<Page>


                    U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

--------------------------------------------------------------------------------

[ X ] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
      OF 1934

            For the fiscal year ended September 30, 2001

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


                 ENVIRONMENTAL REMEDIATION HOLDING CORPORATION
            (Exact name of registrant as specified in its charter)

                        Commission file number: 000-17325

                  COLORADO                                    88-0218499
(State or Other Jurisdiction of Incorporation              (I.R.S. Employer
               or Organization)                           Identification No.)

   5444 WESTHEIMER ROAD, SUITE 1570, HOUSTON, TEXAS              77056
      (Address of Principal Executive Office)                  (Zip Code)

                                 713-626-4700
              (Registrant's Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Exchange Act:  None

Securities registered pursuant to Section 12(g) of the Exchange Act: common
stock

Check whether the issuer: (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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 [   ]

Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [   ]

The issuer had no revenues for the year ended September 30, 2001.

The aggregate market value of the voting stock held by non-affiliates of the
registrant, based on the last sales price of $0.18 per share on the "over the
counter bulletin board" on December 20, 2001, was $47,928,612. As of December
20, 2001 registrant had 536,911,938 shares of common stock outstanding.

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<Table>
<Caption>

                                TABLE OF CONTENTS

                                                                                                   PAGE
<S>       <C>                                                                                     <C>

                                              PART I


Item 1.   Description of Business                                                                  1

Item 2.   Description of Property                                                                  5

Item 3.   Legal Proceedings                                                                        5

Item 4.   Submission of Matters to a Vote of Security Holders                                      5


                                              PART II


Item 5.   Market for Registrant's Common Stock and Related Shareholder Matters                     6

Item 6.   Management's Discussion and Analysis of Financial Condition and
          Plan of Operations                                                                       7

Item 7.   Financial Statements                                                                    10

Item 8.   Changes in and Disagreements with Accountants on Accounting
          and Financial Disclosures                                                               10

                                              PART III


Item 9.   Directors, Executive Officers, Promoters and Control Persons                            10

Item 10.  Executive Compensation                                                                  12

Item 11.  Security Ownership of Certain Beneficial Owners and Management                          13

Item 12.  Certain Relationships and Related Transactions                                          13

Item 13.  Exhibits and Reports on Form 8-K                                                        15

Signatures                                                                                        16

</Table>

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        This annual report contains forward-looking statements. These
statements relate to future events or Environmental Remediation Holding
Corporation's ("Company" or "ERHC") future financial performance and involve
known and unknown risks, uncertainties and other factors that may cause ERHC or
its industry's actual results, levels of activity, performance or achievements
to be materially different from any future results, levels of activity,
performance or achievements expressed or implied by the forward-looking
statements.

        In some cases, you can identify forward-looking statements by
terminology such as "may," "will," "should," "expects," "plans," "anticipates,"
"believes," "estimates," "predicts," "potential," or the negative of these
terms or other comparable terminology. These statements are only predictions.
Actual events or results may differ materially.

        Although the Company believes that the expectations reflected in the
forward-looking statements are reasonable, there can be no guarantee of future
results, levels of activity, performance, or achievements. Moreover, neither
the Company nor any other person assumes responsibility for the accuracy and
completeness of these forward-looking statements. The Company is under no duty
to update any of the forward-looking statements after the date of this report
to conform prior statements to actual results.


                                     PART I

ITEM 1. DESCRIPTION OF BUSINESS

OVERVIEW

        ERHC is an independent oil and gas company and since 1996 has engaged
in the exploration, development, production and sale of crude oil and natural
gas properties. The Company's goal is to maximize its value through profitable
growth in oil and gas reserves and production in Sao Tome in central West
Africa and to acquire interests in non-producing oil and gas properties,
particularly high potential international prospects in known oil producing
areas. The Company's current focus is to exploit its only asset, which is an
oil and gas exploration concession in Sao Tome. The Company intends to explore
forming relationships with other oil and gas companies having technical and
financial capabilities to assist the Company in leveraging its interests in Sao
Tome. Sao Tome is an island nation located in the Gulf of Guinea off the coast
of central West Africa. The Company currently has no other operations.

        On February 15, 2001, pursuant to a Purchase Agreement dated December
31, 2000, as amended by a First Amendment dated January 31, 2001 (as amended,
the "Purchase Agreement"), between Chrome Energy, L.L.C., a Delaware limited
liability company ("Chrome"), Talisman Capital Opportunity Fund Ltd.
("Talisman"), and TC Hydro Carbon, Inc., a Delaware corporation ("TCHC" or "TC
Hydro Carbon" and, together with Talisman, the "Sellers"), Chrome purchased
from the Sellers for $6,000,000 cash the following: (a) 375,000,000 shares of
Company common stock ("Common Stock"), owned of record by TC Hydro Carbon; (b)
2,244,385 shares of Common Stock held and owned of record by Talisman; (c) a
convertible senior subordinated note from the Company due October 15, 2002, in
the principal amount of $750,000 owned and held by Talisman; (d) a convertible
note from the Company due October 26, 2000, in the principal amount of
$500,000, owned and held by Talisman; (e) a senior secured 8.0% exchangeable
promissory note, also referred to as the line of credit, from the Company due
September 1, 2004, in the principal amount of $4,000,000 owned and held by TC
Hydro Carbon; (f) a warrant certificate dated as of October 26, 1998, owned and
held by Talisman providing the right to purchase 750,000 shares of Common Stock
until October 2008; (g) a warrant certificate dated as of October 26, 1998,
owned and held by Talisman providing the right to purchase 750,000 shares of
Common Stock until October 2008; (h) a warrant certificate dated as of October
15, 1997, owned by Talisman providing the right to purchase 45,000 shares of
Common Stock until October 15, 2002; and (i) a warrant certificate dated as of
April 23, 1999 owned by Talisman providing the right to purchase 1,000,000
shares of Common Stock until April 2009. Subsequent to February 15, 2001,
Chrome transferred to its financial advisors an aggregate of 116,629,564 shares
of Common Stock.

        As a result of the Purchase Agreement, Chrome currently owns directly
260,614,871 shares of the Company's Common Stock. Upon consummation of the
purchase by Chrome of the securities of the Company, the Company's three
directors prior to the February 15, 2001 elected three new directors.
Immediately after the election of these new directors, the three prior
directors resigned from the board of directors. The new directors appointed the
new executive officers of the Company.


                                       1
<Page>



CORPORATE HISTORY; FORMER OPERATIONS

        The Company was formed in 1986, as a Colorado corporation, and was
engaged in a variety of businesses until 1996, at which time it began its
current operations as an independent oil and gas company. Since the
commencement of its oil and gas operations, the Company has acquired interests
in the Nueces River area of south Texas, which were abandoned in 1999, and has
acquired interests on the Uintah and Ouray Indian Reservations in Utah, which
were sold in August 1999. The Company also acquired a lease in oil fields
located in Wichita County, Texas, which was subsequently assigned to a former
shareholder. However, in connection with the lease in Wichita County, the
Company may remain liable for certain plugging and abandonment costs, estimated
to be approximately $500,000, which have been accrued as of September 30, 2001
and 2000.

CURRENT BUSINESS OPERATIONS

        In May 1997, the Company entered into an exclusive joint venture with
the Democratic Republic of Sao Tome and Principe ("DRSTP") (the "1997
Agreement"). The 1997 Agreement provides that the Company will enter into a
joint venture with the DRSTP to create an oil company for the benefit of both
parties and the Company will manage the exploration, exploitation and
development of the potential oil and gas reserves onshore and offshore Sao
Tome, either through a joint venture or in collaboration with major
international oil exploration companies.

