Replies to post #261192 on ERHC Energy Inc (ERHE)

[TOB]

Yes, it is a fact that The Petroleum Act under the laws of Kenya do not mandate signature bonuses for exploration blocks.

A fact clearly stated on the NOCKENYA website as "Conditions for Oil and Gas Exploration".

The Petroleum (Exploration and Production Act)

Has no signature bonus.

This does not preclude signature bonuses being negotiated, especially as Kenya is now an exciting exploration target with Tullow's huge discovery in the vicinity of ERHC's large block, and the site states the terms are "negotiable".

For example, in the case of CAMAC Energy Inc., they have negotiated a small signature bonus. In this case $310,000 per block, which is a tiny amount compared with Nigerian equivalents.

There are also "training fund payments", "local community development projects" and surface fees. So the Kenyan's are not entirely missing out on the "Nigerian Scam" of getting companies to pay upfront for blocks, ahead of commercial discoveries.

All PSCs provide for a signature bonus of $310,000, payable upon signing. In addition, the PSCs require training fund payments of $175,000 per year during any exploration periods, $200,000 per year during development and production periods, and local community development projects payments of $50,000 per year during the term of the PSC. Surface fees ranging from $5.00 per square kilometer during the initial exploration period to $100.00 per square kilometer during development and production periods are payable with respect to each PSC.

So while not mandated, it is possible through negotiation, and we will await ERHC's filing of the actual PSC to see whether a small signature bonus has been added to their new acquisition or not.