UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington D.C.20549

FORM 10-Q

(MARK ONE)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2007

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to ________________

Commission File Number 0-17325

(Exact name of registrant as specified in its charter)

Colorado	88-0218499
(State of Incorporation)	(I.R.S. Employer Identification No.)

5444 Westheimer Road

Suite1440

Houston, Texas77056

(Address of principal executive offices, including zip code)

(713) 626-4700

(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes  x No  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer or a non-accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Large Accelerated Filer  o Accelerated Filer  x Non-Accelerated Filer  o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o No  x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

The number of shares of common stock, par value $0.0001 per share, outstanding as of January 31, 2008 was 722,238,550.

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TABLE OF CONTENTS

ERHC ENERGY INC.

PartI. Financial Information		Page
Item 1.	Financial Statements
-	Unaudited Consolidated Balance Sheets at December 31, 2007 and September 30, 2007	5
-	Unaudited Consolidated Statements of Operations for the Three Months Ended December 31, 2006 and 2007, and for the period from inception, September 5, 1995, to December 31, 2007	6
-	Unaudited Consolidated Statements of Cash Flows for the Three Months Ended  December 31, 2006 and 2007, and for the period from inception, September 5, 1995, to December 31, 2007	7
	Notes to Unaudited Consolidated Financial Statements	9
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	13
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	15
Item 4.	Controls and Procedures	16
Part II. Other Information
Item 1.	Legal Proceedings	17
Item 1A.	Risk Factors	18
Item 6.	Exhibits	20
	Signatures	21

2

Forward-Looking Statements

ERHC Energy Inc. (the “Company”) or its representatives may, from time to time, make or incorporate by reference certain written or oral statements that are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).  All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements.  Forward-looking statements include, without limitation, any statement that may project, indicate or imply future results, events, performance or achievements, and may contain or be identified by the words “expect,” “intend,” “plan,” “predict,” “anticipate,” “estimate,” “believe,” “should,” “could,” “may,” “might,” “will,” “will be,” “will continue,” “will likely result,” “project,” “forecast,” “budget” and similar expressions.  Statements made by the Company in this report that contain forward-looking statements include, but are not limited to, information concerning the Company’s possible or assumed future business activities and results of operations and statements about the following subjects:

· business strategy;

· growth opportunities;

· future development of concessions, exploitation of assets and other business operations;

· future market conditions and the effect of such conditions on the Company’s future activities or results of operations;

· future uses of and requirements for financial resources;

· interest rate and foreign exchange risk;

· future contractual obligations;

· outcomes of legal proceedings including, without limitation, the ongoing investigations of the Company;

· future operations outside the United States;

· competitive position;

· expected financial position;

· future cash flows;

· future liquidity and sufficiency of capital resources;

· future dividends;

· financing plans;

· tax planning;

· budgets for capital and other expenditures;

· plans and objectives of management;

· compliance with applicable laws; and

· adequacy of insurance or indemnification.

These types of statements and other forward-looking statements inherently are subject to a variety of assumptions, risks and uncertainties that could cause actual results, levels of activity, performance or achievements to differ materially from those expected, projected or expressed in forward-looking statements.  These risks and uncertainties include, among others, the following:

· general economic and business conditions;

· worldwide demand for oil and natural gas;

· changes in foreign and domestic oil and gas exploration, development and production activity;

· oil and natural gas price fluctuations and related market expectations;

· termination, renegotiation or modification of existing contracts;

· the ability of the Organization of Petroleum Exporting Countries, commonly called OPEC, to set and maintain production levels and pricing, and the level of production in non-OPEC countries;

· policies of the various governments regarding exploration and development of oil and gas reserves;

· advances in exploration and development technology;

· the political environment of oil-producing regions;

· political instability in the Democratic Republic of Sao Tome and Principe and the Federal Republic of Nigeria;

casualty losses;

· competition;

· changes in foreign, political, social and economic conditions;

· risks of international operations, compliance with foreign laws and taxation policies and expropriation or nationalization of equipment and assets;

· risks of potential contractual liabilities;

· foreign exchange and currency fluctuations and regulations, and the inability to repatriate income or capital;

· risks of war, military operations, other armed hostilities, terrorist acts and embargoes;

· regulatory initiatives and compliance with governmental regulations;

· compliance with environmental laws and regulations;

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· compliance with tax laws and regulations;

· customer preferences;

· effects of litigation and governmental proceedings;

· cost, availability and adequacy of insurance;

· adequacy of the Company’s sources of liquidity;

· labor conditions and the availability of qualified personnel; and

· various other matters, many of which are beyond the Company’s control.

The risks and uncertainties included here are not exhaustive.  Other sections of this report and the Company’s other filings with the U.S. Securities and Exchange Commission (“SEC”) include additional factors that could adversely affect the Company’s business, results of operations and financial performance.  Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements.  Forward-looking statements included in this report speak only as of the date of this report.  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 its expectations with regard to the statement or any change in events, conditions or circumstances on which any forward-looking statement is based.

4

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

ERHC ENERGY INC.

