Monday, December 31, 2007

The One That Got Away: Don't Let It Be ERHE

It was with great chagrin that I discovered an article on ERHC Energy I missed when it came out in the New York Times this summer. I was en route to my brother's lake house at Lake Oconee, Ga., to celebrate the Fourth of July, and didn't have Internet access at the house.

I was updating the American Reporter newspaper at odd hours of the day from the nearby Ritz-Carlton at Reynolds Plantation and probably not as interested as usual in anything affecting the company. As a result, I missed the most important ERHC story of the year.

I have been involved with the Times for a very long time, as a reader, a sometimes helper (they once gave me a special address to send in my numerous corrections), a rare topic of their coverage, a letter contributor and a committed fan of the high-quality journalism they publish.

But I was as disappointed by their rehash of the supposed facts of ERHC's role in the development of the Joint Development Zone (JDZ) and the Exclusive Economic Zone (EEZ) of the island nation of Sao Tome and Principe, where ERHC Energy holds substantial concencessions to what most believe are vast quantities of oil 10,000 feet or more below the surface of the Gulf of Guinea.

To me, the facts recounted are those that belong to a certain element of the many players in the ERHC story, and specifically, those of the large oil companies that are behind the scenes working assiduously to get the rights ERHC owns away from it.

That is the reason a competing oilman, George Soros of Pioneer Natural Resources - once a partner of ERHC Energy - funded the heavily biased study done by the Senior Lawyer Project for the Sao Tome Atty. General's office. The Times failed to notice that the report has been rejected by the President of Sao Tome and the Nigerian government, even while they try to spare the former from any role in the issue.

It was Sao Tome President Fradique de Menezes, after all, that took the alleged $100,000 campaign contribution from Sir Emeka Offor, ERHC's then-owner and former chairman, in 2001, while the Times portrays him as an embattled hero only seeking rescue from Jeffrey Sachs, the academic numbskull who organized the law-making that will keep any oil revenues out of the hands of the people and give it instead to the government for public works projects urged on them by the big engineering firms around the globe. Rather than let the oil giants pay for those improvements that will principally benefit them - refineries, pipelines, docks, warehousing, new roads, railroads, etc. - Sao Tome's oil revenues will go indirectly to the same people who produce those revenues, the ChevronTexacos, ExxonMobils and Anadarkos of the world. Where they won't go is to desperately poor individuals and families, as Alaskan oil surplus monies do.

His Earth Institute reportedly told small gatherings of Sao Tomeans that the law could be contemplated as a "dam" between them and the money; most Sao Tomean's probably would have preferred a flood of oil cash distributed among the 150,000 residents. much as Alaska sends its residents a $1,000 check from state oil-royalty funds every year. The handful of families that effectively own Sao Tome can be relied upon to see to it that the dammed-up funds - if they ever come - go to social projects organized by them, for them and benefitting them.

The Times no doubt had leaked information from the FBI or Dept. of Justice that led them to believe, in another set of hashed-up facts, that Noreen Wilson, who has not been charged or indicted, tried to bribe Rep. William Jefferson (D-La.) in 2001. It notes that she had parted company with ERHC after an earlier SEC investigation and suggests without evidence that she and a lobbyist approached Jefferson to get his help in sorting out the company's troubles in Sao Tome, where the company's then immediate past president had charged Sao Tomeans with demanding a bribe. To support its contention, it notes that a file marked "Rep. William Jefferson" was on the list of seized items from an April Fools Day search on 2006. but not that they also took every other file in the office.

Again, the key facts that the Times missed:

  • George Soros, owner of 6% of our competitor and former partner, Pioneer Natural Resources, underwrote the investigation of ERHC;
  • The man who conducted the study, a law professor at the University of Tulsa, has very strong ties to other oil industry competitiors;
  • Both the Nigerian and Sao Tomean governments have rejected the findings of the report;
  • There is no evidence Sir Emeka Offor was ever under investigation by the Nigerian government;
  • The Chevron test well, according to the Wall Street Journal, hit a billion barrels of oil; the Times leaves the impression that there are no differences between the Chevron well site and other regions of the Gulf of Guinea Joint Development Zone, while numerous geological studies have shown that the great bulk of the oil is in the formal blocks partly owned by ERHC Energy.

Notwithstanding any oversights, the Times did get one thing right: ERHC Energy has been the big winner, albeit after 10 years of preparation and hard work. The paper notes that our drilling is set to begin this year, and so, I believe, is our final climb to glory.

