ERHC Energy Inc (ERHE)

[Strategyone]

What a strange day.

First, I actually fall more into MTO's camp on this whole tax audit/disclosure issue. I am not pleased at all with how this looks. That said, I have no idea why or how multiple third party auditors have signed off on all this till now. I still think there is way more than I understand on this whole issue. ERHE, you should update all your shareholders on what this means and how you plan to rectify the issue (do you think they are listening?).

The good news is that this tax audit/lien issue is exactly that, a sideline and long developing or unfolding issue regarding something from 2006 which is not the underlying business of ERHE. It looks to be an argument over how ERHE wanted to offset some expenses to the cash they received from the JDZ.

We can now say definitively that ERHE negotiated one of their EEZ blocks to be worth $4 million. No more discussion there except I was expecting more details on what they might get as a trailer if oil is discovered. I guess it is not big enough to put in a filing???

Anyway, I guess we can pretty much assume the other remaining EEZ block is worth about $4 million in the current state of low oil prices and no discoveries in the EEZ yet. At least that is more than the entire market cap of ERHE.

Now, what is going on with the price today? Up 65% on low volume to .14 and my ask currently shows .24. Maybe there is more news on the way. That is the only thing I can come up with because I wouldn't say there was anything else in that 10 Q to justify a spike up.....

I guess there is sooooooo much negativity built into the share price that "the market" was expecting worse and now it is telling us ERHE is undervalued currently.

The fear gap will eventually close.