**Upstream News** *ERHC* 02/24
Addax to sign West Africa PSC
By Upstream staff
Swiss explorer Addax Petroleum was expected to sign a production sharing contract this week to operate Block 4 in the Joint Development Zone managed by Nigeria and Sao Tome, writes Barry Morgan.
Addax has just completed a $350 million initial public offering on the Toronto Stock Exchange, which will fund its farm-in agreements with ERHC Energy covering blocks 3 and 4.
The Joint Development Authority expects PSCs to be signed for remaining blocks 2, 3, 5 and 6 next week, subject to agreement by Nigeria and Sao Tome.
ERHC has sought a similar deal with Chinese giant Sinopec to lead Block 4 but it is understood that intensified lobbying in recent days by Chevron of ERHC owner, Nigerian business magnate Emeka Offor, could sway the memorandum of understanding for the US supermajor instead.
High-level talks between senior Chevron and ERHC executives continued as Upstream went to press.
Chevron is understood to be interested in Block 2 even at this stage as its Obo-1 wildcat on block 1, just a few kilometers from the Block 2 border, heads for total depth.
The partners are keeping quite on the well's progress but there is talk that both oil and gas have been intersected.
Transocean drillship Deepwater Discovery's bit is now heading out of the upper horizons towards the original reservoir objective and should reach total depth before mid-March.
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24 February 2006 00:02 GMT | last updated: 24 February 2006 00:02 GMT
