Meanwhile, on the OTC BB the share price at 10:30am EST was falling, down two cents at $0.53. The bid was $0.525 as sellers took profits ahead of the expected announcement of bid winners. Volume stood at 1,377,599 shares.
The NAN story singled out ERHC and its partnerships with mid-tier deepwater drillers Pioneer Natural Resources, Devon Energy and Noble Drilling as likely particpants, along with the Oklahoma-based Anadarko, for their deepwater experience.
Offshore experience is a highly sought capability in the second licensing round of the Nigeria-Sao Tome and Principe Joint Development Zone bidding for JDZ Blocks 2, 3, 4 and 5, which are said to hold between six and 12 billion barrels of crude.
Both stories sought to put to rest an African Energy Intelligence report that delays in the awards were occasioned by a dispute between Sao Tome and Nigeria over the preferred method of selecting winners from among the 23 companies making a total of 26 bids for the oil-rich blocks.
Both indicated that ExxonMobil, which had balked at signing the Production Sharing Contract it was scheduled to finalize on Jan. 10, had finally signed the contract. The awards themselves have been delayed from a Dec. 31 deadline announced by Dr. Daukoru at the Nov. 15 opening of the second licensing round.
One of the reports added that Daukoru said XOM was expected to decide this week on which of the blocks it wouuld choose to exercise two 25 percent preferential entitlements in, and that the announcement of the contract signing for Block 1, which it won with ChevronTexaco and Energy Equity Resources of Norway, would come with announcement of Block 2 through 5 awards at "the end of the month."
Meanwhile, the ERHC share price was behaving much as though awards had been announced, zooming 17.02 percent Tuesday on the Over The Counter Bulletin Board (OTC BB) to a recent high of $0.55, and then resuming its climb with a New York opening at $0.58.
The key news from both stories remained that high bidders for the offshore blocks would not be selected on the basis of their offer alone, but in tandem with at least four other criteria, including their ability to execute drilling operations in a relatively short time frame, a capacity promised exclusively by the ERHC-Noble Drilling partnership in Block 4, where Noble has promised to sink three wells within a year if selected.
More than 1 million shares of ERHC had sold above yesterday's close of $0.55 by 10:11am EST this morning, eclipsing even yesterday's blistering pace.
Here is the NAN report:
Daukoru dismisses claims of disagreement in JDZ
The Presidential adviser on petroleum and energy, Dr Edmund Daukoru, has dismissed allegations of disagreement in the Nigeria-Sao Tome Joint Development Zone (JDZ) over award of license.
Rumours doing the rounds has it that disagreement between Nigeria and Sao Tome and Principe and some companies that participated in the last bidding round in the JDZ have stalled the award of license there.
``There cannot be disagreement when a process of dialogue is on-going between the JDA and the oil companies,'' he said in a chat with the News Agency of Nigeria (NAN) today in Abuja.
He said a complex process such as the award of oil license needed a meaningful dialogue between parties.
Daukoru said that four parameters needed to be considered in the operation of an oil concession.
He listed the factors to include signature bonus, local content, technical competence and work programme.
According to him, huge signature bonus alone would not attract award since the value of the blocks may not be captured.
The presidential aide said Exxon-Mobil has already been asked to exercise its 25 per cent pre-emptive rights on any two of the blocks.
``That process is on-going and I am hoping by the end of this week we will be in a position to look at the aggregate scores,'' he said.
He expressed optimism that Exxon-Mobil would respond before the end of this week.
Daukoru said after taking all the four major factors into account final results would be announced any time from now.
NAN recalls that the JDA had in December placed five blocks on offer, for which 26 companies submitted bids.
Few American companies including Anardako, ECl and ERHC, have experience of offshore deep waters having explored hydrocarbon resources in other parts of the world.
ERHC in particular, has entered into partnership with Pioneer Energy, Noble Energy Resources and Devon energy, all reputable upstream development organisations.
There is no "ECI" among the bidders revealed by the Joint Development Authority; there is an ECL. The discrepancy could not immediately be clarified. Exxon Corporation International (ECI) is not believed to be a bidder for the new blocks.
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