The Semi-Submersible Solution

Not long ago, we got a note and several phone calls from a reader who warned us that ERHC Energy and its partners would be unable to drill in the Gulf of Guinea due to the global shortage of drilling rigs. The solution, he told me with passionate conviction, lies in semi-submersible rigs.

Now, with the storms that have trampled Louisiana and Texas having also done historic damage to Gulf of Mexico rigs, I'm a lot more interested.

I haven't heard from the reader in a while (and I'd like to again), but another friend this morning suggested I check out Compass Energy, a Singapore-based firm. Reading Oil & Gas journal this evening, guess what I came across?

Compass Energy buys production semi
By OGJ editors

HOUSTON, Sept. 21 -- Compass Energy Group, an offshore engineering firm based in Singapore, purchased on speculation the semisubmersible production unit Petrobras XXIV to use for fast-track field development and offshore accommodation projects.

The 88-m long production unit was renamed the Molly Brown and is due to arrive in Singapore in mid-November. It was built as a drilling rig by Marathon Le Tourneau in Brownsville, Tex., and named Penrod 72.

In 1987, Placid Oil Co. converted it for use in Green Canyon Block 29 as the Gulf of Mexico's first floating production facility, moored in more than 500 m of water.

The Molly Brown has heated process facilities for up to 60,000 b/d, a gas export system, total power output of 8,000 kw, and accommodation for 94, upgradeable to 200. It does not require any major changes to the hull structure or the marine systems to continue serving as a floating production unit.

There's an old saying: "When there's a will, there's a way." With oil at the incredible prioce of $65 a barrel, let's hope someone in the ERHC/Noble/Pioneer axis has a very strong will.

Anadarko, which won a smaller portion of Block 4, also is going the semi-submersible route, it announced:

Anadarko Announces Rig Plan to Deliver on Deepwater Strategy


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HOUSTON--(BUSINESS WIRE)--Sept. 26, 2005--Anadarko Petroleum Corporation (NYSE:APC) today announced a plan to secure the necessary drilling rigs to execute its deepwater strategy over the next six years.

"A review of our worldwide deepwater drilling inventory along with the tightening deepwater rig market led us to lock in the equipment and services we need to execute upon our strategy," said James T. Hackett, President and CEO. "Nearly two-thirds of the rig time will be to delineate and develop discoveries and the remainder will be for high potential exploration."

As part of the plan, Anadarko with two other producers signed a four-year rig-share agreement under which ENSCO International Incorporated (NYSE:ESV) will build a new semi-submersible drilling rig with a target delivery date of mid-2008. Anadarko committed to 50 percent of the rig time at a cost of almost $200 million over the contract term.

Anadarko executed a three-year drilling contract with Dolphin Drilling Ltd. to secure the Belford Dolphin drillship at a cost of $459 million. It is anticipated the vessel will be released to Anadarko beginning in mid-2007.

In addition, multi-year contracts worth approximately $1.19 billion are being finalized to extend the company's existing contracts and secure incremental rigs. Anadarko currently has two deepwater rigs under contract.

Anadarko's current deepwater Gulf of Mexico development projects include the K2, K2 North and Genghis Khan fields in the Green Canyon area and seven natural gas fields in the Eastern Gulf. Anadarko also has working interests in several non-operated exploration wells currently in progress, including the announced Knotty Head commercial discovery, which will need delineation and development. The company has identified multiple additional prospects throughout the deepwater Gulf and has prospects offshore West Africa, Georgia and Gabon. The company's expanded rig position could provide leverage into additional opportunities if further tightening of the deepwater rig market materializes.

"Our rig-contracting efforts offer compelling economics and facilitate our deepwater drilling strategy. In addition to addressing the cost side of the equation, we will protect our returns by hedging volumes in a manner to cover potential downside rig rates," added Hackett. "While we believe the dynamics of the deepwater rig market over the next six years will be very different than past cycles, we think it prudent to manage potential rig rate risk like we manage other risks -- by controlling the downside and executing upon our operational strategy."

LUSA Article Spooks Traders

An article in Portuguese from the Lusa news agency of Portugal says this morning that the attorney general of Sao Tome and Principe will lead an investigation into allegations of corruption associated with the award of Blocks 2 through 6 in the Nigeria-Sao Toime and Principe Joint Development Zone last May.

The tiny nation-state's government is largely controlled by former communists and major oil companies like ExxonMobil and Chevron, both of which face indictments in corruption charges stemming from their activities in Equatorial Guinea.

The news, as read in a poorly-translated machine version of the story, helped to drive down the price of ERHC Energy (OTC BB symbol: ERHE), the tiny Houston-based, Nigerian-controlled firm that was the biggest winner in the May 31 awards.

At 1pm, in slow trading, ERHE was off a cent at $0.39. Generally, that price has been an attractive buy-point for accumulators awaiting the completion of PSCs and Joint Operating Agreements, along with the payment of signature bonuses, between now and the end of the year, and the start of drilling in oil-rich waters of the Gulf of Guinea in the first quarter of 2006.

AM Selloff Starts The Week, But Strong Buying Follows

A burst of modest selling opened the week this morning, with ERHC Energy (OTC BB symbol: ERHE) losing one one-thousandth of a cent on Sell volume of 92,124 shares in the first half hour. There were no purchases at all, but 15,000 shares were unidentified.

There appeared to be no particular reason for the selloff. It seemed likely an investor was liquidating a small position.

The selloff amounted to 19 separate trades ranging from a few hundred shares to 14,000 in size. Most were in the 2,000 to 5,000-share range.

The late buying on Friday included some 300,000 shares purchased over the space of half an hour, with one Buy of 100,000 shares and three of 50,000 shares in that time.

It appeared that buyer was giving back some of the shares this morning, and the selling seemed to come to a halt after the 92,124 shares moved.

The oddity remains, however, that there was not a single recorded Buy this morning before or after the last 10.02 trade.

Update: By the end of the day, the trend had dramatically reversed. Substantial buys, including several of 50,000 or more and one of $100,000, saw the day end with a 2:1 edge of Buys over Sells. More than 1.2 million shares traded, with 853,898 Buys and 433,524 Sells recorded by the ADVFN service at end of day.
Only 16,000 were unidentified.

The initial selling spree ended abruptly at 10:29am with the price dropping just one-tenth of a cent, and the buying then began immediately with 162,000 shares snapped up in consecutive Buys over the following 20 minutes. It seems clear the modest selling was only intended to push the price down for the same person to re-enter and purchase the same shares at a slightly better price.

Security Issues Present Grave Challenges To West Africa Explorers

The entire coastal region of West Arica, and many of the national and state governments there, pose substantial risks - both potential and ongoing - to the motley crew of majors, mid-tiers and minnows who want to exploit some 30 billion barrels of undiscovered oil believed the b there, an UpstreamOnline report by Barry Morgan suggests.

ERHC is prominently mentioned in the piece via its partnerships with Noble Energy and Pioneer Natural Resources, and singled out for its "strong tie" to President Olusegun Obasanjo's Nigerian presidency.

But the overall thurst of the piece is to suggest that U.S. security efforts in the West African Gulf of Guineau and political efforts onshore need to be ramped up to meet security challenges including a vow by terrorist leader Osama bin Laden to make Nigeria the nexus of his efforts in Africa.

