It is about time ERHE comes back to life.
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coydog,
Good to see you are still watching ERHE. With the news from Addax out today, ERHE & Addax may be good plays as they go through the phases of drilling and announcements. ERHE still hasn't PR'd this news so the volume is still low (IMO). Since the drill ship isn't going to be on site till the end of the 3rd quarter we should see several spikes going into the 4th quarter but with a general uptrend from these recent lows. Even with horrible markets, I suspect both ERHE and Addax getting better than average accumulation over the next 6 months to a year.
Good luck
(Edit) ERHE just PR'd it 15 minutes ago
tryoty, that post might quite be the best and most concise post on the Addax and Gandur issue. Thank you for sharing.
Strass, you also have every right to be upset as you see it as a failure in your eyes. That is ok, but you also need to stop beating your dead horse and except that others share in a different opinion.
Just think, if Addax comes out with a PR in the next week or two that says the Deepwater Pathfinder is indeed contracted and will be drilling third quarter 2009 in the JDZ for 4 wells, everything Strass has said will be proven to be very wrong indeed. Even Strass will be singing a new tune as his investment begins it’s upward trend from here.
On the flip side, if we don’t hear anything for 5 more months until we start hearing the AA is on it’s way to the JDZ, then Mark & Platts & Southern Man & Upstream & the JDZ source all missed their mark.
Why don’t we all wait and see. Obviously, neither one of you is going to change your opinion in the meantime.
Red,
I don't think the MM's play tricks with half a million shares. They could have done the same run down in price in the last two minutes on MUCH less volume.
I am guessing it was some trader types that never hold over weekends. They may have loaded in the teens and just locked in the gains. Good for them if that's all they were holding for. I do think smarter traders would have stepped it out to hold the price steady but who's to know.....
If we get the official PR soon (likely next week - thanks Mark), it's going to be an awfully fun summer
Good luck all and have a good weekend
We don't know why the downgraded estimates are what they are. Maybe Analyst 1 thought with the current business environment and the price of oil being this low compared to last year that they were going to drop the estimated future share price to $x but knowing Addax is moving up the schedule for the JDZ drilling with a ROO on the horizon, they only downgraded the estimated share price to $y. We don't know what X or Y is so we can't read anything into the Addax analyst numbers.
Keep in mind, Addax is a "in production" oil company with many irons in the fire. Analyst target estimates are usually within a year so even with the moving up of drilling in the JDZ, this will not effect the Addax price target until they can increase their proven reserves (to an analyst).
UNLIKE that of ERHE which is pure speculation (no monthly production yet), where the valuation of ERHE's share price is based solely on what it can become (or be sold for) vs what it is producing now plus potential future production (Addax).
This is why ERHE has a potentially higher multiple in share price gain in the short run than a addax or sinopec in the same block.
Hey, my memory isn't failing me too badly.... thanks Try for the facts.
Phase II is referring to Chevron's PSC agreement where they agreed to drill one exploritory well in the first xx months (or years - I think 3 years from the signing). They lived up to their Phase I agreement and are now entering phase II. I don't recall how many wells they need to drill or how long they have for phase II.
Good point Schugs and I concur.
Now I am guessing PR after the market close. (Just my guess! don't jump all over me if its not there, lol)
I don't think Gandur is playing poker on this one. I think he simply learned from the last one that only needed "security finalized", that you don't say too much until official. I think he knows he has the deal done and why not just let the PR do the official announcement once the lawyers have reviewed the contract and/or the PR.
Let's just say that with what other posters here have said from direct contacts to the JDZ and with the Platts article, I have way more confidence that Addax has the deal done than last time where we didn't even know the name of the rig. These rumors have rig name, the number of wells (4), the date to arrive on site in the JDZ(end of 2nd quarter), the time to start drilling (third quarter), and the first prospect to drill (Kina).
