ERHC Energy Inc (ERHE)

[kaydee]

has the credit crunch caught Addax too?
For the past 3 weeks I have had the suspicion that Addax may have a cash crunch to deal with. They rely as much on the banks to finance the exploration activity as their own cash flow. During the past 2 months banks have cut loans to even their most valued clients in view of the worldwide liquidy issues.

Gandur of Addax is an enterpreneur - sure he wants to save costs by waiting to get a better price for a drill rigg. But are these prices really coming down, or are they holding since demand is still high and available riggs still fairly low.

If the above is true, then Addax has another reason for slowing down their search - free cash flow. That does not mean that they will not proceed in due course. But we may just have to wait until sometime in 2009 for any news on drilling.

Other small and midrange exploration companies and mining companies have postponed activities on their new projects. Just read the press each day on more announcements. These 'delays' are everywhere - Russia, Australia, South America, Canada, etc.

So I am not surprised that the same may be true for Addax. They don't have money to fund ALL of their drilling & exploration activity in all of their areas of interest.

It does'nt make me scream doom and gloom. Yes, I am disappointed having to wait yet longer. But this too shall pass.