ERHC Energy Inc (ERHE)

[oilman007]

Four articles below:

HOMEPORT- saw your email yesterday, coudn't respond, only three posts allowed. I don't post a lot of articles I read, but I research and read as much or more than anyone on this board. I have many great sources, and I conduct my due diligence. Your comment that I spend too much time on one negative subject (it was something like that) is taken. However, there are 100 posts on this board of useless hype to one posts of factual information I give, whether other posters consider it a threat or not. There is not doubt that a majority of the posts on this board are simply opinion with no factual basis. My comments focus on facts and articles. This is some of the very little information we are getting, and if the news is focusing on terrorism in the area, than I will read what it entails. I consider this a very important issue for several reasons: 1) it shows a lack of order in the area 2) it hurts potential development 3) it creates unrest amongst residents of the coutry, and infighting is extremely harmful to economic development. I consider all of these major issues that can severely harm investment in the local economy, and that is something that is necessary for things to develop within Nigeria. So I do think it deserves proper focus, and with only three posts per day, I am surprised anyone can say I post too much on the subject, especially if one or more of my posts are typically deleted.

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Nigeria militants seize German hostage in oil-rich southeast
By Associated Press
Thursday, August 3, 2006 - Updated: 02:29 PM EST

PORT HARCOURT, Nigeria - Militants disguised as soldiers took a German oil industry worker hostage Thursday in Nigeria’s oil-rich delta region, spiriting him away on a boat, police said.

Ten attackers in camouflage uniforms abducted the man after stopping his jeep as he traveled to work in the oil-producing hub of Port Harcourt, police spokeswoman Ireju Barasua said.

The man works for construction company Bilfinger Berger Gas and Oil Services Ltd., an affiliate of German construction giant Julius Berger, Barasua said. Company officials could not be reached for comment.



“We are combing the place to locate the victim,” Barasua said, adding that the Nigerian navy and armed forces were searching for witnesses. She said the hostage would be difficult to find in the delta, a Scotland-sized labyrinth of creeks and mangrove swamps dotted with small villages.

Attacks on oil pipelines and kidnappings in the country’s southern Niger Delta have cut oil production by more than 20 percent this year. Nigeria, Africa’s biggest oil producer, normally produces about 2.5 million barrels per day.

More than 30 foreign oil workers have been seized this year, three from Port Harcourt.

Militants generally kidnap workers to bargain for a greater share of the country’s oil wealth. The militants argue that residents have remained deeply impoverished while government officials and oil companies grow rich.

Most of the kidnappings have ended peacefully, though an American oil worker was shot and killed in Port Harcourt in April.

In a report Thursday, the International Crisis Group urged Nigeria’s government to try to defuse the militancy in the region by more than doubling the amount of oil revenue provided to its 36 states.

The Brussels, Belgium-based think tank also said the government should open “a credible, sustained dialogue” with community leaders, militants and activists and work to implement greater transparency on government budgets, skills training and a disarmament program.

© Copyright 2006 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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The Swamps of Insurgency: Nigeria’s Delta Unrest
03 Aug 2006 16:45:23 GMT
Source: Crisis Group
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Background
Nigeria violence
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Dakar/Brussels, 3 August 2006: The Nigerian government and international oil corporations must change direction if they are to reduce the risk of violent meltdown in the Niger Delta.


The Swamps of Insurgency: Nigeria’s Delta Unrest,* the new report from the International Crisis Group, examines the potent cocktail of poverty, crime and corruption fuelling a militant threat to the stability of the region and to the country’s reliability as a major oil producer. Several steps are required to reverse the situation. The government needs to forge far-reaching reforms to administration and its approach to revenue sharing. Oil companies should involve credible, community-based organisations in their development efforts. And Western governments must pay immediate attention to improving their own development aid.


“Attempts to secure energy production have too often been heavy handed, alienating large segments of the population and boosting support for militants”, says Mike McGovern, Crisis Group’s outgoing West Africa Project Director. “There have been some laudable attempts to initiate development, but many have been poorly executed or hijacked by outsiders and local elites”.


Over the past quarter century, unrest in the Niger Delta has slowly graduated into a guerrilla-style conflict that leaves hundreds dead each year. The battle lines are drawn over the region’s crude oil and gas that make Nigeria the number one oil producer in Africa and the world’s tenth largest crude oil producer. Since January, fighters from a new group, the Movement for the Emancipation of the Niger Delta (MEND), demand the government withdraw troops, release imprisoned local leaders and grant oil revenue concessions to Delta groups.


The Nigerian Federal Government should initiate a credible, sustained dialogue on control of resources with Niger Delta civil society groups, including militants, activist leaders, women and youth drawn from nominees submitted by councils of regional ethnic groups. The state governments ought to engage more fully with professional non-governmental organisations that demonstrate a capability and willingness to assist communities to take responsibility for their own development.


