Monday, April 16, 2007
Wednesday, March 28, 2007
Monday, March 26, 2007
Saturday, March 24, 2007
$0.33 Close Marks Beginning Of Buying Spree
Given all the risks that an investment in ERHC Energy entails - and the company is frank about them in every one of its SEC filings - the risk/reward ratio reached parity Friday at $0.33, I believe. It's time for a modest buying spree to begin, and I believe investors can look forward a price in the low $0.40s very soon.
While I still plan a major investment in ERHE (OTC BB), I get antsy when I have to pay very much to buy into a stock that is facing two federal indictments for Foreign Corrupt Practices Act violations and for SEC violations that if handed down are likely to allege major fraud.
I have said on quite a few occasions that I don't believe the evidence is there to support an indictment in the bribery matter because the government of Nigeria is not cooperating in the probe; I think the SEC indictment has a better chance, since someone - probably the big players we all know - almost certainly were manipulating the stock through nominees (I don't use the term in its formal sense here) on I-Hub's ERHC Energy board and Raging Bull's ERHE board.
Anywhere between $0.28 and $0.33 is a great place to buy this stock, I believe. That takes into account my own belief that momentarily, in the event of an indictment, the share price may well fal to $0.18. But you'll hasve to have ready cash and be fast on the trigger to buy it there.
Once the indictments are handed down, if they ever are, the issues then becomes a known and manageable set of facts that will entail a finite amount of risk for the possibility of substantial reward when drilling begins in 2008. I feel like I would like to have 200,000 shares by then, but that's just a pipe dream today.
It's heartening in some ways (and I know it must be painful for some investors, who paid too much at some point) to see a decent bottom for this stock, and to be able to look forward not only to a major buying opportunity if the indictments arrive, but for a modest one now that the risk has been subtracted from the price.
A caveat, however: any investor wanting to get in for a substantial block of shares should ask themselves how long they are willing to sit on their investment, waiting for an oil strike in the Gulf of Guinea. If the same money might be used for other plays (like FSTR or CUP, if you're looking), it may not be available for a year or so.
While I still plan a major investment in ERHE (OTC BB), I get antsy when I have to pay very much to buy into a stock that is facing two federal indictments for Foreign Corrupt Practices Act violations and for SEC violations that if handed down are likely to allege major fraud.
I have said on quite a few occasions that I don't believe the evidence is there to support an indictment in the bribery matter because the government of Nigeria is not cooperating in the probe; I think the SEC indictment has a better chance, since someone - probably the big players we all know - almost certainly were manipulating the stock through nominees (I don't use the term in its formal sense here) on I-Hub's ERHC Energy board and Raging Bull's ERHE board.
Anywhere between $0.28 and $0.33 is a great place to buy this stock, I believe. That takes into account my own belief that momentarily, in the event of an indictment, the share price may well fal to $0.18. But you'll hasve to have ready cash and be fast on the trigger to buy it there.
Once the indictments are handed down, if they ever are, the issues then becomes a known and manageable set of facts that will entail a finite amount of risk for the possibility of substantial reward when drilling begins in 2008. I feel like I would like to have 200,000 shares by then, but that's just a pipe dream today.
It's heartening in some ways (and I know it must be painful for some investors, who paid too much at some point) to see a decent bottom for this stock, and to be able to look forward not only to a major buying opportunity if the indictments arrive, but for a modest one now that the risk has been subtracted from the price.
A caveat, however: any investor wanting to get in for a substantial block of shares should ask themselves how long they are willing to sit on their investment, waiting for an oil strike in the Gulf of Guinea. If the same money might be used for other plays (like FSTR or CUP, if you're looking), it may not be available for a year or so.
Wednesday, February 28, 2007
Not To Worry...
The stock market will bounce back with unusual strength by Thursday afternoon, I believe, and the losses and turmoil that were so prevalent around the globe yesterday - and in Asian markets, today - will recede.
It's not that the global or American markets are healthy - they're all underpinned with mountains of debt that will crumble, probably soon - but that yesterday's losses have already been absorbed in China - whose stock market seems as never before to be leading the world - and the big fall on Wall Street was partly occasioned by a failure of the Dow Jones & Co. software that supports the new "hybrid" stock exchange.
Yesterday's fall took advantage of the timing of Alan Greenspan's remarks coupled to the China shakeout, as well as continuing nervousness about the ability of subprime lenders, banks and brokerage houses to stay afloat when their own risky lending practices come home to roost.
ERHC Energy may have been a microcosm with respect to the bounce we expect. It fell as low as $0.33 before buyers leapt in and took it back to $0.37. The stock at $0.33 was an irresistible temptation. However, it will probably resume its steady but very slow decline until drilling starts and the SEC/DOJ investigations come a cropper (go bust, in Aussie).
While there's no strong reason not to buy ERHE at this level if you are a long-term player, patience will probably be rewarded with a discount up to another 5 cents. I have been hoping for another shot at $0.27 shares like those that made me so much money last year.
It's not that the global or American markets are healthy - they're all underpinned with mountains of debt that will crumble, probably soon - but that yesterday's losses have already been absorbed in China - whose stock market seems as never before to be leading the world - and the big fall on Wall Street was partly occasioned by a failure of the Dow Jones & Co. software that supports the new "hybrid" stock exchange.
Yesterday's fall took advantage of the timing of Alan Greenspan's remarks coupled to the China shakeout, as well as continuing nervousness about the ability of subprime lenders, banks and brokerage houses to stay afloat when their own risky lending practices come home to roost.
ERHC Energy may have been a microcosm with respect to the bounce we expect. It fell as low as $0.33 before buyers leapt in and took it back to $0.37. The stock at $0.33 was an irresistible temptation. However, it will probably resume its steady but very slow decline until drilling starts and the SEC/DOJ investigations come a cropper (go bust, in Aussie).
While there's no strong reason not to buy ERHE at this level if you are a long-term player, patience will probably be rewarded with a discount up to another 5 cents. I have been hoping for another shot at $0.27 shares like those that made me so much money last year.
Wednesday, February 21, 2007
Thursday, February 08, 2007
CNN's Dramatic Encounter With MEND
In an In an extraordiary exclusive, CNN has successfully acquired videotape of Nigerian rebels in the Niger Delta region known as MEND, and it leaves little doubt that the group is a force to be reckoned with now and in the future.
The story speaks for itself:
Koinange: Big guns, big oil collide in Nigeria
POSTED: 1:54 a.m. EST, February 8, 2007
By Jeff Koinange
CNN
Editor's note: In our Behind the Scenes series, CNN correspondents share their experiences in covering news and analyze the stories behind the events. CNN Africa correspondent Jeff Koinange recently met with Nigerian militants, and here he describes what he saw and learned.
The story speaks for itself:
Koinange: Big guns, big oil collide in Nigeria
POSTED: 1:54 a.m. EST, February 8, 2007
By Jeff Koinange
CNN
Editor's note: In our Behind the Scenes series, CNN correspondents share their experiences in covering news and analyze the stories behind the events. CNN Africa correspondent Jeff Koinange recently met with Nigerian militants, and here he describes what he saw and learned.
WARRI, Nigeria (CNN) -- Splashing across the murky waters of southern Nigeria in a speedboat, I suddenly found myself in one of the scariest positions of my journalistic career: masked militants firing machine guns at me and my crew.
We hit the deck, shouting, "We are press! We are press!" Eventually, the bullets stopped flying and the gunmen approached our boat, demanding to know who we were.
As I stared down the barrels of some very big guns, being held by angry young men, I began to have doubts about our trip here. (Watch menacing rebels try to intimidate CNN crew )
The waters are so dangerous in these parts that the Nigerian navy doesn't even dare patrol the region. In a word, it's a no-go zone for outsiders.
