Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
I don't think it's so much out-of-touch management as it is certain out-of-touch shareholders.
Up 3.3 cents since LOI announcement Monday morning. That's a 60% gain in 4 days. Closing at high of the day each day. (historical stock prices)
Congratulations to all who were able and willing to support the rights offer. We now have nearly a 15% gain on our shares acquired via the RO.
And we have not even gotten the details on the farm-in yet.
Maybe "Ebiye" will be "goodly" or "favorable" for the JDZ. Stay tuned.
Does anyone know what "Ebiye" means?
In the Ijaw language it has something to do with "good":
ebi v.t good, goodness, progress, favour, blessing
Ebi n Good
I second OC's comment. Glad to have you posting and contributing your ERHC knowledge/background info and observations!
BT, I am so glad you posted this. It really shows up some of the baseless comments made on this board by people who do not know what they're talking about.
I will say this, the JDZ is not dead.
Yes, I agree. No doubt they've been "courting" suitors for sometime, even as management has intimated. These things don't happen overnight.
Don't know if you were here before the JDZ bids... but those of us who were, were blown away at the deals that ERHC negotiated with JDZ partners. True, some left, but despite that setback, ERHC came through with the goods, signing up Addax and Sinopec.
With Kenya, ERHC wisely waited it out. Adamantine probably jumped too early to get a partner. Since then (9/17/2012), more tantalizing details have been released on the region by Africa Oil, Tullow, Adamantine itself, and others:
2013/4/29: Time Running Out to Grab Juniors in Kenya Before They Make Huge Gains
2013/4/22: Kenya Block 11b Satellite Review Completed
2013/4/15: Lower Lokhone oil discovery made at Ngamia-1 well in Kenya
2013/4/15: Ngamia-1 Churning 281 Barrels of Oil Daily
2013/4/15: Tullow tests oil in Kenya, finds indications in Ethiopia
2013/2/26: Ngamia-1 oil discovery in Kenya
2013/2/22: Tullow Drills for Ethiopia’s First Oil in Kenyan Extension
2013/2/21: Twiga South-1 well flows 2,800 bopd
(And others I probably have left out....)
So I am glad they have not rushed into a deal. Given ERHC management's past negotiations, I will not be surprised if they come up with a sweetheart deal for Block 11B. With all the chum in the water, one might expect a feeding frenzy. - LT
P.S.: Posted previously, a reminder of the prospectivity of the region:
Update from Adamantine Energy on Block 11B:
RemyX, been here since ERHC had a long name. The company certainly has a storied existence in the oil business, going all the way back to Sam Bass. What a roller coaster ride it's been.
This company is like the phoenix; it has risen from the ashes at least twice before, and in worse circumstances.
It has much more going for it right now than it did in the past.
Here's to the flight of the phoenix. - Longtimer
Very interesting senario, Brez.
The fact that SEO did not personally participate in the rights offer is definitely a head-scratcher (one that makes you think, hmmm), because one would expect at least some participation on his part, especially after publicizing his endorsement of it, and given the financial constraints of ERHC right now.
Add to that Dan's confident reply as to fund raising, it is logical to conclude something bigger may be at play here.
I would not be surprised if some creative equity arrangement were part of the deal. Management has certainly discussed many different funding options.
Whether this turns out to be a deal a la our "whiteboard discussion days" or just a simple farm-in remains to be seen. But things are starting to get exciting again! - LT
The b & m team are awfully quiet today.
Woohoo!
I'm not going to celebrate too much until the deal closes and we find out the terms of the agreement. But this should take some of the financial pressure off ERHC, regardless.
Looks like the rights offer could turn out to be a gift from management to those who took advantage of it.
The entire country of Kenya was passed over by every single oil company for decades. Does that make AOC/Tullow's recent success a mirage?
I never said the block is great in my post, so don't slander me, as you are so good at doing.
The map speaks for itself.
In case you missed this graphic from The Hydrocarbon.com, it shows just how well-positioned ERHC's Block 11A is in relation to surrounding recent oil finds:
Block 11A is at the juncture of the Muglad Rift and East Africa Rift System, and above Twiga South-1.
Here's the article: Time Running Out to Grab Juniors in Kenya Before They Make Huge Gains
(Sorry, someone here posted the article link already, but I don't remember who, or else I'd credit them.)
Possible tidbit from Peter's Namibia presentation...
On page 25 of Peter Ntephe's presentation in Namibia, a new prospect, Ebiye, appears to be indicated on the slide. A seismic slice between Egina South and Cantagalo is shown, with "Ebiye" in large bold letters:
Looking at the bottom of the seismic, you can see a small segment of Block 1 is crossed (maybe 4 km), with the rest (to the left) cutting across Block 3. I am not sure what the yellow line means, unless that is a well being drilled in Block 1. However, I like the words "Top Oil Mature" in the Block 3 section!
Interpolating from the prospects listed at the top of the seismic slice and the block delineations at the bottom, it would appear the slice spans the segment shown in red below:
You will notice "Ebiye" is not shown in ERHC's prospect map. Does this indicate that the JDZ is NOT dead, that continuing work is being done on reprocessing the seismic for further exploration? That a NEW prospect has been identified? And does Total factor in somehow?
It would be interesting to know what Peter said about this slide. But in any case, this would seem to indicate that the JDZ is NOT dead, that further work IS being done on the data in hand.
You'll recall that the Lemba prospect was the focus of Addax' drilling campaign in Block 3. Interest appears to have shifted more to the northeast, between Cantagalo and Egina South, and closer to Total's interests.
Looking at the meandering channel system, Ebiye appears to be positioned right where the channel bows upward toward Block 1.