A CORPORATION IN THE DEVELOPMENT STAGE

UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEETS

December 31, 2007and September 30, 2007

	December 31,			September 30,
	2007			2007
ASSETS
Current assets:
Cash	$	33,970,197		$	34,721,933
Prepaid expenses and other current assets		168,486			179,955
Deferred tax asset		-			480,000
Income tax refundable		2,048,758			1,568,758
Total current assets		36,187,441			36,950,646
DRSTP concession fee		2,839,500			2,839,500
Furniture and equipment, net		57,775			64,495
Total assets	$	39,084,716		$	39,854,641
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued liabilities	$	4,999,549		$	5,183,979
Accounts payable and accrued liabilities, related parties		102,464			238,614
Accrued interest		7,336			6,876
Asset retirement obligation		485,000			485,000
Convertible debt		33,513			33,513
Total current liabilities		5,627,862			5,947,982
Commitments and contingencies:
Shareholders' equity:
Preferred stock, par value $0.0001; authorized 10,000,000; none issued and outstanding		-			-
Common stock, par value $0.0001; authorized 950,000,000 shares; issued and outstanding 722,238,550 and 721,938,550 at December 31, 2007 and September 30, 2007, respectively		72,224			72,193
Additional paid-in capital		91,964,474			91,827,545
Losses accumulated in the development stage		(58,579,844	)		(57,993,079	)
Total shareholders’ equity		33,456,854			33,906,659
Total liabilities and shareholders' equity	$	39,084,716		$	39,854,641

The accompanying notes are an integral part of these unaudited consolidated condensed financial statements

5

ERHC ENERGY INC.

A CORPORATION IN THE DEVELOPMENT STAGE

UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS

For the Three Months Ended December 31, 2007and 2006 and for the Period from Inception,

September 5, 1995, to December 31, 2007

							Inception to December 31,
	2006			2007			2007
Operating costs and expenses:
General and administrative expenses	$	1,331,898		$	1,011,447		$	65,104,557
Depreciation, depletion and amortization		2,415			6,720			1,392,650
Write-offs and abandonments		-			-			7,742,128
Loss from operations		(1,334,313	)		(1,018,167	)		(74,239,335	)
Other income and (expenses):
Interest income		543,632			431,863			3,580,202
Loss from settlement		-			-			(247,690	)
Other income		-			-			439,827
Gain from sale of partial interest in DRSTP concession		-			-			30,102,250
Interest expense		(461	)		(461	)		(12,125,523	)
Loss on extinguishment of debt		-			-			(5,749,575	)
Total other income and expenses, net		543,171			431,402			15,999,491
Loss before benefit  (provision) for income taxes		(791,142	)		(586,765	)		(58,239,844	)
Benefit (provision) for income taxes:
Current		749,000			480,000			(820,000	)
Deferred		(480,000	)		(480,000	)		480,000
Total benefit (provision) for income taxes		269,000			-			(340,000	)
Net Loss	$	(522,142	)	$	(586,765	)	$	(58,579,844	)
Net Loss per common share - basic and diluted	$	(0.00	)	$	(0.00	)
Weighted average number of common shares outstanding - basic and diluted		718,988,982			722,016,830

The accompanying notes are an integral part of the consolidated condensed financial statements

6

ERHC ENERGY INC.

A CORPORATION IN THE DEVELOPMENT STAGE

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Three Months Ended December 31, 2007and 2006 and for the Period from Inception,

September 5, 1995, to December 31, 2007

	2006			2007			Inception to December 31, 2007
Cash Flows from Operating Activities
Net loss	$	(522,142	)	$	(586,766	)	$	(58,579,845	)
Adjustments to reconcile net loss to net cash used by operating activities:
Depreciation, depletion and amortization expenses		2,415			6,721			1,392,651
Write-offs and abandonments		-			-			7,742,128
Deferred income taxes		480,000						(480,000	)
Compensatory stock options		-			48,460			1,308,240
Gain from settlement		-			-			(252,310	)
Gain on sale of partial interest in DRSTP concession		-			-			(30,102,250	)
Amortization of beneficial conversion feature associated with convertible debt		-			-			2,793,929
Amortization of deferred compensation		-			-			1,257,863
Common stock issued for services		-			-			20,897,077
Common stock issued for settlements		-			-			225,989
Common stock issued for officer bonuses		-			-			5,015,000
Common stock issued for interest and penalties on convertible debt		-			-			10,631,768
Common stock issued for board compensation		-			-			1,976,548
Loss on extinguishment of debt		-			-			5,682,368
Changes in operating assets and liabilities:
Prepaid expenses and other current assets		857,610			11,469			(168,485	)
Income tax refundable		(749,000	)		-			(1,568,758	)
Other assets		(8,921	)		-			-
Accounts payable and other accrued liabilities		17,271			(183,970	)		(2,674,907	)
Accrued federal income taxes		(3,013,147	)		-			-
Accounts payable, and accrued liabilities, related parties		33,225			(47,650	)		190,964
Accrued retirement obligation		-			-			485,000
Net cash used by operating activities		(2,902,689	)		(751,736	)		(34,227,030	)
Cash Flows from Investing Activities
Purchase of DRSTP concession		-			-			(5,679,000	)
Proceeds from sale of partial interest in DRSTP concession		-			-			45,900,000
Purchase of furniture and equipment		(57,752	)		-			(877,200	)
Net cash provided (used) by investing activities	$	(57,752	)	$	-		$	39,343,800

The accompanying notes are an integral part of the consolidated condensed financial statements

7

ERHC ENERGY INC.