Morgan repeats the comments of a NATO General concerning the fragility of the Nigerian federation, and that comment was one citing a statement to Congress from the director of the CIA warning that Nigeria may cease to exist as a federal state by 2010 (see ERHC On The Move archives for more).

If this is a time to stress security concerns - and it undoubtedly is, as U.S. drilling efforts have not yet begun in earnest in the Guil of Guinea's oil-rich Nigeria-Sao Tome and Principe Joint Development Zone, and good planning can support them admirably - it is also shaded somewhat by a pessimism about the value of investments in the region.

One could almost read it as a transparent effort to reduce the growing interest in ERHC Energy that has come to the fore in recent weeks with an article in the Penny Oil Speculator and a redesigned ERHC Website. There have been determined efforts on the part of unknown forces to keep the company's share price in the $0.40 range, while it becomes more apparent every day that the company is worth far more to a p[ospective buyer.

It was Morgan, too, who revealed that a mid-tier player had offered $2 a share for the company and that the offer was considered when its board met in August. On feels he played a tune for the other side, hoping small investors will dance away from the stock in anticipation of problems even as the big sharks circle to snatch it up on the cheap.

The piece is also an effective advertisement for a private supplier of mercenary armies and a private enterprises-wide telecom solution that are or want to be, respectively, deployed in the region. Both are U.S.-based and enjoy growing influence.

Military Professional Resources (MPRI), headed by former U.S. Army chief of staff Gen. Carl E. Vuono, has 150 "projects" around the globe and is headquartered in Virginia. MPRI is a division L-3 Communications' Government Services Group, also headed by Vuono, which books more than $1 billion a year in revenues.

MPRI came under scrutiny by Z Magazine in 1998 for its role in Africa during the Clinton administration:

Another insidious element of the Clinton agenda for Africa is the African Crisis Response Initiative (ACRI). Despite a sordid history of assassination, terrorism, and destabilization, the Pentagon is now eager to remilitarize the continent, this time for the sake of corporate profitability. Many U.S. companies (and even some U.S. embassies) must now rely on private mercenary outfits, such as Defense Systems Ltd. (DSL), Military Professional Services Inc. (MPRI), and Executive Outcomes to protect themselves in “unstable” Africa. For instance, Chevron has subcontracted Air Scan based in Titusville, FL (managed by retired Brigadier General Joe Stringham who used to run U.S. clandestine operations in El Salvador) to protect its offshore oil concessions in Angola’s volatile Cabinda province. Of course, it would be much “cheaper” for private investors to have public taxpayers kick in their “fair share” — say $15 to 20 million per year — and basically hire the Pentagon to coordinate African security instead. Under Clinton, the U.S. had already invested $175 million between 1991 and 1995 for training 3,400 African military officers — mostly from dictatorships.

The New York Times also took note of the company in a 2001 article by Michael Gordon:

Macedonian officers are also preoccupied by the war. An American- financed consulting business, Military Professional Services Inc., made up of retired American officers, quietly suspended its program here because of the paucity of training and because the Macedonians had spread rumors that the consultants were somehow linked to the Albanian rebels.

Infinity Global Telecom (misidentified as Infinity Wiorld Telecom in the article) is based in Mountain View, Calif. and the African island of Mauritius, and has telecommunication interests around the globe.

Here is Morgan's Sept. 15 article from UpstreamOnline:

Nigeria looks to secure its future as major supplier to US

THE US may plan to take more than 25% of its hydrocarbon needs from western and central Africa by 2015, practically doubling present imports from the region, but Washington will not be alone in seeking to unlock the area's untapped riches. Players from the east are already competing for proven assets and prospective acreage.

Nigeria too is playing its own game. Strict local content rules applied to the latest licensing round coupled with preferential treatment for companies willing to invest downstream in return for prized deep-water plots left the majors deeply miffed and they stayed away in droves.

Korean National Oil Company and Taiwan's Chinese Petroleum Corporation swept into prime position, roundly outbidding medium-sized US rivals such as Devon Energy. India's ONGC-Videsh won junior equity but Beijing's three oil giants did not even get a look-in.

Clearly there will be considerable pressure brought to bear on Abuja to relax its regime ahead of the next round, planned before 2007. There are also technical questions to answer recent probes in the western Niger Delta deep disappointed the pundits, prompting established players to show caution in committing dollars to unproven plays.

Nonetheless, old Africa hands along with relative newcomers to the Gulf of Guinea such as Noble Energy and Pioneer Natural Resources will be jockeying for position in the Joint Development Zone, reputed to contain upwards of 10 billion barrels, managed by Nigeria and Sao Tome under a bilateral protocol.

Both entered the fray in partnership with ERHC Energy, the US minnow with strong links to Abuja's power-brokers.

Success with Chevron's upcoming wildcat in the JDZ Block-1 will boost confidence in the zone and focus Washington's hawks on how to shore up its interests in the area.

The US is already backing construction of a deep-water port at Neves on Sao Tome and negotiating a military support facility on the archipelago.

With substantial upstream investment onshore Nigeria by Chevron, ExxonMobil and Shell, Abuja aims to raise oil output from 2.5 million barrels per day to 4 million bpd by 2010, with liquefied natural gas exports earning more than crude by 2012.

Nigeria is already the fifth biggest crude supplier to the US, yet offers poor security.

An upsurge in piracy in south-eastern Nigeria coupled with mounting ethnic unrest has led one US Nato general to warn the federation may fall apart under the strain.

Incensed by Abuja's refusal to allocate lucrative oil licences to southern indigenes, ethnic Ijaw leaders this month promised to sabotage exploration and production efforts by the Koreans and Taiwanese, especially plans to lay gas pipelines to the northern states.

There are fears the country could implode, bringing down the entire sub-region. “It's a 3,000-mile (4,800-kilometre) coastline with no security,” agrees Lieutenant Commander Daniel Trott of US Naval Forces Europe.

More to the point, Osama bin Laden has officially marked the country down for “liberation” effectively declaring the African interior a war zone.

Already, US forces are stretched throughout the Sahel from Nouakchott to Ndjamena, mopping up terror cells and training partner-states to do the same. Fed by Algerian intelligence, US policymakers fear Mauritania's Salafist-style terror cells may spread to the oil patch.

Nigerian President Olusegun Obasanjo this month approved an anti-terror Bill covering everything from kidnapping to the destruction of infrastructure, even specifying fixed platforms on the continental shelf.

At the same time, Defence Chief of Staff General Alex Ogomudia announced a combined police-military operation to step up protection of oil installations in the delta.

In a parallel pitch, Nigerian oil moguls will this month hear overtures from New York-based Infinity World Telecom to support a $500 million scheme to link all offshore fields to the global telecom system.

Direct links to onshore facilities are also mooted, bypassing reliance on the national utility and underscoring Abuja's concern to keep oil flowing at all costs.

It is a preventive strategy to keep terror off the seas by developing partnerships and capacities, says Trott. To this end, the US is convening a second gathering of regional naval chiefs in Ghana this December.

