It is about time ERHE comes back to life.
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Possible reasons why said analysis is flawed:
1) Oil prices are on the way down.... Until oil prices drop below $30 per barrel and is expected to stay there for an extended period of time making in not profitable to drill in ultra deep water, I won't be too concerned....
2) ERHE will be spending quite a bit of its cash arguing for some of its rights.... do the reseach... ERHE already (with no cash in the bank) fought and won in international courts, their rights. The last PR was ERHE publically putting STP on point to maintain what has already been argued and won. On top of that, ERHE has $30 Million in the bank with no debt.
3) ERHE has 4 to 6 employees who are researching options that they might try to leverage going forward. Reality is that the employees along with all knowledgeable shareholders are waiting to prove the oil rights out. We will all be "focusing" on the % gain of the shares as the data rolls in.
4) Delays, delays, delays...priced in, priced in, priced in... Likely to be a $5 - $10 per share stock when oil proved across their rights currently trading at .20. Nuff said
5) Huge bargains to be had in the market right now in much safer securities..... yeah, like WAMU (the fourth largest bank in the USA) looked just weeks ago. Those same "safe" stocks were bargains yesterday, last week, and likely tomorrow. Nothing against them... I suggest diversifying.. have some of them too.
6) With 6 or fewer employees, $30 million in the bank, no exploratory cash flow pressure, and 40% owned and previously backed by a Billionaire... I am also not worried about finding future credit in this market....Maybe those "safe" companies need to worry more about their credit than cash rich ERHE.....
Good luck with your investment strategy.
The irony is that even if Addax over pays for the exploration costs, it will come back to them directly from production. Indirectly, STP and Nigeria are the ones who pay the extra expense of the drill ships.
Before everyone jumps up and down and gets all mad at Addax, they still have to be able to cash flow the exploration until development so it does have some effect on them.
GLTA
That's better oilphant. Your more recent messages were a little boring. We need more cryptic messages that leads us down a new direction of thought. Could you add a flag or a foreign word to your next post so we have something more to google? LOL
Keep em' coming.
Until Addax PR's a ROO at least these are more entertaining and not bitter towards another poster.
(edited side note)
hey, no current stake....that could mean XOM LOLOL
exceo,
I feel your pain with discussing this stock with another family shareholder. I stopped talking about this stock years ago with them.
I do think if the ROO gets announced in the upcoming weeks that we will see a good spike in price. I think it will break the $1 mark but I also think it will have a pretty dramatic pull back before going beyond the initial spike.
Along with your agreement of $1 by 1/1/09, you may want to make a side agreement that you will sell x amount of shares at $y price (ie. $1.05) if she will allow you to hold some shares beyond 1/1/09 if it dips below $1 again.
I am guessing that if they do get a ROO that the start of drilling may not occur until late 2008 or early 2009 and until rumor or results start to come out from first drilling, ERHE may not stay above $1 through the 1/1 date.
Good luck to you and I hope she starts speaking to you soon.
TopShelf,
I respectfully disagree. Everyone seems to have ants in their pants with what is going on in our country (rightfully so). Many also have become professional armchair Rig Crew negotiators.
Reality check. The negotiations on the ROO have likely been going on for months and months. Addax would not have mentioned anything about it during their conference call unless it was locked except for minor details. You don't think they learned anything from the last two rigs getting taken out from underneath them.....please.
Now, let’s talk about the crew. First, I do NOT know anyone on a drilling rig BUT I do know someone who works on a "rig" for international shipping. For their skill set and education, these people get paid very handsomely (somewhere in the neighborhood of 10X what they would make locally if not more). If someone goes into this line of work, they know the world is their stage. It is a chosen profession and paid accordingly. Think of it like the military. You sign up for a time frame and have relatively no control or choice on where the rig goes. Yes, if you perceive it to be a life and death situation, you can always quit (unlike the military) but generally, these people welcome the opportunity to make more money in a short period of time. They can and do relocate their families if they want (for those that have them). Also keep in mind, just because the ROO is in the GOM now, does not mean the crew is necessarily from the US. For all we know, 3/4ths of them are from Nigeria, lol.
Now, about the time frame. Just because Addax didn't come out 36 hours after the hurricane and announce a signed deal, doesn't mean they won't get it or that the rig is just sitting around doing nothing where ever it is. These rigs deals are done well in advance and regardless of a 2 day or 2 week delay in the announcement, the ROO is probably still working its current job for several more months. They are not in as big of a hurry as WE want them to be in our own minds.