If I had available risk $ in my account I would buy more here at .30 and any dips from here. Even in this market, I could easily see the price taking out the last spike to .61 when news is confirmed (IMHO), especially with drilling being a few short months out.
Sidewinder... Addax could confirm the ROO during the call if they wanted to but they would need to release the PR during the call or shortly thereafter. I recall they have 24 hours after news is released to PR it (if memory serves correctly). The fact that it is a publicly announce conference call, it is not leaking info to insiders only.
That given, I still think we are looking at a matter of a day or two with the PR firms probably already working on the release. (IMHO)
share price back to .30. About right until pr is released
GLTA
Now the cc is like school from the charlie brown cartoons....wha, wha, wha, wha, wha, wha
oooh.
Chev. to drill a second well in block 1.
We knew it was rumored but adx just confirmed.
They just said they can't confirm the rumors of the ROO until it is finalized.
It sure sounds in the works though.
Maybe in the next couple weeks (my opinion - not stated in the call).
I am listening to he cc. I am hoping it is like the ol' EF Hutton commercials... When JCG speaks.....
They get the PM message but can only respond to it (through a PM) during the 1 hour of free use on Fridays after market close. Otherwise, they can always respond to it publically. Good luck
7, LOL
kinda like the 3 in block 1?
Personally, I will be very happy with just one confirmed rig and drilling one hole in 2009. I had already estimated that the AA would barely finish the first well by 3/2010. So, all is good with the intel. coming out now.
By the way, it's pretty cool to think about having the rig that broke the record for deepest hole drilled off Nigeria working for a little oil company like Addax and ERHE. Wouldn't it be even more funny if they hit the biggest find in Kina on the next hole drilled?
Looking very bright like this time around we may be able to keep the gains as once the drilling begins we will just have news of hole after hole followed by proven reserves followed by estimates on when they will hit production followed by the whole thing over again in the EEZ.
If we can all just hold out till we hit the first find. Then it will feel like we invested in a oil company not just another OTC:BB flyer.
Good luck all.
Interesting day.
I made my first new purchase of ERHE in nearly a year. I was waiting for stronger signs of actual drilling. I took the combination of ERHE's update to shareholders along with the Upstream article to be the catalyst I needed to invest further (albeit, relatively small increase).
The specific statements by Upstream of "within two months" sounds to me like the real announcement is going to be less than a fortnight away, lol. Actually, I expect Addax to PR the news prior to the conference call next Wednesday. The timing would be good for them to breeze through the financials and focus on the forward looking progress.
The volume today of just under 1mm shares is likely mainly by traders getting out that purchased in the early teens and long term shareholders waiting for further indications such as myself. When Addax and/or ERHE does an official PR, I think we will see well over 1mm in volume. If a rig is announced to be on site in two months or less, I think we will see a much stronger reaction to the share price as it will be a "surprise" to the industry. Most drill ship announcements are further out in the future like that of the AA announcement. What ever drill ship it is, it must be close by and almost done with another project or sitting in port somewhere getting ready for the next assignment.
In any case, I will be patiently waiting official word from Addax (my guess is Monday either just prior to market open or right after market close) for the specific details and timing.
Good luck all
Strass and other finger pointers.....
Although I am not thrilled at the current share price of ERHE or the amount of progress being made in the JDZ, I also think you are only focusing on negatives and trying to find someone to blame why you are not rich right now.
You said JCG has done nothing to date. I disagree. Addax signed on with ERHE for the JDZ. They then agreed to jointly work all current blocks with ERHE. They then successfully agreed to and signed the PSC with the JDZ. They then paid both the JDZ the signing bonus' and ERHE their fee on schedule. They then worked jointly with Sinopec to find, negotiate and sign a contract for a deep water drilling rig in the AA. This is progress whether you forgot about it or decided it was not worthy is your own opinion but it is progress.
The delays in the AA and the current world wide economic upheaval that we are in are not the fault of JCG.