While making headway in Sao Tome through US corporate ambition in the JDZ, US military and officials have encountered resistance in Equatorial Guinea, where Beijing's influence is rising.

Both states are coup-prone with Malabo unable to provide effective security for offshore installations, leaving companies to deploy private guards.

US company Military Professional Resources has been contracted to train local forces to plug the gap, but ostensibly without any quid pro quo on Malabo's deteriorating human rights front.

Of all the potential hotspots, post-war Angola has pleasantly surprised pessimists. Yet issues of financial probity persist, both in Luanda where output growth has been slower, and also in Malabo where oil revenue boosted Equatoral Guinea's GDP by 60% in the past two years.

The US Securities & Exchange Commission has dragged ExxonMobil, Marathon, Amerada Hess and Devon Energy into protracted enquiries to determine a breach of the Foreign Corrupt Practices Act.

Only Nigeria looks set to implement the UK-inspired Extractive Industries Transparency Initiative, but progress is slow and the region will likely continue to be source of embarrassment for western E&P operators.

Recoverable offshore reserves across the West African arc from Ivory Coast to southern Africa are estimated to be in the region of 30 billion barrels and the influential Washington and Jerusalem-based Institute for Advanced Strategic and Political Studies believes this prospectivity must drive US foreign policy.

15 September 2005 23:02 GMT | last updated: 15 September 2005 23:02 GMT

ERHE Partner Pioneer Seeks Negiotiator For "Billions Of Dollars" In Profits

In a signal to investors about what really lies beneath the waters of the Gulf of Guinea blocks where it is partnered with ERHC Energy (OTCBB symbol: ERHE), Pioneer Natural Resources is seeking an International Negotiator who can help it haggle over contracts it says are in the hundreds of millions of dollars for deals that are worth "billions" in profits.

Here is the ad, from Pioneer's Website:

Director of International Negotiations
LCO - TX

Available Positions - Multiple

The Director of International Negotiations in responsible for organizing and coordinating the business environment assessment process and the negotiations process for acquisition/disposition of property concerning New Business Development Exploration and Producing Ventures internationally. Incumbent’s responsibilities would involve negotiating contracts valued at hundreds of millions in investment exposure, with earnings potential in the billions of dollars. Acts in the capacity of Expert Advisor in all negotiating matters on specific projects. Direct and participate in establishing the contractual requirements, strategies and plans that will lead to a long-term profitable, stable and predictable contract taking into account Pioneer partners, and the host country’s positions and priorities. Develop and prepare the negotiations plan. Coordinate negotiations with third-parties regarding assigned projects for all contractual arrangements.

College degree – 4 year international business or equivalent is preferred. Technical or advance degree(s) or law degree beneficial. Minimum 10-15 years experience in contract negotiations and/or equal time experience in the oil and gas industry, or equivalent is essential. Person demonstrating a blend of commercial and management skills with broad competencies in technical/legal/contractual disciplines is preferred. [Emphasis added.]

Schwab Cuts Fees

The Charles Schwab discount online trading brokerage announced today that it has reduced its fees to better compete with the likes of TD Waterhouse, E*Trade, Scottrade, Ameritrade and others.
Here is the PR Newswire version of the story:

SAN FRANCISCO, Sept 15, 2005 /PRNewswire-FirstCall via COMTEX News Network/ -- Charles Schwab & Co., Inc. today announced it is eliminating account service fees on all U.S. individual brokerage accounts effective October 1. The action impacts about 650,000 accounts with less than $25,000 (1). Also in October, Schwab is eliminating its $3.00 order handling fee on equity trades. The elimination of account service and order handling fees furthers a commitment to value and simplified pricing that Schwab launched in May 2004, and is the seventh price cut for clients since that time.

"This change opens the door for smaller investors and others who are interested in testing the waters with Schwab, expanding the range of clients who can now take advantage of the great investment services available here," said Charles R. Schwab, founder, chairman and CEO. "In mid-2004, we committed to eliminating price as a reason to go elsewhere, and thanks to improved efficiencies and streamlining, we can now profitably serve a much broader range of investors. These fee eliminations are also strategically important investments in our future: approximately 28% of current Independent Investing Signature clients, 40% of Active Trader clients, and 29% of Advised Investing clients started with less than $25,000 at Schwab."

Value, Performance and Service

Schwab further commented: "With our financial turnaround completed, we are shifting our attention to Schwab's second act, where our primary focus will be driving profitable growth through deeper relationships that improve our clients' experience and investment results.

"Over the last 16 months, we took a number of steps to build on our heritage as a company that provides incredible value," Schwab said. "Elimination of account service and order handling fees follows six rounds of reductions in fees and in online equity and option trading commissions since May 2004 that cumulatively represent an annualized investment in our clients of more than $375 million."

"On the performance front, across the board, we believe the advice we provide to our clients is institutional quality. Schwab Equity Ratings(R) continue to provide investors with a reliable, balanced and successful alternative to traditional Wall Street research," Schwab added, noting that since their inception in May 2002, Schwab Equity Ratings' buy recommendations have doubled the market's return (relative to the S&P 500 index) (2). "Additionally, all eight of the Schwab Funds equity funds* based on the ratings have beaten their benchmark and category averages since launching or converting to a strategy utilizing Schwab Equity Ratings. Our portfolio advice is based on the same sound principles of asset allocation and diversification applied by foundations and institutional investors, and we are delighted with the risk and return performance we are seeing with clients who enroll in our advised services."

Schwab also noted: "In January, we began providing more affluent clients with a dedicated financial consultant who can serve as a 'go-to' person on a wide variety of questions or investing needs." Depending on their location, clients are paired with a financial consultant in one of Schwab's 290 branch offices or one of its three telephone service centers. In a recent survey of clients following a conversation with a Schwab financial consultant, 50% of clients said they planned to increase their business with Schwab.

"We have also restored domestic 24x7 and holiday telephone service, upgraded our automated phone service with state-of-the-art natural language technology, and made a variety of enhancements to our website, Schwab.com, that make it easier to do business with us," Schwab said, adding that the company also has trained 1,400 employees across its branch network to become dual employees of both Charles Schwab & Co., Inc., and Charles Schwab Bank, to better help clients access the growing range of credit and cash management services from the bank.

"All of these advances are made possible by the tremendous drive and commitment of Schwab's employees," Schwab said. "Their dedication and enthusiasm are truly inspiring as we work together to create a client experience that is second to none."

[Disclosure ommitted]

(1) Account service fees are periodic fees of $120 to $180 a year automatically charged to accounts that fail to meet asset, trading or other published thresholds. Other fees, such as transfer of account fees, may apply. Accounts that are exempt from account service fees will be subject to a minimum balance charge of $30 per quarter for brokerage accounts or $50 per year for retirement accounts if, after receipt of notice and a notice period, their assets remain below account opening minimums of $2,500 for brokerage accounts or $2,000 for IRAs. The minimum balance charge is waived for households with balances of at least $10,000 or with at least eight equity and/or option trades in the preceding 12 months.

Excludes QRP, CRA, Individual 401(k), 403(b)(7), SIMPLE IRA -- plan level accounts, and all accounts held by clients who reside outside the U.S., its territories or possessions.