My last comment here does come from experience. If you want to loose money quickly in the stock market......invest emotionally.
Luckily, I hope I have learned from my past mistakes and what I continue to see others do. I work for a high net worth wealth management firm. It is in times like these that we see a large amount of "wealth" being transferred from the amateurs to Warren Buffetts of the world. Watch and learn.
It's getting ugly in the streets.
Talk about over reaction. I guess there are some ERHE shareholders that are in panic mode also. Too bad. Still up on the year and likely to get ROO deal soon.
At some point the market will bounce hard off a bottom. I'm about 35% in cash in my diversified account (I don't manage that one myself, lol). Hope they put some of that cash to work at some point in this cycle....
GLTA
OT:
Ok, for those with a sense of humor about what is going on with the market these days, enjoy the following SNL clip:
http://www.financialsense.com/fsn/SNLvideo052005.wmv
Just think. If Ike had broken through their windows and damaged files etc. they would just have to contact the alphabet gang to get another copy of their files from the raid....LOL. What a disaster recovery plan!
just a joke folks.
huh? would that be a Isuzu NPS300 4x4? LOL
or better yet, why don't you view it and let us know what you see....
a close of up .01 on 69,800 of volume doesn't sound like wide spread glee, lol.
Maybe the chatter someone was hearing was from children without money to purchase shares....lolol.
what a day. Better up than down I guess.
are you sure that's not just "chatter" in your own mind? LOL
I agree whole heartedly. Once an actual drill ship is on the way to blocks 2, 3 or 4 the pps will be heading to new highs way before the actual drill bit hits the ground (or ocean floor). Right now I think the lack of volume shows the lack of interest as most people probably have assumed the AA wont be hitting the JDZ until late 2009 or early 2010 therefore a year of dead money. Once ERHE is no longer dead money we will be hearing about drilling results of one hole after another for several years in a row. I am planning on a fun ride. Good luck all.
I think it will take drill ship news to approach the triple top at .60 and I think there will be NO resistance due to real news then. Maybe at 1.00
just touched .40 with over 400k volume
Something might be leaking cause we are at .39 X .395 with a little volume spike at the end of the day here. Is oily buying back in? LOL
If I had to take an educated guess I would say that it is 4 wells with 4 well option simply because the next contract signed (Addax consortium) is a 5 well with 5 well option.
BUT...I disagree with the estimated time per well that most are throwing around here. If I recall correctly, it was origanally guessed or PR'd that the OBO-1 well would take 30 - 60 days. I think we got the first analysis around 45 days with the final PR coming out at about 60 days. That was weeks of analysis after the well was completed. We may not here the official results of a well drilled for 60 days after it starts but I doubt the rig hangs around for analysis before moving on to the next site. My educated guess is 45 day average including moves between spots in the JDZ. (IMHO)
Although, ERHE price will likely advance greatly from here well before we get the analysis from the first well so even if drilling in 2H of 2009 or later, it will ramp up prior too (again IMHO).
Good luck all yee patient ones.
I like the asking price on the current quote: .55. LOL
On a side note, reading the article about "blood oil" makes one happy that ERHE is in the deep water. No way to "tap" the pipe lines before they get loaded on ships.
Everyone has the right to have an opinion (no matter how wrong it is...lol). Everyone can also vent on a public message board.
My opinion is this: the share price of ERHE will reflect the future potential of the business of ERHE discounted by the level or risk times the amount of time.
ERHE is in the discovery and/or holding of rights to oil business. Until we have a near term solid drilling schedule, ERHE will not come close to the projections of either outside industry analysts or the armchair speculators of this board. Management can jump up and down and do cart wheels on the moon yet the oil and/or assets still have the same unknown value.
Once ERHE and their partners have a confirmed oil drilling rig heading for their blocks, nobody knows the exact time ERHE will confirm the quantity of oil they have rights too, therefore, time is unknown. In the oil business and especially around the Nigerian neck of the woods, there will always be a level of risk from lawsuits, change of political strongholds, potential of somebody attacking them (although I give very very low risk to this) which means the level of risk is unknown. And finally, since ERHE or their partners have not punched the first hole in the ocean floor yet, the quantity of oil is unknown.
What we have here is an equation of unknowns (oil, risk and time) therefore we have pure speculation.