I wish the AA was already drilling in the JDZ just like we all thought it would when we first signed the contract for her. I wish Addax would have successfully negotiated and signed for another ROO. I wish the oil prices were at least $50+ per barrel. I wish the stock market and home prices would rebound. I wish ERHE stock price was over $5 per share. But this is not the reality we are in right now.
It really doesn't matter what we all wish for (although it is healthy to think positively) or what our past failed expectations were. It is, however, important what actions we continue to see from Addax and ERHE as we move forward. These actions will create the future price for ERHE shares and be the determining factor for how long each of us decide to hold on to our investment in ERHE.
I do agree with you that JCG has not been as successful as we all had hoped and I am not singing praises for what he has done but I will give him credit for positive movement forward. Right now, I am feeling very fortunate that there is a JDZ contractual deadline out there (2010) for beginning drilling because if nothing else, this will hold JCG’s hand to the fire to get something going or he will be held accountable to that date.
When I originally invested in ERHE (I think 2001), I never thought it would take this long for the amount of progress we have made and I likely would have never invested had this been my expectations. But I do constantly re-evaluate this and many other investment decisions and make the appropriate adjustments. I still judge the ERHE investment to be a very positive Risk/Reward opportunity as we stand today.
The reality of this investment is that I view the downside risk being very limited here with low likelihood of much further downward pressure. Primarily due to zero debt; minimal employees; cash in the bank for years of current burn rate; excellent legal representation; stellar track record for maintaining the amount of rights they currently have through world court; and the perceived future value of their current prospects (if they can only drill to prove). With the March 2010 looming deadline, this should provide enough pressure for action to be taken in 2009 and I fully expect upward pressure on the stock price sometime this year as a result. For my high risk investment money, ERHE is still an attractive bargain (IMHO).
Good luck all.
Jeez, up .04 today on 1/2m of volume. I was not expecting that.
For the past couple of days I was thinking this is the tax loss sellers getting back in but I have to agree with someone’s post from yesterday that the tax loss sellers would probably pace themselves back in and not hit the ask so much. I also expected a very healthy pull back today for traders to take their 100+% but so far it's not happening.
Something smells like insiders know something but in this case, I don't mind as long as we head north. It is long overdue and this was way oversold.
Good luck all
If I recall correctly, there is a stipulated fine. Hopefully, large enough to encourage the signing of a more expensive ROO if need be.
hey Red, speak for yourself...lol
LMAO! Nice one Tryoty
reply to oilphant
"Are you bipolar?"
If not, his guesses on oil and stock prices sure are! He must be playing the odds. At some point in time, some wild guess will hit it's mark, right?
Too funny.
Good points midtieroil.
Like I said, I wish that Gandur had closed a deal on a ROO because ERHE share price would no doubt be above .11 now (IMHO) BUT that doesn't mean it was a bad decision for Addax to pass on a deal which it turns out to be the peak in hindsight.
I am not completely taking sides here. I think the truth lies somewhere in between. We are in a huge economic crisis and it will effect EVERY company with debt and that NEEDS debt to grow. Smart companies must look at their budgets with a "corrected" set of rose colored glasses for growth strategies. No, that does not mean stop every thing regarding exploration, but to take a 3 - 6 month pause and see what happens with rig negotiations should not be the end of the world like some people are making it out to be here. The projected 14.4 Billion barrels in the JDZ will still be there 6 months from now if it is there now. Addax/ERHE will have lost NOTHING if they passed on a ROO in Nov/Dec but sign a different contract in Apr/May (I am optimistically hoping for this).
The only real threat is if they don't find another ROO AND there is yet another delay for the AA, they could get penalized for missing the minimum drill dates. But thanks to whoever found the article a few minutes ago, it looks like Nigeria and STP are going to hold firm to those dates. Good for them! More pressure on Addax to actually sign on the next opportunity. And whether the Gandur bashers would like to admit it or not, EVERYthing I am reading points towards MORE available rigs and at a LOWER cost. Still doesn't mean Gandur didn't make mistakes but he may have caught a little luck and he could look the hero with a successful contract down the road.