        In April 1998, the DRSTP granted approval to the joint venture to
proceed with the preparation and sale of leases of its oil concession rights.
In July 1998, the Company formed a joint venture with the DRSTP called the Sao
Tome and Principe National Petroleum Company, S.A. ("STPetro"), of which the
Company owns 49%. In September 1998, the DRSTP and STPetro entered into a
Technical Assistance Agreement with Mobil Exploration and Producing Services,
Inc., a subsidiary of Exxon Mobil Corporation. This agreement expired on or
around September 30, 2000. As part of the 1997 Agreement, the Company paid the
DRSTP an aggregate concession fee of $5,000,000.

        In October 1999, the DRSTP claimed that the Company had breached
certain terms of the 1997 Agreement and announced the termination of the 1997
Agreement. The Company immediately exercised its rights to have the matter
settled via international arbitration.

        After the acquisition of a controlling interest in the Company by
Chrome, the Company initiated negotiations with the DRSTP concurrent with the
arbitration process. In May 2001, the Company and the DRSTP reached a
Memorandum of Agreement (the "2001 Agreement"), witnessed by the Federal
Republic of Nigeria ("FRN"), which replaced the 1997 Agreement and suspended
the arbitration process. The 2001 Agreement will be embodied in a Consent Award
to be issued by the arbitrator upon the ratification of a treaty between the
FRN and the DRSTP. Although the Company believes that this ratification will
occur during early-to-mid year 2002, there is no assurance that it will be
completed in such time frame, if at all. If the treaty is not ratified by May
2003, the 2001 Agreement will not become effective, the parties will revert to
the 1997 Agreement, which the DRSTP claims has been breached, and the
arbitration process will continue.

        The 2001 Agreement gives the Company rights to participate in
exploration and production activities in both the exclusive territorial waters
of Sao Tome (referred to as the "Exclusive Economic Zone" or "EEZ") and an area
between Sao Tome and the FRN that the two nations have designated as a "Joint
Development Zone" or "JDZ". Since the 2001 Agreement replaces the 1997
Agreement, it requires the Company to relinquish its rights arising under the
1997 Agreement, including any interest it had in STPetro. As a result, the
Company wrote off its interest in STPetro during the year ended September 30,
2001.

        More specifically, if the 2001 Agreement becomes effective, the Company
will be entitled to the following:

        -  10% of the DRSTP share of all Profit Oil received from operations
           conducted in the JDZ. Profit Oil means the available crude oil and
           natural gas minus all royalty payments and costs associated with the
           exploration and development of such oil and gas.

        -  5% of the DRSTP share of all Signature Bonuses paid by contractors
           operating within the JDZ. Signature Bonuses are funds paid by an
           operator or contractor to acquire the right to enter into an
           exploration and production agreement.


                                       2
<Page>


        -  A 1.5% overriding royalty interest in all the production of crude oil
           and natural gas in the JDZ.

        -  The option to acquire up to a 15% paid working interest in up to two
           Blocks of the Company's choice in the JDZ (this interest option must
           be exercised by the Company prior to the signature of an exploration
           and production agreement with an operator or contractor). A Block is
           an area designated as an individual unit for exploration or
           production of crude oil and natural gas.

        -  Subject to certain restrictions, the Company shall receive up to two
           blocks of the Company's choice in the EEZ but outside the JDZ for
           development (the DRSTP will have the prior right to reserve up to a
           maximum of the first three Blocks).

        -  The option to acquire up to a 15% paid working interest in up to two
           blocks of the Company's choice in the EEZ but outside the JDZ (this
           working interest option must be exercised by the Company prior to
           the signature of an exploration and production agreement with an
           operator). The Company would be required to pay its proportionate
           share of the signature bonus and all other costs related to the
           exploration and exploitation of the Blocks.

        The above is only a brief summary of the terms of the 2001 Agreement and
such summary does not purport to be complete and is qualified in its entirety by
reference to the text of the 2001 Agreement (any and all related documents),
which have been filed by the Company and which are available on the SEC's web
site at www.sec.gov.

GOVERNMENT REGULATION

        The development, production and sale of crude oil and natural gas is
subject to extensive laws and regulations, including environmental laws and
regulations. In the event the Company begins exploration and development of any
oil and gas properties, it may be required to make large expenditures to comply
with environmental and other governmental regulations. Matters subject to
regulation include:

        -  discharge permits for drilling operations;
        -  bonds for ownership, development and production of oil and gas
           properties;
        -  reports concerning operations; and
        -  taxation.

        Under these laws and regulations, the Company could be liable for
personal injuries, property damage, oil spills, discharge of hazardous
materials, remediation and clean-up costs and other environmental damages. If
the Company failed to comply with these laws and regulations, it could result
in the suspension or termination of the Company's operations and subject it to
administrative, civil and criminal penalties. Moreover, these laws and
regulations could change in ways that substantially increase the Company's
costs. Accordingly, any of these liabilities, penalties, suspensions,
terminations or regulatory changes could have a materially adverse effect on
the Company's financial condition and results of operations.

EMPLOYEES

        The Company currently has three officers and support staff that
provide services to the Company pursuant to a management services agreement
between the Company and an operating company affiliated with Chrome and Sir
Emeka Offor, the chairman of the board of directors of the Company.

RISK FACTORS THAT MAY AFFECT THE RESULTS OF OPERATIONS AND FINANCIAL CONDITION
OF THE COMPANY

        You should carefully consider the risks described below before making
any investment decision related to the Company's securities. The risks and
uncertainties described below are not the only ones facing the Company.
Additional risks and uncertainties not presently known or that the Company
currently deems immaterial also may impair its business operations. If any of
the following risks actually occur, the Company's business could be harmed.


                                       3
<Page>


NO BUSINESS OPERATIONS

        The Company's sole asset is an oil and gas exploration concession in
Sao Tome received pursuant to the 2001 Agreement, which will not become
effective until the treaty between the DRSTP and the FRN becomes effective. As
such, until such time, the Company will conduct no business operations under
the Agreement, except to explore opportunities for acquiring interests in
non-producing oil and gas properties in known international oil producing
areas. If the treaty does not become effective for any reason, the 2001
Agreement will terminate and the parties will revert to the 1997 Agreement,
which will then be subject to arbitration. The failure of the treaty to become
effective could have a materially adverse effect on the Company's operations.

CONCENTRATION OF CONTROL

        Chrome, which appointed the Company's board of directors, beneficially
owns approximately 55.82% of the Company's outstanding Common Stock as of
December 20, 2001. As a result, Chrome has the ability to substantially
influence, and may effectively control, the outcome of corporate actions
requiring stockholder approval, including the election of directors. This
concentration of ownership may have the effect of delaying or preventing a
future change in control of the Company.

GOING CONCERN OPINION; LACK OF LIQUIDITY

        For the year ended September 30, 2001, the Company's independent
auditors stated that the Company's financial condition raises substantial
doubts about its ability to continue as a going concern. The Company has
incurred net losses of $6,394,810 and $1,958,880 in fiscal years 2001 and 2000,
respectively, and has a working capital deficit of $3,909,464 as of September
30, 2001. Since the Company currently has no business operations, it has no
internal sources of funding. The Company has been dependent on external sources
of funding for its prior operations, and will continue to be dependent on such
sources until it is able to generate sufficient operating cash flow, which may
not occur on a timely basis, if at all. Although the Company has received
funding from its shareholders in the past, it should not be assumed that such
funds will be available in the future or that the shareholders are obligated to
fund any amounts in excess of its committed lending obligations.

LACK OF TRADING MARKET

        On December 20, 2001 the Company's common stock began trading on the
"over the counter bulletin board" or "OTCBB" under the stock ticker symbol
"ERHC." The market for the Common Stock is sporadic and highly volatile. As
such, your ability to sell shares of Common Stock could be severely limited.
Prior to December 20, 2001 the Company's common stock was trading on the
"foreign exchange" under the symbol "ERHC".

