of the current investigation, and several other companies, including one that is now called Global Environmental Energy Corp (GEEC). According to records filed with the Louisiana Secretary of State, GEEC's principal office is in the Bahamas; its president is Noreen Wilson, and its registered agent is Phil C. Nugent. The latter is the son of Phil H. Nugent, a Houston-based oil and gas consultant who, when I met him three years ago, was a major shareholder in ERHC and major promoter of the firm. Noreen Wilson is a Beltway lobbyist and ERHC shareholder who helped negotiate the company's deal in São Tomé. (Phil Nugent Sr is also linked to GEEC through Green Energy Management, a firm that partnered with GEEC and of which he was chairman.)

So GEEC, which helped pay for one of Jefferson's trips to Africa (a trip that included a pit stop in São Tomé), has ties to ERHC, the company with the big oil stake in São Tomé. As for ERHC's owner: that would be Emeka Offor, a controversial billionaire with close ties to Nigerian political figures, including vice president Abubakar Atiku. The Nigerian vice president owns a home in Maryland that was searched as part of the Jefferson investigation, and court records show that the congressman is alleged to have planned to bribe him in order to advance iGate's interests in Nigeria. A story published last December by a Nigerian journalist reported that Offor was “being investigated by a branch of the American government,” and suggested it might be tied to money “said to have been paid to some U.S. congressional contacts.” (Offor disputed the claim.)

There is one final iGate connection, which might well be nothing more than a coincidence. Court papers show that Jefferson told a cooperating witness in the probe about a firm called Global Energy & Environmental Services (GEES), which was controlled by his children and run by his son-in-law. The congressman allegedly arranged for GEES to benefit financially from his efforts on behalf of iGate.

Africa's tragedy is that its great resources have been used to enrich a tiny number of colonizers, post-colonial strongmen, and their foreign friends. That may well turn out to be the real story of the Jefferson affair.

In defense of ERHC, I have written the noted journalism blogger, Jim Romenesko, to ask for coverage of this issue:

Jim, you may have been hearing about an investigation of Rep Jefferson that touches on other companies he may have helped, and in particular ERHC Energy. ERHC has been a bad guy in the eyes of the world media for a long time, but I believe it has been a scapegoat to take our eyes off larger crimes involving ExxonMobil, Chevron, Total, Devon Energy and several other larger players in Equatorial Guinea and other parts of West Africa.

The Los Angeles Times ran a brief several years ago about Senate Commerce Committee hearings into the dealings of these and other firms with President Obiang of Equatorial Guinea. The hearings abruptly stopped, probably because Commerce Committeee chairman Sen. Ted Stevens didn't want the probable explorers of ANWAR tainted. Ironically, almost all were either our partners at one time or were our rivals for the same blocks of the Nigeria-Sao Tome and Principe Joint Development Zone, probably the largest and richest new oil field in the world.

It is a large and complex story, but essentially, ExxonMobil in particular and Anadarko Petroleum wanted a block of the Sao Tome-Nigeria Joint Development Zone - Block 4. In adjoing Block 1m Chevron and Exxon have already struck a huge reservoir - at least according to Chip Cummings of the WSJ in early May, who said they discovered a billion barrels and that ERHC had been served with a search warrant because of links to Nigerian and Sao Tome officials "uncovered" by a report funded by George Soros, then a major stockholder in Pioneer, ERHC's partner in Blocks 2 and 3 of the JDZ. Chevron's May 31 press release said they discovered "at least 100 million barrels."

The report sank ERHC's stock, but it bounced right back because insiders knew that the two governments, in a formal statement, discredited it (www.nigeriasaotomejda,com, Feb. 8 press link). Cummings ommitted that fact. Ken Silverstein, the former Washington reporter for the LA Times, wrote a 1,500-word piece on ERHC Energy in late May, 2003 that put the company on the map. Since then, major stories have appeared about in the Houston Chronicle, by David Ivanovich, and by Norval Scott from London in the premium Dow Jones New Service; a book, The Christmas Strike by Joel Rosenberg, and a New Yorker story also focused on the company.

Now Ken is writing a blog for He picked up on the WSJ error (in not reporting the discredited report by Sao Tome's attorney generral) and did a follow-up yesterday linking a search warrant served at the request of the Sao Tome AG to the Jefferson probe. But there is no evidence of that - he is blowing smoke. In fact, I was the source, back on May 5, for an observation that the search warrant served on ERHC and the Jefferson scandal may be linked.

Here is the story: While some very big players tied to specific bribery allegations by the Senate Commerce Committee run free, the media is piling on ERHC Energy, an oil company with three or four employees that is African in origin, a rare thing. We have already been told by the company of all suspect payments it made in 2002, namely, a $100,000 contribution to the Sao Tome campaign of its current president, and payment of a scholarship that was required under a contract ERHC made public in SEC filings even before that, where the benficiary was the son of a prominent oil official in Sao Tome. The AG's report - conducted by R. Dobie Langenkamp, who is a U. of Tulsa Law School prof with very close ties to dozens of Exxon, Anadarko and Chevron officials) concluded that there was no evidence ERHC had bribed anyone, but asked the US to investigate the matter. That gave Greg Pensabene, Anadarko's VP for Government Affairs, who is married to the chief counsel of the Senate Energy Committee, Judy Pensabene, an opportunity to work his magic. And Exxon is not exactly without influence in Washington, either. So, US Marshals served a search warrant on ERHC looking for correspondence with Nigerian and Sao Tomean officials in early May. Nigerian VP Atiku Abubakar, whose home in Potomac, Md., was searched earlier, was cleared of any wrongdoing by the search (Ken refers to him as Abubakar Atiku, the reverse of Atiku's website). We believe ERHC will be cleared, too. But Ken, echoing the CMS group bi-monthly publication African Energy Intelligence, which echoed me, is reporting a link to the Jefferson probe. I blogged about that confluence today: (I pasted in the preceding post)

I hope you will find a way to report on this issue in your column, and if you can't, please feel to pass on this info to anyone you please. Thanks for your time and attention, which I know is hard to come by.


Joe Shea