I still feel strongly that the oil companies are much more longer term oriented and Addax probably did have a ROO budgeted in with oil around $60 and they should continue planning on drilling many of their prospects. Once proven, they could always sell specific rights if they really ran into financial problems over their debt. Better to sell pieces of their rights with proven than untapped hopeful rights. There is a reason oil companies get HUGE lines of credit with a very long term focus.
Unfortunately, we all have to wait longer than anticipated to see how this plays out. I wish the best for all invested here.
Now where did I say I wanted to high five with him even if he did get a better deal. I would personally benefit the sooner a deal gets done regardless the cost of that deal. I have an exit strategy that will divest over time at certain price points. With that strategy, the sooner the price points hit the sooner I will have access to the same amount of cash. I am well versed in the time value of money.
I am just not ready to throw Grandur under the bus for my failed expectations over the timing of oil reserves proven.
ERHE is in partnership with Addax. That is both good and bad.
The bad is that had we partnered with a different major, they might not have blown the original ROO. I do hold that against Addax but I don't have all the info so I am not selling due to it.
The good is that Addax is young and hungry which aligns with my hopes for earliest development of the fields. If ERHE had partnered with the Chevrons or Exxon’s out there, think of how long it might take to bring the different fields to market. Look how fast Chevron is going with their drilling program on Block 1 and they had a two year head start. Chevron has no excuse on rig availability yet the whole world is their sandbox so they may sit on the JDZ toy until they want to develop it.
High fives, hardly but he doesn't deserve the bus wheels yet either, IMHO.
I'll just be happy when we are having these same discussions over the ROO for the EEZ blocks and the price is stuck at $30.....
Have a great weekend all.
Strass,
lack of "what" performance? Your personal speculative stock holding share price?
You or I will not know whether it was a good move or not to delay signing (an even worse deal I speculate) for a ROO. We don't know what the future holds, do we? Grandur could come out in two months with a much better priced deal for a ROO that could be drilling side by side with the AA to get the oil to market at the same time as it otherwise would have than if he signed a really expensive deal several months ago at the PEAK.
I have to agree with Umbra. Many here are looking for a scapegoat for their failed expectations of a quicker homerun on ERHE.
I have to agree with midtieroil on GC and rig prices also.
Not that I want to agree with him. I would much, much prefer Grandur make a deal for a ROO as soon as he possibly could at whatever the cost but that is ONLY because it would benefit the near term and short term outlook for ERHE stock price and me personally.
I feel there are some posters on here that are missing a few points to the full argument.
1) Technically, the AA is under contract and should eventually show up in the JDZ. Currently the consortium is not likely going to miss the JDZ timeline of the first well drilled in 2010 (or something like that). Let's play out a possible delayed scenario for a second.... The AA was originally signed under contract with the expected delivery in early 2008 (if I recall correctly). Under circumstances beyond Addax, ERHE, or Sinopec's control, they have not hit their time table target. Now let’s say we get to early 2010 and the AA get's another 6 month delay or something like that. Does anyone here really think the JDZ, STP or Nigeria will get another company to drill any faster by relinquishing the rights under the PSC contract and rebidding it and then getting another PSC signed? Get real! Besides making the JDZ or JMC look like fools for not recognizing the INDUSTRY ISSUE of a shortage for deep water drill ships, they would likely delay the drilling by another 4 to 5 years (look at the history - when did this originally go out to bid?). It shouldn't take too many finance consultants to let the JDZ people know that it would be more prudent to allow an extension if needed and it may only need to be for 6 months to a year.
2) The current or short term market cap for EHRE should have absolutely no place in the calculations of whether it makes economic sense for Addax to pay a higher price to get a rig of opportunity in 6 months before the AA.