PENNY STOCK REGULATIONS

        The Securities and Exchange Commission ("SEC") has adopted rules that
regulate broker-dealer practices in connection with transactions in "penny
stocks." Penny stocks generally are equity securities with a share price of
less than $5.00. The penny stock rules require a broker-dealer, prior to a
transaction in a penny stock not otherwise exempt from the rules, to deliver a
standardized risk disclosure document prepared by the SEC that provides
information about penny stocks and the nature and level of risks in the penny
stock market. These disclosure requirements may have the effect of reducing the
level of trading activity in any secondary market for a stock that becomes
subject to the penny stock rules. The Common Stock may be subject to the penny
stock rules, and accordingly, investors in the Common Stock may find it
difficult to sell their shares in the future, if at all.

SUSCEPTIBILITY TO GENERAL ECONOMIC CONDITIONS

        The Company's revenues and results of operations will be subject to
fluctuations based upon the general economic conditions both in the United
States and internationally. If there were to be a general economic downturn or a
recession in the oil and gas industry, the Company's future revenues and the
value of its oil and gas exploration concession could be materially adversely
effected. In the event of such an economic downturn, there can be no assurance
that the Company's business, operating results and financial condition would not
be materially and adversely affected.


                                       4
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ITEM 2. DESCRIPTION OF PROPERTY

        The Company's office is located at 5444 Westheimer Road, Suite 1570,
Houston, Texas 77056.  These premises are leased by Chrome Oil Services Ltd. or
("COS"), and pursuant to a management services agreement, COS provides the
space to the Company. This lease for approximately 1,900 sq. ft. of office
space expires in February 2006.

ITEM 3. LEGAL PROCEEDINGS

        Except as described below, the Company is not aware of any other
material legal proceedings pending to which it is a party or its property is
subject. From time to time, the Company may be subject to proceedings, lawsuits
and other claims in the ordinary course of business, the resolution of which,
in the opinion of management should not have a materially adverse effect on the
Company's financial position. The Company is opposing vigorously each of the
claims discussed below and intends to continue to do so unless an agreeable
resolution may otherwise be secured with regard to each such claim.

ARBITRATION PROCEEDINGS WITH DRSTP. In 1999, the Company requested that the
President of the International Chamber of Commerce appoint an arbitrator to
decide the Company's claims against the DRSTP arising under the 1997
Agreement. An arbitrator was appointed and, on March 17, 2000, the arbitrator
issued an order setting forth the deadlines for the parties to submit their
defenses, claims and counter-claims and the procedures for submission of
evidence, submission of documents, witnesses, testimony and examination. On
May 21, 2001, the Company and DRSTP agreed that, should a treaty between the
FRN and DRSTP on the joint development of petroleum and other resources in
areas of the EEZ of the two nations become effective, the 2001 Agreement will
then become effective and be in effect through September 30, 2024. Should a
treaty not be entered into between the two countries by May 21, 2003, (i) the
2001 Agreement will be null and void and (ii) arbitration proceedings
regarding the agreements described in the paragraph will resume. No further
action has been taken by the Company or the DRSTP and the treaty between the
DRSTP and the Federal Republic of Nigeria has not been ratified. Although the
Company believes that this ratification will occur during early-to-mid year
2002, there is no assurance that it will be completed in such time frame, if
at all. There can be no assurance that the treaty will be ratified, or that
if a treaty is not ratified, that the results of any future arbitration
proceedings will result favorably to the Company.

SAM L. BASS, JR. V. ERHC. U.S. District Court, Western District of Louisiana,
No. 6:99CV1668.  This case was commenced in 1999 by a former officer and
director of the Company, asserting claims for past due salaries, penalty wages
and attorney's fees.  The plaintiff is seeking damages of approximately $1.2
million in damages.  The named plaintiff in the case has died and his widow
and executrix, Sheila Bass, has substituted herself as plaintiff.  The trial
is set for July 2002.  The case is currently in the preliminary stages of
discovery.

RICHARD MAGAR V. ERHC. U.S. District Court, Western District of Louisiana,
No. 6:00CV1918.  This case was commenced in 2000 by a former employee of the
Company, asserting claims for unpaid salaries in the amount of $79,000 and
unpaid business expenses of $2,000.  The plaintiff has been deposed and the
parties are continuing discovery efforts.  Although trial has been set for
April 2002, the parties have agreed to mediate this dispute and are currently
in the process of setting a mutually agreeable mediation date.

AL COTTEN V. ERHC. 15th Judicial District Court, Lafayette, No. 99-4120-L.
This case was commenced in 1999 by a consultant and former director of the
Company, asserting claims for unpaid fees.  The plaintiff originally sought
$10,000 for such fees, but recently amended his complaint to add a claim
seeking payment of 400,000 shares of Common Stock allegedly promised to him in
1999.  The parties have begun discovery efforts, and a trial date is
imminent.

SECURITIES AND EXCHANGE COMMISSION INVESTIGATION. In 2000, the Company was
advised by the SEC that it had begun an investigation of the Company's past
activities. The Company is cooperating fully with the SEC and has provided
documentary support as requested. Although the Company has been advised that the
focus of the investigation is actions taken by the Company prior to August 1999
there is no assurance that the investigation will not be expanded to later
dates. As of December 20, 2001, there has been no recent contact from the SEC
requesting additional information for the investigation.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

        None.


                                       5
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                                     PART II

ITEM 5. MARKET FOR COMMON STOCK AND RELATED SHAREHOLDER MATTERS

        On December 20, 2001, the Company's common stock began trading on the
"over the counter bulletin board" or "OTCBB" under the symbol "ERHC." Prior to
December 20, 2001 the Company's Common Stock was trading under the symbol
"ERHC" on a "foreign exchange." The market for the Common Stock is sporadic and
highly volatile. The following table sets forth the closing sales price per
share of the Common Stock for the past two fiscal years, as reported on the
"foreign exchange." These prices reflect inter-dealer prices, without retail
mark-ups, mark-downs or commissions, and may not necessarily represent actual
transactions.


                                                      HIGH        LOW
                                                      ----        ---
            FISCAL YEAR 2001
            ----------------

First Quarter                                         $.10       $.01
Second Quarter                                        $.08       $.01
Third Quarter                                         $.22       $.02
Fourth Quarter                                        $.37       $.12

            FISCAL YEAR 2000
            ----------------

First Quarter                                         $.06       $.02
Second Quarter                                        $.125      $.01
Third Quarter                                         $.12       $.01
Fourth Quarter                                        $.10       $.01

        On December 20, 2001, the closing price of the Common Stock as reported
on the "OTCBB" was $0.18. As of December 20, 2001, there were approximately
2,143 record owners of the Common Stock. It is the Company's present policy not
to pay cash dividends and to retain future earnings to support growth. Any
payment of cash dividends in the future will be dependent upon the amount of
funds legally available, the Company's earnings, financial condition, capital
requirements, and other factors that the board of directors may deem relevant.
The Company has not paid any dividends during the last two fiscal years and
does not anticipate paying any cash dividends in the foreseeable future.

RECENT SALES OF UNREGISTERED SECURITIES

        In December 2001, the Company issued 2,500,000 shares of Common Stock
to a former employee in connection with the settlement of various claims
against the Company in the aggregate amount of $250,000.

        In October 2001, the Company issued 713,739 shares of Common Stock to
three creditors for the conversion of debt and payment of accrued interest in
the aggregate amount of $142,748.

        In March 2001, the Company issued 10,000,000 shares of Common Stock to
an entity controlled by an officer for services rendered in connection with the
February 2001 change of control transaction in the aggregate amount of $500,000.