(2) Performance data based on all complete 12-month periods through 5/6/02 - 7/5/05 for all A- and B-rated stocks. Please refer to www.schwab.com/serperformance for more information about limitations of model performance and how performance is calculated, as well as other important disclosures. The worst period for the A-rated stocks was May 6, 2002 - May 5, 2003 and had a negative return of 5.93%. The S&P 500 Index returned a negative 10.4% in that same period. The worst period for the B-rated stocks was May 20, 2002 - May 19, 2003 and had a negative return of 6.08%. The S&P 500 Index return was negative 14.1% in that period.

Indices are unmanaged, do not incur management fees and expenses, and cannot be invested in directly. Stocks can be volatile and entail risk and individual stocks may not be suitable for an investor.

Investment Products: Not FDIC Insured | No Bank Guarantee | May Lose Value

SOURCE Charles Schwab

Media, Glen Mathison, +1-415-636-5448, or glen.mathison@schwab.com, or Sarah Bulgatz, +1-415-636-5940, or sarah.bulgatz@schwab.com, or Investors

http://www.prnewswire.com

PXD Raids XOM And Marathon For JDZ Geoscience

ExxonMobil and Marathon Oil have reportedly lost "many" of their top geoscientists to Pioneer Narural Resources' Gulf of Guinea projects with ERHC Energy in the Joint Development Zone, lured by the promising Direct Hydrocarbon Indicators (DHI) revealed in some of the 3D and remote sensing work they've done, as well as background work done by KOSMOS in the GoG.

This development reinforces the belief of many that ERHC Energy is poised to quickly take possession of major oil finds in its positions in Blocks 2, 3, 4, 5 and 6, where it is partnered with Pioneer in Blocks 2 and 3 (with operatorship in Block 2), and paired as operator with Noble Energy in Block 4.

Our source says:

Pioneer was able to lure away many world class geoscientists from some of the majors ie. Exxon and Marathon among others and the key or one of them is the DHI 's (direct hydrocarbon indicators) revealed from various remote sensing and the 3 D work in the primary JDZ block hydrocarbon regime areas

More Of The Mystery Solved

Yesterday's strange trading elicited quite a few comments until it was learned that our friend Rancho had tested the weird Bid and Ask situation prevailing yesterday morning (see post before the last).

Now comes word from another friend with 700,000 shares, explaining another part of the mystery, which was the sale at $0.42 in the first 10 trades yesterday morning:

Joe, just wanted to let you in on something that you were very observant on. Every morning I check the news on ERHE, and when I saw the oddity of the bid/ask situation I tried what to me was an experiment. I have over 700K shares. I had just bought 20k at .395 the day before and decided to place an attempted sale at the .42 posted, and was amazed to get filled gaining an unexpected $500 profit in my retirement account. So the trade that you noted was mine; I was able to perform this "feat" of illogic due to my rather large and faithful position in the stock. Just sending this info to you in order for you to fill in your data and knowledge concerning same. Also have a significant large postion in PXD and DVN. per due diligence

JDA Chief Sees Sept. 21 Completion Date, Reuters Says

Just before the bell, although without any effect on price, Reuters news agency reported that Nigeria-Sao Tome and Principe Joint Development Authority head Carlos Gomes believes Sept. 21 will mark the end of negotiations on signature bonuses.

That news ought to move the stock up on Thursday and Friday, as it will definitively clarify the fact that ERHE is a working partner with mid-tier oil giants Noble Energy in Block 4 and Pioneer Natural Resources in Blocks 2 and 3 of the JDA's Joint Development Zone in the oil-rich Gulf of Guinea, where 8 of every 10 exploration wells have struck oil.

In addition, because it had been thought that the negotiations would take much longer - they were hurried up, sources say, because the price of oil that appears to be readily available in the JDZ is priced at record highs, a situation some explorers feel may not last long enough - some short players could be forced to cover substantial positions.

The story made an error, we think, including Devon Energy as one of the winning bidders. But was it an error, really? Devon won rights with ERHE in Blocks 2 and 3, then decided that the three-way split with ERHC Energy and Pioneer Natural Resources made profit margins too tight for the risk, and dropped out of both blocks. They are no longer participating, but Pioneer Natural Resources (PXD) is, and their role goes unmentioned. Maybe that's too fine a point for Reuters.

The story also omits Noble Energy's stock symbol (NBL), and might have noted that its stock rose $1.02 Wednesday. Pioneer was up $0.94.

Here is the Reuters story, released this afternoon:

14 Sep 2005, 03:50 PM EDT

SAO TOME, Sept 14 (Reuters) - Sao Tome and Nigeria hope jointly to earn some $400 million by awarding production sharing contracts for five offshore oil blocks, in talks that could conclude as early as next week, an official said on Wednesday.

Carlos Gomes, chairman of the Nigeria and Sao Tome Joint Development Authority, said talks with five Nigerian and U.S. oil companies began on Monday in the capital of the impoverished West African archipelago.

"The budget for the contract signature bonuses for the five blocks totals $406 million," Gomes told reporters, saying this estimate was made on the basis of proposals made by the interested companies.

"If everything goes as planned the negotiations should end on the 21st (of September)," he added.

A signature bonus is an up-front payment made to a government for the right to develop an oil block, often in addition to guaranteed investments in the field.

The Joint Development Authority, which administers the offshore area in the Gulf of Guinea on behalf of the two countries, awarded five offshore exploration licenses in May after a turbulent five-month selection marred by disagreements and accusations of corruption.

Companies that won the rights to exploration blocks in the second licensing round in May include ERHC Energy (ERHE), Devon (DEV), Noble and Anadarko (APC).

The Gulf of Guinea has become one of the world's exploration hot spots since a series of huge oil finds in the last 20 years.

Signed in February 2001, the joint development establishes a 60 percent stake for Nigeria and the remaining 40 percent for Sao Tome.

(Reporting by Ricardo Neto, writing by Daniel Flynn; editing by Matthew Lewis; Dakar Newsroom +221 864 5076)


Wed Sep 14 19:48:23 2005 -GMT- pnac (nN14363253) = 1 19:48

Weird Morning: Offer Outstrips Buy

Something odd happened in this morning's trading that is difficult to explain. Someone offered $0.395 for about 70,000 shares of ERHC Energy (OTC BB symbol: ERHE) when the Ask was $0.42, two and a half cents higher than the offer.

Apparently, five of the trades - which could not be identified as Buys or Sells - went off at $0.395, but one for 20,000 went off at $0.42.

Following that, there was more than a half hour hiatus in trading, and seven more trades came quickly - almost all of them Buys - at $0.395 for the first four and then three at $0.40. Then, for a single 5,000 Buy, the Bid went up $0.001 and the Ask went up $019 to $0.419. It immediately dropped back down to $0.405 after that trade.

While it at first appeared that a single trader was getting favored treatment from a market-maker, the later rise in the Offer suggested more than the normal skullduggery was going on.

While two-cent price jumps are not all that rare, today's trading is strange by any definition. It could mean news is coming.

At 10:25am EDT, the Bis was $0.40, and the Ask $0.405. Volume was 260,500 shares - a good start for what seemed like a slow day, with Buys outpacing Sells by more than 129,500 to 58,00, with a very hefty 73,000 - the first seven trades unidentified.