I see my glass (shares of ERHE) as more than half full, albeit a little blurry and out of reach right now. I am very confident that at some point in time, ERHE via partners will find commercial quantities of oil with very secure rights to them (lawsuits without merit and STP politicians without legal recourse to their yells of unfairness for past signed deals). The clearest time frame we have is from the signed agreement for the Aban Abraham which due to delays is now predicted to be somewhere near mid year 2009 (with potential for more delays).
I look forward to the day when the three parts to our equation become known (or at least the time and quantity of oil). I feel confident that we currently have a qualified management team doing responsible management of our resources while we wait out the time neccessary to get our destined oil rig. Once we have firmed up value of our assets, then I will begin to evaluate how management is doing on getting our share price close to that value.
Good luck all.
JE
1) 458 million barrels is a conservative estimate.
2) it is on just the Kina prospect (not the entire block)
3) 14 Billion barrels was also a conservative estimate based on old data on Blocks 1 - 9.
Sinopec will disclose info.
Keep in mind that even though Sinopec might not be jumping up and down when they make discoveries, they are still under legal agreements with the JDZ. Remember when CVX drilled in block 1? Someone from the JDZ was one of the first to speak publically about the find. Granted CVX knows more of the specifics and they put a lid on the info but a certain amount of info will always get out through the JDZ.
Example Scenario:
First of all, we already know CVX did strike oil in block 1 and that they purposefully drilled off structure.
We also know that the AA will be drilling 5 to 10 holes in the JDZ and the ones that Addax controls will be publicized (they have a proven record of PR'ing their discoveries).
By the time Sinopec gets information back regarding their discoveries, they will have to share some of the information with the JDZ per agreements. By this time there will no longer be much reason for Sinopec to keep their discoveries a secret and they will likely not pressure the JDZ to put a lid on it. So Sinopec may not have the shareholder pressure to party like wild animals but the JDZ will still have the motivation to spread the word as there are still more blocks to auction off.
We will be notified, IMHO.
Looks like Addax is presenting at another conference next week also (in Spain): 19th WPC
Madrid, Spain June 29 - July 3, 2008
This will continue the media blitz on the JDZ prospects at least.
Now, who from IHUB will attend this one? LOL
Slightly OT but applies to some of the posts the past couple days:
An old man, a boy and a donkey, were going to town. The boy rode on the donkey and the old man walked.
As they went along they passed some people who remarked it was a shame the old man was walking and the boy was riding.
The man and boy thought maybe the critics were right, so they changed positions.
Then, later, they passed some people who remarked, 'What a shame, he makes that little boy walk.'
So they then decided they'd both walk!
Soon they passed some more people who thought they were stupid to walk when they had a decent donkey to ride.
So, they both rode the donkey.
Now they passed some people who shamed them by saying how awful to put such a load on a poor donkey.
The boy and man figured they were probably right, so they decide to carry the donkey.
As they crossed the bridge, they lost their grip on the animal and he fell into the river and drowned.
The moral of the story?
If you try to please everyone, you might as well...
...Kiss your a## goodbye!
I finally got the chance to listen to the Red Chip presentation and was pleasantly suprised by what was said and how it was presented. I am also impressed with ERHE's strategy to tell the story to multiple outlets. Nice to have back to back to back weeks of presentations.
Being that I work in the investment field, I can assure you that these fund managers that may be attending these seminars, do NOT go back to their offices and immediately buy. They may start researching right away and start "following" the stock (putting it on an investments teams "watch list") but it will take time to analyze the fundamentals vs other stock choices in the same industry and category (Energy, small cap., etc.). Then when they are ready they will work with multiple MM's to build an initial position over several days without trying to create a price spike (it is ok for a general rise but they will pull their order if it starts running away from them). You will find that most upward price spikes are created by the emotional purchases of individual investors (such as ourselves, lol). When institutions decide to exit a position, they sometimes get out quicker due to an upcoming event or due to a specific news item. So, don't expect a sudden upward price spike from any of these seminars but be pleased with the company for spreading the news to a broader base of potential investors.
Cudo's to ERHE's new marketing efforts!
This one has huge potential but the problem right now is that the entire Chinese stock market has fallen out of favor. It has corrected so far that maybe this is a good time to watch for another technical entry point.
good luck
OT: Sidewinder, good to see someone else here knows about The Secret. I have listened to my tapes many, many times and proven it correct on my own multiple times. I found it somewhat interesting when they discussed Belize becoming an oil producing country (I visited Belize once myself). Anyway, keep the positive attitude and believe. I have my million dollar check from The Secret posted where I see it every day, dated in August and I don't have a single doubt about it........Stranger things have happened.