I am ambarrassed that my favorite newspaper, The New York Times, has done such a one-sided and poor job of reporting on this issue, and have to chalk it up the "herd mentality" sometimes at work in journalism. Someday, our side of the story will be told, but that will be after those who believed in the company and its future have finally vanquished its foes and are rolling in money from stock that is selling this New Year's Eve afternoon for $0.199.

And by the way, Happy New Year, everyone!

Here is the Times article from July 2, 2007:
Photo caption: No Oil Yet, but African Isle Finds Slippery Dealings
Armando Franca/Associated Press
A bicyclist rides near a hotel under construction in São Tomé, which is trying to ensure that its residents benefit from an anticipated oil boom.

Published July 2, 2007
A decade ago, geologists found signs that one of Africa’s least-known countries, the tiny island nation of São Tomé and Principe, might hold a king’s ransom in oil.:

Managing Globalization Blog
A curse more often than a blessing

The first drop of oil has yet to be produced. But these days, little São Tomé may have attracted ample supplies of something else, federal investigators suspect — oil-related corruption.

All of this might not seem unusual in Africa, where oil and corruption often go hand in hand. However, São Tomé, a former Portuguese colony off the coast of Nigeria, was supposed to be different. In recent years, a steady stream of activists like the Columbia University economist Jeffrey D. Sachs have gone there to try to make sure that any energy boom would benefit its 150,000 people, rather than politicians and companies.

“Oil can be a blessing or a bane for a country,” Mr. Sachs said. “The theory was to help São Tomé avoid the resource curse.”

Things, however, have not quite worked out that way.

The recent Justice Department indictment of William J. Jefferson, a Democratic congressman from Louisiana, contends, for example, that he solicited a bribe from a company seeking his help with an oil-related dispute involving São Tomé.

Separately, federal authorities are investigating a small Houston-based company whose only assets are large holdings in São Tomé to determine if it bribed the country’s officials. On another front, a powerful Nigerian businessman who is the chairman of the Houston company, ERHC Energy, is under investigation in his country for possible insider oil dealings.

All those involved — Mr. Jefferson, ERHC, and that company’s chairman, Emeka Offor — deny that they did anything wrong.

Still, the experience of São Tomé, a poor country that supports itself by selling cocoa and commemorative stamps featuring celebrities like Elvis Presley and Brigitte Bardot, shows how just the hint of oil can set off a scramble for riches. Along with Mr. Sachs, those who sought to help included George Soros, the billionaire turned philanthropist, and a high-powered Washington lawyer, Gregory B. Craig, who defended President Bill Clinton during the Monica Lewinsky scandal.

“In West Africa, the scent of oil alone may be enough” to produce corruption, said Joseph C. Bell, another Washington lawyer who has traveled to São Tomé to work on new oil laws.

At the center of the São Tomé story stands ERHC, a tiny company whose ranks have included a collection of characters and politically connected entrepreneurs like Mr. Offor. According to a 2005 report by the attorney general of São Tomé, Mr. Offor is one of the largest donors to Nigeria’s ruling political party and a close ally of Olusegun Obasanjo, who until recently was Nigeria’s president.

São Tomé’s unusual journey through the backwaters of the oil industry traces back to the mid-1990s, when ERHC arrived there. Large underwater oil deposits had been found nearby, off the coast of Nigeria, and ERHC believed that the tiny island might be the next big prize in west Africa.

At that time, the Texas company was owned by some wildcatters and an enterprising Florida businesswoman named Noreen Wilson. Over the years, she has been involved with several penny stock companies including a short-lived enterprise called Pizza Group Inc.

In 1997, Ms. Wilson signed a $5 million contract that gave ERHC, which was then known as the Environmental Remediation Holding Corporation, exploration rights in São Tomé for 25 years. The contract was soon described by some outside experts as extremely lopsided.

Soon afterward, Ms. Wilson resigned from ERHC during an investigation of the company by the Securities and Exchange Commission. But she appeared to retain an interest in the island’s future; in 2001, for instance, she apparently reached out to Mr. Jefferson for help there, his indictment suggests. At that time, São Tomé’s new president was threatening to break a number of oil-related deals, including ERHC’s.

