Thursday, October 14, 2010

ERHC Energy Gets 6-Month Extension on Block 2 Development

ERHC Energy has announced that it's gotten a 6-month extension on its efforts to develop the as-yet unproducing Block 2 offshore Nigeria concession in the Gulf of Guinea's Nigeria and Sao Tome Joint Development Zone, a stock tip letter has reported.

Here's the report:

ERHC reports extension of Exploration Phase I in JDZ Block 2
EBR Staff Writer
Published 14 October 2010

ERHC Energy, a US based oil and gas firm, said that the Joint Development Authority (JDA) has approved a six-month extension of Exploration Phase I in Joint Development Zone (JDZ) Block 2.

The extension will enable the operator of the block, Sinopec, to complete all studies needed for further exploration.

Last month, ERHC supported Sinopec, ERHC's technical partner, in applying to enter into Exploration Phase II pending the completion of the studies.

Instead, agreement was reached with the JDA to further extend Exploration Phase I to enable completion of the studies before commencement of Phase II.

A similar decision to extend Exploration Phase I in JDZ Blocks 3 and 4 was reported in September.

ERHC has 22% interest of JDZ Block 2, 10% interest of JDZ Block 3 and 19.5% interest of JDZ Block 4.

It's hard to say whether another 6 months will make a difference in Block 2, which at one time was highly prospective and sought after by ExxonMobil, Chevron and other suitors of the JDZ joint ministerial council that made the block awards.

The positive element of this news if that ERHC brings the resources of Sinopec to the table in this effort. If the oil is there, as believed, Sinopec has the resources to find it. Let's hope, for investors' sake, that they do!

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