        In March 2001, the Company issued 18,500,000 shares of Common Stock to
a consultant for services rendered in connection with the February 2001 change
of control transaction in the aggregate amount of $925,000.

        In March 2001, the Company issued 8,500,000 shares of Common Stock to a
law firm for attorneys' fees in connection with the settlement of a claim
against the Company in the aggregate amount of $425,000.

        In October 1999, the Company issued 7,607,092 shares of Common Stock to
three creditors for the conversion of debt and payment of accrued interest and
penalties in the aggregate amount of $295,881.


                                       6
<Page>


        The Company believes the above transactions were exempt from
registration pursuant to Section 4(2) of the Securities Act, as the recipients
were all accredited investors, and since the transactions were non-recurring
and privately negotiated. There were no underwritten offerings employed and no
sales commissions were paid in connection with the sales and issuances of the
unregistered securities in any of the transactions set forth above.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND PLAN
        OF OPERATIONS

        You must read the following discussion of the results of the operations
and financial condition of the Company in conjunction with its financial
statements, including the notes included in this Form 10-KSB filing. The
Company's historical results are not necessarily an indication of trends in
operating results for any future period.

OVERVIEW

        ERHC is an independent oil and gas company and since 1996 has engaged
in the exploration, development, production and sale of crude oil and natural
gas properties. The Company's goal is to maximize its value through profitable
growth in oil and gas reserves and production in Sao Tome in central West
Africa and to acquire interests in non-producing oil and gas properties,
particularly high potential international prospects in known oil producing
areas. The Company's current focus is to exploit its only asset, which is an
oil and gas exploration concession in Sao Tome. The Company currently has no
other operations. The Company intends to explore forming relationships with
other oil and gas companies having technical and financial capabilities to
assist the Company in leveraging its interests in Sao Tome.

CHANGE IN CONTROL

        On February 15, 2001, pursuant to a Purchase Agreement dated December
31, 2000, as amended by a First Amendment thereto dated January 31, 2001 (as
amended, the "Purchase Agreement"), between Chrome Energy, L.L.C., a Delaware
limited liability company ("Chrome"), Talisman Capital Opportunity Fund Ltd.
("Talisman"), and TC Hydro Carbon, Inc., a Delaware corporation ("TCHC" or "TC
Hydro Carbon" and, together with Talisman, the "Sellers"), Chrome purchased
from the Sellers for $6,000,000 cash the following: (a) 375,000,000 shares of
Company common stock, par value $.0001 per share (the "Common Stock"), owned of
record by TC Hydro Carbon; (b) 2,244,385 shares of Common Stock held and owned
of record by Talisman; (c) a convertible senior subordinated note from ERHC due
October 15, 2002, in the principal amount of $750,000 owned and held by
Talisman; (d) a convertible note from ERHC due October 26, 2000, in the
principal amount of $500,000, owned and held by Talisman; (e) a senior secured
8.00% exchangeable promissory note from ERHC due September 1, 2004, in the
principal amount of $4,000,000 owned and held by TC Hydro Carbon; (f) a warrant
certificate dated as of October 26, 1998, owned and held by Talisman providing
the right to purchase 750,000 shares of Common Stock until October 26, 2008;
(g) a warrant certificate dated as of October 26, 1998, owned and held by
Talisman providing the right to purchase 750,000 shares of Common Stock until
October 26, 2008; (h) a warrant certificate dated as of October 15, 1997, owned
by Talisman providing the right to purchase 45,000 shares of Common Stock until
October 15, 2002; and (i) a warrant certificate dated as of April 23, 1999
owned by Talisman providing the right to purchase 1,000,000 shares of Common
Stock until April 22, 2009. Subsequent to February 15, 2001, Chrome transferred
to its financial advisors an aggregate of 116,629,564 shares of Common Stock
acquired in this transaction.

RESULTS OF OPERATIONS

YEAR ENDED SEPTEMBER 30, 2001 COMPARED TO YEAR ENDED SEPTEMBER 30, 2000

        During the year ended September 30, 2001, the Company incurred a net
loss of $6,394,810, compared to a net loss of $1,958,880 for the year ended
September 30, 2000. A significant portion of the increase in net loss for the
year ended September 30, 2001 was attributable to $1,425,000 of expense
incurred as a result of the issuance of common stock of the Company to an
entity controlled by an officer of the Company and a consultant as compensation
for completing the Purchase Agreement by and between Chrome and Talisman of
which there was no such expense incurred during the prior year. Additionally,
there was $425,000 of expense incurred through the issuance of common stock of
the Company to the attorney of the plaintiffs of a derivative lawsuit, which
was settled in February 2001. During the year ended September 30, 2001, the
Company abandoned its investment and a claim for reimbursement from STPetro
totaling $1,125,557 due to recent developments regarding a proposed treaty
between the FRN and DRSTP which would result in STPetro being dissolved.


                                       7
<Page>


        During February 2001, the Company negotiated a management services
agreement by and between Chrome Oil Services Ltd. ("COS") and the Company
whereby the Company would pay a monthly management fee of $68,000 for various
services to be provided by COS inclusive of all general office expenses
incurred. Total expenses incurred under this management services agreement were
approximately $505,000 for the year ended September 30, 2001 of which there was
no such expense incurred in the prior year. Lastly, the Company's executive
officers incurred significant travel expenses of approximately $962,000 as they
continued negotiations with officials of the FRN and DRSTP as well as numerous
trips to the United States while managing the ongoing affairs of the Company.
The Company anticipates travel related expenses to continue to be significant
as the Company further develops its business interests. The net loss per common
share was $0.01, basic and diluted, for the year ended September 30, 2001
compared to a net loss per common share of $0.00, basic and diluted, for the
year ended September 30, 2000.

        During 2001 and 2000, the Company had no revenues from which cash flows
could be generated to support operations and thus relied on borrowings funded
from its line of credit provided by Chrome and TC Hydro Carbon.

GOING CONCERN

        For the year ended September 30, 2001, the Company's independent
auditors stated that the Company's financial condition raises substantial
doubts about its ability to continue as a going concern. The Company's current
liabilities exceed its current assets by $3,909,464 at September 30, 2001. The
Company has incurred net losses of $6,394,810 and $1,958,880 in fiscal years
2001 and 2000, respectively. These conditions raise substantial doubt as to the
ability of the Company to continue as a going concern. The Company is in
ongoing negotiations to raise general operating funds and funds for specific
projects. Management will be required to, and expects to, raise additional
capital through the issuance of debt securities and offerings of equity
securities to fund the Company's operations, and will attempt to continue
raising capital resources until such time as the Company generates revenues
sufficient to maintain itself as a viable entity. However, there is no
assurance that such financing will be obtained.

        The Company's sole asset is its interest from the 1997 DRSTP Agreement,
which will not become effective until the treaty between the DRSTP and the FRN
becomes effective. The failure of the treaty to become effective could have a
materially adverse effect on the Company's planned operations.

        The Company has a total of $6.8 million available under debt agreements
of $1,800,000 and $5,000,000, respectively, entered into by and between the
Company and Chrome (its majority shareholder). The Company has drawn the full
amount of the $1,800,000, and $829,883 from the $5,000,000, for a total
outstanding of $2,629,883 as of September 30, 2001. It is expected that the
Company will continue to borrow funds from Chrome in the future but there is no
assurance that funds will be made available or under similar terms. Chrome is
not obligated to provide future borrowings in excess of its existing committed
lending obligations. In prior years, the Company was able to raise funds in a
timely manner, but there is no assurance that they will continue to do so in
the future. The accompanying financial statements have been prepared assuming
that the Company will continue as a going concern. If the Company is unable to
continue as a going concern, the values realized from the Company's assets may
be less than the carrying amounts reported in its financial statements. The
accompanying financial statements do not include any adjustments relating to
the recoverability and classification of asset carrying amounts or the amount
and classification of liabilities that might result should the Company be
unable to continue as a going concern.