Ms. Wilson, who declined through her lawyer, Joseph A. Artabane, to be interviewed for this article, is not named in that indictment. But the filing describes how two unnamed people, a business executive and a lobbyist, went to see Mr. Jefferson about an oil-related dispute on São Tomé. In return for a promise of help, Mr. Jefferson demanded that a family member receive benefit, a demand that was met, the indictment states.

Mr. Artabane, who said that Ms. Wilson testified before the Jefferson grand jury, declined to confirm that she was the executive involved, but he did not dispute it either. The lobbyist involved was James P. Creaghan, according to his lawyer, E. Barton Conradi, who said his client has cooperated throughout with authorities. Mr. Creaghan worked with Ms. Wilson during that time. (Neither of them has been accused of wrongdoing.)

Meanwhile, wheels were already spinning in São Tomé when activists like Mr. Sachs, the economist, arrived. Their mission: To prevent it from following in footsteps of other African countries where corruption and waste typically follow oil. In Nigeria, the continent’s largest producer, most people live on less than $2 a day while politicians have stolen or squandered billions.

Initially, hopes were high. Soon after his election as president, Fradique de Menezes, a cocoa plantation owner, vowed that his country would be different. And he turned for help to outsiders like Mr. Craig, the Washington lawyer who represented President Clinton during his impeachment trial.

But Mr. Craig, like others who followed him, found himself facing some powerful adversaries: Nigeria and Mr. Offor. In 2001, Nigeria had jumped in the picture when it signed an agreement with São Tomé to share oil revenues from waters between the two nations. Mr. Offor, the ally of Nigeria’s president, bought ERHC, which was then near bankruptcy, just a few days before that agreement was signed.

Mr. Craig said that while he successfully renegotiated contracts with other oil companies in São Tomé, Mr. Offor would not budge. “The metaphor of David versus Goliath doesn’t quite capture the relation between São Tomé and Nigeria,” he said. “It’s more like an ant.”

In time, ERHC did agree to some changes in its contract, but the company retained extremely favorable terms, including the right to choose among the best oil blocks without paying the type of special one-time fee that governments typically demanded.

Mr. de Menezes continued to seek assistance; in 2003, for instance, he reached out to Mr. Sachs.

“He called and said, ‘Look we’ve found some oil and the sharks are swimming around us now, and I’d like some help to manage this properly,’ ” Mr. Sachs recalled in a recent interview.

As part of that effort, a Columbia University team and others helped draft a new oil law that contained safeguards to make sure São Tomé spent its oil-related revenue properly. The team then traveled around the country, holding meetings on cocoa plantations and in churches, where they explained to residents how the new statute would protect their interests.

“Imagine what would happen if there was a big flood that hit us,” stated a cartoon-like booklet that they handed out to residents. “The oil law creates a dam.”

By late 2005, however, a report by the attorney general of São Tomé delivered a dose of reality. Among other things, it found that some companies that won blocs in the zone controlled jointly by São Tomé and its neighbor were headed by Nigerian businessmen with political ties but no oil experience.

The bidding process “was subject to serious procedural deficiencies and political manipulation,” the report concluded. In addition, the report found some large multinational oil companies were so suspicious of ERHC that they decided not to bid and added that ERHC “may have made improper payments to government officials.”

ERHC has disputed those findings and said in a statement that it received its rights legitimately and that it has also made numerous concessions to São Tomé.

“We care about perceptions of ERHC Energy and we have been working to fully understand any concerns expressed about our activities,” the company said.

The attorney general’s report may have precipitated last summer’s raid on ERHC’s Houston offices by the F.B.I. Among other things, F.B.I. agents took a file marked “William Jefferson,” a reference to the Louisiana congressman, a publicly filed subpoena shows.

Dan Keeney, a spokesman for ERHC, said that the company was not aware of “any facts to suggest that the U.S. government investigation of ERHC is in any way related to the ongoing investigation of Congressman Jefferson.”

Whatever the case, ERHC has emerged thus far as the biggest winner in São Tomé. Over the last year, it has sold off various rights to its holdings in São Tomé, making tens of millions of dollars in the process.

As for the reform effort by Mr. de Menezes, the country’s president, he has been far less publicly vocal over the last year, outside consultants said. Mr. de Menezes, who met on several occasions with Mr. Jefferson, did not respond to repeated requests to be interviewed for this article.

Despite earlier predictions of vast oil finds, it is unclear whether waters off São Tomé will ever produce oil in commercial quantities. Last year, Chevron drilled the first exploration well there but failed to find much oil and, for the moment, has no immediate plans to drill again. ERHC said that it and a partner planned to drill next year.