Energy companies should improve measures to ensure transparency of contracts and other community payments, including for surveillance, development projects and compensation for land use and pollution.


The international community should press the Nigerian government to institute resource-control reforms and negotiate in good faith with Niger Delta groups, and encourage oil companies headquartered in their countries to be transparent about revenue and payments.


“Immediate action on these issues is crucial if open conflict is to be averted”, says Suliman Baldo, Director of Crisis Group’s Africa Program.



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Contacts: Andrew Stroehlein (Brussels) [phone]
Kimberly Abbott (Washington) [phone]
To contact Crisis Group media please click here
*Read the full Crisis Group report on our website: http://www.crisisgroup.org

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EXECUTIVE SUMMARY AND RECOMMENDATIONS


A potent cocktail of poverty, crime and corruption is fuelling a militant threat to Nigeria’s reliability as a major oil producer. Since January 2006, fighters from a new group, the Movement for the Emancipation of the Niger Delta (MEND), have fought with government forces, sabotaged oil installations, taken foreign oil workers hostage and carried out two lethal car bombings. MEND demands the government withdraw troops, release imprisoned ethnic leaders and grant oil revenue concessions to Delta groups. The Nigerian government needs to forge far-reaching reforms to administration and its approach to revenue sharing, the oil companies to involve credible, community-based organisations in their development efforts and Western governments to pay immediate attention to improving their own development aid.


The root causes of the Delta insurgency are well known. Violence, underdevelopment, environmental damage and failure to establish credible state and local government institutions have contributed to mounting public frustration at the slow pace of change under the country’s nascent democracy, which is dogged by endemic corruption and misadministration inherited from its military predecessors. Nigeria had estimated oil export revenues of $45 billion in 2005 but the slow pace of systemic reforms and the lack of jobs, electricity, water, schools and clinics in large parts of the Delta have boosted support to insurgents such as MEND. Militants appeal to the kind of public disaffection that prompted ethnic Ogoni leader Ken Saro-Wiwa to protest the military-led government and Royal Dutch/Shell before his execution in November 1995.


A decade later, the potential consequences of this conflict have escalated in both human and economic terms across a swathe of territory 30 times the size of Ogoniland. Nigerian and international military experts have recognised that the crisis requires a negotiated political resolution. Any attempt at a military solution would be disastrous for residents and risky for the oil industry. Most facilities are in the maze of creeks and rivers that are particularly vulnerable to raids by well-armed militants with intimate knowledge of the terrain. But inaction risks escalating and entrenching the conflict at a time when tensions are already rising in advance of the 2007 national elections.


MEND increasingly serves as an umbrella organisation for a loose affiliation of rebel groups in the Delta. It has not revealed the identity of its leaders or the source of its funds but its actions demonstrate that it is better armed and organised than previous militant groups. Observers warn that a worst-case scenario could lead to a one to two-year shutdown of the oil industry in the Delta, where most of Nigeria’s 2.3 million daily barrels of crude oil originate.


Illegal oil “bunkering” – theft – has accelerated the conflict and provided militant and criminal groups with funds to purchase arms. Another source of funding are the discreet payments oil companies make to militant leaders in return for “surveillance” and protection of pipelines and other infrastructure. This practice, frequently cloaked as community development, has fueled conflict through competition for contracts and by providing income to groups with violent agendas. Oil companies also pay allowances, perks – and sometimes salaries – to “supernumerary police”, as well as regular duty police and soldiers deployed to protect oil installations. Security forces consider these plum postings and are alleged to use excessive force to protect company facilities and their jobs.


President Olusegun Obasanjo’s government has begun important reforms but these must be deepened if peace is to succeed. Yet, his government has downplayed the seriousness of the insurgency. Senior officials have dismissed the militants as “mere” criminals and defended security crackdowns that have embittered locals, making it easier for armed groups such as MEND to gain new recruits. In an effort to deflect growing public impatience, government officials have demanded oil companies spend ever larger amounts on community projects. Oil industry officials counter that, after taxes and royalties, the federal government collects the vast majority of earnings on a sliding scale – 90 per cent of industry profits when oil prices are above $60. The companies rightly place the primary responsibility for political solutions to the crisis – including increased development – on the government but they also chafe at the suggestion that their own development strategies have failed.


Transparent and participatory development schemes can foster hope and accountability in Delta communities. Development efforts led by the European Commission and Pro-Natura International provide models for an approach that could reverse the cycle of poverty and violence – but only if their scale is significantly broadened to include a wide range of groups in oil producing areas. Government must also tackle corruption by making development initiatives more transparent. Otherwise, even dramatic increases in spending will be wasted.