A CORPORATION IN THE DEVELOPMENT STAGE

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Three Months Ended December 31, 2006and 2005 and for the Period from Inception,

September 5, 1995, to December 31, 2006

	2006			2007			Inception to December 31, 2007
Cash Flows from Financing Activities:
Proceeds from warrants exercised	$	-		$	-		$	160,000
Proceeds from common stock, net of expenses		-			-			6,955,049
Proceeds from related party line of credit		-			-			2,750,000
Proceeds from related party debt		-			-			158,700
Proceeds from related party convertible debt		-			-			8,207,706
Proceeds from convertible debt		-			-			9,019,937
Proceeds from note payable to bank		-			-			175,000
Proceeds from shareholder loans		-			-			1,845,809
Collection of stock subscription receivable		-			-			913,300
Repayment of shareholder loans		-			-			(1,020,607	)
Repayment of long-term debt		-			-			(189,508	)
Net cash provided by investing activities		-			-			28,975,386
Net increase (decrease) in cash and cash equivalents		(2,960,441	)		(751,736	)		33,970,197
Cash and cash equivalents, beginning of period		40,991,114			34,721,933			-
Cash and cash equivalents, end of period	$	38,030,673		$	33,970,197		$	33,970,197
Supplemental Disclosure of Cash Flow Information
Cash paid for interest expense	$	-		$	-
Cash paid for income taxes	$	-		$	-

The accompanying notes are an integral part of the consolidated condensed financial statements

8

ERHC ENERGY INC.

A CORPORATION IN THE DEVELOPMENT STAGE

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Note 1– Basis of Presentation and Business Organization

The consolidated financial statements included herein, which have not been audited pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”), reflect all adjustments which, in the opinion of management, are necessary to present a fair statement of the results for the interim periods on a basis consistent with the annual audited financial statements.  All such adjustments are of a normal recurring nature.  The results of operations for the interim periods are not necessarily indicative of the results to be expected for an entire year.  Certain information, accounting policies and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted pursuant to such rules and regulations, although ERHC Energy Inc. (“ERHC” or the “Company”) believes that the disclosures are adequate to make the information presented not misleading.  These financial statements should be read in conjunction with the Company’s audited financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2007.

Note 2- Accounts Payable and Accrued Liabilities

Accounts payable and accrued liabilities consisted of the following as of each balance sheet date:

	December 31, 2007		September 30, 2007
Accrued stock payable – success fee	$	4,803,750	$	4,803,750
Accounts payable		195,799		380,229
Total	$	4,999,549	$	5,183,979

Accounts payable and accrued liabilities - related parties consisted of the following as of each balance sheet date:

	December 31,		September 30,
	2007		2007
Due to Chrome Management Services, Inc.	$	62,314	$	62,314
Due to board of directors for board fees		40,150		87,800
Due to board of directors – stock payable		-		(1) 88,500
Total	$	102,464	$	238,614

(1) In December of 2007, 300,000 shares of common stock were issued to directors. The Company recognized $88,500 of compensation related to those shares in 2007.

Note 3- Sao TomeConcession

In April 2003, the Company and the DRSTP entered into an Option Agreement (the “2003 Option Agreement”) in which the Company relinquished certain financial interests in the JDZ in exchange for exploration rights in the JDZ.  The Company additionally entered into an administration agreement with the Nigeria-Sao Tome and Principe Joint Development Authority (“JDA”).  The administration agreement is the formal agreement by the JDA that it will fully implement ERHC’s preferential rights to working interests in the JDZ acreage as set forth in the 2003 Option Agreement and describes certain procedures regarding the exercising of these rights.  However, ERHC retained under a previous agreement the following rights to participate in exploration and production activities in the EEZ subject to certain restrictions:  (a) the right to receive up to two blocks of ERHC’s choice and (b) the option to acquire up to a 15% paid working interest in up to two blocks of ERHC’s choice in the EEZ.  The Company would be responsible for its proportionate share of exploration and exploitation costs in the EEZ blocks.

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The following represents ERHC’s current rights in the JDZ blocks.

JDZ Block #	ERHC Original Participating Interest(1)	ERHC Joint Bid Participating Interest	Participating Interest(s) Sold	Current ERHC Retained Participating Interest
2	30%	35%	43% (2)	22%
3	20%	5%	15% (3)	10%
4	25%	35%	33.3% (4)	26.7%  (6)
5	15%	(5)	(5)	(5)
6	15%	(5)	(5)	(5)
9	20%	(5)	(5)	(5)

(1) Original Participating Interest granted pursuant to the Option Agreement, dated April 2, 2003, between DRSTP and ERHC (the “2003 Option Agreement”).