LIQUIDITY AND CAPITAL RESOURCES

        Historically, the Company has financed its operations from the sale of
its debt and equity securities (including the issuance of its securities in
exchange for goods and services) and bank and other debt. The Company had
expected to finance its operations and further development plans during fiscal
2001 and 2000 in part through additional debt or equity capital and in part
through cash flow from operations. Due to there being no sustainable cash flows
generated from operations in the past two years the Company has relied entirely
on borrowings provided under various debt agreements entered into by and
between the Company and its majority shareholders (Chrome in fiscal year 2001
and TC Hydrocarbon in fiscal year 2000).

        The Company presently intends to utilize any available sources of funds
to provide for general corporate overhead and to continue to pursue its
interests in Sao Tome.


                                       8
<Page>


        The Company is in ongoing negotiations to raise general operating funds
and funds for specific projects. Management will be required to, and expects
to, raise additional capital through the issuance of debt securities and
offerings of equity securities to fund the Company's operations, and will
attempt to continue raising capital resources until such time as the Company
generates revenues sufficient to maintain itself as a viable entity. However,
there is no assurance that such financing will be obtained.

        As of December 20, 2001, the Company has borrowed approximately
$1,178,000 against a $5 million working capital line of credit from Chrome. It
is expected that the Company will continue to borrow funds from this
shareholder in the future but there is no assurance that funds will be made
available or under similar terms. Chrome is not obligated to provide future
borrowings in excess of its existing committed lending obligations. In prior
years, the Company was able to raise funds in a timely manner, but there is no
evidence that it will continue to do so in the future.

WORKING CAPITAL

        As of September 30, 2001, the Company had negative working capital of
$3,909,464 of which $921,929 relates to accrued interest and $1,013,035 relates
to accrued officers salaries, both of which will most likely be settled by the
issuance of shares of common stock of the Company. As of September 30, 2001,
the Company had drawn the full amount available of $1,800,000 under one note
agreement and $829,883 had been advanced to the Company under another
$5,000,000 promissory note, or line of credit, with Chrome. The Company expects
to utilize this line of credit in order to sustain minimum operations relative
to continuing to develop and promote its interests in DRSTP. Where possible,
the Company may seek to preserve cash resources by settling obligations through
the issuance of shares of the Common Stock or by the issuance of convertible
debt instruments.

        Pursuant to a Purchase Agreement entered into by and between Chrome and
TCHC in February 2001, Chrome assumed a $4.0 million line of credit available
to the Company. Chrome and the Company agreed to amend and restate the line of
credit into a $2.2 million note and Chrome has made available, a new working
capital line of credit in the amount of $1.8 million both having terms similar
to the $4.0 million line of credit. The Company has borrowed the entire $1.8
million under that line of credit. In addition, in February 2001 Chrome made
available to the Company, a two-year $5 million line of credit, which accrues
interest at a rate of 10% per annum. As of December 20, 2001, the Company had
borrowed approximately $1,178,000 under this line of credit. This note is
convertible into shares of Common Stock at a rate of $0.20 per share.

DRSTP GEOLOGICAL DATA

        In July 1997, the Company acquired substantial geologic data and other
information from an independent source in exchange for 1,000,000 shares of
Common Stock. This data was valued at $2,000,000 based on an agreement with the
seller that the Company would repurchase these shares for $2,000,000 at a rate
of 25% per quarter should the seller so choose. In December 1997, the Company
repurchased 250,000 shares of its Common Stock for $500,000 in cash. Due to
unavailability of cash resources, the Company was unable to acquire the
remaining shares when presented by the seller. Accordingly, the seller sold
those shares in the open market with the proceeds generated from the sales
offsetting the obligations owed by the Company. Under the agreement's terms of
default, the seller requested that the Company make whole the seller's
shortfall incurred from disposition of the stock at less than $2.00 per share.
Accordingly, the Company issued an additional 6,997,917 shares of Common Stock
and paid cash of $222,500 during fiscal year 1999 and $122,000 during fiscal
year 2000, leaving a remaining obligation in accounts payable of approximately
$246,000 at September 30, 2001 and 2000.

NEW ACCOUNTING STANDARDS

        In July 2001, the Financial Accounting Standards Board issued SFAS 141,
"Business Combinations", and SFAS 142, "Goodwill and Other Intangible Assets".
SFAS 141 requires that the purchase method of accounting be used for all
business combinations initiated or completed after June 30, 2001. SFAS 141 also
specifies criteria intangible assets acquired in a purchase method business
combination must meet to be recognized and reported apart from goodwill. SFAS
142 requires that goodwill and intangible assets with indefinite useful lives
no longer be amortized, but instead tested for impairment at least annually in
accordance with the provisions of SFAS 142. SFAS 142 also requires that
intangible assets with definite useful lives be amortized over their respective
estimated useful lives to their estimated residual values, and reviewed for
impairment in accordance with SFAS 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to Be Disposed Of".


                                       9
<Page>


        The provisions of SFAS 141 are effective immediately. The provisions of
SFAS 142 are effective for fiscal years beginning after December 15, 2001.
Earlier adoption is permitted for entities with fiscal years beginning after
March 15, 2001 but not required.

        SFAS 141 will require that upon adoption of SFAS 142, the Company
evaluate its existing intangible assets and make any necessary
reclassifications in order to conform with the new criteria in SFAS 141. Upon
adoption of SFAS 142, the Company plans to reassess the useful lives and
residual values of all recorded intangible assets, and make any necessary
amortization period adjustments by December 31, 2001. In addition, to the
extent an intangible asset is identified as having an indefinite useful life,
the Company will be required to test the intangible asset for impairment in
accordance with the provisions of SFAS 142 by December 31, 2002. Any impairment
loss will be measured as of the date of adoption and recognized as the
cumulative effect of a change in accounting principle. Upon adoption of SFAS
141 and SFAS 142, the Company does not anticipate a material impact to its
financial statements.

ITEM 7. FINANCIAL STATEMENTS

        The information required under Item 310(a) of Regulation S-B is
included in this report as set forth in the "Index to Financial Statements."
See F-1 for Index to Financial Statements.

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURES

        In January 2000, Durland & Company resigned as the Company's
independent auditors. Based upon available information, the Company is unaware
of any matter of accounting principles or practices, financial statement
disclosure, or auditing scope and procedures which, if not resolved to the
satisfaction of Durland & Company, would have caused Durland & Company to make
references to the matter in connection with the audit of the Company's
financial statements for the fiscal year ended September 30, 1998. The audit
reports of Durland & Company on the Company's financial statements for the
fiscal year ended September 30, 1998 contained an explanatory paragraph
regarding uncertainty as to the Company's ability to continue as a going
concern.

        In February 2001, the Company engaged Pannell Kerr Forster of Texas,
P.C. of Houston, Texas as its principal independent accountants to audit its
financial statements for fiscal years 2001, 2000 and 1999 and the board of
directors approved this engagement in February 2001.


                                    PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
        COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934

        Since February 2001, the following directors and executive officers have
served the Company.

