ERHC Energy Inc (ERHE)

[balance_builder]

Homeport...hopefully this post will serve to aid your confused state on this zone and investment.

First, lets assume we BOTH believe there's a large amount of commercial oil in our interests. Safe to assume because both of us continue to hold this stock. Moreover safe to assume BECAUSE Addax just purchased further JDZ properties (B-1) with the leader of the OBO-1 drill team employed and in charge of the JDZ exploration. Stop here if this assumption is unwarranted.

Next, you have ERHC making the following comments:

"Additionally, ERHC continues to pursue other potential oil and gas acquisitions, where feasible."
http://www.erhc.com/

From 8/06:
"Looking ahead, while ERHC is certainly focused on maximizing its value through exploration and exploitation of oil and gas reserves in the Gulf of Guinea, we are not a one dimensional company. Through disciplined financial management and a focused acquisition strategy, we intend to identify, acquire and explore high quality prospects wherever we have a competitive advantage.

Ultimately, ERHC’s long-term plan is to keep administrative costs to a minimum by entering into production sharing agreements and to utilize cash flow from operations to acquire a geographically diversified portfolio of producing and development projects and low to medium risk exploration properties."

From 9/06:
"Looking ahead, ERHC’s long-term plan is to utilize cash flow from operations to implement a focused acquisition strategy, targeting a diversified portfolio of production and development projects and low- to medium-risk exploration properties. We intend to identify, acquire and explore prospects in which we discern a competitive advantage."

From 12/06:
"For instance, we are exploring new business in Nigeria, where the chance to work in marginal fields and to farm into existing concessions is increasingly available."

From 1/07:
"We also are looking beyond the JDZ. As stated by ERHC Energy Chairman Sir Emeka Offor, Mr. Ledbetter will help implement a focused acquisition strategy that targets a portfolio of low- to medium-risk properties. The Board's goal is to build a significant revenue base that will have a positive impact on the Company's profitability for the benefit of its shareholders.

As an illustration of our intention to grow, we have relocated ERHC’s Houston headquarters to a new floor within the same building at 5444 Westheimer Road. We have entered into a long-term lease with an option through 2011 on 5,200 square feet. This is more than double our previous space and will be enough to accommodate new staff as the Company grows and as operations in the JDZ begin to take shape. ERHC Energy’s new address is 5444 Westheimer Road, Suite 1440, Houston, Texas 77056."

From 4/07:
" He has also been exploring prospects in the region for ERHC and met with several parties who might have interesting opportunities for investment by ERHC. Nigeria, as many shareholders are aware, has announced it will soon auction exploration licenses for 45 offshore and onshore oil and gas blocks. In addition, marginal fields which might provide good investment for companies of ERHC’s size and capacity are starting to become available. ERHC is seriously looking at all available opportunities right now and assessing them for feasibility of participation."

From 7/07:
"As noted previously, ERHC’s Vice President (Technical), Mr. James Ledbetter, also has been assessing the feasibility of various other prospects in the region, including marginal fields that might provide good investment opportunities for companies of ERHC’s size and capacity."

From 9/07 PR:
"Additionally, the board approved management’s recommendation to reformulate the Company’s business plan. The reformulated plan will permit ERHC’s management to expand the Company’s business focus beyond the Gulf of Guinea."


Based on the above, would you consider it safe to assume that ERHC is planning on acquire additional properties? Pay paticular attention to ERHC's CEO comments of 12/06 and I'll bolden the portion I request focus on:

"we are exploring new business in Nigeria, where the chance to work in marginal fields and to farm into existing concessions is increasingly available"

Now one must connect just a bit here. Where would existing Nigerian concessions most likely be "increasingly available". From the articles you post, this sounds very much like the Niger Delta area. Offorland. Oil companies vacating the area for security/safety reasons. By good authority, I have learned that progress is developing rapidly toward solving the Niger Delta crisis. Sweet timing???? Maybe, just maybe.

Oilphant asked me on 9-24-07,

"BB:What could a minnow do with a 150 million?"

My response, in part, stated,

"Oilphant...with an injection of $150 million, ERHC could purchase producing, or near producing oil properties like they've said they plan on doing. This would certainly assist the co is being able to "stand on is own" and would also "enhance SEO's holdings"."

....I would assume the properties to be acquired would be outside of the GOG. Niger Delta? Libya? United States?"
http://investorshub.advfn.com/boards/replies.asp?msg=23168968

Now oilphant is telling you in answer to your question where you specifically asked Oilphant:

"What could a minnow do with 250 million, Oilphant? Any suggestions would be appreciated, as we really need creative ideas."

He responds less than an hour later explaining:

"HP: buys producing wells in the shallow end of the pool."