Mystery Solved! At least part of it, anyway. Our good friend and confidante Rancho said he offered some shares at $0.419, and then posted he was doing so on the Raging Bull message board, and 5,000 of his shares immediately sold; he cancelled the sell order and the Ask immediately fell to $0.405. It appears that the market is so thin that any given investor can move it.

At $0.394, It's Time To Buy

I just bought another 5,000 shares of ERHC Energy at the bargain price of $0.394 - a good deal any day you can get it.

With the slow trading underway this week and prevailing last week, there will probably be a number of bargains available on ERHE before the price starts feeling the pressure of impending PSC and JOA signatures.

That brings the ERHC On The Move portfolio to a total of 115,000 shares currently valued at - well, you do the math!

ERHC's Coleman Files Form 144 To Sell 3.5 Million Shares

John Coleman, the erstwhile spokesman for ERHC Energy, has filed a Form 144 with the Securities Exchange Commission to allow him to sell 3,500,000 shares of ERHE.

It is the third year in a row that Coleman has filed a Form 144, but it is not known with certainty whether he actually ever sold any.

While one other large holder of ERHC shares remarked that it is never a good sign when an insider is selling shares, he also noted that Coleman presumably anticipates positive news when he files to sell.

His last filing came a few months ahead of when the Nigeria-Sao Tome Joint Development Zone Blocks 2-6 awards were supposed to be made. The awards were delayed another several months by political infighting and familiar charges of corruption on the Sao Tome side of the Joint Ministerial Commission.

If Coleman was among the sellers who wrecked the price of the stock in June and afterwards, when it fell from about $0.84 to as low as $0.32 before beginning a recovery last month, he did so to spite himself. The shares are likely to be worth far more when the company's rights to oil deposits in the five blocks are perfected in December.

However, a deep uneasiness has settled in among investors due to the fact that all of owner Sir Emeka Offor's shares were transferred to a Cayman Islands shell corporation. Volume has fallen off dramatically, and a recent price spike caused by an article in the Penny Oil Speculator has largely been retraced.

For investors, the next bright spot on ERHC Energy's horizon is the signing of Production Sharing Contracts and Joint Operating Agreements with their venture partners, Pioneer Natural Resources and Noble Energy, and with the Joint Development Authority.

What They Knew And When They Knew It

000
WTNT32 KNHC 290850
TCPAT2
BULLETIN
HURRICANE KATRINA ADVISORY NUMBER 26
NWS TPC/NATIONAL HURRICANE CENTER MIAMI FL
4 AM CDT MON AUG 29 2005

...EXTREMELY DANGEROUS CATEGORY FOUR HURRICANE KATRINA MOVING NORTHWARD TOWARD SOUTHEASTERN LOUISIANA AND THE NORTHERN GULF COAST...

...TROPICAL STORM-FORCE WINDS LASHING THE GULF COAST FROM SOUTHEASTERN LOUISIANA TO THE ALABAMA-FLORIDA BORDER...

A HURRICANE WARNING IS IN EFFECT FOR THE NORTH CENTRAL GULF COAST FROM MORGAN CITY LOUISIANA EASTWARD TO THE ALABAMA/FLORIDA BORDER...INCLUDING THE CITY OF NEW ORLEANS AND LAKE PONTCHARTRAIN. PREPARATIONS TO PROTECT LIFE AND PROPERTY SHOULD BE COMPLETED THIS EVENING.

A TROPICAL STORM WARNING AND A HURRICANE WATCH ARE IN EFFECT FROM EAST OF THE ALABAMA/FLORIDA BORDER TO DESTIN FLORIDA...AND FROM WEST OF MORGAN CITY TO INTRACOASTAL CITY LOUISIANA.

A TROPICAL STORM WARNING IS ALSO IN EFFECT FROM DESTIN FLORIDA EASTWARD TO INDIAN PASS FLORIDA...AND FROM INTRACOASTAL CITY LOUISIANA WESTWARD TO CAMERON LOUISIANA.

FOR STORM INFORMATION SPECIFIC TO YOUR AREA...INCLUDING POSSIBLE INLAND WATCHES AND WARNINGS...PLEASE MONITOR PRODUCTS ISSUED BY YOUR LOCAL WEATHER OFFICE.

AT 4 AM CDT...0900Z...THE CENTER OF HURRICANE KATRINA WAS LOCATED NEAR LATITUDE 28.8 NORTH... LONGITUDE 89.6 WEST OR ABOUT 90 MILES SOUTH-SOUTHEAST OF NEW ORLEANS LOUISIANA AND ABOUT 120 MILES SOUTH-SOUTHWEST OF BILOXI MISSISSIPPI.

KATRINA IS MOVING TOWARD THE NORTH NEAR 15 MPH... AND THIS MOTION IS FORECAST TO CONTINUE TODAY. A GRADUAL TURN TOWARD THE NORTH-NORTHEAST AT A SLIGHTLY FASTER FORWARD SPEED IS EXPECTED LATER TONIGHT AND ON TUESDAY. ON THE FORECAST TRACK...KATRINA WILL MOVE ONSHORE THE SOUTHEASTERN LOUISIANA COAST JUST EAST OF GRAND
ISLE THIS MORNING... AND REACH THE LOUISIANA-MISSISSIPPI BORDER AREA THIS AFTERNOON. CONDITIONS WILL CONTINUE TO STEADILY DETERIORATE OVER CENTRAL AND SOUTHEASTERN LOUISIANA...SOUTHERN MISSISSIPPI...AND SOUTHERN ALABAMA THROUGHOUT THE DAY.

MAXIMUM SUSTAINED WINDS ARE NEAR 150 MPH...240 KM/HR...WITH HIGHER GUSTS. KATRINA IS A STRONG CATEGORY FOUR HURRICANE ON THE SAFFIR-SIMPSON SCALE. SOME FLUCTUATIONS IN STRENGTH ARE LIKELY PRIOR TO LANDFALL...BUT KATRINA IS EXPECTED TO MAKE LANDFALL AS
A CATEGORY FOUR HURRICANE. WINDS AFFECTING THE UPPER FLOORS OF HIGH-RISE BUILDINGS WILL BE SIGNIFICANTLY STRONGER THAN THOSE NEAR GROUND LEVEL.

KATRINA REMAINS A VERY LARGE HURRICANE. HURRICANE FORCE WINDS EXTEND OUTWARD UP TO 105 MILES FROM THE CENTER...AND TROPICAL STORM FORCE WINDS EXTEND OUTWARD UP TO 230 MILES. RECENTLY...A SUSTAINED WIND OF 53 MPH WITH GUST TO 91 MPH WAS REPORTED AT GRAND ISLE LOUISIANA ...AND A WIND GUST TO 71 MPH WAS REPORTED IN NEW ORLEANS.

THE MINIMUM CENTRAL PRESSURE RECENTLY REPORTED BY AN AIR FORCE RESERVE UNIT RECONNAISSANCE AIRCRAFT WAS 915 MB...27.02 INCHES.