"How many times do you people come here with your cameras and nothing is done? We don't want you guys to come here again," one of the gunmen shouted.
But we weren't about to leave so easily.
I had been given permission to come to the region from the militants themselves to find out what is happening in the Niger Delta, where the well-armed militants have been fighting Nigeria's beleaguered armed forces over oil. (Read more about the militants' battle)
These guys in their intimidating black outfits and matching black ski masks looked like any army's worst nightmare. And that's exactly what they've become: Nigeria's worst nightmare.
They call themselves the Movement for the Emancipation of the Niger Delta, or MEND. They insist what they're trying to do is mend what they say is the unequal distribution from the profits Nigeria gets from its oil bonanza. (Gallery: See what the militants look like up close)
Nigeria is Africa's largest oil producer. In 2005, it was the world's sixth largest exporter of oil, but the conflict there has cut distribution by an estimated 500,000 barrels per day, the U.S. Department of Energy said in November.
Very little of the profits makes it back to Nigeria, and even less makes it down to the mangrove swamps of the Niger Delta.
As a result, MEND in recent months has escalated its struggle, kidnapping expatriate oil workers at an alarming rate (more than 30 in the last month alone), indiscriminately killing Nigerian military forces, and carrying out attacks on oil installations in the region that cut the flow of oil dramatically.
Hostages paraded before my eyes
Now, as guns pointed at me, I explained we had been given permission for them to take us to their leader. They laughed me off, saying their leader doesn't talk to anyone, especially journalists.
But they agreed to take us to one of their hideouts and show us something no Western journalist had seen: dozens of MEND militants in black dancing and chanting themselves into a trance. Some pointed their guns menacingly at us; others simply tried to intimidate us.
It was MEND military might for the whole world to see. And they told me this is just a fraction of their forces. They claimed to have more than 200,000 troops spread across an area the size of Texas. (Interactive: See where the Niger Delta is located)
As the militants danced, they displayed their latest hostages: 24 Filipino sailors captured on January 20 as their cargo ship tried to take turn into the port of Warri. (Watch the rebels show off their hostages )
It is the largest number of foreign hostages ever captured here at a single time. The Filipinos seemed dazed and confused, their nerves wearing thin as they struggled to come to terms with a fight they said they have no clue about.
The militants fired into the air. The hostages flinched. I thought there was going to be an execution in front of us -- and I'm sure the hostages thought the same thing.
'Our fight is against everybody'
After about an hour, the militants agreed to take me to their leader. They said that due to his superstitions, we could only interview him out in the middle of the creeks and they took us back out into the water.
A short while later, he appeared, accompanied by a small army of heavily armed bodyguards.
He described himself as "Major General Tamuno," the field commander of MEND. He spoke softly through the slits of his black ski mask.
"MEND is a struggle for the liberation of the Niger Delta, the most devastated and the most threatened region in the world," he said.
"Our fight is against everybody -- every institution that don't want the people of the Niger Delta to have their fair share."
I learned this militant leader has a degree in political science from a local university, but he couldn't find work after college. Many of his men are the same -- educated and frustrated.
He told me foreigners working in Nigeria's oil sector should get out now.
"We will take lives, we will destroy lives, we will crumble the economy," he said bluntly.
And with that, the interview was suddenly over.
We were escorted back out into open waters by a convoy of speedboats. As we were about to leave, one of the masked gunmen reissued his group's threats.
"If they don't listen, well, maybe Nigeria will go into pieces. We don't know how many pieces it will go into, but the federal government will not be in peace unless they listen to us," he said.
And just like that, they were off -- speedboats spluttering in the water, gunfire echoing into the crisp afternoon air and, before we'd even put down our gear, the militants were gone.
Saturday, January 13, 2007
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Tuesday, January 09, 2007
Oil Falls, But ERHE Rises (And Falls)
ERHC Energy shares today showed strong buying support throughout most of Tuesday on low volume, but as the 3 p.m. witching hour arrived the share price fell back to where it started the day. At 3:38pm EST, volume stood at 366,354 and the last sale was $0.448, slightly below the $0.45 start.
Meanwhile, the price of oil continued to fall despite alleged threats from Iran to shut the Straits of Hormuz (attributed to "a foreign office official" in the Jerusalem Post) and the continuing issues with MEND in Nigeria. A barrel of crude for Feb. 7 delivery fell below the $54 mark to $53.88 in early trading Tuesday, but closed off just $0.35 for the day at $55.74.
A trade of 15,000 shares at $0.395 at 1:07pm EST baffled the kibitzers on the message boards, and there was no explanationfrom ADVFN, either, except that it was a standard NASDAQ trade and could not be identified as either a Buy or Sell. Buys outpaced sells 255,372 to 125,668, with 44,414 trades unidentified.
The last trade for the day went off at $0.455, a half-cent gain on the open.
Meanwhile, the price of oil continued to fall despite alleged threats from Iran to shut the Straits of Hormuz (attributed to "a foreign office official" in the Jerusalem Post) and the continuing issues with MEND in Nigeria. A barrel of crude for Feb. 7 delivery fell below the $54 mark to $53.88 in early trading Tuesday, but closed off just $0.35 for the day at $55.74.
A trade of 15,000 shares at $0.395 at 1:07pm EST baffled the kibitzers on the message boards, and there was no explanationfrom ADVFN, either, except that it was a standard NASDAQ trade and could not be identified as either a Buy or Sell. Buys outpaced sells 255,372 to 125,668, with 44,414 trades unidentified.
The last trade for the day went off at $0.455, a half-cent gain on the open.
Tuesday, December 26, 2006
'Hundreds' Of Bodies In Lagos After Latest Gas Line Explosion
A huge gasoline pipeline explosion in Nigeria's unofficial capital city, Lagos, came hours after people started collecting gas from a rupture in the line that later exploded.
Despite its immense wealth in oil and gasoline resources, Nigeria has been experiencing chronic shortages of both as those resources are exploited by mostly foreign oil companies and Nigerian politicians.
It remains one of the few countries in the world where tens of thousands of people often risk their lives to get a few quarts of gas.
Today's tragedy is yet another failure of the Nigerian government to recognize and correct its official greed and to start sharing its natural resource income with ordinary Nigerians. By all indications, it will not be the last - if the government last that long.
"Hundreds of mangled bodies" fused with one another in a grisly heap were visible in the flames, observers reported. There is no indication of when the fire will be controlled.
Here is the awful story:
Pipeline Explosion in Nigeria Kills More Than 200
By THE ASSOCIATED PRESS
Published: December 26, 2006
Filed at 7:57 a.m. ET
LAGOS, Nigeria (AP) -- At least 200 people were killed Tuesday when a gasoline pipeline exploded in Nigeria's biggest city of Lagos, a Red Cross official said. The death toll was expected to rise.
Ige Oladimeji, a senior official for the Nigerian Red Cross, said his workers had documented "over 200 and still counting."
"We can only recognize them through the skulls, the bodies are scattered over the ground," he said. Workers "can't get close enough because the fire is still burning."
Witnesses said the pipeline ruptured shortly after midnight and that people had been collecting leaking fuel in plastic cans for hours before the explosion. It wasn't clear what caused the initial rupture in the pipeline or the later explosion.
Hundreds of bodies could be seen jumbled and fused together in the raging flames at the blast site. Intense heat kept rescue workers back as smoke billowed over the heavily populated Adule Egba neighborhood.
The blast shook the neighborhood after dawn, Nigerian Red Cross spokesman Umar Mairiga said. He said 16 bodies had been taken to the morgue, but raging fires were hindering further recovery. Many people had been injured, he said.
Nigerians often tap into pipelines carrying refined fuel, scooping up the raw product in buckets or plastic bags. Spilled fuel spreading in pools sometimes ignites, immolating people nearby.
