Replies to post #6902 on JDZ Nigeria-Sao Tome e Principe

[nh]

Thanks for the explanation, Strategyone. The way I'm looking at it is the contribution ERHE makes to the pie vs. what they away take from the pie. If you were in Sinopec's position, you might say "How much would I be making out of this if I could take the entire pie and not have to pay out any at all to ERHE?" The cost to produce the amount that ERHE will gain from oil will be financed 100% by Sinopec. Anyway you figure it, Sinopec will have to share the gains with ERHE. Where is any upside to Sinopec to carry ERHE if they could have had it all anyway? I still maintain that ERHE brings nothing to the table. Am I still misunderstanding how it works?