3) The really large elephant in the room (pun intended) is that even regardless of the potential savings of $15 million per well or $100 million for multiple wells (speculated by someone here for which I won't dispute), the real financial analysis that would need to be included would be the estimated difference in the price per oil as it went to market at the delayed time versus the current cost of money for that time period (that the different cash flow stream would create for bringing the same oil up earlier). My point here is better understood with an example: Let's say scenario 1) Addax contracts a ROO which eventually brings the oil up 1 year earlier with a projected starting price per barrel at $100. Scenario 2) Addax waits for the AA or gets a ROO one year later than scenario 1 and there is a 1 year delay on the stream of money that comes from the production of the same amount of oil but the price per barrel starts at $120.
With everything I have read over the past 9 years that I have invested in ERHE, everything points to the of oil going UP over the long term simply due to supply and demand. I would say the likely hood of scenario 2 above (with a 20% increase in the value of the same asset) is higher than the likelihood of the cost of funds being a greater percent (in this case the oil companies/shareholders cost of funds would have to be greater than 20%). This all assumes that the cost of the ROO would be the same as the AA will be.
The reality of this situation is this: Most shareholders in ERHE speculate that the share price for ERHE will skyrocket from this lowly .12 range (once we have proven oil) anywhere from $1 to $10 in fairly short order. For us, YES, we would all want to get to that proven oil sooner rather than later because we are talking about 1000%’s increases in our investment that we would like to have now. Count me in. I want it all now!
But the long term financial analysis for a business is very different and they are the one’s making the decisions.
One day our ship will come in. We just need to wait a little bit longer.....
GLTA
That's better Oilphant. Back to potential insider information although you didn't give us a clue as to whether it would be good news or bad.....
Now, is morning over yet? Hey, I'll give you till 1 hour past market close incase ERHE decides to wait till the close to release the news.
GLTY
tryoty, good post! (edited, oops your good message was deleted by the time I posted this)
It is about time someone informed certain people here of the reality of this situation.
Whether one chooses to believe it or not....the company never lied. If one can't understand that reality, one will have a very difficult future with all natural changes in business plans.
Nobody likes it when a positive event is changed (ROO negotiations) but the oil business environment changed dramatically and the successful oil companies will recognize this and change their plans accordingly.
GLTA
LOL,
I may have to sell my stamp collection and buy more ERHE if the price drops to 7 cents.....
Wrong again MN. Life is only as you choose to see it! You say "Nothing has really changed except more promises that never seem to come to fruition".
Reminder of the forgotten promises that have come true:
ERHE bid on and WON additional block percentages in bidding rounds
ERHE partnered with known and world wide leaders in the oil business (albeit lacking in current deep sea exploration but nothing money and time can't buy)
PSC contracts were signed (remember when we thought that promise would never come to fruition???)
RIG contracted (simply delayed but still under solid contract)
Have to admit, no one will ever suggest you have rose colored glasses, lol.
I wish nothing but the best for you also. Enjoy your holidays.
Been a while......
It is nice to take a break from the board, especially when nothing company-wise is happening.
I have read most of the posts over the past few weeks and I can understand the underlying negative tone. I share the same pain as the rest of the shareholders that are not currently increasing their share count. I don't like seeing the share price this low either.
Another reality check:
I have been reading a lot of negative posts relating to the latest presentation.... nothing much to add. I agree, that presenter sucked! I doubt they will let him present again BUT it didn't change the underlying value of my investment (the oil didn't move). I didn't get an artificial share price boost (which is all a good presenter could have done for us short term), but I would have preferred it none-the-less. nuff said.
