Replies to post #259682 on ERHC Energy Inc (ERHE)

[Krombacher]

Why did everyone after TOB's post about selling all of Block 2 to someone else completely miss that point, lol?

They're not going to be sitting on JDZ 2 inactive useless acreage if ERHC has found a way to sell the entire block.

Selling a block that is now deemed years out because SNP left it and because it seems uncommercial to someone, even if for $10 million is not a bad thing. Especially if they don't squander that $10 million (which is tough to say, but I'm saying it) and they use that money to really fast track other assets (again tough to say that given Africa time, but I'm saying it).

Krombacher - the above may be wrong

[emdyal]

Who is ERGO ??? A new oil company maybe ??lolol

[Krombacher]

Let's think about this for a second.

ERHC just got nearly 45% of JDZ B2 assets out of the blue handed to them free of any charge having lost only some time. AND it doesn't pay for *ANY* of the drilling costs in B2, so it also got a bunch of seismic and drilling data for B2 again free of charge.

Of course the question is what is all of this freebie stuff really worth?

Potentially ERHC could sell 45% of B2 to someone and STILL keep its original stake prior to this development and potentially garner yet another free carry. If they pull this off then that's money in the pocket, free carry and new and improved operator like Total who may be able to turn B2 into something commercial after all.

And if they can't? Then sell B2 outright and pick up some cash!

And if they can't do that? Well, the B2 must truly be worthless (at least at the current state of technology), so they just shelve their B interest somewhere and they are no worse than before. Someday if technology improves and can make B2 commercial, then they dust off that interest and go with it...in the meantime our focus is elsewhere...

Krombacher - the above may be wrong

[TOB]

Hard to predict...

Who would possibly be interested in JDZ Block 2 other than Total?

But I would suspect Ophir may be interested at some point, as they have made several gas discoveries NE of JDZ-2 in Block-R, and have plans to build a gas pipeline back to Bioko Island for a second LNG Train.

Block -R Fortuna-1 and Lykos-1 discovered significant volumes of dry gas. There are a large number of Lykos look-alike prospects in Block-R. This is all in the Niger Thrust Belt geology.

They are estimating 2 to 4Tcf.

Another company may have interest because they can now pick up a larger share of the block, Sinopec/Addax had 43%.

There could be additional pipeline to Egina, for example.

But I don't believe every block has to be commercial. Giving back blocks is standard. Sometimes others pick them up, sometimes they sit dormant. I think we have a fascination with the JDZ in our group and want every block to be commercial.

JDZ-2 looked the most likely to go, but the whole JDZ looked less appealing post drilling the first 6 wells.

That doesn't mean the story of the JDZ is over, even if Blocks 3 & 4 lose their operator. Some delay, surely, but Sinopec wasn't exactly moving fast.

But for ERHC, and us, the EEZ and Chad became the highest potential post drilling IMO. And possibly quickest to production, unless Total steps in.