(2) In March 2006, ERHC sold an aggregate 28.67% participating interest to Sinopec and an aggregate 14.33% participating interest to Addax Ltd.

(3) In February 2006, ERHC sold a 15% participating interest to Addax Sub.

(4) By a Participation Agreement made in November 2005 and subsequently amended, ERHC sold 33.3% participating interest to Addax.

(5) No contracts have been entered into as of the date hereof. ERHC’s goal is to enter into agreements to exploit its interests in Blocks 5, 6 and 9 also.  Additionally, the Company intends to exploit its rights in the EEZ.

(6) Includes the 9% reclaimed by ERHC from Godsonic by ERHC on behalf of the ERHC/Addax consortium following Godsonic's inability to fulfill financial and other conditions upon which the 9% was to have been assigned to Godsonic. Pursuant to the Amendment to the Participation Agreement made on April 11, 2006, the 9% is subject to distribution between Addax (7.2%) and ERHC (1.8%), if agreement is reached between the parties on the amount payable by Addax to ERHC for said interest.

This exercise of the Company’s rights was subject to the condition that if no license is awarded or a license is awarded and subsequently withdrawn by the JDA prior to the commencement of operations, ERHC will be entitled to receive its working interest in that block in a future license awarded for the block.

10

Note 4 - Income Taxes

At December 31, 2007, the Company had a consolidated net operating loss carry-forward (“NOL”) of approximately $1.9 million expiring through 2027. The NOLs are subject to certain limitations under the Internal Revenue Code of 1986, as amended, including Section 382 of the Tax Reform Act of 1986.  During the fiscal year ended September 30, 2006, the Company recognized a significant gain on the sale of various participation interests. This gain utilized a substantial portion of the Company’s NOLs and such NOLs were adjusted to remove losses limited under Section 382.

The composition of deferred tax assets and the related tax effects at December 31, 2007and September 30, 2007are as follows:

	December 31, 2007			September 30, 2007
Net operating losses	$	634,265		$	931,241
Accrual for asset retirement		164,900			164,900
Total deferred tax assets		799,165			1,096,141
Valuation allowance		(799,165	)		(616,141	)
Net deferred tax asset	$	-		$	480,000

The $480,000 deferred tax asset at September 30, 2007 represents the minimum NOL carry back claim from losses in future years against the fiscal year ended September 30, 2006 taxable income. At December 31, 2007, the $480,000 balance was reclassified to current income tax receivable.

The difference between the income tax benefit (provision) in the accompanying consolidated statements of operations and the amount that would result if the U.S. federal statutory rate of 34% were applied to pre-tax income (loss) for the three months ended December 31, 2007 and 2006, is as follows:

	2007			2006
Benefit at federal statutory rate	$	199,500		$	268,988
Non-deductible stock based compensation		(16,476	)		-
Other		-			12
Increase in valuation allowance		(183,024	)		-
Provision for income taxes	$	-		$	269,000

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Note 5 – Stock-Based Compensation

During the year ended September 30, 2007, the Company issued 1,000,000 options to purchase common stock of the Company to its new employee. These options are for a term of three years, have an exercise price of $0.43 and vest over one year. Fair value of $223,900 was calculated using the Black-Scholes Model. Variables used in the Black-Scholes option-pricing model during 2007, include (1) 4.90% discount rate, (2) option life is the expected remaining life of the options as of each year end, (3) expected volatility of 75.00%, and (4) zero expected dividends. Option expense of $175,440 was recorded during the year ended September 30, 2007and $48,460 during the three months ended December 31, 2007.

Note 6 - Commitments and Contingencies

Contingencies

From time to time, certain potential obligations are presented to the Company that may have originated during periods not under existing management’s control.  These alleged obligations are generally for goods and services for which the Company has no record.  The Company actively investigates these claims as they arise.  All known material obligations of the Company have been recorded and reflected in the financial statements, but there is no certainty that all material claims have been presented to the Company nor have the benefits of available statutes of limitations been considered, should they apply.

Legal Proceedings

Subpoenas.  On May 4, 2006, a Federal court search warrant initiated by DOJ was executed on the Company.  The DOJ sought various records including, among other matters, documents, if any, related to correspondence with foreign governmental officials or entities in Sao Tomeand Nigeria.  Related SEC subpoenas issued on May 9, 2006and August 29, 2006also requested a range of documents. ERHC continues to interface with both the DOJ and SEC investigators to respond to the SEC subpoenas and any additional requests for information from the DOJ or SEC.  ERHC’s attorneys, Akin Gump Strauss Hauer & Feld LLP, are assisting ERHC in responding to the subpoena

On July 5, 2007, the U.S. Senate Committee on Homeland Security and Governmental Affairs’ Permanent Subcommittee on Investigations served ERHC with a subpoena in connection with its review of matters relating to the potential abuse of payments made to foreign governments. The subpoena, as amended on July 18, 2007, seeks documents and information regarding ERHC’s activities, particularly those related to the acquisition of ERHC’s interests in the Gulfof Guinea.  ERHC’s attorneys, Akin Gump Strauss Hauer & Feld LLP, are assisting ERHC in responding to the subpoena.

