ERHC Energy Inc (ERHE)

[kingpindg]

Section 4.1 of the ERHC/Total Assignment Agreement reads...

4.1 Condition Precedent

Completion is subject to the fulfilment (or, where permitted, waiver) of the following conditions (“Conditions”):

(a) receipt of all requisite written approvals and consents from the Competent Authority of the Deed of Assignment;

(b) notification by Assignee that it has obtained the authorisation of Total SA (I) on the transfer of the Transferred Interests under the terms and conditions of this Agreement, and (ii) to become a party to the PSC for Block 4; and

(c) execution and entry into full force and effect of a PSC in respect of Block 4 either:

(i) between (i) Assignor (or Assignee in cased Assignor has assigned and transferred remaining rights and interests in Block 4 to Assignee pursuant to Clause 4.7), (ii) Assignee and (iii) DRSTP represented by ANP-STP; or

(ii) in the case of the Farm-In Alternative between (I) Assignor and (ii) DRSPT represented by ANP-STP.

In the event that a Condition precedent is not satisfied or waived by the Longstop Date, any Party shall have the right to terminate this Agreement in accordance with Clause 4.8 at any time by written notice to the other Party. By mutual agreement of the Parties in writing the Longstop Date may be extended for another period to be agreed by the Parties.


Discussion:

Condition (a): something confirming that this condition was met would likely only be included as part of a SEC filing, as Kosmos did with Block 11 (see below). As we know, ERHC is not filing and Total has filed nothing related to EEZ Block 4. Additionally, there is no evidence that any interest in Block 4 has ever been transferred to Total. Conclusion: condition (a) has not been met.

https://www.sec.gov/Archives/edgar/data/1509991/000155837016005628/kos-20160331ex101065573.htm


Condition (b): a document of this nature would likely not be made available for public viewing. Conclusion: neutral.

Condition (c): the only official mention of a PSC for Block 4 is the ANP-STP invitation to Shell to negotiate such a PSC. If ERHC/Total/STP had executed a full force and effect PSC for Block 4 then STP would have had no reason to run their bid process on Block 4. Conclusion: condition (c) has not been met.

So, with two out of three conditions being unmet (although it would only take one), it is my conclusion that the Assignment Agreement has not been completed.

I welcome any evidence to the contrary.


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