ERHC Energy (OTC: ERHC), an independent oil and gas company based in Houston, Texas, is actively looking for acquisitions to push its expansion plans, said CEO Peter Ntephe.
The company, which focuses on exploration and exploitation of oil and gas reserves in the Gulf of Guinea, offshore of central West Africa, is interested in diversifying its portfolio. EHRC has a USD 400m market cap and potential buys include smaller energy companies listed on the Alternative Investments Market of the London Stock Exchange.
"We have two distinct options: we can acquire a listed-company or start ours from scratch. We are mostly interested in finding companies listed in the Alternative Investment Market (AIM) and have no particular focus on a geographic area. It is more about their mix of assets, which should complement what we do. If we can't find one, then we are open to creating one ourselves," said Ntephe. EHRC recently appointed David Bovell as its new vice president for Corporate Development.
In addition to being listed on the AIM, potential targets must have producing assets, according to the CEO. "All the assets we have in the Gulf of Guinea are prospective assets. They have huge potential but drilling should start in 2009 and we will only see oil in 2012. To balance that off, we are looking for companies or properties that have immediate revenue stream. Their geographic location is not important, what really matters is that the company is listed on AIM in London so that we have access to this market," explained Ntephe.
EHRC has 12% of the assets in the joint-development zone (JDZ), a 34,548 square kilometer area approximately 200 kilometers off the coastline of Nigeria and Sao Tome and Principe that is adjacent to petroleum discovery areas. The company operates with different partners and has interests in six of the nine blocks in the JDZ. In 2005 and 2006, EHRC sold participating interests to Addax Petroleum (trading as AXC on the Toronto and London Exchanges TSE and LSE) and Beijing-based oil company Sinopec, which injected more than USD 45m into ERHC.
by Danielle Duran Baron