In May, more than 150 people died in a similar explosion in Lagos.
Nigeria is Africa's largest oil producer, but corruption, poor management and limited refining capacity often leave the country short of fuel for vehicles and stoves.
Shortages in recent days have prompted hours-long lines at Lagos filling stations.
Despite its immense wealth in oil and gasoline resources, Nigeria has been experiencing chronic shortages of both as those resources are exploited by mostly foreign oil companies and Nigerian politicians.
It remains one of the few countries in the world where tens of thousands of people often risk their lives to get a few quarts of gas.
Today's tragedy is yet another failure of the Nigerian government to recognize and correct its official greed and to start sharing its natural resource income with ordinary Nigerians. By all indications, it will not be the last - if the government last that long.
"Hundreds of mangled bodies" fused with one another in a grisly heap were visible in the flames, observers reported. There is no indication of when the fire will be controlled.
Here is the awful story:
Pipeline Explosion in Nigeria Kills More Than 200
By THE ASSOCIATED PRESS
Published: December 26, 2006
Filed at 7:57 a.m. ET
LAGOS, Nigeria (AP) -- At least 200 people were killed Tuesday when a gasoline pipeline exploded in Nigeria's biggest city of Lagos, a Red Cross official said. The death toll was expected to rise.
Ige Oladimeji, a senior official for the Nigerian Red Cross, said his workers had documented "over 200 and still counting."
"We can only recognize them through the skulls, the bodies are scattered over the ground," he said. Workers "can't get close enough because the fire is still burning."
Witnesses said the pipeline ruptured shortly after midnight and that people had been collecting leaking fuel in plastic cans for hours before the explosion. It wasn't clear what caused the initial rupture in the pipeline or the later explosion.
Hundreds of bodies could be seen jumbled and fused together in the raging flames at the blast site. Intense heat kept rescue workers back as smoke billowed over the heavily populated Adule Egba neighborhood.
The blast shook the neighborhood after dawn, Nigerian Red Cross spokesman Umar Mairiga said. He said 16 bodies had been taken to the morgue, but raging fires were hindering further recovery. Many people had been injured, he said.
Nigerians often tap into pipelines carrying refined fuel, scooping up the raw product in buckets or plastic bags. Spilled fuel spreading in pools sometimes ignites, immolating people nearby.
In May, more than 150 people died in a similar explosion in Lagos.
Nigeria is Africa's largest oil producer, but corruption, poor management and limited refining capacity often leave the country short of fuel for vehicles and stoves.
Shortages in recent days have prompted hours-long lines at Lagos filling stations.
Wednesday, December 20, 2006
ERHC's Search For New Chief Tech Officer Is Over
ERHC Energy's long search for a replacement for its former Chief Technical Officer - a demanding post now that there are actually rights to explore and immense challenges ahead in exploring them - has ended with the selection of former Aramco technology coordinator James Ledbetter, the company announced in a press release issues just after the market closed Tuesday.
Update, 5:30pm EST, 12/20/06: The good news lifted ERHE shares 9.5 percent by Wedbesday's close to $0.46 Bis and ).47 Ask on double our average volume - more than 1.5 million shares. The stock hit $0.50 for the second time during trading, as we predicted it would back on November 4.
Here is the release, courtesty of publicist Dan Keeney:
Update, 5:30pm EST, 12/20/06: The good news lifted ERHE shares 9.5 percent by Wedbesday's close to $0.46 Bis and ).47 Ask on double our average volume - more than 1.5 million shares. The stock hit $0.50 for the second time during trading, as we predicted it would back on November 4.
Here is the release, courtesty of publicist Dan Keeney:
FOR IMMEDIATE RELEASE
ERHC Energy Inc. Appoints Vice President Technical
HOUSTON, December 19, 2006 – ERHC Energy Inc. (OTCBB: ERHE), an independent oil and gas company with assets in the Gulf of Guinea, has announced the appointment of James Ledbetter to the position of Vice President Technical. Mr. Ledbetter begins his duties with ERHC Energy immediately.
Mr. Ledbetter brings more than 25 years experience in exploration and production projects to ERHC Energy. He has an international background, having worked on projects in more than 20 countries, including work in Australia, Europe, the Middle East, North and South America, and the Pacific Rim.
In addition to managing the Company’s relationships with consortium partners and various regulatory agencies in this new position, it is expected Mr. Ledbetter will play a key role in helping ERHC Energy expand its asset base and diversify beyond the Joint Development Zone.
“We are very pleased to have James join us and anticipate he will be pivotal in implementing a focused acquisition strategy that targets a credible portfolio of low- to medium-risk properties,” said Sir Emeka Offor, chairman of ERHC Energy’s Board of Directors. “We sought a person who could help to identify, acquire and manage prospects in which we discern a competitive advantage, and I believe James has the right background for the job. The Board’s goal is to build a significant revenue base that will have a positive impact on ERHC’s profitability for the benefit of its shareholders.”
Most recently, Mr. Ledbetter served as a technology coordinator for Saudi Aramco’s Research & Technology Division, where he coordinated more than 200 technology initiatives. Prior to that, he developed and evaluated the worldwide exploration portfolio for Occidental Oil & Gas Corporation as its chief of strategic planning & economics, worldwide exploration.
Prior thereto, Mr. Ledbetter worked for International Economic & Engineering Consultants, Inc., Kuwait Foreign Petroleum Exploration Company, Capitol Steel & Iron Company, Kerr-McGee Corporation and Cities Service Company.
“As operations are initiated in the Joint Development Zone (JDZ), the depth of experience and international perspective that James offers will be very valuable for ERHC Energy,” said Nicolae Luca, acting chief executive officer for ERHC Energy. “We are very pleased to welcome James onto our management team and look forward to his contribution to the exploration and exploitation of ERHC Energy’s rights.”
ERHC Energy holds exploration rights in six JDZ blocks, consisting of a 22 percent participating interest in JDZ Block 2, a 10 percent participating interest in JDZ Block 3, a 17.7 percent participating interest in JDZ Block 4, and a 15 percent working interest in JDZ Blocks 5, 6 and 9. Additionally, subject to certain restrictions, ERHC holds the right to receive up to two blocks of ERHC’s choice in Sao Tome’s Exclusive Economic Zone (EEZ) and holds the option to acquire up to 15 percent paid working interest in up to two additional blocks of ERHC’s choice in the EEZ.
Mr. Ledbetter earned a Bachelor’s Degree in Petroleum Engineering from the University of Tulsa.
Monday, December 18, 2006
More Fallout Over Starcrest/Addax Deal Touches Chukwueke
Tony Chukwueke, the former Chrome executive and close associate of ERHC Energy chairman Sir Emeka Offor, may be at the center of a new firestorm following his ouster as the head of the Petroleum Ministry last week. A report in an industry intelligence journal, Petroleum Africa, says Chukwueke is being seconded to the Dept. of Petroleum Resources, a former berth, to find out why billions of past-due payments due for non-JDZ blocks awarded in 2005 and 2006 have apparently not been made.
At another angle, however, the story appears to be yet another effort by majors working through Petroleum Africa to indict Offor, a Nigerian billionaire who has been decidedly unpopular with ExxonMobil, Chevron and Anadarko ever since he won a substantial cluster of rights concessions in the JDZ in open bidding last winter and then walked away with choice rights in OPL 291, outside the zone (see my December 1, 2006 post).
In fact, since the story is unsourced - as was the Barry Morgan story in UpstreamOnline that hinted at the same scandal - it is likely that someone from the majors' back office is peddling the story to a variety of publications. There is no indication that doing so has made the least bit of difference, however.