RECOMMENDATIONS


To Nigeria’s Federal Government:


1. Initiate a credible, sustained dialogue on control of resources with Niger Delta civil society groups, including militants, activist leaders, religious leaders, women and youth drawn from nominees submitted by councils of ethnic groups in the Niger Delta states.


2. Institute while this dialogue is proceeding a derivation formula of between 25 and 50 per cent of mineral resources, including oil and gas, to all Nigerian states, and phase this in over five years in order to avoid budgetary shock to non-oil producing states and to encourage exploration and production of other mineral resources throughout Nigeria.


3. Amend or repeal the 1978 Land Use Act to expand the opportunity for communities to seek compensation for land through legal means and to allow a more transparent adjudication process of potential land seizures.


4. Seek in parallel with the dialogue on control of resources an agreement with militants that includes a phased withdrawal of troops from Delta towns, concurrent with a weapons-return amnesty program that pays militants and gang members market rates for guns and enrols them in skills and job training and that pays attention as well to the needs of girls and women who may not carry guns but have roles within those bodies (such as forced wives or cooks).


5. Bring the increasing number of quasi-independent local government institutions formally into federal structures as part of an effort to rationalise local governments in Niger Delta states, particularly in areas where these are unworkably large or combine substantively distinct ethnicities or communities.


6. Ensure that security force personnel are paid on time and in full in order to help prevent dependency on oil company payments and illicit and corrupt practices; increase enforcement of penalties for corruption and consider raising salaries; clarify the chain of command; and change the uniform of the “supernumerary police” that provide security services for the energy companies.


7. Refashion the government/transnational oil company joint ventures that control production to offer residents a substantial ownership stake along the lines of what corporate majors including Royal/Dutch Shell, ExxonMobil and Conoco have done in Canada’s Arctic.


To the State Governments:


8. Engage more fully with professional, non-governmental organisations that demonstrate a capability and willingness to assist communities to take responsibility for their own development.


9. Accelerate steps to implement poverty reduction strategies outlined in State Economic Empowerment and Development Strategies (SEEDS) that have been developed in conjunction with Nigeria’s national umbrella anti-poverty strategy, NEEDS.


10. Make budget details publicly available and respond to queries about specific spending patterns and projects.


To the Energy Companies:


11. Improve measures to ensure transparency of contracts and other community payments, including for surveillance, development projects and compensation for land use and pollution, and in particular:


(a) honour company commitments and ensure that payments are made in full, by bank transfer – not in cash – to the intended recipients;


(b) conclude agreements wherever possible that provide for individuals and local communities to be compensated for land use and pollution; and


(c) seek independent mediation or arbitration when agreements are in dispute.


12. Prioritise long-term ability to operate in Nigeria over short-term production goals and seek community assent before proceeding with production-related projects.


13. Develop partnerships with non-governmental, community-based bodies with a demonstrated ability to provide skills training and capacity building for development projects, including women’s and religious groups that have played significant roles in mediating among various ethnic groups and actors in the past decade.


To the U.S., the EU and EU Member States with major oil interests in Nigeria (the UK, France and Italy):


14. Press the Nigerian government to institute resource-control reforms and negotiate in good faith with Niger Delta groups, and encourage oil companies headquartered in their countries to be transparent about revenue and payments.


15. Condition assistance to the government upon greater transparency in federal and state budgets, particularly with regard to energy revenues.


16. Lobby China and India to sign the Extractive Industries Transparency Initiative.


To the United Nations and the wider International Community:


17. Offer the good offices of a neutral country without oil interests in Nigeria to mediate between the federal government and Delta groups, an idea already accepted in principle by MEND.


18. Consider delaying or postponing cooperation with state governments that have a poor record for delivering public services or controlling graft, and do not work with government or party officials who provide weapons or funding to armed groups for political purposes.


Dakar/Brussels, 3 August 2006


Read full report


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Iran, Venezuela in oil deal
Iran’s state-owned Petropars oil and gas company agreed to invest around $4 billion in the exploration and development of two oil fields in Venezuela.

The Wall Street Journal reported Petropars, affiliated to the National Iranian Oil Co. and which started in 1998, is currently involved in a number of oil and gas projects in Iran. It is also intent on expanding its operations outside Iran.

Petropars had previously said its first foreign investment venture involved the development of a heavy oil field in the Gulf of Venezuela. The company will develop bloc 7 of the 540 square-kilometer oil field for $2 billion.

The field has an estimated 18 billion barrels of in-place oil. The world uses about 80 million barrels a day.

Petropars also has studied a gas field in the Gulf of Venezuela and one in the northern Falcon gas field.

