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.
Acting Chief Executive Officer