COASTAL STORM SURGE FLOODING OF 18 TO 22 FEET ABOVE NORMAL TIDE LEVELS...LOCALLY AS HIGH AS 28 FEET...ALONG WITH LARGE AND DANGEROUS BATTERING WAVES...CAN BE EXPECTED NEAR AND TO THE EAST OF WHERE THE CENTER MAKES LANDFALL. SOME LEVEES IN THE GREATER NEW ORLEANS AREA COULD BE OVERTOPPED. SIGNIFICANT STORM SURGE FLOODING WILL OCCUR
ELSEWHERE ALONG THE CENTRAL AND NORTHEASTERN GULF OF MEXICO COAST. NOAA BUOY 42040 LOCATED ABOUT 50 MILES EAST OF THE MOUTH OF THE MISSISSIPPI RIVER RECENTLY REPORTED WAVES HEIGHTS OF AT LEAST 46 FEET.

RAINFALL TOTALS OF 5 TO 10 INCHES...WITH ISOLATED MAXIMUM AMOUNTS OF 15 INCHES...ARE POSSIBLE ALONG THE PATH OF KATRINA ACROSS THE GULF COAST AND THE TENNESSEE VALLEY. RAINFALL TOTALS OF 4 TO 8 INCHES ARE POSSIBLE ACROSS THE OHIO VALLEY INTO THE EASTERN GREAT LAKES REGION TUESDAY AND WEDNESDAY.

THE TORNADO THREAT AHEAD OF KATRINA CONTINUES TO INCREASE AND SCATTERED TORNADOES WILL BE POSSIBLE TODAY OVER SOUTHEASTERN LOUISIANA... SOUTHERN MISSISSIPPI...SOUTHERN ALABAMA...AND OVER THE FLORIDA PANHANDLE.

REPEATING THE 4 AM CDT POSITION...28.8 N... 89.6 W. MOVEMENT TOWARD...NORTH NEAR 15 MPH. MAXIMUM SUSTAINED WINDS...150 MPH. MINIMUM CENTRAL PRESSURE... 915 MB.

INTERMEDIATE ADVISORIES WILL BE ISSUED BY THE NATIONAL HURRICANE CENTER AT 6 AM CDT AND 8 AM CDT FOLLOWED BY THE NEXT COMPLETE ADVISORY AT 10 AM CDT.

FORECASTER STEWART


$$

When The Saints Come Marchin' In: Ode To A Drowned City

Tonight at sunset I took a long drive after Mass down to Turtle Beach at the end of Midnight Pass Road on Siesta Key. The bright orange wafer of the Sun was just falling below the rim of the Gulf of Mexico, and as I always try to do, I looked up at the shape of the sparse few clouds in the fading blue sky and wondered whose souls they were.

The largest of all was of a bird, a graceful kingfisher whose figure stretched for miles from his long pointed beak to the one sad eye in his trapped and perfect head; his arcing white wings trailed away from magnificent tail feathers into a rippling white stream that faded for 10 miles into the cerulean blue.

Clutched in the talons of the kingfisher was a long thin evil-looking thing I named a rat shark, with the elongated snout of a rat and mutliple triangular barbed fins along his head and the body of a dark greasy eel, his dreadful hungry jagged mouth staring back in anger at New Orleans as he was carried away to his reward.

Just behind the kingfisher and going the opposite way was the figure of a tall graceful woman, her naked long glowing white limbs stretched in a languid swim and her hair curled in a bun, and her head turned away from shore, back towards the drowning city far away. I recognized her as Evangeline, the living goddess of hills and vales of Arcady, where the Cajun people began their awful journey to the distant shores of the Mississippi Delta.

Beyond her were two terrible masks like those of Tragedy and Comedy, reminiscent of them in their pairing but unlike them in the gargoyle shriek of their faces. I remember them as the masks of Mardi Gras, but they would terrify the dead. Atop a dune, amid small clusters of people standing silently as they waited for the Sun to drop, I thought of the city of music that is drowning as I write.

I know who they are, the kingfisher, the rat shark, Evangeline and the masks; they are the soul of a city, and they will precede the eternal march of the thousands dead now and the thousands dead before them, and at last the triumphant march of "the city that care forgot." The masks were the broken-hearted soul of Tennessee Williams, he of the tales of Desire and the sweet fragility of hope, who now unclosed from his grave bids the the audience still ashore to be rapt and sacred watchfulness.

The Kingfisher was the soul of Huey Long, the famous Populist whose life was taken by an assassin after he ruthlessly reined in the demigods of the petroleum business, John D. Rockefeller and others. To history he is only known for legendary corruption, but to historians he is known as the first American governor to stand up to the power of a rich and rotten industry and seize it for the people. Even those who know him as corrupt are shamed by the towering rage and roaring music of his great Louisiana soul.

The rat shark was the essence of the evil that lived in New Orleans, so it might have been some combination of former Gov. Edwin Edwards and a hungry oilman who gave his great city over into the raking jaws of refineries, pipelines and toxic chemical plants that surrounded it. He was every excuse New Orleans ever made for itself, every head turned away from the face of violated beauty, every dead thing that passed for an eye that glared from the sockets of a crooked, brutal cop. And Evangeline, her face turned away from us towards the waters of Lake Ponchartrain, is the soul of her people, the mestizos of French, Indian and Negro blood awed by the gentle music of Longfellow's timeless poetry and the dim racial memory of a place called Arcadia, an Eden known only to them.

Many people, I fear, do not know what befalls us when we die, or seem to, and leave this weary Earth of ours. What happens is that the essence of our souls, which flies from us in a pulse of light, expands in the atmosphere and takes the form that best fulfills it, and depending on the size of the life we held within, spreads it out, converted to this luminous white of clouds, gowning us across the endless miles of the sky, and we inhabit these new beings that are purely ourselves as we float above the seas to - well, I do not know that part. I do not know where we go.

So preceded by these four grand marshals, and followed by smaller pure white angels that hung in the dusk at the edge of the sky, the march shall soon begin. Thus the honest soul of a busker will march beside that of a Baptist preacher who once raged of true perdition, and both shall be in the trail of a man slain for his honesty with a sharp knife in an alley off Bourbon Street.

It is not required of the marchers in this parade that they joined any krewe, wore any beads, fought and brawled and drank and danced and gave all hope to abandon, but it helps. If you failed to live, or lived only at the expense of others, your own soul will simply merge with tens of thousands of others to become a ripple in the prayerful bearded face of one who knelt before the storm and opened his tired eyes and hopeful soul to God, in awe and trembling at His enormous strength.

There will be a happy chef among the marchers, that I know, and there will be a beautiful willowy singer of timeless songs, and an enormous bartender whose flowing cup shall never empty. There will be the soul of a crooked politician who embodied evil to some but who secretly wanted to be good, and quietly loved New Orleans; there will be a fat black woman sprawling over miles, laughing, reaching for cakes and pies and children with giant arms. There will be the soul of a dog who loved one master and gave his life for him, and of a drummer who burned to death in a French Quarter dive in a fire that blazed up from his sticks.

That is how the great funeral parade of the soul of New Orleans will begin to march across the oceans tonight, tomorrow, the next day and the next, and for a very, very long time. There is no rush up there.