Here's the latest unsourced hit piece:
Nigeria’s DPR in $2.7 Billion Oil Scandal
© Petroleum Africa. All rights reserved.
http://petroleumafrica.com/read_article.php?NID=2798
Petroleum Africa has learned through inside sources that a scandal is about to break in Nigeria’s petroleum industry in regard to $2.7 billion in oil revenue that has yet to be collected from the 2005/2006 bid rounds.
Apparently a special meeting of high level government officials was called last Friday that included President Olusegun Obasanjo, Petroleum Resources Minister Dr. Edmond Daukoru, and Tony Chukwueke, the former head of the Department of Petroleum Resources (DPR). At the meeting Obasanjo was informed that many of the 2005/2006 bid round winners had not yet made payments for their respective blocks; 25 oil blocks were awarded in the 2005 round and 13 in the 2006 mini bid round.
The shocked president directed high-level officials at the meeting to set up a committee to look into the extent of default, and other problems associated with the bid rounds.
An excited Obasanjo gave both Daukoru and Chukwueke a firm directive to recover the money. “Where is my money, where is my money? You have to pay this money. It was in the budget and people are watching,” a panicked Obasanjo reportedly said.
Last month Chukwueke was re-assigned to the Petroleum Ministry over what was commonly believed to be related to the Starcrest/Addax deal for OPL 291. Earlier speculation had it that Chukwueke was to be reinstated, but at this time it does not appear a full re-instatement to DPR is likely for Chukwueke, but rather a return to the DPR to get the accounts in order, so to speak. He will be working with the Acting Director of DPR, Mrs. Chioma Njoku, while he carries out the President’s directive.
Our source postulated: “Industry watchers are beginning to wonder if Chukwueke’s removal last month from the DPR was solely as a result of the controversial Addax/ Starcrest $35m deal on OPL 291, or it is a case of a Pandora’s Box about to be blown open?”
At another angle, however, the story appears to be yet another effort by majors working through Petroleum Africa to indict Offor, a Nigerian billionaire who has been decidedly unpopular with ExxonMobil, Chevron and Anadarko ever since he won a substantial cluster of rights concessions in the JDZ in open bidding last winter and then walked away with choice rights in OPL 291, outside the zone (see my December 1, 2006 post).
In fact, since the story is unsourced - as was the Barry Morgan story in UpstreamOnline that hinted at the same scandal - it is likely that someone from the majors' back office is peddling the story to a variety of publications. There is no indication that doing so has made the least bit of difference, however.
Here's the latest unsourced hit piece:
Nigeria’s DPR in $2.7 Billion Oil Scandal
© Petroleum Africa. All rights reserved.
http://petroleumafrica.com/read_article.php?NID=2798
Petroleum Africa has learned through inside sources that a scandal is about to break in Nigeria’s petroleum industry in regard to $2.7 billion in oil revenue that has yet to be collected from the 2005/2006 bid rounds.
Apparently a special meeting of high level government officials was called last Friday that included President Olusegun Obasanjo, Petroleum Resources Minister Dr. Edmond Daukoru, and Tony Chukwueke, the former head of the Department of Petroleum Resources (DPR). At the meeting Obasanjo was informed that many of the 2005/2006 bid round winners had not yet made payments for their respective blocks; 25 oil blocks were awarded in the 2005 round and 13 in the 2006 mini bid round.
The shocked president directed high-level officials at the meeting to set up a committee to look into the extent of default, and other problems associated with the bid rounds.
An excited Obasanjo gave both Daukoru and Chukwueke a firm directive to recover the money. “Where is my money, where is my money? You have to pay this money. It was in the budget and people are watching,” a panicked Obasanjo reportedly said.
Last month Chukwueke was re-assigned to the Petroleum Ministry over what was commonly believed to be related to the Starcrest/Addax deal for OPL 291. Earlier speculation had it that Chukwueke was to be reinstated, but at this time it does not appear a full re-instatement to DPR is likely for Chukwueke, but rather a return to the DPR to get the accounts in order, so to speak. He will be working with the Acting Director of DPR, Mrs. Chioma Njoku, while he carries out the President’s directive.
Our source postulated: “Industry watchers are beginning to wonder if Chukwueke’s removal last month from the DPR was solely as a result of the controversial Addax/ Starcrest $35m deal on OPL 291, or it is a case of a Pandora’s Box about to be blown open?”
Friday, December 15, 2006
Upstream's Barry Morgan Floats Buy-In Rumor
Barry Morgan, the veteran industry reporter whose hit-or-miss record on ERHC stories is passable but not high, ran another one up the flagpole Thursday night suggesting that a Dubai company called Millennium - where former ERHC CEO Walter Brandhuber is charged with building Millennium's energy portfolio - is interested in "a stake" in the rights that might be acquired by buying some of Chairman Sir Emeka Offor's 300 million shares.
The story offers no supporting information at all, so you have to take it with a grain of (sea) salt. Admittedly, there's been a lot of talk - almost exclusively confined to one Investor's Hub message board - about buy-ins and buy-outs as investors drove the share price up $0.12 on rumors several weeks ago. Nothing came of those rumors, which were similar in most respect to today's, other than some of the smarter players pocketing bundles of cash on the sale of their multimillion-share hoards.
That's a common ploy with the group of players that dominate the board and drive out unbelievers who may demur. Its moderator is a woman who has been ERHC co-founder Phil Nugent's Houston CPA for decades, and it's hard to imagine any rockets getting launched over there without his matches.
If it is more than a plan to snatch your Christmas money, it has eluded our sources. We continue to urge caution, at least until the SEC and FBI wind up their probes.
Here is Barry Morgan's article:
The story offers no supporting information at all, so you have to take it with a grain of (sea) salt. Admittedly, there's been a lot of talk - almost exclusively confined to one Investor's Hub message board - about buy-ins and buy-outs as investors drove the share price up $0.12 on rumors several weeks ago. Nothing came of those rumors, which were similar in most respect to today's, other than some of the smarter players pocketing bundles of cash on the sale of their multimillion-share hoards.
That's a common ploy with the group of players that dominate the board and drive out unbelievers who may demur. Its moderator is a woman who has been ERHC co-founder Phil Nugent's Houston CPA for decades, and it's hard to imagine any rockets getting launched over there without his matches.
If it is more than a plan to snatch your Christmas money, it has eluded our sources. We continue to urge caution, at least until the SEC and FBI wind up their probes.
Here is Barry Morgan's article:
Players in chase for JDZ stake
By Upstream staff
An unidentified US oil player is said tro be among an assortment of investors trying to enter the Nigeria&Sao Tome Joint Development Zone in the Gulf of Guinea by acquiring the shares of Emeka Offor, the Nigerian chairman of Colorado-registered ERHC Energy, writes Barry Morgan.
ERHC holds substantial equity in the play, including preferential rights to blocks 2, 3 and 4 alongside operators Sinopec, Anadarko and Addax Petroleum.
The financial manoeuvre is being undertaken through the Dubai-based Millennium Finance Corporation, where former ERHC chief executive Walter Brandhuber is now fund manager with a brief to build up the energy portfolio.
Investors and Millennium Finance may be angling to take a stake in ERHC, drawn from stock sold by Emeka Offor, the company's largest single shareholder, who is in talks to offload at least half his 43% equity in ERHC.
Offor is facing legal threats by shareholders preparing individual and class-action lawsuits.
Their complaints range from compensation for unpaid fees to the alleged usurpation of corporate opportunity arising from a deal he struck with Addax Petroleum for deep-water acreage through Nigerian independent Starcrest Energy, another company he controls.
ERHC Narrows Loss In 2rd Quarter
A press release form ERHC Energy says that the company narrowed its losses in the 3rd Quarter of 2006 ended Sept. 30, and that year-to-year expenses are also sharply down.
