ERHC files 10-Q, Earns $0.04 Per Share On $45.3 Million in Revenues; Company Studies New Acquisitions

ERHC Energy, Inc. has released it quarterly earnings report, showing unprecedented earnings of $0.04 per share and revenues of $45,384,000 - and shareholder equity of more than $35 million and less than $2.8 million in debt.

In the filing, the company also removed its troublesome "going concern" clause:

As described in Note 4 to the financial statements, during the quarter ended March 31, 2006, the Company received cash proceeds of $45,900,000 from the sale of participation interests in Blocks 2, 3 and 4 of the JDZ. Management believes that these proceeds will sustain the Company's operations for the foreseeable future and that they mitigate any going concern issues raised at September 30, 2005.

The company also revealed that it is looking for other opportunities in the supply and trading end of the industry, In the typically restrained language of the filing, officials said "The Company is currently exploring opportunities in other areas of the energy industry with emphasis in supply and trading."

The amounts below appear with a line through them due to the "E" that has been placed on the symbol by the SEC due to the late filing. The "E" will be removed by Wednesday.

ERHEE shares immediately soared 9.6 percent to $0.67 in light trading.

March 31, September 30,
2006 2005
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ASSETS

Current assets:
Cash $ 45,384,771 $ 988,490

Prepaid expenses and other 134,625 32,093
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Total current assets 45,519,396 1,020,583


DRSTP concession fee 2,839,500 5,679,000

Furniture and equipment, net 16,076 20,627

Deferred tax asset 960,000 -
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Total assets $ 49,334,972 $ 6,720,210
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LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:

Accounts payable and accrued liabilities $ 8,255,965 $ 195,823

Accounts payable and accrued liabilities, related party 2,175,125 2,064,675

Income taxes payable 3,300,000 -

Asset retirement obligation 485,000 485,000

Current portion of convertible debt 33,513 33,513
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Total current liabilities 14,249,603 2,779,011
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Commitments and contingencies:

Shareholders' equity:
Preferred stock, par value $0.0001; authorized

10,000,000; none issued and outstanding - -
Common stock, par value $0.0001; authorized 950,000,000
shares; issued and outstanding 710,912,226 71,091 71,091

Additional paid-in capital 89,589,309 83,584,956
Accumulated deficit (54,575,031 ) (79,407,711 )

Deferred compensation - (307,137 )
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Total shareholders' equity 35,085,369 3,941,199
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Total liabilities and shareholders' equity $ 49,334,972 $ 6,720,210
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