ERHC Energy Inc (ERHE)

[daylatedolarshort]

Some thoughts

There are No Royalties payable for the production of Natural Gas in the JDZ.
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ExxonMobil sees gas trumping coal by 2030
Natural gas will surpass coal as the second-largest global energy source behind oil by 2030, even as overall global demand for energy jumps 35% from 2005 levels, ExxonMobil said today.

News wires 27 January 2011 18:19 GMT

That energy demand will be fastest in developing economies, where usage will climb 70%, while developed economies will see essentially flat demand because of improvements in energy efficiency, the supermajor said in its annual energy outlook, according to a Reuters report...
http://www.upstreamonline.com/live/article242649.ece
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China, Nigeria, Sao Tome/Principe are developing countries; the gas that has been found has value and there are No Royalties payable on Natural Gas in the JDZ.
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Sinopec and Addax Ltd. pay all of ERHC’s current and future costs in respect of petroleum operations in Blocks 2,3 and 4. Sinopec and Addax Ltd. are to receive to 100% of ERHC’s allocation of cost plus up to 50% of ERHC’s allocation of profit until they recover all costs advanced on behalf of ERHC.
Additionally in Block 2, Sinopec is to receive 6% interest on its current and future costs, up to $35 million, but only to the extent that those interest costs are recoupable out of production.
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If I understand that correctly, ERHE will have a revenue stream from the first drop of Oil. It sounds like a win-win situation for SNP/Addax/ERHE. Sounds like they both covered their a$$ and have a good relationship.

Thinking of the JDZ as an area wide developement; if you take SNP/Addax/ERHE's percents in Blocks 2,3 and 4 and add them together, that's a big chunk of percents to work with if you want to form some kind of consortium with TOTAL who is now in Block 1. Then there are also Blocks 5,6,9 and the EEZ which could be used in negotiating a consortium. Although 5 and 6 appear to still be in Arbitration.