Now I want to touch on a topic I have seen bantered back and forth but I see a glaring and important fact being ignored (which I will touch upon last). The infamous RIG - both the ROO and the much delayed AA. I am noticing that the further the share price drifts that the further people are predicting the true drilling to begin (now some ol'time posters are saying mid 2010). Here are the facts that no matter how much we cry, we can't change:
1) Addax/Sinopec/ERHE contracted the AA for 5 firm wells with the option of 5 more for a specified price. They PR'd the facts as they knew of them then, which was the AA was going to be refitted and then another contract preceded ours. They gave an estimated timeline which I am sure they were given by the AA owners at the time. Nobody lied. Our's and Addax's and Sinopec's management did not conspire to pull the wool over our shareholders heads to think drilling would commence the next day yet they knew the AA wouldn't be ready for years. Posters here seem to think our management is somehow at fault for the AA's refitting delays. I am sure they don't like it either but this kind of thing happens in the oil patch and life happens. Get over it!
Another fact: the free world's financial economy crumbled before our very eyes. Every stock world wide (with few exceptions) is sucking wind in share price. I can hardly hold ERHE's management to blame for the world wide financial crisis. I will say that I am confident that ERHE is in a great position as the world pulls out if the crisis (inevitable eventually). They have cash and very little needed to spend it on. I am liking the carry's to production agreements even better now. Thanks SEO!
Now here's the glaring issue: OIL PRICES.... Yes, along with the world wide financial crisis, the oil prices have dropped dramatically and continue to drift downward. I still laugh at everyone's short sightedness with things being posted. OMG! oil hit $48.80 today..... we may never drill for the oil in the JDZ..... Give me a BREAK! Oil was at $30 per barrel when the largest and oldest oil companies in the world bid the highest ever signing bonus' for the opportunity to drill in the JDZ!!!!! Chevron and Exxon broke records with their bids. Part of the reason is because of the then current seismic’s and what was discovered recently in the waters close by. Guess what? We now have better seismic’s, acknowledgement that oil exists in similar structures (that are smaller) in block 1, and the oil is of higher quality (sweet crude), closer to the US's domestic shores that doesn't need to be shipped through the middle east, and there are no seasonal hurricanes to constantly threaten the flow or increase the cost over time for maintaining the deap sea platforms. Now, back to the oil prices... If any shareholder here thinks for one second that oil prices will stay below even $50 for even a short extended period of time (lets say 1 to 2 years) you may want to rethink the reasons for investing in a OIL STOCK period. In very simple terms, the world demand is simply delayed not changed forever. When world financial markets find stability, oil demand will again start going nowhere but UP! Simple supply vs demand will eventually rule in a free market and prices will again break records. That is simply a bonus for people investing now in energy stocks. You get a second chance at catching an obvious wave. Enjoy it!
Back to oil prices and the not talked about benefit of lower short term prices. Remember our AA contract for 5 firm wells with the addition of 5 optional wells? Now think about the AA’s contract before ours….. 4 + 4. Yes, 4 firm wells with an OPTION for 4 more. For those of you that think these oil prices will continue to go down or stay low for a while then the chances of the optional wells being drilled just decreased dramatically and we just cut in half the time it will take for the AA to begin drilling under the Addax/Sinopec contract. Yes, under these circumstances I would say mid 2009 by the latest. Now, what happens if oil finds a bottom and starts to rise again as world financial markets regain strength and normal energy supply and demand forces kick back in? Rig prices will again find a bottom too and many of the higher priced options for all rigs will be foregone and new contracts will be negotiated at current prices. This will increase the number of available rigs that Addax will be in a position to negotiate for that infamous ROO. Most likely at a lower cost. We know they have already ordered the supplies for 2009! Which again, is likely under contract which means there is a financial incentive (beyond the obvious) to get a ROO to begin drilling in 2009. And finally, the operator of block 3 has stated they are drilling in 2009 and they have many rigs under contract already.
2009 will be a year of dramatic proportions for ERHE (imho). I just hope that many of the long term ERHE shareholders and posters here can ride out this storm to be here when the benefits roll in. Don’t lose sight of the prize. It really hasn’t changed if you think about it.
Good luck to all
Strass and Topshelf, after listening to the presentation I'll have to admit the two of you sum it up pretty good.
I am now in the camp of: I really don't know what is going on.