The new oil and anticorruption statutes drafted by consultants like Mr. Bell, the Washington lawyer, have become law. But with all the obscurity and intrigue that has now descended onto São Tomé, he, like others, question if it will make any difference.

“The game is not lost yet,” Mr. Bell said. “But it is a very uphill game.”

On the contrary: Mr. Bell lost the game long ago, and from here, it should only be downhill for his input.

Wednesday, December 26, 2007

Volume Tops 2 Million Today, But Gains Are Modest

The volume of trade in ERHC Energy shares jumped by more than 1.7 million on the day after Christmas over the 600K daily average to 2.3 million shares today, but the price remained near-static in a range of $0.195 - $0.21 and closed at $0.205, unchanged from the day before.

Much of the selling was driven by tax-loss considerations, but some opined on investor boards that market makers were stocking up on low-priced shares. One investor admitted he sold 200,000 shares to take advantage of tax-loss provisions.

Many investors, however, are feeling more strongly the likelihood of impending indictments. It is both refreshing and interesting that they are not selling off in anticipation of an indictment, and that may be because of the dynamic we mentioned in our last post. Once the burden of the indictment is known, the price will have been almost fully discounted except for the day it comes down, if ever.

Here is a slicwe of the heaviest trading:

Rec. Time Action Price Volume
2:52:02 PM Ask 0.205 5000
2:51:58 PM Trade 0.2 103000
2:51:48 PM Trade 0.2 50000
2:51:42 PM Trade 0.2 50000
2:51:38 PM Trade 0.2 50000
2:51:36 PM Ask 0.201 5000
2:51:06 PM Bid 0.2 5000
2:50:58 PM Trade 0.205 37000
2:50:50 PM Trade 0.209 40000
2:50:44 PM Trade 0.21 100000
2:50:42 PM Trade 0.209 120000
2:50:38 PM Trade 0.205 20000
2:50:32 PM Trade 0.205 50000
2:50:30 PM Ask 0.206 5000
2:50:22 PM Trade 0.205 50000
2:50:16 PM Trade 0.205 50000
2:50:02 PM Trade 0.205 20000
2:49:56 PM Trade 0.205 20000
2:49:00 PM Trade 0.209 25000

New Earnings Report Highlights January Conference Call, $34.7 Million In Assets

Just 15 minutes from the close on Dec. 14, ERHC issued a 4th-quarter earnings report that shows plenty of cash - some $34.7 million in assets altogether
- on the balance sheet and a sharply reduced cost of operations, while stirring expectations of drilling news with the announcement of a conference call on Jan. 15.

The call will be archived and available for replay at site provided in the press release below.

For our money, this is an exciting but precarious time to be heavily invested in ERHC, yet I am holding a 75,000-share stake that I would like to have increased in recent days as the share price fell briefly below $0.195. Those are the levels I originally purchased the stock at back in May 2003, and probably represent its absolute bottom before any discount for indictment news.

In my estimate, an indictment - regardless of the charges preferred - will drive the price within the same day of trading to about $0.115 or $0.12 cents. I would urge investors to buy all they can at those levels, because I believe it will rise to close to the previous day's close by the end of the following day. So if it ends at $0.20 the day before the indictment comes, it would end at about $0.12 - $0.14 on the day of the indictment, and at between $0.18 and $0.20 the market day following the indictment.

There is rarely a chance to make as much as 50 percent on your money in one or two days, but this possibility now beckons as the day draws closer for a Justice Dept,. decision (and for the Grand Jury's decision, of course, which tends to reflect only the input of the prosecutors).

But an indictment is not the end of the world, or the end of the line, for ERHC. I think this company's management has actually be through worse things in recent years.

What investors with a brain on their shoulders may well say to themselves is that despite the charges, the future is now mappable. The company will either plead guilty to the charges and then probably pay a fine, or it will plead not guilty and go through a trial. That trial, under most circumstances, would take place after - get that, after - drilling starts in the Gulf of Guineau. Either the company will be acquitted on the charges, in which case we'll see our dollar bill and then some almost instantly, or it will be found guilty, and that would occasion a sharp drop - depending on what we expect the consequences to be - and a fairly robust immediate recovery, depending on the drilling prospects already identified.