In the petrochemical field, Iran and Venezuela have agreed on two joint ventures, adding the general outline on the establishment of a petrochemical company to follow up on the agreements is not yet final.

Iran also has asked Venezuela to become a partner in a planned refinery in Indonesia.

Iran and Venezuela also agreed, along with Indonesia, to build a refinery in Venezuela.

Separately, an Iranian auto industry official said Iran will begin assembling its “Samand” sedan automobile in Venezuela in October. Iran expects to sell about 5,000 of the cars annually in the South American country.

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Madagascar: Watchdog Calls for Transparency As Oil Boom Takes Off





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UN Integrated Regional Information Networks

August 3, 2006
Posted to the web August 3, 2006

Johannesburg

Madagascar is becoming the next staging post of Africa's energy boom as oil conglomerates descend on the poverty stricken island to contend for a share of the recent discovery, but a global watchdog cautions that the windfall could challenge the island's fledgling democracy.

At current prices, industry estimates were that the oil could translate into annual revenue of one billion dollars for the Indian Ocean island. Energy analysts are predicting an oil price of US$100 in the short term, caused by a combination of geopolitical tensions, diminishing world reserves and high demand that has sent oil prices soaring.

Gavin Hayman, spokesperson for the anti-corruption watchdog Global Witness, warned that oil revenue did not automatically lead to poverty alleviation.

"President Marc Ravalomanana has taken a strong public stand against corruption, but the problem remains with members of the government. Our fear is that oil revenues will be squandered easily unless the international community steps in to guarantee transparency and accountability of oil revenues."

The threat of a privileged elite benefiting from huge oil wealth, while the majority remained excluded has been played out in other oil-producing nations. Oil revenue in Angola, the continent's second largest producer, has not benefited the poor. Britain's Department for International Development noted that "although growing revenues from oil and diamonds have boosted the country's economy, extreme poverty is still a daily reality for 68 percent of Angolans".

Hayman said some of the smaller oil companies rushing to secure concessions in Madagascar had been "soiled by corruption and bribery in Africa and Asia in the past. Government officials in Madagascar may be tempted into murky deals that may never benefit the millions of poor people."

Among the global oil giants scrambling for a share of Madagascar's oil resources are US-based Exxon-Mobil and Chevron Texaco; British-based Madagascar Oil and British Petroleum; Total, a French company; Royal Dutch Shell, Stat-Oil of Norway, China's National Offshore Oil Corporation and South Korea's SK Corporation.

Initial projections were that Madagascar could produce 60,000 barrels per day in three to four years, which would quickly make the oil industry the main contributor to the country's gross domestic product (GDP). In 2003 Madagascar's GDP was $5.5 billion dollars, or $240 per person annually.

Hayman said it was imperative that Madagascar join the international Extractive Industries Transparency Initiative, a forum of oil producers and consumers seeking to promote accountability in oil revenues.

Under the transparency initiative, governments, civil society and oil producers are required to make public details of financial deals, exploration rights and profits.

"Such open records enable civil society organisations to play their watchdog roles in judging if state revenue is indeed spent according to developmental needs. Madagascar needs to put such accountability measures in place before it can begin full production," said Hayman.

The promise of billions of petrodollars for a country the World Bank ranks at 146 out of the world's 177 poorest countries could place immense pressure on the fragile democracy.

In 2001 Madagascar was on the cusp of a civil war after the former president Didier Ratsiraka refused to accept Ravalomanana's presidential victory. The island was cut in half, with two capitals, two governments and a divided army. It was not until the following year that the crisis was defused, after Ratsiraka fled to France.

The next presidential polls are scheduled for December this year. Among the 10 declared candidates so far is Phillipe Tsiranana, son of the country's first post-colonial president. Talks between Ravalomanana and opposition parties to defuse rising political tensions ahead of the December elections fizzled out in June, and Ravalomanana has yet to announce whether he will contest the poll.

The government has already begun auctioning oil-drilling rights. Hugues Rajaoson, head of the energy ministry, told the media recently that "the potential for production is very, very high. The sector could contribute up to 15 percent of GDP within five years." Official estimates put offshore reserves as high as five billion barrels of oil, but the exact size remains unknown.

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According to the World Food Programme (WFP), 70 percent of the population live on less than a dollar a day and the country has to contend with regular occurrences of natural disasters such as drought, cyclones and floods. WFP information officer Patricia Lucas said 300,000 people could need food aid before the end of the year because of a drought.

This week, the International Monetary Fund injected more than $80 million into the country's Poverty Reduction and Growth Facility, the fund's concessional facility for debt support to low-income countries. Under the facility, beneficiaries can repay the loan over 10 years at an interest rate of 0.5 percent.

[ This report does not necessarily reflect the views of the United Nations ]