Think "the shallow end of the pool" could be the Niger Delta? It is noteworthy that ONLY you mention $250 million. Oilphant only asked about $150 million.

Noteworthy is the fact that after Oilphant answers the ONLY question you asked, you later accuse him of only answering half your question????

Is it that far out there that Oilphant has predicted ERHC will buy producing properties in the shallow end of the pool? Hasn't ERHC made it down right CLEAR that ERHC fully intends of making acquisitions of further properties?

My mindthink is that a strong relationship has developed between CVX and Addax. Oilphant posted that there is now an imbalance of properties in the JDZ following Addax's acquisition of 40% of B-1. That would mean, IMHO, that Cheveron has to come up with property in the other blocks. What other co besides Addax owns property in blocks 2,3 and 4? ERHC is the only one I know of. So, for CVX to square up with Addax in the JDZ, they take control of ERHC! The possible (read: make believe) conversation goes like this:

CVX: SEO, we want to buy ERHC.

SEO: No way can you pay me what I want yet.

CVX: How about we buy half your shares for $X

SEO: You're joking, right? I have big plans for ERHC.

CVX: What plans?

SEO: I'm going to add Niger Delta producing properties to ERHC's coffer.

CVX: Niger Delta? Thats far too dangerous. Oil co's are leaving that area for safety/security concerns.

SEO: You're right. I'm going to buy their properties.

CVX: What about the safety/security concerns?

SEO: My buddy has Goodluck handling this problem. The problem is about to be MEND'ed.

CVX: Seriously?

SEO: Yep. I didn't buy 200 acres of Ocean front property as a simple real estate investment a few years back. I've got big plans for that property with another co I own.

CVX: Interesting. How about letting us handle the operations of ERHC since we're in the business and our name alone will make your remaining ERHC shares far more valuable than you could ever make them.

SEO: Hmmm....you've got a point there. The investment community doesn't seem to take my oil co seriously. What else, besides the $X for half my shares will you throw in?

CVX: Since your fixing the Niger Delta concerns, how about we throw in $150 million for you to purchase some serious Niger Delta property.

SEO: You'd have to keep the name of the company ERHC as the locals recogize my name by it.

CVX: No problem. In fact, we insist on keeping the name since it will go over well with the natives in the Niger Delta.

SEO: Its a deal then.

CVX: Hold on. You have to step down from chairmanship of the company first. That cloud must be made to go away for instituions to come in and drive the co's sp up.

SEO: Ok. I'll step down. First I have to change the company's business plan as the Niger Delta is not officially a part of the Gulf of Guinea.

CVX: Good thinking SEO. Hey, how far along is Jimmie on coming up with viable oil producing properties in the swamps?

SEO: Very close to acquiring. I've had him on it for many months now.

CVX: Sounds good. Deal consumated upon your stepping down as COB.

CVX to CVX: What a deal. Now we own similar interests to our major JDZ partner Addax. Now we'll get Addax to give up ERHC's full carries for a few more percentages of the block and we can bring in an additional drill ship along with the Aban Abraham to get Sao Tome some desperately needed funding. Oh yeah, after the ink has dried, lets announce the real results of OBO-1 and declare it commercial. The world will like our fast track plan of hosting a platform for all four blocks. Sure was a great idea having Schrull join the Addax team.

CVX back to CVX: Yeah, what a deal we made here. Multi billions of dollars worth of oil properties for pennies on the dollar with SEO tied in for futher purchases in the future. We're brilliant! All we had to do was buy 4.9% of ERHC early on and hold down the price into each run. Matzke was right from day one, this has turned into a reserve lifeline for CVX.

CVX back to CVX: Yes, I can't believe were going to be slurping up the great oil producing potential of the Niger Delta as our competition sells. With Addax and ERHC in the swamps and the politicians supporting direct funding from the Gov't production share of these properties....SEO is going to look like a hero and get distgustingly rich at the same time. He deserves it. XOM was really playing hardball with him.

CVX back to CVX: Sure glad SEO found no need to get involved with dollar bill. Baker & McKenzies clean bill of health for ERHC wouldn't have come about had SEO not come into the picture. We got lucky....and SEO deserves to get rich after all he's been thru on this investment.

CVX back to CVX: Hey, you don't suppose SEO will offer us a postion on the ERHC team, do you? I'd take my entire salary in shares as we know how undervalued they are. We could both retire in a few short years laden with very valuable ERHC shares that will continue to produce healthy dividends for years to come....even better thanCVX own pay outs!

CVX back to CVX: You know, he does have a couple of Officer vacancies we could interview for.

Above is all in fun. But bottom line is....it pays to listen. Listening doesn't mean you have to believe....

If there's oil....there is going to be manipulation by the players involved. Lets let er play out. I think we're close to seeing some real action. King3939 indicated this as did AngryAsian and Richkan.