What do I think? I think these charges and the DOJ prosecutors' indictment are now politically driven by the power of Big Oil, who so desperately want to be the sole owners of the vast oil deposits in the Joint Development Zone.

You may have noted that no grand jury indictments are awaiting ChevronTexaco, ExxonMobil, Anadarko and others who have been identified by the U.S. Senate Commerce Committee (chaired by the crooked, angry and indictment-prone GOP Sen. Ted Stevens of oil-rich Alaska) as bribing other African governments - so this is clearly selective enforcement against what is perceived to be the weakest of possible victims.

However, the recent 5th Circuit ruling on one of the rare FCPA cases held that a defendant must have been aware that his transfer of money was illegal, and there would be immense difficulty demonstrating that in the case of a Nigerian millionaire whose government's culture of corruption may have well left him clueless that a personal political donation to a propsective Sao Tome presidential candidate in a 1991 election violated foreign corporate bribery laws in the United States, and that particular element is necessary for conviction.

To date, however, no one had made a fortune by underestimating former ERHC chairman and still-controlling stockholder Emeka Offor; he will not walk awat from this fight, either, and I strongly believe he will win it.

But apart from any indictments that may happen, the likelihood of our striking some big oil ourselves in 2008 is very high. That will be the key and decisive factor with respect to share price this year, so all of those who have loaded up in recent months are very likely going to be some very happy campers come Christmas next year or sooner (and remember, I'm an OU almnus and a big Sooner fan). There should be a slow but steady build up of shasre price from the current $0.205 (Dec. 26 close) to the day the drilling begins. It will be chaotic and wonderful.

Now, here is the Dec. 14 release:

ERHC Energy Inc. Reports Fourth Quarter and Year End 2007 Financial Results
HOUSTON, December 14, 2007 – ERHC Energy Inc. (OTCBB: ERHE), an independent oil and gas company with assets in the Gulf of Guinea, today announced its results for the fourth quarter and fiscal year ended September 30, 2007.

As of September 30, 2007, ERHC reported cash assets totaling $34.7 million.

During the three months ended September 30, 2007, ERHC had a net loss of $683,037, compared to a net loss of $1,039,670 for the three months ended September 30, 2006. General and administrative expenses during the fourth quarter totaled $1,377,372, a reduction of 12 percent compared to the same period a year earlier.

For the fiscal year ended September 30, 2007, ERHC had a net loss of $1,756,904, compared to a net income of $23,171,536 for fiscal 2006. The decrease in net income was due primarily to the one-time a $30.1 million net gain from sale of participating interests in Blocks 2, 3 and 4 of the Joint Development Zone (JDZ). For the year, general and administrative expenses fell below $5 million. The decrease of 17 percent was a result of strict cost controls implemented by Company leadership.

“ERHC Energy has strengthened its fundamentals, with improved operational efficiencies, solid finances and continued strong relationships with strategic allies Addax Petroleum and Sinopec,” said Nicolae Luca, acting chief executive officer. “With exploratory drilling possible in JDZ Blocks 2 and 4 within the next calendar year, we expect to begin realizing the benefits of our strategy for orderly growth.”

ERHC Energy holds exploration rights in six JDZ blocks. Additionally, subject to certain restrictions, ERHC holds the right to receive up to two blocks of ERHC’s choice in Sao Tome’s Exclusive Economic Zone (EEZ) and holds the option to acquire up to 15 percent paid working interest in up to two additional blocks of ERHC’s choice in the EEZ.

ERHC will hold a conference call to update the investment community on company operations and discuss its 2007 financial results on Tuesday, January 15, 2008, at 9:00 a.m. Eastern Time (8:00 a.m. Central Time). To participate on the conference call, please dial 866-697-7870 (domestic) or 706-902-1710 (international) five to ten minutes before the call begins and reference the pass code 26560348. A simultaneous live Webcast will be available over the Internet and will be accessible by going to the following link:

A replay of the call will be available from Tuesday, January 15, 2008 at 10:00 a.m. Eastern Time through January 22, 2008 by dialing 866-697-7870 (domestic) or 706-902-1710 (international) and providing the following replay code 26560348. In addition, the Webcast will be available for replay until February 28, 2008 by going to

5427 14th St. West, Bradenton, FL 34207

Happy Holidays from IHOP!

Manatee Co.'s Only 24-Hr.