The release follows a November update from CEO Nicolae Luca telling investors that despite the company's cooperation with probes mounted by the FBI and SEC, those continue to eat away at resources better used in developimng its Gulf of Guineau rights.
The Luca shareholder letter last week said the company is looking to exploit opportunities in the GoG as its steers toward budget decisions for its drilling program in 2007. He repeated that theme in Thursday's release.
"Though our successes were overshadowed at times by various challenges, this has been a year in which we made significant strides toward exploiting our assets in the JDZ," Luca said.
Shares on the Pink Sheets lagged yet another day on Thursday, with just over 409,000 traded in a range of $0.40 to $0.42. ERHE closed in the black on a gain of one cent to $0.42.
Here is the press release, courtesy of ERHC publicist Dan Keeney of Houston:
The release follows a November update from CEO Nicolae Luca telling investors that despite the company's cooperation with probes mounted by the FBI and SEC, those continue to eat away at resources better used in developimng its Gulf of Guineau rights.
The Luca shareholder letter last week said the company is looking to exploit opportunities in the GoG as its steers toward budget decisions for its drilling program in 2007. He repeated that theme in Thursday's release.
"Though our successes were overshadowed at times by various challenges, this has been a year in which we made significant strides toward exploiting our assets in the JDZ," Luca said.
Shares on the Pink Sheets lagged yet another day on Thursday, with just over 409,000 traded in a range of $0.40 to $0.42. ERHE closed in the black on a gain of one cent to $0.42.
Here is the press release, courtesy of ERHC publicist Dan Keeney of Houston:
FOR IMMEDIATE RELEASE
ERHC Energy Inc. Reports Fourth Quarter and
Year End Financial Results
HOUSTON, December 14, 2006 – ERHC Energy Inc. (OTCBB: ERHE), an independent oil and gas company with assets in the Gulf of Guinea, today announced its results for the fourth quarter and year ended September 30, 2006.
As of September 30, 2006, ERHC reported cash assets totaling $41 million.
During the three months ended September 30, 2006, ERHC had a net loss of $1,039.670, compared to a net loss of $2,786,906 for the three months ended September 30, 2005. General and administrative expenses during the fourth quarter totaled $1,569,158, a reduction of $1.2 million compared to the same period a year earlier.
For the fiscal year ended September 30, 2006, ERHC had net income of $23.2 million, compared with a net loss of $11.3 million for the fiscal year ended September 30, 2005. The improvement in net income was the result primarily of a $30.1 million net gain from sale of participating interests in Blocks 2, 3 and 4 of the Joint Development Zone (JDZ) and a conversion of $5.7 million in debt to common stock and income tax expenses. For the year, general and administrative expenses were up 29 percent over fiscal year 2005, mostly due to an increase in legal costs.
“Though our successes were overshadowed at times by various challenges, this has been a year in which we made significant strides toward exploiting our assets in the JDZ,” said Nicolae Luca, acting chief executive officer. “With a solid financial position and strong relationships with strategic partners Addax Petroleum and Sinopec, we believe that we are positioned well for the coming year.”
ERHC Energy holds exploration rights in six JDZ blocks, consisting of a 22 percent participating interest in JDZ Block 2, a 10 percent participating interest in JDZ Block 3, a 17.7 percent participating interest in JDZ Block 4, and a 15 percent working interest in JDZ Blocks 5, 6 and 9.
Monday, December 04, 2006
ERHC Shares Up 38.89 % On No News; Beware Of Buyout Scenario
Shares of ERHC Energy have rocketed upward on stronger-than usual volume from the opening bell this morning, possibly in anticipation of the announcement I said on Friday that coukld come from the Justice Dept., SEC or the company regarding its issues under the Foreign Corrupt Practices Act.
What some investors are being told, however, through the made-up entity "S. Freed" on the subscriber-based, pumpers-only Elephant Fields board, is that Sir Emeka Offor has decided to sell 20 percent of the company for somewhere in the range of $2 per share. This hidden-source rocketry may cost some investors dearly, as the information is almost certainly false, I believe, and their willingness to buy in anticipation of such a deal will be used to clean them out once again.
With the share price at 3:12pm standing $0.50 - now up $0.14, or 38.89 percent, the real certainty to me is that the Justice Dept. has, as we have said all along, found no evidence of wrongdoing by ERHC Energy and will not seek an indictment.
What some investors are being told, however, through the made-up entity "S. Freed" on the subscriber-based, pumpers-only Elephant Fields board, is that Sir Emeka Offor has decided to sell 20 percent of the company for somewhere in the range of $2 per share. This hidden-source rocketry may cost some investors dearly, as the information is almost certainly false, I believe, and their willingness to buy in anticipation of such a deal will be used to clean them out once again.
With the share price at 3:12pm standing $0.50 - now up $0.14, or 38.89 percent, the real certainty to me is that the Justice Dept. has, as we have said all along, found no evidence of wrongdoing by ERHC Energy and will not seek an indictment.
Friday, December 01, 2006
Upstream Article Roils Waters; Some Investors Wary, But Deal Holds Promise
An article in UpstreamOnline that talks about a complex deal involving a company called Starcrest and ERHC Energy and the dilution of ERHE shares has left investors in an uproar - most of them angry at Upstream for what they say is an unfounded new attack on the company.
As we said in our last post, the company was due a $0.05 share price hike after good news on drilling rigs and schedules leaked from the Nigeria-Sao Tome and Principe and Joint Development Authority. The new revelation set off a small wave of selling this morning at the bell, though, with 28,000 shares trading before a buy was made and the price falling from the opening Bid of $0.385 and Offer of $0.39 to $0.365 and $0.375 at 10:08am EST, respectively. Trading is light. Note: We had mentioned a downside in our last column, too.
The article was written by Barry Morgan, who has written frequently about the company in the past. While he is often praised, yesterday's missive - or missile, more like it - detonated a growing stockpile of anger among shareholders who have seen their investment languish for endless months of low volume as the company awaits the next step by the SEC and the Justice Dept. in the Foreign Corrupt Practices Act probe of the company that began last April.
The problem, in short, is that the aticle says ERHC Energy CEO Sir Emeka Offor owns both companies, and by issuing new ERHE shares to acquire all of Starcrest he would then reap those shares, as well, increasing his stake in ERHE from 43 percent to 70 percent.
The deal as outlined is a stroke of genius that may leave his critics awed yet angrier than ever. The prospects of OPL 291 are the caveat in any criticism, though. If ERHC Energy ends up as owner of Starcrest and its rights in OPL 291, and the block as expected pays off in a big strike, the company's fortunes could again soar overnight. The dilution issue would evaporate in that case.
The positive side of the article is that Offor is not sitting on his thumbs while the majors mount their political attacks through the U.S. Justice Deopt. and SEC; instead, he is seeing opportunities and taking them, appearances be damned. That is how billionaires are made.
Here is the article:
What is fascinaing is how incredibly agile Mr. Offor is when it comes to making deals. He had set his eye on two other non-JDZ blocks and won them, but was apparently persuaded by his JDZ partners at Addax to swap them for OPL 291 instead. The winning bid for OPL 291 was from India's ONGC, another crafty player, but ONGC couldn't pay the hefty $55 million licensing fee.
Starcrest's original partner in the bid for the two other blocks (collateral for the swap), Chinese Petroleum Corp., dropped out, and Offor tried to link with Sinopec, a government-owned Chinese company, but it couldn't make a quick decision and Offor replaced them with Addax. With Addax, he got the identical good deal he got from the Swiss driller in their JDZ partnership.
Once again, as other companies faltered, Offor seized the day and came out on top.