NAME              AGE            POSITION
----              ---            --------

Sir Emeka Offor    42            Chairman of the board

Chude Mba          43            Chief executive officer, president and director

Nicolae Luca       42            Director

Eze Echesi         45            Chief financial officer

Peter C. Ntephe    34            Secretary



                                      10
<Page>


        SIR EMEKA OFFOR has served as the chairman of the board of ERHC since
February 2001. In addition to his duties as chairman, Sir Emeka Offor is
currently chairman of Chrome Consortium, chief executive officer of COS and
vice chairman of African Express Bank PLC, positions he has held at various
times since 1995. Apart from owning majority interests in these companies, Sir
Emeka Offor has majority interests in aviation and insurance companies. Sir
Emeka Offor is the sole manager of Chrome, the Company's majority shareholder.
In addition, Sir Emeka Offor is a director and sole shareholder of COS, a
company which provides management, administrative and consulting services to
the Company.

        CHUDE MBA has served as chief executive officer, president and director
of ERHC since February 2001.  Since February 2001, Mr. Mba has served as
president of Chrome.  Since February 1999, Mr. Mba has served as group
financial advisor of COS and Chrome Consortium (Nigeria) and an advisor to the
board of directors of African Express Bank PLC.   From June 1993 to February
1999, Mr. Mba was a principal of MBA & Co (Chartered Accountants), a financial
and banking consulting firm with operations in Lagos, Nigeria and London, UK.
Mr. Mba has management experience spanning two decades in the financial
services and banking industries.  Mr. Mba is a chartered accountant and spends
approximately 50% of his working time on ERHC company business.

        NICOLAE LUCA has served as a director since February 2001.  Since April
1998, Mr. Luca has also served as the technical director for COS.  From January
1995 to April 1998, Mr. Luca was a technical specialist for Comrint Ltd., a
Nigeria-based petrochemical plant maintenance and engineering company.  Mr.
Luca has a bachelor of science in mechanical engineering.  Mr. Luca spends
approximately 10% of his working time on ERHC company business.

        EZE ECHESI has served as chief financial officer of ERHC since February
2001.  Since December 2000, Mr. Echesi has served as a financial advisor to
Nimek Investments, a Nigeria-based investment holding company with interests in
banking, insurance, energy and aviation.  From January 1996 to December 2000,
Mr. Echesi was the chief operating officer of operations in Africa for Minaj
Systems Ltd., an international private broadcasting organization.  Mr. Echesi
spends approximately 10% of his working time on ERHC company business.

        PETER C. NTEPHE has served as secretary of ERHC since February 2001.
Since June 1999, Mr. Ntephe has served as the senior special assistant to the
chairman of the Nigerian Senate committee on judicial and legal matters.
Between 1987 and May 1999, Mr. Ntephe was a partner of Ntephe, Smith and Wills,
a Lagos-based law firm.  Mr. Ntephe spends approximately 20% of his working
time on ERHC company business.

        All officers serve at the discretion of the board of directors. There
are no family relationships between or among any executive officers and
directors.

        The Company entered into a management services agreement with COS in
February 2001. Pursuant to that agreement, COS provides the Company with
management and business development services, in addition to making available
specialized services in the areas of refinery maintenance, engineering design,
and upstream oil industry services. COS provides the Company with such services
for a management fee of $68,000 per month. Messrs. Mba, Echesi, and Ntephe are
employees of COS and receive salaries and expense reimbursement from COS, not
from the Company. Total management fees incurred during the year ended
September 30, 2001 was approximately $505,000. During the year ended September
30, 2001, total direct expense reimbursed by the Company to COS for travel and
related expenses were approximately $962,000. Other that the management
services agreement, the Company does not have employment agreements with any of
its officers.

COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

        Section 16(a) of the Exchange Act requires the Company's directors and
executive officers, and persons who own beneficially more than ten percent
(10%) of the Common Stock, to file reports of ownership and changes of
ownership with the Securities and Exchange Commission. Copies of all filed
reports are required to be furnished to the Company pursuant to Section 16(a).
The Company is unable to determine whether its officers and directors prior to
February 2001 have complied with their filing requirements.



                                      11
<Page>



ITEM 10. EXECUTIVE COMPENSATION

       The following table sets forth certain information regarding
compensation paid by the Company to its chief executive officer and other
executive officers who received total annual salary and bonus that exceeded
$100,000 during the periods involved.

SUMMARY COMPENSATION TABLE

<Table>
<Caption>
                                      Annual Compensation               Long Term Compensation
                                      -------------------               ----------------------
                                                                                Awards
                                                               --------------------------------------------
Name and                   Fiscal                                 Restricted          Securities Underlying
Principal Positions         Year    Salary ($)    Bonus ($)    stock award(s)($)           Options/SARs
-------------------        ------   ----------    ---------    -----------------      ---------------------
<S>                        <C>      <C>           <C>          <C>                    <C>

Chude Mba (2)
Chief Executive Officer
(from 2/01 to present)       2001   $97,500 (1)       --          $500,000 (3)                  --

Geoffrey Tierman
Chief Executive Officer
(from 8/99 to 2/01)          2001       --            --              --                        --
                             2000       --            --              --                        --
                             1999       --            --              --                        --
</Table>

   (1) The Company does not pay any officers of the Company directly but does
       pay a management services fee of $68,000 per month to COS, a component of
       which is an amount representing compensation to this officer for services
       provided under the management services agreement.

   (2) Chude Mba became an officer of the Company effective February 15, 2001
       upon completion of the Purchase Agreement.

   (3) In March 2001, the Company issued to an entity controlled by Mr. Mba,
       10,000,000 shares for services rendered in connection with the February
       2001 change of control transaction.

OPTION GRANTS IN FISCAL 2001

       There were no options to acquire common stock of the Company granted to
any employee, officer or director of the Company during the year ended September
30, 2001.

AGGREGATED OPTION EXERCISES IN 2001
AND YEAR-END OPTION VALUES

       There were no options to acquire common stock of the Company exercised by
any employee, officer or director of the Company during the year ended September
30, 2001.








                                      12
<Page>


ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

       The following table and notes thereto set forth certain information
regarding beneficial ownership of the Common Stock as of December 20, 2001 by
(i) each person known by the Company to beneficially own more than five percent
of the Common Stock, (ii) each directors, (iii) each named executive officer and
(iv) all directors and officers of the Company as a group.

<Table>
<Caption>

                                                SHARES OF COMMON STOCK
NAME AND ADDRESS                                  BENEFICIALLY OWNED            PERCENTAGE OF VOTING POWER
----------------                                ----------------------          --------------------------
<S>                                             <C>                             <C>
Sir Emeka Offor                                      299,677,483                          55.82%

Chude Mba                                             10,000,000                           1.86%

Nicolae Luca                                             --                                 --

Eze Echesi                                               --                                 --

Peter C. Ntephe                                          --                                 --

Chrome Energy, LLC                                   299,677,483                          55.82%

All officers and directors
as a group (5 persons)                               309,617,478                          59.83%

</Table>

       The address of each beneficial owner is c/o Environmental Remediation
Holding Corporation, 5444 Westheimer Road, Suite 1570, Houston, Texas 77056.

       Shares beneficially owned and percentage of ownership are based on
536,911,938 shares of Common Stock outstanding as of December 20, 2001.
Beneficial ownership is determined in accordance with the rules of the SEC and
generally includes voting or dispositive power with respect to such shares.

       COS is the sole member of Chrome.  Sir Emeka Offor is the sole manager
of Chrome and the sole shareholder and director of COS.  Mr. Mba is the
president of Chrome, but disclaims all beneficial ownership in the shares
owned by Chrome.

