ERHC Energy Inc (ERHE)

[balance_builder]

I remain under the belief that ERHC shareholders will either have a buy-in or buy-out well before the drill bit churns into the ocean floor. While this isn't a popular belief by many on this board I believe the co action/inactions speak loudly toward this route. Here's some of my reasoning:

1. ERHC has remained without a real CEO/CFO for 19 months. Any company working toward real growth KNOWS the market perception for a company lacking these critical officer positions would cease all growth capability. The co's lame excuse of being unable to fill these positions due to the ongoing investigations doesn't cut it for this investor. If ERHC can successfully hire on James Ledbetter and he was able to determine the JDZ prospects were not getting sufficient attention.....and that the investigations were baseless....I'm certain ERHC could find quality leaders for the company as well. In fact, with a beat down price, quality leaders doing some real DD would be pleased to gain ownership of co shares at todays price. IMHO.

2. The company has lacked in the area of telling the world what they believe the assets to be worth. ERHC has resisted hiring available co's to read the seismic data and profess it to the world in a PR campaign. Instead they retain 9 year old 2D data and refer shareholders to that information on their website and at the same time, admit to individual shareholders that they do, in fact, have much newer 3D seismic in hand.

3. ERHC settled ALL outstanding lawsuits last year. They did a complete "about face" in their settlement of same with conditions that the filers could never come back (a welcomed condition by any ERHC suitors). Coincidence?

4. SEO steps down as Chairman of the Board. Can a COB vote his shares in a buyout offer or tender offer? Coincidence?

5. Only days after SEO steps down as COB, his Chrome attorney, O.J. Chidolue, is dismissed from his court subpeona. Coincidence?

6. SEO mysteriously moves almost exactly 1/3 of his ERHC holdings from Chrome Services to Chrome Energy. This move takes place AFTER he steps down as COB and after years of holding all of his ERHC shares in his Chrome Services company. Coincidence?

7. ERHC announces their second shareholder meeting (scheduled for April 22, 2008) after years of no shareholder meeting. Coincidence?

8. ERHC's secretary stated at the 1-15-08 Conference Call when questioned about buyout/buyin rumorings:

"Again its not company policy to comment on rumors and there's a lot of rumor out there about ERHC naturally given the exciting times we are currently facing, however, [much emphasis] if there is any such move, if there is any such initiated [end emphasis]we will tell our shareholders as and when appropriate....[pause and then emhpasis again] you will be duly informed [emphasis ends] according to regulations, according to law and according to good corporate practice. That's all we say about that.....at the moment"


Many on this board think SEO would be crazy to sell any shares prior to drilling and subsequent proving of oil which would enhances the co's assets significantly. My response: Risk reduction. FINDING OIL IS NOT A SURE THING. Don't believe me....listen to Devon energy and their quest for finding oil in a block adjacent to the JDZ. They failed after 3 attempts and drilling costs are high!

Bottom line is.....I strongly disagree with those that believe SEO will make no significant move prior to drilling. The action strongly suggests otherwise IMHO. We all wait. What we do know is:

1) AFREN is looking at acquistions with a new major partner looking to take a stake in their co.

2) ADDAX has indicated they are looking at acquisitions in the short term.

3) Petrobras is slithering their way into the STP EEZ through the president of STP and even going as far as seeking a change in the law to get a foothold.

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