ERHC/Addax Arbitration.  Addax, our consortium partner in JDZ Block 4, claims entitlement under our existing agreements to 7.2% out of the recovered 9% interest in Block 4, leaving 1.8% remaining with ERHC.  ERHC disputes the consideration that Addax should pay to ERHC for the 7.2%.  If Addax’s claims are successful, ERHC’s share of JDZ Block 4 will increase from 17.7% to 19.5% and Addax’s share of the JDZ Block 4 will increase from 33.3% to 40.5% for no additional consideration paid to ERHC.  ERHC and Addax are currently in arbitration to resolve the issue.  The parties are also exploring mediation as a potential alternative.

From time to time, ERHC may be subject to routine litigation, claims, or disputes in the ordinary course of business.  In the opinion of management, no pending or known threatened claims, actions or proceedings against the Company are expected to have a material adverse effect on ERHC’s consolidated financial position, results of operations or cash flows.  ERHC intends to defend these matters vigorously; the Company cannot predict with certainty, however, the outcome or effect of any of the litigation or investigatory matters specifically described above or any other pending litigation or claims.  There can be no assurance as to the ultimate outcome of these lawsuits and investigations.

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Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with the Company’s unaudited consolidated financial statements (including the notes thereto) and Item 1A of Part II, “Risk Factors,” included elsewhere in this report and the Company’s audited consolidated financial statements and the notes thereto, Item 7, “Management’s Discussion and Analysis of Financial Condition and Plan of Operations” and Item 1A, “Risk Factors” included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2007, Item 1A of Part II, “Risk Factors,” included in the Company’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2006 and Item 1A of Part II, “Risk Factors,” included in the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2006.  The Company’s historical results are not necessarily an indication of trends in operating results for any future period.   References to “ERHC” or the “Company” mean ERHC Energy Inc., a Coloradocorporation, and, unless expressly stated or the context otherwise requires, its wholly owned subsidiary.

Overview

ERHC reports as a development stage enterprise as there are currently no significant operations and no revenue has been generated from business activities. The Company was formed in 1986, as a Coloradocorporation, and was engaged in a variety of businesses until 1996, when it began its current operations as an independent oil and gas company.  The Company’s goal is to maximize its value through exploration and exploitation of oil and gas reserves in the Gulfof Guineaoffshore central West Africa. The Company’s current focus is to exploit its only assets, which are rights to working interests in exploration acreage in the Joint Development Zone (“JDZ”) between the Democratic Republic of Sao Tome & Principe (“DRSTP” or “Sao Tome”) and the Federal Republic of Nigeria (“FRN” or “Nigeria”) and in the exclusive territorial waters of Sao Tome (the “Exclusive Economic Zone” or “EEZ”).  The Company has formed relationships with upstream oil and gas companies to assist the Company in exploiting its assets in the JDZ and entered into production sharing agreements with upstream oil and gas companies in certain of these JDZ Blocks. The technical and operational expertise in conducting exploration operations will be provided by such oil and gas companies and the Company’s various consortium partners.

Saleof Participation Interests

The following represents ERHC’s current rights in the JDZ blocks.

JDZ Block #	ERHC Original Participating Interest(1)	ERHC Joint Bid Participating Interest	Participating Interest(s) Sold	Current ERHC Retained Participating Interest
2	30%	35%	43% (2)	22%
3	20%	5%	15% (3)	10%
4	25%	35%	33.3% (4)	26.7%  (6)
5	15%	(5)	(5)	(5)
6	15%	(5)	(5)	(5)
9	20%	(5)	(5)	(5)

(1) Original Participating Interest granted pursuant to the Option Agreement, dated April 2, 2003, between DRSTP and ERHC (the “2003 Option Agreement”).

(2) In March 2006, ERHC sold an aggregate 28.67% participating interest to Sinopec and an aggregate 14.33% participating interest to Addax Ltd.

(3) In February 2006, ERHC sold a 15% participating interest to Addax Sub.

(4) By a Participation Agreement made in November 2005 and subsequently amended, ERHC sold 33.3% participating interest to Addax.

(5) No contracts have been entered into as of the date hereof. ERHC’s goal is to enter into agreements to exploit its interests in Blocks 5, 6 and 9 also.  Additionally, the Company intends to exploit its rights in the EEZ.

(6) Includes the 9% reclaimed from Godsonic by ERHC on behalf of the ERHC/Addax consortium following Godsonic's inability to fulfill financial and other conditions upon which the 9% was to have been assigned to Godsonic. Pursuant to the Amendment to the Participation Agreement made on April 11, 2006, the 9% is subject to distribution between Addax (7.2%) and ERHC (1.8%), if agreement is reached between the parties on the amount payable by Addax to ERHC for said interest.