       Of the 299,677,483 shares beneficially owned by Chrome, includes: (a)
260,614,871 shares of Common Stock owned of record; (b) 11,000,000 shares of
Common Stock to be issued due to the conversion of the 8.0% note in the
principal amount of $2,200,000; (c) 9,000,000 shares of Common Stock assuming
the conversion of a 10.0% note in the principal amount of $1,800,000; (d)
5,889,415 shares of Common Stock assuming the conversion of a 10.0% $5 million
line of credit with an outstanding principle amount of $1,177,883; (e) 3,158,335
shares of Common Stock assuming the conversion of a 20.0% note in the principal
amount of $631,666; (f) 4,021,565 shares of Common Stock assuming the conversion
of a 5.5% note in the principal amount of $804,313; (g) 3,448,297 shares of
Common Stock assuming the conversion of accrued interest owed as of December 20,
2001 in the amount of $689,659; and (h) 750,000, 750,000, 45,000, and 1,000,000
shares of Common Stock underlying four warrants, which have expiration dates
ranging from October 2002 to April 2009, an exercise price of $0.25 per share,
and each of which is currently exercisable. The number of shares of Common Stock
that the above-described notes and accrued interest are convertible into,
includes only shares of Common Stock that may issued upon the conversion of the
principal amounts and accrued interest amounts owed as of and through December
20, 2001.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

       Please see the discussion in Item 1 above for a detailed discussion of
Chrome's February 2001 acquisition of a controlling interest in the Company.
Also, please see Item 11 for a description of the shares of Common Stock and
securities convertible into Common Stock that Chrome retained in the
transaction.

       As more fully described in Item 9 above, the Company has entered into a
management services agreement with COS. COS is the parent company of Chrome, the
Company's largest shareholder. Sir Emeka Offor, the chairman of the


                                      13
<Page>


board of directors, is the sole director and shareholder of COS. As such, COS
is an affiliate of Sir Emeka Offor and Chrome.

       In February 2001, pursuant to the change of control transaction,
Chrome assumed from Talisman a working capital line of credit made available
to the Company which provided for borrowings of up to $4 million, of which
approximately $2.6 million was then outstanding. That note was amended and
restated in February 2001 to provide that $2.2 million of the total of $2.6
million of principal shall accrue interest at a rate of 8% per annum, and
shall be convertible into shares of common stock at a conversion price of
$0.20 per share and shall expire in September 2004. Additionally during
February 2001, the remaining principal of approximately $400,000 shall accrue
interest at a rate of 8%, will not be convertible and shall expire in
September 2004. Chrome has also made available a new working capital line of
credit in the amount of $1.8 million. As of September 30, 2001, the Company
had borrowed $1.8 million from this new line of credit. Borrowings under this
new line of credit, which expires in September 2004, bear interest at 8% per
annum and may be converted into shares of Common Stock at a conversion price
of $0.20 per share.

       In addition, pursuant to the February 2001 change of control transaction
and Derivative Settlement, Chrome made available to the Company, a two-year $5
million line of credit, which accrues interest at a rate of 10% per annum. As of
December 20, 2001, the Company has borrowed approximately $1,178,000 under this
line of credit. This note is convertible into shares of Common Stock at rate of
$0.20 per share.

       In March 2001, the Company issued to an entity controlled by Mr. Mba,
10,000,000 shares of common stock of the Company for services rendered in the
February 2001 change of control transaction.






















                                      14
<Page>


ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

       (a)   The following exhibits are to be filed as part of the annual
report:

       EXHIBIT NO.      IDENTIFICATION OF EXHIBIT
       -----------      -------------------------

       Exhibit 10.1     Purchase Agreement dated as of December 31, 2000,
                        among Talisman Capital Opportunity Fund, Ltd., TC Hydro
                        Carbon, Inc. and Chrome Energy, LLC. (Incorporated by
                        reference to Exhibit 1 of Form 8-K filed March 2, 2001).

       Exhibit 10.2     First Amendment Agreement between Kevin Bartley et
                        al., and Chrome Energy, LLC dated February 9, 2001.
                        (Incorporated by reference to Exhibit 2 of Form 8-K
                        filed March 2, 2001).

       Exhibit 10.3     Memorandum of Agreement dated as of May 21, 2001, among
                        The Government of the Democratic Republic of Sao Tome
                        and Principe and the Company. (Incorporated by reference
                        to Exhibit 1 of Form 8-K filed June 5, 2001).

       Exhibit 10.4     Management and Administrative Services Agreement by
                        and between Chrome Oil Services, Ltd. and the Company.
                        (Incorporated by reference to Form 10-KSB filed
                        September 24, 2001).

       Exhibit 10.5     $5,000,000 Term Loan Agreement by and between Chrome
                        Energy, LLC and the Company dated February 15, 2001.
                        (Incorporated by reference to Form 10-KSB filed
                        September 24, 2001).

       (b)   Form 8-K Filings

             None.


















                                      15
<Page>


                                   SIGNATURES

      In accordance with the Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                   Environmental Remediation Holding Corporation

                                   By: /s/ Chude Mba
                                       -----------------------------------------
                                           Chude Mba, Chief Executive and
                                           President

                          ---------------------------

      In accordance with the Exchange Act, this report has been signed below by
the following persons on behalf of the registrant and in the capacities and on
the dates indicated.

Signature                      Title                       Date
---------                      -----                       ----


/s/ Sir Emeka Offor            Chairman of the Board       December 28, 2001
-------------------------
    Sir Emeka Offor

/s/ Chude Mba                  Chief Executive Officer,    December 28, 2001
-------------------------      President and Director
    Chude Mba


/s/ Nicolae Luca               Director                    December 28, 2001
-------------------------
    Nicolae Luca

/s/ Eze Echesi                 Chief Financial Officer     December 28, 2001
-------------------------
    Eze Echesi


/s/ Peter C. Ntephe            Secretary                   December 28, 2001
-------------------------
    Peter C. Ntephe










                                      16
<Page>





                 ENVIRONMENTAL REMEDIATION HOLDING CORPORATION

                          INDEX TO FINANCIAL STATEMENTS

                                                                   Page
                                                                   ----

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS                            F-2

FINANCIAL STATEMENTS

     Balance Sheets as of September 30, 2001 and 2000               F-3

     Statements of Operations for the Years Ended
     September 30, 2001 and 2000                                    F-4

     Statements of Shareholders' Equity (Deficit)
     for the Years Ended September 30, 2001 and 2000                F-5

     Statements of Cash Flows for the Years Ended
     September 30, 2001 and 2000                                    F-6

     Notes to Financial Statements                                  F-7























                                      17
<Page>






                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS



Board of Directors and Shareholders
Environmental Remediation Holding Corporation

We have audited the accompanying balance sheets of Environmental Remediation
Holding Corporation (the "Company") as of September 30, 2001 and 2000, and the
related statements of operations, cash flows, and shareholders' equity (deficit)
for the years then ended. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Environmental Remediation
Holding Corporation as of September 30, 2001 and 2000, and the results of its
operations and its cash flows for the years then ended in conformity with
accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 2 to the
financial statements, the Company has incurred net losses of $6,394,810 and
$1,958,880 in fiscal years 2001 and 2000, respectively, and had a working
capital deficit and stockholders' deficit of $3,909,464 and $11,804,113,
respectively, at September 30, 2001. These conditions and other factors
discussed in Note 2 raise substantial doubt about the Company's ability to
continue as a going concern. Management's plans regarding the resolution of
these issues are also discussed in Note 2. The financial statements do not
include any adjustments that might result from the outcome of these
uncertainties.

/s/   Pannell Kerr Forster of Texas, P.C.
-----------------------------------------
      Pannell Kerr Forster of Texas, P.C.

