ERHC Energy Inc (ERHE)

[oilman57]

The impact of next week's meeting is that the Joint Ministerial Council (JMC) which is comprised of delegates from Sao Tome and Nigeria will be meeting to sign off on the final award recommendations and percentages that were made by the Joint Development Authority (JDA). According to the JDA winning companies will be notified next week. Then they have two weeks to accept the block award. They more than likely will accept well before the two week deadline and some are believed to have accepted their awards already (although that has not been verified.)

Many are speculating that the public will also be notified next week as to which companies won blocks awards. Im not sure if that will occur but the winning companies will be notified so it is only a matter of time before block awards are announced to the general public. I would imagine there will be a formal ceremony to announce the winners to the general public and the press. Could that happen next week? Quite possibly.

ERHE is in line to receive significant percentages in these blocks when awards are announced. In addition they have bid for additional percentages and operatorships (with Noble and Pioneer) over and above their treaty percentages. If ERHE were to win operatorships that would be quite a bonus.

So in sum, the purpose of next weeks meeting is so the Joint Ministerial Council can put their final stamp of approval on block awards and then they will notify the winning companies that they won and what percentage in a given block that they won.

I believe a total of 26 different companies bid on these 5 blocks. Record signature bonuses were offered for the rights to win percentages in these blocks. ERHE's rights are primarily signature bonus free. SO ERHE's rights are very valuable. For example, I believe the top signature bonus offered for Block 4 was $170 million just to win rights to drill on that block.

This has been a hotly contested and lengthy process so next weeks meetings will confirm that things are finally drawing to a conclusion.