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Results of Operations

Three Months Ended December 31, 2007Compared with Three Months Ended December 31, 2006

During the three months ended December 31, 2007, the Company had a net loss of $586,765 compared with a net loss of $522,142 for the three months ended December 31, 2006.   Interest income decreased from $543,632 in the three months ended December 31, 2006 to $431,863 in the three months ended December 31, 2007 due to a decline in the significant cash balance maintained by the Company following the sale of the participation interests in 2006.  General and administrative expenses decreased from $1,331,898 in the three months ended December 31, 2006 to $1,011,447 in the three months ended December 31, 2007 primarily due to a decrease of $673,116 in legal fees, from $893,733 in the three months ended December 31, 2006, to $220,617 in the three months ended December 31, 2007. The decrease in legal fees was due to reduction in required assistance in connection with the Justice Department investigation of the Company, and the decrease was partially offset by an increase in public relations expense of $133,407 from $2,002 in the three months ended December 31, 2006 to $135,409 in the three months ended December 31, 2007.  See “Legal Proceedings” in Item 1 of Part II of this report.

Liquidity and Capital Resources

As of December 31, 2007, the Company had $33,970,197 in cash and cash equivalents and short-term investments and positive working capital of $30,571,579.  Management believes that this cash position should be sufficient to support the Company’s working capital requirements for more than 12 months.

Off-Balance Sheet Arrangements

At December 31, 2007, the Company had no off-balance sheet arrangements that have or are reasonably likely to have a material current or future effect on its financial condition or results of operations.

Debt Financing Arrangements

At December 31, 2007, the Company had short-term debt of $33,513 bearing interest at 5.5% per year payable to an individual. The Company had other current liabilities of $5,594,349 including related party liabilities as follows: $62,314 owed to Chrome Management Services Inc. and $40,150 due to the Company’s board of directors for directors’ fees. Included in current liabilities is also a $4,803,750 liability to Feltang International Inc. that will be satisfied upon issuance of 5,250,000 shares of common stock.

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Item 3. Quantitative and Qualitative Disclosures about Market Risk

The Company’s current focus is to exploit its primary assets, which are rights to working interest in the JDZ and EEZ under agreements with the JDA and DRSTP.  The Company intends to continue to form relationships with other oil and gas companies with technical and financial capabilities to assist the Company in leveraging its interests in the EEZ and the JDZ.  The Company currently has no other operations.

At December 31, 2007, all of the Company's operations were located outside the United States.  The Company’s primary asset are agreements with DRSTP and the JDA, which provide ERHC with rights to participate in exploration and production activities in the Gulf of Guinea off the coast of central West Africa.  This geographic area of interest is controlled by foreign governments that have historically experienced volatility, which is out of management’s control. The Company’s ability to exploit its interests in the agreements in this area may be impacted by this circumstance.

The future success of the Company’s international operations may also be adversely affected by risks associated with international activities, including economic and labor conditions, political instability, risk of war, expropriation, renegotiation or modification of existing contracts, tax laws (including host-country import-export, excise and income taxes and United States taxes on foreign subsidiaries) and changes in the value of the U.S. dollar versus the local currencies in which future oil and gas producing activities may be denominated.  As well, changes in exchange rates may adversely affect the Company's future results of operations and financial condition.

Market risks relating to the Company’s operations result primarily from changes in interest rates as well as credit risk concentrations.  The Company’s interest expense is generally not sensitive to changes in the general level of interest rates in the United States, particularly because a substantial majority of its indebtedness is at fixed rates.

The Company holds no derivative financial or commodity instruments, nor does it engage in any foreign currency denominated transactions.

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Item 4. Controls and Procedures

The Company’s Chief Executive Officer and Principal Accounting Officer participated in an evaluation by management of the effectiveness of the Company’s disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of December 31, 2007.  Based on their participation in that evaluation, the Company’s Chief Executive Officer and Principal Accounting Officer concluded that the Company’s disclosure controls and procedures were effective as of December 31, 2007to ensure that required information is disclosed on a timely basis in its reports filed or furnished under the Exchange Act.

There was no change in the Company’s internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) that occurred during the fiscal quarter ended December 31, 2007 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

DOJ, SEC and U.S.Senate Committee Subpoenas.  On May 4, 2006, a search warrant issued by the U.S. District Court of the Southern District of Texas, Houston Division, was executed on ERHC seeking various records including, among others, documents, if any, related to correspondence with foreign governmental officials or entities in Sao Tomeand Nigeria.  The search warrant cited, among other things, possible violations of the FCPA, Section 10(b) of the Exchange Act, Rule 10b-5 under the Exchange Act and criminal conspiracy and wire fraud statutes.  ERHC filed suit in federal district court in Texasin June 2006 seeking to protect the Company’s attorney-client privileged documents and to allow its counsel to determine the factual basis for the DOJ’s search warrant affidavit, which is currently under seal.

A related SEC subpoena was issued on May 9, 2006, and a second related subpoena issued on August 29, 2006.  The subpoenas request from ERHC a range of documents including all documents related to correspondence with foreign governmental officials or entities in Sao Tome and Nigeria, personnel records (specifically, those regarding the Company’s former Chief Financial Officer, Franklin Ihekwoaba) and other corporate records.  The Company has been actively responding to both subpoenas.  