That has always been the pattern: In Blocks 2 and 3, he replaced Pioneer and Devon with Sinopec and Addax in a heartbeat, just as he'd earlier replaced Noble Energy with Addax in Block 4. The process, from the outside, looked seamless and brilliant; investors shocked by the Noble defection sold out, and the ERHE share price shot up almost instantly; the same occurred in Blocks 2 and 3, with sharp price drops followed by sharp rises when the malefactors were replaced.
But is that in the cards today and tomorrow?
We're dealing, if you'll permit me to abuse the paradigm of myth, with a many-footed Hydra, and there are thus more than two shoes that may fall. My suspicion is that an announcement on the SEC and Justice Dept. probes is near, perhaps within a business day or two. I expect it to be a positive announcement, but I am not urging investors to bet that I am right. To me, the place to be right now is on the sidelines, watching a fabulous football game in which all the players but one wear sunglasses. If the ball disappears in the sun, he's fried; if the skies cloud over, they are blind.
As we said in our last post, the company was due a $0.05 share price hike after good news on drilling rigs and schedules leaked from the Nigeria-Sao Tome and Principe and Joint Development Authority. The new revelation set off a small wave of selling this morning at the bell, though, with 28,000 shares trading before a buy was made and the price falling from the opening Bid of $0.385 and Offer of $0.39 to $0.365 and $0.375 at 10:08am EST, respectively. Trading is light. Note: We had mentioned a downside in our last column, too.
The article was written by Barry Morgan, who has written frequently about the company in the past. While he is often praised, yesterday's missive - or missile, more like it - detonated a growing stockpile of anger among shareholders who have seen their investment languish for endless months of low volume as the company awaits the next step by the SEC and the Justice Dept. in the Foreign Corrupt Practices Act probe of the company that began last April.
The problem, in short, is that the aticle says ERHC Energy CEO Sir Emeka Offor owns both companies, and by issuing new ERHE shares to acquire all of Starcrest he would then reap those shares, as well, increasing his stake in ERHE from 43 percent to 70 percent.
The deal as outlined is a stroke of genius that may leave his critics awed yet angrier than ever. The prospects of OPL 291 are the caveat in any criticism, though. If ERHC Energy ends up as owner of Starcrest and its rights in OPL 291, and the block as expected pays off in a big strike, the company's fortunes could again soar overnight. The dilution issue would evaporate in that case.
The positive side of the article is that Offor is not sitting on his thumbs while the majors mount their political attacks through the U.S. Justice Deopt. and SEC; instead, he is seeing opportunities and taking them, appearances be damned. That is how billionaires are made.
Here is the article:
Nigeria defiant over its awards Ministry says round followed 'routine practice' but potential future bidders stay wary
By Upstream staff
THE Nigerian Ministry of Petroleum has defended the way it awarded deep-water blocks outside of procedures dictated for last May's mini-round, suggesting "routine oil industry practice" was followed.
Majors bidding for the blocks remain unconvinced, clouding plans to hold another licensing exercise before the end of the year.
The acquisition by Addax Petroleum of Nigerian independent Starcrest's interest in OPL 291 was defended as "in line with the open and transparent bidding for acreage allocation in the 2005 round", according to ministry spokesman Peter Ogbonnaya. The same process will be adopted in future rounds, he said.
Minister of State for Petroleum Edmund Daukoru insisted Starcrest, in partnership with Taiwan's Chinese Petroleum Corporation, qualified to participate in the mini-round, winning OPLs 226 and 294 while Transcorp won OPLs 281 and 295.
India's Oil & Natural Gas Corporation/Mittal Energy tie-up won right of first refusal to OPL 291 but did not submit any bid, leaving the acreage stranded, Daukoru said.
This justified a request by both Transcorp and Starcrest/CPC to swap their own blocks for OPL 291, but Transcorp failed to pay the signature bonus, leaving the way clear for Starcrest/CPC to find $55 million and secure the block.
When CPC withdrew, Starcrest applied to replace its operating partner with Addax. Daukoru's explanation has left industry observers wondering why, if everything was above board, the director of the Department of Petroleum Resources (DPR) Tony Chukwueke was forced out of his job so abruptly two weeks ago.
Neither Transcorp nor Starcrest indicated interest in OPL 291 at the time, nor did they later apply on the floor of the conference to swap their own blocks for the acreage, said a senior executive present during proceedings.
Both companies are alleged to be associated with close business allies of the presidency and to have benefited from secret post-bidding manoeuvres, unwitnessed by other participants.
Faith in the ability of Abuja to conduct fair and open tendering before next April's elections has collapsed, as has morale at the DPR.
Junior assistant director of finance Chioma Njoku has been appointed acting director of the DPR, over the heads of more senior directors such as veteran upstream petrocrats Billy Agha and Olutoye Ibikunle who were deemed to be too close to Chukwueke.
Starcrest is owned by Ibo business magnate Emeka Offor and is under investigation by Abuja's Economic & Financial Crimes Commission.
Starcrest tried its luck with Sinopec after the deal with CPC fell through but the Beijing giant was unhappy with the tight time frame for concluding an agreement on OPL 294.
Addax persuaded Starcrest to instead pursue OPL 291 and in partnership with Starcrest managed to secure terms from the DPR exactly similar to the deal Addax had earlier signed with ERHC Energy in the Joint Development Zone.
At least 43% of ERHC equity is also owned by Offor, who has angled to acquire Starcrest by issuing additional ERHC shares - a move that at one fell swoop would land him about 70% of ERHC stock in the most prospective frontier oil province in west Africa. Minnow ERHC enjoys a key position with Addax in JDZ blocks 2, 3 and 4.
Offor also came under fire this week from Colorado-registered ERHC shareholders for appearing to commit a breach of fiduciary duty by diverting a commercial opportunity for his own benefit, preferring to press the interests of Starcrest rather than ERHC in Nigeria's Exclusive Economic Zone.
Burgeoning disquiet among ERHC shareholders may yet result in a class action derivative lawsuit under US federal jurisdiction designed to prompt Offor to revaluate his acquisition strategy in the Gulf of Guinea.
A spotlight thrown on the world of Nigerian licence allocations at this juncture could dissolve all confidence in the country's upstream policy until a new administration takes charge next May.
--------------------------------------------------------------------------------
01 December 2006 00:01 GMT | last updated: 01 December 2006 00:01 GMT.
What is fascinaing is how incredibly agile Mr. Offor is when it comes to making deals. He had set his eye on two other non-JDZ blocks and won them, but was apparently persuaded by his JDZ partners at Addax to swap them for OPL 291 instead. The winning bid for OPL 291 was from India's ONGC, another crafty player, but ONGC couldn't pay the hefty $55 million licensing fee.
Starcrest's original partner in the bid for the two other blocks (collateral for the swap), Chinese Petroleum Corp., dropped out, and Offor tried to link with Sinopec, a government-owned Chinese company, but it couldn't make a quick decision and Offor replaced them with Addax. With Addax, he got the identical good deal he got from the Swiss driller in their JDZ partnership.
Once again, as other companies faltered, Offor seized the day and came out on top.
That has always been the pattern: In Blocks 2 and 3, he replaced Pioneer and Devon with Sinopec and Addax in a heartbeat, just as he'd earlier replaced Noble Energy with Addax in Block 4. The process, from the outside, looked seamless and brilliant; investors shocked by the Noble defection sold out, and the ERHE share price shot up almost instantly; the same occurred in Blocks 2 and 3, with sharp price drops followed by sharp rises when the malefactors were replaced.
But is that in the cards today and tomorrow?