Although, the investment basics have not changed. I am here for the oil. Until one of ERHE blocks are drilled we don't know what they are worth. ERHE does have a solid rig under contract but the time frame is somewhere from "2H 2009" to "2H 2010" (Bovell's slip doesn't help us much and doubt it will get corrected publically). The "not holding our breath" comment about the ROO is far less possitive that Grandur's comments or Peter's "advanced negotiations" comment.
Time to take a break from the message board for a while and concentrate on things I have more control over. I may pick up a few more shares for my 2008 Roth but will not "hold my breath" till I do it, lol.
Away for a bit.
GLTA
so if Gandur successfully gets a lower priced ROO, you will be against this??????
Don't get me wrong, I would love to see a PR about a ROO sooner rather than later and our ERHE shareprice would benefit greatly no matter what the cost of this rig would be but I am also a businessman and our entire marketplace has changed. I am willing to give Gandur another 1 to 3 months to secure a better deal.
Because we don't know what is going on regarding the negotiations it is hard to cast good judgement on the situation. I am pretty confident that Gandur wants a ROO as much as ERHE shareholders do so I think we are in good hands for the time being.
I guess we have to be specific to blow your arguments out of the water.....
Your stated reasons for the sp to go up:
"Announcement of an ROO" - this is a rumor or hope and has no basis in fact until it is announced, so according to your last email, you shouldn't bring this up for discussion.
"Belief that share price is drastically undervalued", moot point - opinion
If these are truely the only reasons you could find for the share price to go up then NO ONE would own this company. Do you think you might be missing something???? lol
Your stated reasons for the sp to go down:
"Fact that rights in blocks 5&6 are not secured" - incorrect statement. They are indeed secured by international treaty as many have pointed out to you which you ignore. They will not be any "less" secured until the JDZ tries to take them away in a court of law. The fact that ERHE has filed a protection lawsuit should actually go to the argument that it is more secure.
"Continued violence, including successful offshore attacks" - not relevant as ERHE is not an oil company operator and has no production. Further, the JDZ is in international waters, not Nigerian waters which has also been pointed out many times. If you really believed in this argument then due to the distance offshore ERHE rights are, it would make them more valuable compared to every oil company currently operating closer to Nigeria.
"SEC filings claim that investigations are ongoing and may last a long time" - no change from yesterday except that the time for any action on any specific findings becomes less likely and as stated my ERHE lawyers publically, the timeframe for any infractions has already lapsed. Old, rehashed non-news, moot point and plenty baked into the share price.
"No revenues, only expenses" - no change, already priced in. Compared to three years ago when the share price was higher, ERHE had no cash and debt. Now they have $30+million in the bank with years of current SEC FILED cash flow cushion.
"No CEO, CFO for publically traded company" - no change in years - ZERO affect on current share price. Can more likely be argued as a positive that they aren't wasting their good cash on a CEO or CFO until they and their partners are closer to oil production from their rights.
"Lack of institutional investors" - no change from yesterday and if this was an influential argument then there is no direction except UP from here. ERHE is OTC and well priced in.
"Does business in the most corrupt part of the world" - and yet every major oil company in the world also does business there and that’s where the oil is. No change from yesterday, moot point unless you want the positive argument that the majority owner of ERHE has become a multi BILLIONAIRE in the same most corrupt part of the world which will give ERHE an advantage to all other players around the JDZ as has been proven by the awards granted.
"Inability to get a rig" - incorrect statement as proven in the SEC FILINGS. hint - AA.
In summary, ERHE's partners have a RIG under contract. It is only a matter of time before they can hopefully prove out the Trillions of dollars of oil located in the JDZ. A Rig of Opportunity can ONLY move that timeframe up. SEC Filings prove ERHE has cash in the bank for years beyond the AA drilling timeframe at the SEC Filings current cash burn rate.