On July 5, 2007, U.S. Senate Committee on Homeland Security and Governmental Affairs’ Permanent Subcommittee on Investigations served ERHC with a subpoena, in connection with its review of matters relating to the potential abuse of payments made to foreign governments. The subpoena, as amended on July 18, 2007, seeks documents and information regarding ERHC’s activities, particularly those related to the acquisition of ERHC’s interests in the Gulfof Guinea.  ERHC’s attorneys, Akin Gump Strauss Hauer & Feld LLP, are assisting ERHC in responding to all subpoenas.

The investigations by the DOJ, SEC and Senate Subcommittee are continuing.  The Company anticipates that these investigations will be lengthy and do not expect these investigations to be concluded in the immediate future.  If violations are found, the Company may be subject to criminal, civil and/or administrative sanctions, including substantial fines, and the resolution or disposition of these matters could have a material adverse effect on its business, prospects, operations, financial condition and cash flows.

ERHC/Addax Arbitration.  Addax, our consortium partner in JDZ Block 4, claims entitlement under our existing agreements to 7.2% out of the recovered 9% interest in Block 4, leaving 1.8% remaining with ERHC.  The parties are currently in arbitration to determine whether additional consideration is payable to ERHC under the existing agreements for the 7.2% claimed by Addax.  If Addax’s claims are successful, ERHC’s share of JDZ Block 4 will increase from 17.7% to 19.5% and Addax’s share of the JDZ Block 4 will increase from 33.3% to 40.5% for no additional consideration paid to ERHC.  The parties are also exploring mediation as a potential alternative to arbitration.

From time to time, ERHC may be subject to routine litigation, claims, or disputes in the ordinary course of business.  In the opinion of management, no pending or known threatened claims, actions or proceedings against the Company are expected to have a material adverse effect on ERHC’s consolidated financial position, results of operations or cash flows.  ERHC intends to defend these matters vigorously; the Company cannot predict with certainty, however, the outcome or effect of any of the litigation or investigatory matters specifically described above or any other pending litigation or claims.  There can be no assurance as to the ultimate outcome of these lawsuits and investigations.

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Item 1A. Risk Factors

The Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2006 (“2006 Annual Report”), as modified by its Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2006 (“First Quarterly Report”) and its Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2007 (“Second Quarterly Report”), includes a detailed discussion of certain material risk factors facing the Company.  The information presented below describes updates and additions to such risk factors and should be read in conjunction with the risk factors and information disclosed in ERHC’s 2006 Annual Report, First Quarterly Report and Second Quarterly Report.  References to “ERHC,” “we,” “us” or “our” mean ERHC Energy Inc., a Coloradocorporation and, unless expressly stated or the context otherwise requires, its wholly owned subsidiary.

The risk factor in the First Quarterly Report captioned “Our Operations Are Located Outside of the United States Which Subjects Us to Risks Associated with International Activities.” is amended and restated in its entirety as follows:

Our Operations Are Located Outside of the United StatesWhich Subjects Us to Risks Associated with International Activities.

At December 31, 2007, all of our operations were located outside the United States.  Our only assets are agreements with DRSTP and the JDA, which provide ERHC with rights to participate in exploration and production activities in the Gulfof Guineaoff the coast of central West Africa.  This geographic area of interest is controlled by foreign governments that have historically experienced volatility, which is out of management’s control. Our ability to exploit our interests in this area pursuant to such agreements may be adversely impacted by this circumstance.

The future success of our international operations may also be adversely affected by risks associated with international activities, including economic and labor conditions, political instability, risk of war, expropriation, termination, renegotiation or modification of existing contracts, tax laws (including host-country import-export, excise and income taxes and United States taxes on  foreign  subsidiaries)  and  changes  in the value of the U.S. dollar versus the local currencies in which future oil and gas producing activities may be  denominated.  Changes in exchange rates may also adversely affect our future results of operations and financial condition.

In addition, to the extent we engage in operations and activities outside the United States, we are subject to the Foreign Corrupt Practices Act, or FCPA, which generally prohibits U.S. companies and their intermediaries from making corrupt payments to foreign officials for the purpose of obtaining or keeping business or otherwise obtaining favorable treatment, and requires companies to maintain adequate record-keeping and internal accounting practices to accurately reflect the transactions of the company.  The FCPA applies to companies, individual directors, officers, employees and agents.  The FCPA also applies to foreign companies and persons taking any act in furtherance of such corrupt payments while in the United States.  Under the FCPA, U.S.companies may be held liable for actions taken by strategic or local partners or representatives.

The FCPA imposes civil and criminal penalties for violations of the Act.  Civil penalties may include fines of up to $500,000 per violation, and equitable remedies such as disgorgement of profits causally connected to the violation (including prejudgment interest on such profits) and injunctive relief.  Criminal penalties for violations of the corrupt payments provisions could range up to the greater of $2 million per violation or twice the gross pecuniary gain sought by making the payment, and/or incarceration for up to 5 years per violation.  Moreover, if a director, officer or employee of a company is found to have willfully violated the FCPA books and records provisions, the maximum penalty would be imprisonment for 20 years per violation.  Maximum fines of up to $25 million also may be imposed for willful violations of the books and records provisions by a company.