We're dealing, if you'll permit me to abuse the paradigm of myth, with a many-footed Hydra, and there are thus more than two shoes that may fall. My suspicion is that an announcement on the SEC and Justice Dept. probes is near, perhaps within a business day or two. I expect it to be a positive announcement, but I am not urging investors to bet that I am right. To me, the place to be right now is on the sidelines, watching a fabulous football game in which all the players but one wear sunglasses. If the ball disappears in the sun, he's fried; if the skies cloud over, they are blind.
Wednesday, November 29, 2006
Mark St. Amour Offers Upbeat News From Nigeria
It hasn't lifted ERHE's share price yet - we've fallen to $0.32, where texasspeculatior entered four years ago, he said - but Mark. St. Amour revived investors' spirits today with the news of an upcoming Nigeria-Sao Tome and Principe Joint Development Authority meeting in mid-December to finalize operating budgets proposed by concessionaires in the Joint Development Zone.
Those ought to reflect a drilling cost for operations that Mark believes (too optimistically, I think) will begin in February or March. ERHC Energy's partner, Addax Petroleum, had "conservatively" forecast a 2008 start in our Blocks 2, 3 and 4, Mark's JDZ source told him, and a Summer 2007 start appears more likely, the source said. Mark's post also carries hints that drilling rigs may be available earlier, and if that is the case, it ought to provide at least a five-cent boost to the current $0.32 share price.
There is a downside to this news, though. That is that we seem to be headed for a return to the $0.28 - $0.295 level where I purchased about 90,000 new shares in December 2005. I would like to see that entry point again, and despite Mark's good news, I think we will. The other shoe has yet to fall - i.e., we do not know with certainty whether there will be an indictment in the FCPA probe - and that has a powerful depressant effect on our share price. In my dreams, I can even imagine a momentary opportunity as low as $0.22.>br>
The important thing about Mark's post is that it brings not only optimism but some (albeit vague) factual data to answer our queastions, and that has been lacking from the mix for a rather long time. Good work, Mark.
Here's his post, straight from Nashville:
****UPDATE JDA***** FINALLY
Those ought to reflect a drilling cost for operations that Mark believes (too optimistically, I think) will begin in February or March. ERHC Energy's partner, Addax Petroleum, had "conservatively" forecast a 2008 start in our Blocks 2, 3 and 4, Mark's JDZ source told him, and a Summer 2007 start appears more likely, the source said. Mark's post also carries hints that drilling rigs may be available earlier, and if that is the case, it ought to provide at least a five-cent boost to the current $0.32 share price.
There is a downside to this news, though. That is that we seem to be headed for a return to the $0.28 - $0.295 level where I purchased about 90,000 new shares in December 2005. I would like to see that entry point again, and despite Mark's good news, I think we will. The other shoe has yet to fall - i.e., we do not know with certainty whether there will be an indictment in the FCPA probe - and that has a powerful depressant effect on our share price. In my dreams, I can even imagine a momentary opportunity as low as $0.22.>br>
The important thing about Mark's post is that it brings not only optimism but some (albeit vague) factual data to answer our queastions, and that has been lacking from the mix for a rather long time. Good work, Mark.
Here's his post, straight from Nashville:
****UPDATE JDA***** FINALLY
Sorry this took so long. Looks to be well worth the wait. I had questioned/doubted Spec29's BD rig rumor but looks like he may be correct.
I spoke with my JDA source. He said all block consortia are meeting next week and week after (next 10-15 days) to finalize 2007 Budgets. I asked him about drilling and he commented drilling will begin in 2007 (Blocks 2,3,4). I asked him how certain he was of this and asked him if this was just hopeful thinking. He basically stopped me in my tracks and said he was 100% certain drilling would begin in 2007. This also includes CVX drilling another well in Block 1 in 2007. His point was that the operators have a lot of pressure to meet their minimum commitments for drilling. I pointed out that Addax has been saying 2008 for start of drilling. He pointed out they have to be very conservative in their comments/presentations, which makes perfect sense. Addax did say however that if a "rig of opportunity" became available it could be 2007. I asked about timeline (1st,2nd,3rd,4th QTR 2007?). He said he could not be specific but he was certain drilling would begin in 2007 and very likely first 1/2 of 2007. He told me to call back in mid-Dec after meetings have been concluded and he will be able to give me specifics. It was very interesting he mentioned the BD Rig that Spec29 has been talking about. I asked where he heard this info and he told me he heard from people very close to the companies. He said he was hearing the same thing about BD drilling early 2007 but would not comment on Exact date or which block. He says this has to be "formally submitted" before he can further comment on this. This should all happen within next 10-15 days.
Ok, now all the bashers can come out and say I am lying. What you can do is call for yourself. The numbers are on the JDA website. Also, I asked my JDA source numerous times how certain he was of drilling in 2007. Almost to the point of being offensive. He was adamant that drilling will begin in 2007. In his tone he acted as if it was almost common knowledge and that I should have already known this.
IMO, I think we see drilling in JDZ Feb-March. Just my opinion based on my call and other sources.
Sorry if this update seems a little hard to follow. I am busy with work and have to hop back to it.
Cheers,
Mark
Take my posts for what they are worth. Better yet do your due diligence. Long and Strong ERHE.
Wednesday, November 22, 2006
ERHC Disappoints, But VION Pick Soars
I guess I have the right to brag a little about this column's recommendation of VION, a small pharmaceutical company whose stock a few months ago had fallen to a very affordable $1.01. I told folks I thought it was a great price, and bought 4,800 shares myself. In the lamented good ol' days, I might have plunged for a bigger chunk, as I felt strongly about it, but alas, my foolish dalliance with high-intensity day-trading - I spent $5,000,000 in March alone - cost me dearly.
Well, my financial ship has righted, but I made the mistake of selling the Vion around $1.09 to help a friend save his store on his promise to pay me back the following week. I should have known better, but I didn't want him to lose his store, and he and his wife are personal friends, but the repayment has stretched now to more than three months and he still owes me all but $700 of the entire principal, and I probably will have to go to court.
VION, in the meantime, has climbed to $1.84, although it's fallen back to $1.78 this morning. I think it has a little ways to go, though. That 84 percent profit is the kind of money we ought to have been enjoying in our investment in ERHC Energy, and while that will probably come, we have waited a very, very long time. This was Chevron and Exxon Mobil's design, I believe, when as I also allege, they used their political influence to snag the company in a phony foreign corruption probe they also fomented.
The plan was to cause our investors to suffer interminable delays while our money was frittered away on high-powered lawyers and complex international legal issues. This is an excellent plan, and it is working like a charm. There has been no crime committed, but ERHC Energy remains in a state of suspended animation while that fact is being established by a very dilatory U.S. Attorney in Washington - not Houston, where the case should have been initiated.
What does this mean for invesgtiors?
Well, in my opinion, even the U.S. Attorney at some point has to face the absence of probative facts and accept a "no bill" before the federal grand jury that is presumably hearing some aspect of this case. US Atty. Mary K. Dimke is fortunate, though, that media reports - and nothing else - have very imperfectly linked the issue to the William Jefferson case, where it had no role and no exposure beyond a yellow press clipping found in a file bearing Jefferson's name in ERHC Energy's offices during the armed raid by an FBI SWAT team that scared our three employees - our poor secretary, former CFO and ex-CEO Walter Brandhuber - half to death. Now we have only two employees to scare.
Meanwhile, though, I have spent three hours in face-to-face conversation with someone who is extremely familiar with the woman who wore the wire in the Jefferson case. That has left me fully briefed on elements of that case, and I can guarantee you the information supplied by my new acquaintance will dramatically undercut the Jefferson probe as well. As that case is eroded, and the U.S. Attorney faces a major embarrassment, the ties to ERHC Energy will evaporate as they ought to; they were never more than a guilt-by-association rap against two long-ago proponents of ERHC who had already moved on to the big and lucrative GEECF scam.