I take the quote to meaning they will try to again use their political clout (in Nigeria) along with their partnership clout (Addax more likely than Sinopec at this point) and their now technical expertise or analysis to recognize an opportunity (what James Ledbetter has been working on for a while now) to duplicate (successfully bid and partner up for territorial oil rights) what they did in the GOG. Nothing magical or mysterious. Just a duplication of what they have successfully done.
It's all good.
OT kind of:
can someone point me in the direction of this ERHC Energy FaceBook profile?
I am logged into my profile and did a search on ERHC and got back a couple of people that had those letters in their names. Not exactly what I was looking for.
Is there a link or a trick to search for it?
Strategyone
According to Oily, the Eighties are next....oh, wait...that was nearly 2 months ago..LOL
On a side note, I liked seeing the base form in the 40's. I would have thought that ERHE would have drifted back further after the shareholder meeting without a buyout/buyin....
Good luck all
Ironic Twist:
Ok, remember that sore subject or "deal" a while back where Offor teamed up with Addax and swung a deal for a Nigerian oil block with a new company? Let me see, the reason he had to do it outside of ERHE was because he needed a non us-based company to do this deal. Offor started a new company with little to NO assets or value, teamed up with Addax and Addax paid the new company cash to partner with them...hmm. I wonder if ERHE could do something similar in the future? Let's say they hire someone who could start a subsidiary with relatively no assets and then use local political clout to get a deal going where they can then IPO the new entity to raise additional capital to keep a larger percentage of the total deal. Nah. That could never happen with ERHE. It must be that they are going to use all their cash up on a mining company in Timbuktu. Oh wait, the management team already nixed that idea....hmm, what else could they be thinking?
Great post magic. Your "rant" is welcomed and I second that rant!
TopShelf, let me give my two cents worth here.
Although, Sinopec does not care as much about publishing drilling results, they still are a part of a group of companies in their respective blocks which will be wanting results published therefore they will likely request it. On top of that, they are required to share results with the JDZ committee which has a strong need to publish good news (to increase future bidding rounds for other JDZ blocks and also Nigerian and EEZ blocks close by).
We may not get every bit of news we want as soon as it is known but I feel confident we will get a good amount of news to move the stock accordingly when good results are in from drilling.
vip, the other problem one would have is that in 20 years $5 million will only be able to purchase a three bedroom fixer-upper in the low rent area of town......
BB, give it a rest. In my view, you are going to a little extreme on your witchhunt of a new employee. It is ok to have your reservations and bring them up once but put the stick down already. Give the new guy a chance to perform. Even your track record has some blemishes in it, afterall wasn't this last shareholder meeting going to have some event, predicted by you (along with dots connected from the trustworthy "oily" posts), that was going to steal the company out from underneath us shareholders?
Don't get me wrong, I appreciate all the dd and opinions you share but maybe a deap breath is warrented here.
Enjoy the rest of your Friday.
Red,
Thanks for putting up some pictures with names to faces. The first picture at the meeting looks like official "red tie" day. LOL
Hopefully, I will attend one of the future SHM.
thanks again for providing the forum and running it.
It is very encouraging to see Addax up without news right now. Maybe they are close to announcing a "rig of opportunity". That would explain both Addax and ERHE's current spikes to new 52 week highs.
I'm all for that. Bring it on!
by the way, oilphant...was that your idea of a volume and price spike? I think the price went up .005 and about 100,000 in volume in the hours after your post. Woooooooeeee! Stop trying to guess the market. Try leaking real news that proves out to be correct if it so pleases you and you might regain some credibility. Good luck to you.
(edited note: not implying sidewinder is oilphant...just putting two messages in one)
Too funny! If the whiteboard is there, can someone take a picture of it for discussion here...LOL
You got to like the warrents outstanding (page 47) for 120,000 shares with an exercise price of $3.00. It will be nice when those are "in the money".
LMAO, let the white board deciphering begin....LOL
Other than that, a pretty impressive annual report. It will be nicer yet in coming years when ERHE has proven reserves....
good luck all
Or Parking signs??? LOL
(not trying to poke at the ERHE person who sell's them, just having fun)
Healthy pull back and consolidation and way overdue. I helped with the consolidation with my last buy for a while in my Roth. Now, stay in the red for at least today so the chart looks better (without news).