I am pleased once again to provide an update on the recent progress of ERHC Energy Inc.
Our team continues to make progress toward exploration of some of our assets in the Gulf of Guinea, off the coast of West Africa. ERHC Energy’s assets in the Gulf of Guinea include interests in the deepwater Joint Development Zone (JDZ) as well as interests in the territorial waters of São Tomé and Príncipe known as the Exclusive Economic Zone (EEZ). To date, attention has been focused on JDZ Blocks 2, 3 and 4.
JDZ Block 4 is most likely to be the first of our exploratory drilling locations. ERHC has a 26.7 percent* participating interest in JDZ Block 4. Our technical partner, Addax Petroleum, an experienced exploration and production company with significant interests throughout the JDZ, is the operator of JDZ Block 4. Addax executives have indicated that drilling could commence as early as the fourth quarter of this year. The Joint Development Authority (JDA), which was set up by the governments of Nigeria and São Tomé and Príncipe to administer the JDZ, has approved the first drilling location, the Kina Prospect.
Initial exploration of JDZ Block 2, in which ERHC Energy has a 22 percent participating interest, is currently expected to commence in 2009. Sinopec Corp. is the operator of JDZ Block 2. As we have stated previously, Sinopec and Addax Petroleum jointly contracted the Aban Abraham deepwater drillship, which continues to undergo refurbishment in Singapore. Discussions continue regarding the specific drilling location in JDZ Block 2.
In JDZ Block 3, in which ERHC Energy has a 10 percent participating interest, the JDA has approved the first well location at what is known as the Lemba Prospect. Anadarko is the operator of JDZ Block 3 and has not disclosed a potential timeline for exploration.
If you have not recently visited the ERHC Web site, I encourage you to review the latest seismic images that have been disclosed by our technical partner, Addax Petroleum, at www.erhc.com/jdzprospectivity. The images showcase what geologists and engineers, using advanced technologies, have determined lies beneath 5,000 feet of water and sand on the bottom of the Gulf of Guinea.
ERHC remains interested in diversifying its asset and investment portfolio. As reported several months ago, ERHC’s board of directors approved the reformulation of ERHC’s business plan and expansion of strategic focus in August 2007. Greater flexibility was therefore granted to the Company’s leadership, letting us explore opportunities beyond the Gulf of Guinea. Most recently, after due consideration and technical appraisal of a proposal to acquire a significant stake in a company pursuing mining investments in South East Asia, ERHC decided not to pursue the proposal. Going forward, ERHC will continue to consider opportunities in mining and minerals in addition to possible acquisitions in oil and gas.
Plans are taking shape for ERHC Energy’s annual shareholders' meeting on April 22, 2008. The requisite notice of meeting and proxy statement were filed with the U.S. Securities and Exchange Commission on March 17, 2008. The documentation has been mailed to all shareholders of record as of that date. The meeting will be held at the Renaissance Houston Hotel in Houston, Texas. We hope to see you there.
ERHC Energy’s annual report for 2007 has been completed and is also being sent to shareholders of record as of March 17, 2008. The annual report extends the Company’s theme, 'Deep Opportunity.' The annual report continues our telling of the ERHC story and we encourage you to pass it along to others.
Speaking of telling the ERHC story, the ERHC Energy staffers were doing a lot of that at Nigeria Oil & Gas 2008, a major conference and exhibition in Abuja, Nigeria where ERHC had a significant presence as sponsor and exhibitor. Some photographs from the event have been posted on our Web site and if you have not already seen them, please do so. According to conference organizers, the event attracted nearly 4,400 visitors, approximately 1,100 conference delegates and more than 100 journalists. It was an enormous success. Stories featuring ERHC Energy have already appeared in a number of trade publications.
And finally, we have received a number of questions from shareholders regarding the significance of a photograph used in various marketing materials and posted online in February. As we have consistently stated, ERHC’s management continues to explore options, proposals and prospects that might advance the interests of the Company and our shareholders. It is important to note, however, that ERHC Energy has not signed any letters of intent (LOIs), memoranda of understanding, undertakings or any other form of legal obligation related to any information or transaction that might appear to be depicted in the photograph. In the event that the ERHC leadership signs or enters into any LOIs or agreements related or giving rise to any material transaction, we will publicly disclose that information by the requisite means of dissemination.
Acting Chief Executive Officer
This document contains statements concerning ERHC Energy Inc.’s future operating milestones, future drilling operations, the planned exploration and appraisal program, future prospects, future investment opportunities and financing plans, future shareholders’ meetings, response to the Senate Subcommittee investigation, developments in the SEC investigation of the Company and related proceedings, as well as other matters that are not historical facts or information. Such statements are inherently subject to a variety of risks, assumptions and uncertainties that could cause actual results to differ materially from those anticipated, projected, expressed or implied. A discussion of the risk factors that could impact these areas and the Company’s overall business and financial performance can be found in the Company’s reports and other filings with the Securities and Exchange Commission. These factors include, among others, those relating to the Company’s ability to exploit its commercial interests in the JDZ and the exclusive territorial waters of São Tomé and Príncipe, general economic and business conditions, changes in foreign and domestic oil and gas exploration and production activity, competition, changes in foreign, political, social and economic conditions, regulatory initiatives and compliance with governmental regulations and various other matters, many of which are beyond the Company’s control. Given these concerns, investors and analysts should not place undue reliance on these statements. Each of the above statements speaks only as of the date of this document. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement to reflect any change in the Company’s expectations with regard thereto or any change in events, conditions or circumstances on which any of the above statements is based.
* Subject to a possible transfer of 7.2 percent to Addax Petroleum on parameters that are currently being determined.