I have more encouraging information about the JDZ that I will share in an upcoming post. - Longtimer
Amen, brother. Chad appears to be the fastest track to securing proven reserves and a possible revenue stream that ERHC has. Why would they want to dump it?!
ERHC has wisely scheduled things to spread out the financial burden of their exploration plans, as shown from this slide of the Chad work program from Peter's Namibia presentation:
If they are able to obtain adequate funding faster, they can always accelerate the scheduled work, as they have acknowledged in the past.
We can speculate on the why's and why-not's of SEO's nonparticipation, but I don't suppose anyone really knows the real answer. His participation would have certainly boosted the morale of existing shareholders, at the very least.
In any case, as an owner of roughly 42% of the company, I doubt he will stand by and watch ERHC go bankrupt. He has too much to lose. So either he has a rescue plan or he knows of some saving grace that is coming down the pike. In any case, he must have enough confidence that funding will be obtained in one way or the other, without fearing deleterious affects to his interests. Push come to shove, he could step in and inject cash into the company as he did once before.
Whether his interests are beneficent to minority shareholders' interests is yet to be seen.
Forget about Chrome... Offor could have participated.
His comments about supporting the rights offering and then not participating (seemingly--no Form 4 yet) invokes another analogy...
Imagine a tug of war match going on. Some scrawny spectators jump in to pull for the "good guys'" side. Meanwhile, a muscle-bound man stands on the sidelines yelling, "go boys go, you can do it." But he never joins the struggle. I think the scrawny guys would have every right to be resentful of the strongman's lack of active participation, especially as they are being dragged closer and closer toward the center line.
Another phrase comes to my mind, "be warm and well fed."
One addendum to my post:
The Chrome/Offor ownership percentages are stated without respect to the participation by other shareholders (which would have been unknown at rights exercise time). Any participation by other investors would have had the effect of lowering slightly any increase in Chrome/Offor's ownership percentage due to his participation.
Just a trivial technicality at this point.
Kobi, I agree with you about the context of Chrome/Offor's press release. However, I think it would have been a good faith gesture on his part to back those words up by substantial participation in the rights offering (like exercise rights for 30,000,000 shares).
Without any further developments, my feelings are that he hoodwinked other investors into participating in a scheme that he wasn't ready to belly up to the bar for.
But I am hoping he will come through in another equitable way, as part of the "ERHC family". Leaders of character do that. But the question at this point is, is SEO of that character? - LT
Let's think this out...
Chrome/Offor own 307,796,433 shares, which is 41.62% of all shares.
Let's assume the goal is for Chrome/Offor NOT to have a majority ownership of shares. (Would the market be comfortable with a Chrome/Offor majority ownership position?) This means Chrome/Offor could at most have exercised rights for less than 61,932,994 shares out of its possible 102,598,811 to keep below 50%.
So given that assumption, Chrome/Offor would never have fully participated in the rights offering from the get-go.
The question is, why didn't they participate in a token way, say for 30,000,000 shares, which would have taken ownership up to 45.68% of the company. Especially after having gone on the record as follows:
Hmmm, wonder what the words "both sides" means then in that sentence:
Thank you for posting a quotation, Midtier. But you omitted the sentence following your quotation (bolded below) from the 10-Q, which gives a little more color to the matter:
Midtier, you have stated a number of times:
Umbra, I understand.
What difference does it make people, whether we hear tomorrow or next week?! No doubt the company will announce the results of the rights issue as soon as they can.
In the big picture, it really doesn't matter as long as ERHC gets the funds it needs to accomplish its work programs and is able to add value to its holdings.
I think both you and I, and all shareholders, want that to happen.
If the transfer agent botched it (and no one knows at this point), then maybe ERHC will get another one. But I'd rather they concentrate on their business plan than get bogged down in legal matters. - LT
Finally something on which I agree with you.
I also believe Chrome fully subscribed. And that oversubscribing to a point that it would give Offor/Chrome 50% or more control of the company would not be a good thing for the company, at least from a market viewpoint.
This was the first time their transfer agent handled a rights offering for ERHC. So you think ERHC should have had clairvoyant knowledge of all the unexpected events that might have happened?
Hindsight is 20/20, so they say. And armchair quarterbacking is oh so easy.
All my shares as well as my oversubscription have been credited to my account.
A true indication of a completely-subscribed offering would be if anyone did not get all of their overscription. But I haven't seen anyone post that they haven't received all of their oversubscribed shares yet... unless I missed it.
Oh, you're back. Midtear, I don't think any of your comparisons to other companies are valid unless they had the same transfer agent as ERHC. Otherwise, you are comparing apples to oranges.
For example, would you expect speedier cross-country delivery service from FedEx or from Slim Jim's Trucking? - LT
That would be nice, if Tullow isn't spread too thin already. Whoever ERHC signs up--and to me, it's not if but when--I hope it will be someone as proactive as Tullow.
My thoughts exactly, Tamtam.
I didn't consider his April Fool's comment worth replying to.
Yep, oil-cowboy, whatever the outcome of the share offering, ERHC still has Block 11A in its pocket. Peter has stated they have suitors for a farm-in to the block, but they wisely are waiting for the best deal, as the feeding frenzy intensifies. Tullow is just chumming the water for us.
In case anyone missed it, the Ph.D. that composed that basin map is petroleum geologist Bernard Kipsang Rop, with the following credentials:
Good, informative interview.
Good to hear ERHC is actively pursuing the Full Tensor Gravity gradiometry survey in Kenyan Block 11A.
Overall message: ERHC is forging ahead whether they have partners signed or not.
But this comment is very encouraging regarding Block 11A:
A rights exercise cannot be revoked once it has been submitted to the subscription agent. The prospectus clearly addressed this:
Maybe they should add Gandur to the ERHC board to replace Blair.