Friday, August 25, 2006

Drilling Setback: Not Until 2008, Addax Says

The odious Tuneman, a longtime ERHC pumper, tries to disguise bad news as good in a post to I-Hub today celebrating an email response from Addax, our partner in Nigeria-Sao Tome Joint Development Zone blocks 2, 3 and 4.

While the bad news is evident - most investors had hoped for a drill rig to start exploring Block 4 by Fall 2007 or earlier - the good news is that a consortium of drillers that includes Chevron (but not Exxon Mobil, at least by name), Anadarko, Addax and Sinopec are scouring the world for a drillship, and have hired a former drilling coordinator for Chevron, Jeff Schrull, to run their show.

Here is the exchange posted to I-Hub:

Here is my e mail response from my contact at ADDAX in regards to my question:"Could you please advise me if Addax has firmed up any plans or has outlined any schedules for drilling in the Nigerian Sao Tome' Joint Development Zone? Or could you give me an update as to any activities in this area? I was impressed with you company's acquisition of rights in this area ( JDZ) but I have been unable to find any follow up on these activities.:


Thank you for your email and your interest in Addax Petroleum.

In terms of our involvement in the JDZ, Addax Petroleum recently hired a deepwater specialist to head our JDZ exploration group. Jeff Schrull was formerly with Chevron and had, in fact, headed up their involvement in the JDZ. Jeff has subsequently filled out his team and they have been working on an exploration plan for Block 4. In addition, we have taken the lead to coordinate the operators of Blocks 1-4 (including Anadarko, Sinopec, Chevron and ourselves) in order to jointly contract a deepwater rig to drill the first 6 exploration wells (3 of which are on Block 4). As you are probably aware, the market for deepwater rigs is very tight these days - but we would anticipate contracting a rig in the coming months and expect to commence drilling the 6 wells as early as 2008. We will also continue looking for a "rig of opportunity" and are prepared to drill the first well on Block 4 earlier than 2008 should a rig slot become available.

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