You know the songs that we who watch will sing on this side of the shore, but the music that will drive their caravan forward is a world beyond us, and we will not hear it till we die. We might if God is generous hear just a snatch of it, however, a few fleeting notes that reverberate with the power of forever. I heard a little of it long ago.

Joe Shea is the Editor-in-Chief of The American Reporter.

A Question Of Competence

President Bush delivered his weekly radio address from the Rose Garden of the White House on Saturday. Photo: NY Times/Dennis Brack

President George W. Bush has exhausted his political capital and his challenges have exceeded his competence, White House observers are saying after the President's dismal day-late-dollar-short performance to Hurricane Katrina.

Meanwhile, 10 of the 20 people who had managed to survive until Saturday died in a hospice in New Orleans Sunday, an emergency medical technician told CNN this afternoon, as rescuers found them too late. The 10 will be added to the thousands of corpses that are believed to still lie undiscovered throughout the city that drowned in the aftermath of calamitous levee breaks the day after Category 4 Hurricane Katrina slammed into the city with scouring 140mph winds.

Perhaps the best expression of the depths of anger and distress felt by Louisiana residents came from the President of Jefferson Parish, Aaron Broussard, who appeared this morning on NBC's "Meet The Press":

Many people were still angry about how long it took to mobilize the relief effort. Aaron Broussard, president of Jefferson Parish, south of New Orleans, began to cry on NBC's "Meet the Press" as he related the story of a rescue official's mother who called repeatedly asking her son for help but died Friday before crews could get to her.

"We have been abandoned by our own country," Broussard said. "It's not just Katrina that caused all these deaths in New Orleans. Bureaucracy has committed murder here in the greater New Orleans area, and bureaucracy has to stand trial before Congress now."

Officials from the Bush administration came to the region again to oversee the federal operation. Chertoff, Secretary of Defense Donald H. Rumsfeld and Secretary of State Condoleezza Rice visited with residents and relief workers in Louisiana and Alabama. [end excerpt]

The Federal government's slow response has created a huge crisis of confidence for the Republican Party and President George W. Bush, the New York Times reported today, and the 2006 Congressional elections are now thought likely to reflect widespread voter distrust of the President's party, the Times suggested:

As White House Anxiety Grows, Bush Tries to Quell Political Crisis

By ELISABETH BUMILLER
and ADAM NAGOURNEY
Published: September 4, 2005

WASHINGTON, Sept. 3 - Faced with one of the worst political crises of his administration, President Bush abruptly overhauled his September schedule on Saturday as the White House scrambled to gain control of a situation that Republicans said threatened to undermine Mr. Bush's second-term agenda and the party's long-term ambitions.

In a sign of the mounting anxiety at the White House, Mr. Bush made a rare Saturday appearance in the Rose Garden before live television cameras to announce that he was dispatching additional active-duty troops to the Gulf Coast. He struck a more somber tone than he had at times on Friday during a daylong tour of the disaster region, when he had joked at the airport in New Orleans about the fun he had had in his younger days in Houston. His demeanor on Saturday was similar to that of his most somber speeches after the Sept. 11 terrorist attacks.

"The magnitude of responding to a crisis over a disaster area that is larger than the size of Great Britain has created tremendous problems that have strained state and local capabilities," said Mr. Bush, slightly exaggerating the stricken land area.
[end excerpt]

Unlike rapper Kanye West, who on Friday's night's NBC fund-raising concert told viewers "President Bush doesn't like black people," senior Republicans in Congress and the Senate have told the President that the problem is not his image - because he is a lame duck - but in the huge losses the party's elected officials may suffer as a result of the failure to anticipate and plan for Katrina's destruction.

Many are now mulling over who should be the first to make an open call for the resignation of Homeland Security director Michael Chertoff - who has overall responsibility for the response to the evacuation, FEMA Director Mike Brown (whose agency has been folded into Chertoff's), and possibly even of the President himself, whose failure on Katrina is believed to lend credence to the 9/11 Commission's report that he and his senior advisors also ignored warnins of the Sept. 11 attacks on New York and Washington, D.C.

In the President's defense, administration officials point out the President was only the latest to ignore the possibility that levees would break and drown the city, a situation whose potential was seen decades ago. However, the Presdent took tens of millions from the current budget slated to strengthen the levees, his critics say, so he has some direct responsibility for the disaster. A full repair of the levees would have cost $14.5 billion, the White House responds, while the disaster caused by their failure will cost $100 billion or more, according to latest estimates. The Los Angeles Times also explored the topic:

KATRINA'S AFTERMATH
Despite Warnings, Washington Failed to Fund Levee Projects
To cut spending, officials gambled that the worst-case scenario would not come to be.

By Richard A. Serrano and Nicole Gaouette, Times Staff Writers

WASHINGTON — For years, Washington had been warned that doom lurked just beyond the levees. And for years, the White House and Congress had dickered over how much money to put into shoring up century-old dikes and carrying out newer flood control projects to protect the city of New Orleans.

As recently as three months ago, the alarms were sounding — and being brushed aside.

In late May, the New Orleans district of the Army Corps of Engineers formally notified Washington that hurricane storm surges could knock out two of the big pumping stations that must operate night and day even under normal conditions to keep the city dry.

Also, the Corps said, several levees had settled and would soon need to be raised. And it reminded Washington that an ambitious flood-control study proposed four years before remained just that — a written proposal never put into action for lack of funding.

What a powerful hurricane could do to New Orleans and the area's critical transportation, energy and petrochemical facilities had been well understood. So now, nearly a week into the devastation caused by Hurricane Katrina, hard questions are being raised about Washington officials who crossed their fingers and counted on luck once too often. The reasons the city's defenses were not strengthened enough to handle such a storm are deeply rooted in the politics and bureaucracy of Washington.

With the advantage of hindsight, the miscues seem even broader. Construction proposals were often underfunded or not completed. Washington officials could never agree on how much money would be needed to protect New Orleans. And there hung in the air a false sense of security that a storm like Katrina was a long shot anyway.

As a result, when the immediate crisis eases and inquiries into what went wrong begin, there is likely to be responsibility and blame enough for almost every institution in Washington, including the White House, Congress, the Army Corps of Engineers and a host of other federal agencies.

For example, Lt. Gen. Carl Strock, the Corps commander, conceded Friday that the government had known the New Orleans levees could never withstand a hurricane higher than a Category 3. Corps officials shuddered, he said, when they realized that Katrina was barreling down on the Gulf Coast with the vastly greater destructive force of a Category 5 — the strongest type of hurricane.

Washington, he said, had rolled the dice.

Rather than come up with the extra millions of dollars needed to make the city safer, officials believed that such a devastating storm was a small probability and that, with the level of protection that had been funded, "99.5% of the time this would work."

Unfortunately, Strock said, "we did not address the 0.5%."

Corps officials said the floodwaters breached at two spots: the 17th Street Canal Levee and the London Avenue Canal Levee. Connie Gillette, a Corps spokeswoman, said Saturday there never had been any plans or funds allocated to shore up those spots — another sign the government expected them to hold.

Nevertheless, the Corps hardly was alone in failing to address what it meant to have a major metropolitan area situated mostly below sea level, sitting squarely in the middle of the Gulf Coast's Hurricane Alley.