Bingo! The most important thing that is stated with this lawsuit action is that ERHE will fight agreesively for it's rights. The 5 & 6 is a no brainer and I doubt we will even notice the increase in expense for this one (IMHO). It is more of a warning shot across the bow for STP to notice about their EEZ rights.
This could turn out to be quite a good quarter. Maybe a ROO soon, maybe more specifics about Anadarko's drilling in Q1 2009, maybe movement on the EEZ, and who knows, maybe a surprise from Sinopec regarding another Rig. We know they have money.
GLTA
Dazzling volume for 2 rig announcements on Monday....
Ho Hum, another listless Friday.
BB, glad to see you posting again, even if we don't always see eye to eye on all things.
Good discussion going on also...
GLTA
See, we can read into these posts tooooo much and come up with opposite meanings.
"Destined to be an ERHE SP Bestbuyer!" Could mean
A) that if you buy now or before the news, it will be a "best buy" compared to where the SP ascends to.
Or B) read a different way, once news hits about 2 ROO's being missed, the SP will tank further to create a "best buy" opportunity.
If you want to build any kind of credibility, you need to post A) or B)?
If news hits on 11/3 about Two separate deep water rigs, credit goes to both SPEC and Oily (Spec rumored it first though). You struck out on the volume post though cause ERHE ended up "below average" by 70,000 shares.
GLTA
Fishdog, ditto your opinion.
Although I "wished" for greater news up till now, my primary hope for ERHE is drill ship news SOON (the sooner the better); first oil FIRST; then as the share price ascends into the multiple $, then hire the oil industry CEO & experts, make the additional asset acquisitions, list a subsidiary on AIM, etc.....
In hind sight, ERHE is lucky and is better positioned now due to lack of "action" over the past 12 - 24 months.
I purchased ERHE due to the potential of the JDZ and EEZ assets. It is really only a time game until the market determines the value of those assets. Unfortunately for all of us shareholders, the time has been way longer than expected BUT we are closer every day and I see no reduction in the future demand for the assets for which I am invested in.
GLTA
Great post tryoty!
Although everyone has a right to their opinion, I almost find it humorous reading some of the extreme suggestions. If some of these posters actually thought out their logic, it is almost the opposite from what they suggest.
If times are so bad that people are suggesting saving the salary of one employee (when ERHE has $30 million in the bank and a payroll of approx. 6), just think of all the other small oil companies that don't have $30 million in the bank and cash flow for about 10 more years at current levels. This is the PRECISE environment that we want a MR BOVELL as we might actually find another opportunity in the likeness of ERHE 8 or 9 years ago???? Who knows. That same $30 million in cash has never been as valued as it is right now for a potential deal.
IMHO, I am not that thrilled for ERHE to rush into any deal right now but I am also not asking for Mr. Bovell's head.
It is actions like those suggested that have many people in today's environment turn their "unrealized losses" into "realized losses" possibly never to be recovered again. Anyone notice with Warren Buffett did recently? Time for great deals are NOW. Buy the fear, sell the greed. Watch and learn.
This is a huge development. It's about time they changed the rules to allow for better valuations of oil company holdings.
I don't want this to start all the buy-out or buy-in rumors etc. and I actually don't want a buy-out before proven BUT this has been a major stumbling block from a fair transaction taking place.
Any publically traded oil company would have been blasted if they had offered even a low ball price for ERHE shares (say $2 - $5) due to the fact ERHE has essentially ZERO oil assets on it books. With the new rule, ERHE could actually book reserves before all holes (or any) are drilled which would allow other companies to justify to their shareholders any kind of buy-in or buy-out deal.
Not only that but this will immediately provide ERHE with a justifiable asset base for financing any number of things it wants to do (such as the other plans they talked about doing and/or moving towards an AIM listing).
Imagine the potential news announcements that will take place over the next 12 months with ERHE. Once it starts, it will be continuous for quite a while.
The only question remains is when will it all start and how many shares will I be holding then for the real fireworks to begin.
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