Monday, December 03, 2007

Hints Of Drilling Delay Sink ERHE 10 Percent

Hints iof a drilling delay in today's letter from ERHC Energy acting CEO Nicolae Luca sunk the share price of ERHC from $0.225 to $0.205, or almost 10 percent this morning, but investors apparently ignored the good news that Addax is seeking to "accelerate" its drilling program on the blocks it jointly operates with ERHC by getting an additional rig to the Aban Abraham, which has already been contracted for the last quarter of 2008.

Of course, the even better news is that with two ships under contract, while our "carry" charges will be higher, we will also know more quickly what we can expect in oil from our Blocks 2, 3 and 4. The answer should be twice as soon in coming.

Here is the note. We suggest the anxious minds who sold stock this morning may have been misled by their own fears.

From the desk of Acting Chief Executive Officer Nicolae Luca.

To ERHC Shareholders:

I am pleased once again to provide an update on the recent progress of ERHC Energy Inc.

We are pleased to report that progress continues toward eventual exploration in several Joint Development Zone Blocks in which ERHC has a stake. The latest word from Addax Petroleum, our consortium partner in JDZ Blocks 2, 3 and 4, is that they are actively seeking a drilling rig of opportunity to accelerate their deepwater drilling program. This is in addition to the Aban Abraham drilling rig, which has already been contracted.

Addax has announced intentions to start exploration drilling on its deepwater license areas as soon as possible in 2008, but it is important to keep in mind that contingencies could always arise that delay the start of drilling. We fully support Addax’s efforts to avert delay, or at least mitigate its impact, by working to secure a drilling rig of opportunity.

Work continues to pinpoint where and how to drill in each of the JDZ Blocks to achieve the greatest likelihood of success. ERHC Vice President Technical, Jim Ledbetter has led our efforts in this regard and reports that, along with our consortium partners, Addax and Sinopec, we are in the midst of highly advanced and technical work. As a Company with interests in several blocks in the JDZ, we are helping to share knowledge among the operators of all the Blocks to minimize mistakes and maximize success. Throughout the process, keeping an open mind and looking for creative solutions is essential. The consortium has brought a collaborative mindset to their meetings.

We can also report progress toward resolving the difference of opinion regarding the recovered nine percent share of JDZ Block 4. You may remember that ERHC took action to recover it from another company that had failed to meet certain obligations. Our consortium partner, Addax Petroleum (Nigeria Offshore 2) Limited, claims entitlement under the existing agreements to 7.2 percent out of the recently recovered nine percent, leaving 1.8 percent remaining with ERHC. If finalized, this would increase ERHC’s share of JDZ Block 4 from 17.7 percent to 19.5 percent. ERHC and Addax are amicably exchanging statements in arbitration, to resolve whether or not additional consideration is due to ERHC from Addax for the 7.2 percent claimed by Addax under the terms of the existing agreements. The parties are also exploring mediation as an alternative to seeing arbitration to conclusion.

As many of you are aware, the Company’s annual report for the fiscal year ending September 30th is scheduled to be issued in December. It has been the focus of a great deal of attention during the past several weeks and we look forward to sharing the annual report with you. ERHC will hold a conference call to update the investment community on company operations and discuss its 2007 financial results on Tuesday, January 15, 2008, at 9:00 a.m. Eastern Time (8:00 a.m. Central Time). To participate on the conference call, please dial 866-697-7870 (domestic) or 706-902-1710 (international) five to ten minutes before the call begins and reference the pass code 26560348.

ERHC is moving forward with plans to hold its next annual shareholders’ meeting on Tuesday, April 22, 2008. As announced earlier, it will be held in Houston. Shareholders of record as of March 14, 2008 will be eligible to receive notice of and vote at the meeting.

Meanwhile, we are also continuing to assess the feasibility of various acquisition prospects in North America and other regions. Several interesting possibilities have come to our attention. We must add however that at this stage, no guarantees can be given that any specific prospects can be brought to fruition. We look forward to sharing additional information with shareholders as our acquisition strategy develops. Our efforts to raise awareness about our ongoing operations and the progress being made toward eventual drilling in the JDZ will continue to accelerate in the months to come. We will be exhibiting at the Nigeria Oil & Gas 2008 conference, which runs from February 18-21, 2008. The conference is expected to attract more than 4,000 participants, including more than 600 senior delegates.

ERHC Energy remains focused on building positive momentum and values your ongoing trust and support. The management and board look forward to getting together with you in due course at the shareholders meeting.


Nicolae Luca

Acting Chief Executive Officer