The SEC and/or the Department of Justice, or DOJ, could assert that there have been multiple violations of the FCPA, which could lead to multiple fines.  The amount of any fines or monetary penalties which could be assessed would depend on, among other factors, findings regarding the amount, timing, nature and scope of any improper payments, whether any such payments were authorized by or made with knowledge of ERHC or its affiliates, the amount of gross pecuniary gain or loss involved, and the level of cooperation provided to the government authorities during the investigations.  Negotiated dispositions of these types of violations also frequently result in an acknowledgement of wrongdoing by the entity and the appointment of a monitor on terms agreed upon with the SEC and DOJ to review and monitor current and future business practices, including the retention of agents, with the goal of assuring future FCPA compliance.  Other potential consequences could be significant and include suspension or debarment of ERHC’s ability to contract with governmental agencies of the United Statesand of foreign countries.  Any determination that ERHC has violated the FCPA could result in sanctions that could have a material adverse effect on our business, prospects, operations, financial condition and cash flow.

The risk factor in the First Quarterly Report captioned “We are under investigation by the SEC and the DOJ, and the results of these investigations could have a material adverse effect on our business, prospects, operations, financial condition and cash flow.” is amended and restated in its entirety as follows:

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We are under investigation by the SEC, the DOJ and a U.S.Senate Subcommittee, and the results of these investigations could have a material adverse effect on our business, prospects, operations, financial condition and cash flow.

On May 4, 2006, a search warrant issued by the U.S. District Court of the Southern District of Texas, Houston Division, was executed on ERHC seeking various records including, among others,  documents, if any, related to correspondence with foreign governmental officials or entities in Sao Tomeand Nigeria.  The search warrant cited, among other things, possible violations of the FCPA, Section 10(b) of the Exchange Act, Rule 10b-5 under the Exchange Act and criminal conspiracy and wire fraud statutes.  ERHC filed suit in federal district court in Texasin June 2006 seeking to protect our attorney-client privileged documents and to allow our counsel to determine the factual basis for the DOJ’s search warrant affidavit, which is currently under seal.

A related SEC subpoena was issued on May 9, 2006, and a second related subpoena issued on August 29, 2006.  The subpoenas request from ERHC a range of documents including all documents related to correspondence with foreign governmental officials or entities in Sao Tome and Nigeria, personnel records (specifically, those regarding our former Chief Financial Officer, Franklin Ihekwoaba) and other corporate records.  We have been actively responding to both subpoenas.  

On July 5, 2007, the U.S. Senate Committee on Homeland Security and Governmental Affairs’ Permanent Subcommittee on Investigations served ERHC with a subpoena, in connection with its review of matters relating to the potential abuse of payments made to foreign governments. The subpoena, as amended on July 18, 2007, seeks documents and information regarding ERHC’s activities, particularly those related to the acquisition of ERHC’s interests in the Gulfof Guinea.  ERHC’s attorneys, Akin Gump Strauss Hauer & Feld LLP, will assist ERHC in responding to the subpoena.   Please see “Legal Proceedings” for more information.

The investigations by the DOJ, SEC and Senate Subcommittee are continuing.  We anticipate that these investigations will be lengthy and do not expect these investigations to be concluded in the immediate future.  If violations are found, we may be subject to criminal, civil and/or administrative sanctions, including substantial fines, and the resolution or disposition of these matters could have a material adverse effect on our business, prospects, operations, financial condition and cash flow.

These investigations could also result in:

· third party claims against us, which may include claims for special, indirect, derivative or consequential damages;

· damage to our business, operations and reputation;

· loss of, or adverse effect on, cash flow, assets, goodwill, operations and financial condition, business, prospects, profits or business value;

· adverse consequences on our ability to obtain or continue financing for current or future projects; and/or

· claims by directors, officers, employees, affiliates, advisors, attorneys, agents, debt holders or other interest holders or constituents of ERHC.

Continuing negative publicity arising out of these investigations could also adversely affect our business and prospects in the commercial marketplace.  In addition, these investigations have resulted in increased expenses to ERHC, including substantial legal fees and the diversion of management’s attention from our operations and other activities.  If we incur costs or losses as a result of these matters, we may not have the liquidity or funds to address those costs or losses, in which case such costs or losses could have a material adverse effect on our business, prospects, operations, financial condition and cash flow.

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Item 6. Exhibits

31.1* Rule 13a-14(a) Certification of the Chief Executive Officer

31.2* Rule 13a-14(a) Certification of the Principal Accounting Officer

32.1* Certification Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of the Chief Executive Officer

32.2* Certification Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of the Principal Accounting Officer

* Filed or furnished herewith. 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

ERHC Energy Inc.

Name	Title	Date
/s/ Nicolae Luca	Director and Acting President and	February 5, 2007
Nicolae Luca	Acting Chief Executive Officer
/s/ Sylvan Odobulu	Controller (Principal Accounting Officer)	February 5, 2007
Sylvan Odobulu

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EXHIBIT INDEX

31.1* Rule 13a-14(a) Certification of the Chief Executive Officer

31.2* Rule 13a-14(a) Certification of the Principal Accounting Officer

32.1* Certification Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of the Chief Executive Officer

32.2* Certification Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of the Principal Accounting Officer

* Filed or furnished herewith.

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