Small Price Hike Cheers ERHC Investors

For a long time Friday, it looked as though the people who are suppressing ERHC's share price were going to carry the day again, despite positive rumors concerning the imminent signing of the Production Services Contract for Block 1 between ExxonMobil and the Nigeria-Sao Tome Joint Development Authority.

But observers cheered when a 100,000-share block traded, along with several smaller but substantial odd lots, and volume more than doubled over yesterday's anemic effort to just over 1 million shares. At the end of regular trading ERHC was .026 cents better than the open (it moved down 0.001 in a late print). The market cap for the Houston-based, Nigerian owned ERHC was $290 million at the 4pm close.

Much of today's positive move came on the heels of Barry Morgan's upbeat report in UpstreamOnline Thursday night and the arrival of a note from Norval Scott of the Dow Jones News Service on Friday morning indicating the article on ERHC he is writing may - and it's only a small chance - run in the Wall Street Journal when ERHC officials get around to answering his questions.

Many happy campers on the message boards clicked their heels and predicted a share price of $1.35 to $1.50 by the close of business on Jan. 31, the date by which ExxonMobil is supposed to have made known its choices for two 25 percent entitlements in the 5 blocks on offer by the JDA in their oil-rich Joint Development Zone. Some also felt moved to declare that Monday's action will produce large gains.

Cooler heads have been saying, however, that the market has already discounted the impact of the PSC signing, and also that the signing has no discernible impact on the awards expected on Jan. 31. The optimists among them, however, say the market wants to be reassured that oil companies can in fact do business with the Joint Development Authority running the show, which promised transparency and has delivered delay after delay without communicating anything that helped investors understand why.

Some observers attribute the perceived incompetence of the JDA to inexperience, not deliberate obfuscation, but even after taking down the page today for several hours, the site again went up without a clarification of the dates certain.