ERHC Energy Inc (ERHE)

[sranmal]

EEL (in conjunction with PGS) are the first company to do seismic in the STP EEZ. I guess they're doing 2D as it's cheaper and quicker(?). They've done 2D, will now begin discussions with the govt re. choosing their 2 blocks, and then do 3D seismic on the 2 blocks. It would, IMO, be preferable to have 3D sesimic before choosing their 2 blocks, but I expect they know better than me!

Note that EEL's options in the STP EEZ are not free of signature bonus. EEL must pay US$2M and US$2.5M upfront for the 2 blocks, with further signature bonuses payable upon commercial discoveries and production (aggregate not to exceed US$77M for each Block). I would expect EEL to farm-out a % of the blocks when they have done 3D seismic. This may be to ONGC, their partner in the Nigeria block bidding - ONGC are leading experts in deepwater drilling and would have appropriate rigs available to fit into drilling timescales.

Note I can only post 3 times a day at the moment since I've just joined, so have only 1 left now!