Chevron and ExxonMobil, acting - we believe - through the former Chief Counsel for the Senate Energy Committee, Judy Pensabene - whose husband Greg (last time we checked) is chief lobbyist for Anadarko and a strong Democratic Party contributor (and former Clinon Administration Energy Dept. official), ERHC's rival for the priceless Block 3 and Block 4 rights we won in the Nigeria-Sao Tome and Principe Joint Development Zone (where the Chevron and ExxonMobil venture has already found at least a billion barrels of oil, partly under our Block 2 rights) will likely come up with some scheme to either extend the probe or concoct evidence through their maze of intermediaries.
But ERHC Energy's day will inevitablty come, because it is fundamentally innocent of anything but being Nigerian, which by itself is apparently a federal crime these days. That's why those long-term investors who are not in and out daily seeking small gains are likely to prosper mightily by the time it all winds to an end. Our company will not give up its rights or sell them off short of a massive offer, and Chevron and ExxonMobil will lose out when one of the world's richest oil deposits is ultimately located in Blocks 2 and 4.
By the way, look for ExxonMobil to go to $69 ex-dividend. Some folks have all the luck.
Disclosure: I own no shares of ERHE or VION, and a trustee controls the 1,500-odd shares of Chevron held by our family trust.
Well, my financial ship has righted, but I made the mistake of selling the Vion around $1.09 to help a friend save his store on his promise to pay me back the following week. I should have known better, but I didn't want him to lose his store, and he and his wife are personal friends, but the repayment has stretched now to more than three months and he still owes me all but $700 of the entire principal, and I probably will have to go to court.
VION, in the meantime, has climbed to $1.84, although it's fallen back to $1.78 this morning. I think it has a little ways to go, though. That 84 percent profit is the kind of money we ought to have been enjoying in our investment in ERHC Energy, and while that will probably come, we have waited a very, very long time. This was Chevron and Exxon Mobil's design, I believe, when as I also allege, they used their political influence to snag the company in a phony foreign corruption probe they also fomented.
The plan was to cause our investors to suffer interminable delays while our money was frittered away on high-powered lawyers and complex international legal issues. This is an excellent plan, and it is working like a charm. There has been no crime committed, but ERHC Energy remains in a state of suspended animation while that fact is being established by a very dilatory U.S. Attorney in Washington - not Houston, where the case should have been initiated.
What does this mean for invesgtiors?
Well, in my opinion, even the U.S. Attorney at some point has to face the absence of probative facts and accept a "no bill" before the federal grand jury that is presumably hearing some aspect of this case. US Atty. Mary K. Dimke is fortunate, though, that media reports - and nothing else - have very imperfectly linked the issue to the William Jefferson case, where it had no role and no exposure beyond a yellow press clipping found in a file bearing Jefferson's name in ERHC Energy's offices during the armed raid by an FBI SWAT team that scared our three employees - our poor secretary, former CFO and ex-CEO Walter Brandhuber - half to death. Now we have only two employees to scare.
Meanwhile, though, I have spent three hours in face-to-face conversation with someone who is extremely familiar with the woman who wore the wire in the Jefferson case. That has left me fully briefed on elements of that case, and I can guarantee you the information supplied by my new acquaintance will dramatically undercut the Jefferson probe as well. As that case is eroded, and the U.S. Attorney faces a major embarrassment, the ties to ERHC Energy will evaporate as they ought to; they were never more than a guilt-by-association rap against two long-ago proponents of ERHC who had already moved on to the big and lucrative GEECF scam.
Chevron and ExxonMobil, acting - we believe - through the former Chief Counsel for the Senate Energy Committee, Judy Pensabene - whose husband Greg (last time we checked) is chief lobbyist for Anadarko and a strong Democratic Party contributor (and former Clinon Administration Energy Dept. official), ERHC's rival for the priceless Block 3 and Block 4 rights we won in the Nigeria-Sao Tome and Principe Joint Development Zone (where the Chevron and ExxonMobil venture has already found at least a billion barrels of oil, partly under our Block 2 rights) will likely come up with some scheme to either extend the probe or concoct evidence through their maze of intermediaries.
But ERHC Energy's day will inevitablty come, because it is fundamentally innocent of anything but being Nigerian, which by itself is apparently a federal crime these days. That's why those long-term investors who are not in and out daily seeking small gains are likely to prosper mightily by the time it all winds to an end. Our company will not give up its rights or sell them off short of a massive offer, and Chevron and ExxonMobil will lose out when one of the world's richest oil deposits is ultimately located in Blocks 2 and 4.
By the way, look for ExxonMobil to go to $69 ex-dividend. Some folks have all the luck.
Disclosure: I own no shares of ERHE or VION, and a trustee controls the 1,500-odd shares of Chevron held by our family trust.
Wednesday, November 08, 2006
Ali Memon Registers 1.27 Million Shares For Sale
Ali Memon, the congenial, low-key former president of ERHC Energy and onetime head of Marathon oil operations in Africa, has registered his intent to sell some 1,272,727 formerly restricted shares he obtained as compensation during his term as ERHC's operational head twice removed, and the share price slipped briefly to $0.35 as the news spread.
The move was not necessarily made for any other reason than that it is Memon's first opportunity to register the shares as required by the Securities Exchange Commission.
But the prospect of a possible indictment from the ongoing FBI investigation of ERHC's dealings with Sao Tome and Nigerian officials, or a fine arising from the SEC's current Nigeria-Sao Tome Joint Development Zone, probably unsettled investors who were buoyed just last week by a $0.03 gain in the share price to $0.39 from lingering lows of $0.34.
As we see it, though, the filing is immaterial. Some posters have suggesed the former CEO was moved to register the sale by coming good news about a possible buyout from Sinopec, or any number of other rumors that have surfaced on I-Hub in recent months. None have panned out, however, and we feel significant movement is unlikely to come until the FBI and SEC issues are resolved.
Indeed, when that may happen is the most salient question facing prospective investors, who are advised once again to be watchful and cautious. We do believe the share price will make a comeback at least to the $0.50 level before the year is out, and we believe that resurgence will be attributable to good news about the probes. Those, we feel certain, are politically motivated and unlikely to prosper. In the meantime, we remain out of the stock, although we hope to make an entry at the @0.34 level or lower in coming weeks.
Here is the essence of the Memon registration document:Br>
The move was not necessarily made for any other reason than that it is Memon's first opportunity to register the shares as required by the Securities Exchange Commission.
But the prospect of a possible indictment from the ongoing FBI investigation of ERHC's dealings with Sao Tome and Nigerian officials, or a fine arising from the SEC's current Nigeria-Sao Tome Joint Development Zone, probably unsettled investors who were buoyed just last week by a $0.03 gain in the share price to $0.39 from lingering lows of $0.34.
As we see it, though, the filing is immaterial. Some posters have suggesed the former CEO was moved to register the sale by coming good news about a possible buyout from Sinopec, or any number of other rumors that have surfaced on I-Hub in recent months. None have panned out, however, and we feel significant movement is unlikely to come until the FBI and SEC issues are resolved.
Indeed, when that may happen is the most salient question facing prospective investors, who are advised once again to be watchful and cautious. We do believe the share price will make a comeback at least to the $0.50 level before the year is out, and we believe that resurgence will be attributable to good news about the probes. Those, we feel certain, are politically motivated and unlikely to prosper. In the meantime, we remain out of the stock, although we hope to make an entry at the @0.34 level or lower in coming weeks.
Here is the essence of the Memon registration document:Br>
FILER: MEMON ALI
TITLE: Shareholder
BROKER: NFS LLC
RESTRICTED SHARES TO SELL: 1,272,727 DATE REGISTERED: 11/3/2006
APPROXIMATE DATE OF SALE: N/A
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