Many federal, state and local flood improvement officials kept asking for more dollars for more ambitious protection projects. But the White House kept scaling down those requests. And each time, although congressional leaders were more generous with funding than the White House, the House and Senate never got anywhere near to approving the amounts that experts had said was needed.

What happened this year was typical: Local levee and flood prevention officials, along with Sen. Mary L. Landrieu (D-La.), asked for $78 million in project funds. President Bush offered them less than half that — $30 million. Congress ended up authorizing $36.5 million.

Since Bush took office in 2001, local experts and Landrieu have asked for just short of $500 million. Altogether, Bush in his yearly budgets asked for $166 million, and Congress approved about $250 million.

These budget decisions reflect a reality in Washington: to act with an eye toward short-term political rewards instead of making long-term investments to deal with problems.

Vincent Gawronski, an assistant professor at Birmingham Southern College in Alabama who studies the political impact of natural disasters, said the lost chances to shore up the levees were a classic example of government leaders who, although meaning well, clashed over priorities.

"Elected politicians are in office for a limited amount of time and with a limited amount of money, and they don't really have a long-term vision for spending it," he said.

"So you spend your pot of money where you feel you're going to get the most political support so you can get reelected. It's very difficult to think long-term. If you invest in these levees, is that going to show an immediate return or does it take away from anything else?" [end excerpt]

http://www.latimes.com/news/nationworld/nation/la-na-levee4sep04,0,3450779.story?coll=la-home-headlines

In an effort to control the political damage, the Presdent and federal officials are trying to shift the blame for failures associated with the relief effort to state and local officials who are Democrats, the Washington Post reported today:

Many Evacuated, but Thousands Still Waiting
White House Shifts Blame to State and Local Officials

By Manuel Roig-Franzia and Spencer Hsu
Washington Post Staff Writers
Sunday, September 4, 2005; Page A01

NEW ORLEANS, Sept. 3 -- Tens of thousands of people spent a fifth day awaiting evacuation from this ruined city, as Bush administration officials blamed state and local authorities for what leaders at all levels have called a failure of the country's emergency management.

President Bush authorized the dispatch of 7,200 active-duty ground troops to the area -- the first major commitment of regular ground forces in the crisis -- and the Pentagon announced that an additional 10,000 National Guard troops will be sent to Louisiana and Mississippi, raising the total Guard contingent to about 40,000.

Authorities reported progress in restoring order and electricity and repairing levees, as a hospital ship arrived and cruise ships were sent to provide temporary housing for victims. As Louisiana officials expressed confidence that they had begun to get a handle on the crisis, a dozen National Guard troops broke into applause late Saturday as Isaac Kelly, 81, the last person to be evacuated from the Superdome, boarded a school bus.

But there remained an overwhelming display of human misery on the streets of New Orleans, where the last 1,500 people were being evacuated from the Convention Center amid an overpowering odor of human waste and rotting garbage. The evacuees, most of them black and poor, spoke of violence, anarchy and family members who died for lack of food, water and medical care.

About 42,000 people had been evacuated from the city by Saturday afternoon, with roughly the same number remaining, city officials said. Search-and-rescue efforts continued in flooded areas of the city, where an unknown number of people wait in their homes, on rooftops or in makeshift shelters. Hundreds of thousands of people have been displaced by the flooding -- 250,000 have been absorbed by Texas alone, and local radio reported that Baton Rouge will have doubled in population by Monday. Federal officials said they have begun to collect corpses but could not guess the total toll.

Behind the scenes, a power struggle emerged, as federal officials tried to wrest authority from Louisiana Gov. Kathleen Babineaux Blanco (D). Shortly before midnight Friday, the Bush administration sent her a proposed legal memorandum asking her to request a federal takeover of the evacuation of New Orleans, a source within the state's emergency operations center said Saturday.

The administration sought unified control over all local police and state National Guard units reporting to the governor. Louisiana officials rejected the request after talks throughout the night, concerned that such a move would be comparable to a federal declaration of martial law. Some officials in the state suspected a political motive behind the request. "Quite frankly, if they'd been able to pull off taking it away from the locals, they then could have blamed everything on the locals," said the source, who does not have the authority to speak publicly.

A senior administration official said that Bush has clear legal authority to federalize National Guard units to quell civil disturbances under the Insurrection Act and will continue to try to unify the chains of command that are split among the president, the Louisiana governor and the New Orleans mayor.

Louisiana did not reach out to a multi-state mutual aid compact for assistance until Wednesday, three state and federal officials said. As of Saturday, Blanco still had not declared a state of emergency, the senior Bush official said.

"The federal government stands ready to work with state and local officials to secure New Orleans and the state of Louisiana," White House spokesman Dan Bartlett said. "The president will not let any form of bureaucracy get in the way of protecting the citizens of Louisiana."

Blanco made two moves Saturday that protected her independence from the federal government: She created a philanthropic fund for the state's victims and hired James Lee Witt, Federal Emergency Management Agency director in the Clinton administration, to advise her on the relief effort.

Bush, who has been criticized, even by supporters, for the delayed response to the disaster, used his weekly radio address to put responsibility for the failure on lower levels of government. The magnitude of the crisis "has created tremendous problems that have strained state and local capabilities," he said. "The result is that many of our citizens simply are not getting the help they need, especially in New Orleans. And that is unacceptable." [end excerpt]

Pioneer, ERHE's Partner, To Sink 5 Oil Wells in JDZ, W Africa, In Blocks With 1 To 2 Billion Bbls. Oil Reserves In 2005 - 2007

In a remarkable statement of its plans for blocks it holds with ERHC Energy in the Nigeria-Sao Toime Joint Development Zone and Equatorial Guinea, Pioneer Natural Resources - which only Wednesday revealed it is selling all its Gulf of Mexico leases to focus on other investments - revealed Thursday that it expects to take between 1 and 2 billion barrels of oil out the two zones. The could mean that as its partner, ERHE would stand to reap a minimum of $21 billion in crude oil payments - before taxes, royalties and costs - from its estimated share of those properties, about 300 million barrels of crude, at current prices.

Company officials said in the 16-page presentation they "Expect to drill five to seven exploration wells from 2005 to 2007 in five blocks with 1 – 2 billion barrels of gross unrisked reserve potential" in the JDZ and Equatorial Guinea.

Pioneer and ERHC are partners and operators in Block 2, the most hioghly regarded prospect after Chevron-ExxonMobil's Block 1 and immediately adjoining it, and are partners in a 25 percent chunk of Block 3. ERHC partners with Noble Energy as operators in Block 4.
In a PowerPoint presentation called "Progressing Attractive Growth Opportunities in Africa," Pioneer spoke of plans that are well-known but have not been tied to specific prospects before.

Here is the statement from Pioneer's Website:

Deepwater Nigeria / JDZ /
Equatorial Guinea

Expect to drill five to seven exploration
wells from 2005 to 2007 in five blocks
with 1 – 2 billion barrels of gross
unrisked reserve potential

The PDF file is available on Pioneer's corporate Website at:
http://library.corporate-ir.net/library/90/909/90959/items/163997/090105_pxd.pdf