      Houston, Texas
      December 17, 2001





                                      F-2
<Page>

<Table>
<Caption>


ENVIRONMENTAL REMEDIATION HOLDING CORPORATION

BALANCE SHEETS
---------------------------------------------------------------------------------------

                                                                  SEPTEMBER 30,
                                                          -----------------------------
                                                               2001            2000
                                                          -------------   -------------
<S>                                                       <C>             <C>
                                        ASSETS

CURRENT ASSETS
Cash                                                      $      10,604   $      15,333
Restricted cash                                                  17,529          15,811
Prepaid expenses and other current assets                        53,819          24,211
                                                          -------------   -------------

       Total current assets                                      81,952          55,355
                                                          -------------   -------------

Investment in STPetro, S.A.                                        -             49,000
Due from STPetro, S.A.                                             -          1,076,557
DRSTP concession fee                                          5,550,000       5,000,000
                                                          -------------   -------------

Total assets                                              $   5,631,952   $   6,180,912
                                                          -------------   -------------

                    LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES
Accounts payable and other accrued liabilities            $   2,056,452   $   1,799,945
Accrued officers salaries                                     1,013,035       1,013,035
Accrued interest and penalties                                  338,057         579,351
Accrued interest - shareholder                                  583,872         174,190
Current portion of convertible debt, net                           -          3,878,750
                                                          -------------   -------------

     Total current liabilities                                3,991,416       7,445,271
                                                          -------------   -------------

LONG TERM LIABILITIES
Nonconvertible debt, shareholder                                403,644            -
Convertible debt, shareholder                                 6,265,862       2,444,944
Convertible debt, net of current portion                      6,775,143       3,550,000
                                                          -------------   -------------

     Total long term liabilities                             13,444,649       5,994,944
                                                          -------------   -------------

Total liabilities                                            17,436,065      13,440,215
                                                          -------------   -------------

COMMITMENTS AND CONTINGENCIES                                      -               -

SHAREHOLDERS' EQUITY (DEFICIT)
Preferred stock, $0.0001 par value; authorized
  10,000,000 shares; none issued and outstanding                   -               -

Common stock, $0.0001 par value; authorized 950,000,000
  shares; issued and outstanding 532,456,917 and
  495,456,917 at September 30, 2001 and 2000,
  respectively                                                   53,246          49,546
Additional paid-in capital                                   45,448,394      43,602,094
Accumulated deficit                                         (57,305,753)    (50,910,943)
                                                          -------------   -------------

Total shareholders' deficit                                 (11,804,113)     (7,259,303)
                                                          -------------   -------------

Total liabilities and shareholders' deficit               $   5,631,952   $   6,180,912
                                                          -------------   -------------
</Table>

See accompanying notes to financial statements.

                                          F-3
<Page>

<Table>
<Caption>


ENVIRONMENTAL REMEDIATION HOLDING CORPORATION

STATEMENTS OF OPERATIONS
---------------------------------------------------------------------------------------

                                                              YEAR ENDED SEPTEMBER 30,
                                                            ---------------------------
                                                                2001           2000
                                                            ------------   ------------
<S>                                                         <C>            <C>


COSTS AND EXPENSES
General and administrative                                  $  4,318,493   $  1,214,284
Interest expense                                                 950,760        744,596
Write offs and abandonments                                    1,125,557           -
                                                            ------------   ------------

Net loss                                                    $ (6,394,810)  $ (1,958,880)
                                                            ------------   ------------

Net loss per common share - basic and diluted               $      (0.01)  $       -
                                                            ------------   ------------

Weighted average number of common shares outstanding         516,136,369    493,581,196
                                                            ------------   ------------
</Table>
























See accompanying notes to financial statements.

                                          F-4
<Page>

<Table>
<Caption>


ENVIRONMENTAL REMEDIATION HOLDING CORPORATION

STATEMENT OF SHAREHOLDERS' EQUITY (DEFICIT)
FOR THE YEARS ENDED SEPTEMBER 30, 2001 AND 2000
---------------------------------------------------------------------------------------

                             Common Stock      Additional                     Total
                         --------------------    Paid-In    Accumulated   Shareholders'
                           Shares     Amounts    Capital      Deficit        Deficit
                         -----------  -------  -----------  ------------  -------------
<S>                      <C>          <C>      <C>          <C>           <C>

Balance at
 September 30, 1999      487,849,825  $48,785  $43,306,974  $(48,952,063) $ (5,596,304)

Common stock issued
 for conversion of
 debt and payment
 of accrued interest
 and penalties             7,607,092      761      295,120          -          295,881

Net loss                       -          -           -       (1,958,880)   (1,958,880)
                         -----------  -------  -----------  ------------  -------------

Balance at
 September 30, 2000      495,456,917   49,546   43,602,094   (50,910,943)   (7,259,303)

Common stock issued
 for services             37,000,000    3,700    1,846,300                   1,850,000

Net loss                       -         -            -       (6,394,810)   (6,394,810)
                         -----------  -------  -----------  ------------  -------------

Balance at
 September 30, 2001      532,456,917  $53,246  $45,448,394  $(57,305,753) $(11,804,113)
                         -----------  -------  -----------  ------------  -------------
</Table>


















See accompanying notes to financial statements.

                                          F-5
<Page>

<Table>
<Caption>


ENVIRONMENTAL REMEDIATION HOLDING CORPORATION

STATEMENTS OF CASH FLOWS
----------------------------------------------------------------------------------------

                                                              YEAR ENDED SEPTEMBER 30,
                                                             ---------------------------
                                                                 2001           2000
                                                             ------------   ------------
<S>                                                          <C>            <C>

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss                                                     $(6,394,810)   $(1,958,880)
Adjustments to reconcile net loss to net cash used by
operating activities:
    Amortization of beneficial conversion feature
     and convertible debt expenses                                  -           409,242
    Stock issued for services                                  1,850,000           -
    Write-offs and abandonments                                1,125,557           -
Changes in operating assets and liabilities:
  Restricted cash                                                 (1,718)
  Prepaid expenses and other current assets                      (29,608)       141,175
  Due from STPetro, S.A.                                            -           (31,207)
  Accounts payable and other accrued liabilities                 256,507       (298,464)
  Accrued interest and penalties                                 950,760        744,596
                                                             ------------   ------------

Net cash used in operating activities                         (2,243,312)      (993,538)

CASH FLOWS FROM INVESTING ACTIVITIES:
Investments in DRSTP concession                                 (550,000)          -
                                                             ------------   ------------

Net cash used in investing activities                           (550,000)          -
                                                             ------------   ------------

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from non-convertible debt, shareholder                  158,700
Proceeds from convertible debt, shareholder                    2,629,883        935,063
                                                             ------------   ------------

Net cash provided by financing activities                      2,788,583        935,063
                                                             ------------   ------------

Net decrease in cash                                              (4,729)       (58,475)

Cash, beginning of year                                           15,333         73,808
                                                             ------------   ------------

Cash, end of year                                            $    10,604    $    15,333
                                                             ------------   ------------

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Noncash operating and financing activities:
 Stock issued in exchange for:
  Services                                                   $ 1,850,000    $      -
  Accrued interest and penalties                             $      -       $   145,881
  Convertible debt                                           $      -       $   150,000
 Interest converted to principal upon amendment of debt      $   782,372    $      -

</Table>





See accompanying notes to financial statements.

                                          F-6
<Page>



                 ENVIRONMENTAL REMEDIATION HOLDING CORPORATION
                        NOTES TO THE FINANCIAL STATEMENTS


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      GENERAL BUSINESS AND NATURE OF OPERATIONS

      Environmental Remediation Holding Corporation, ("ERHC" or the "Company"),
      is an independent oil and gas company. The Company was formed in 1986, as
      a Colorado corporation, and was engaged in a variety of businesses until
      1996, at which time it began its current operations as an independent oil
      and gas company. The Company's goal is to maximize its value through
      profitable growth in oil and gas reserves and production in Sao Tome and
      to acquire interests in non-producing oil and gas properties, particularly
      high potential international prospects in known oil producing areas. The
      Company's current focus is to exploit its only existing asset which is an
      oil and gas exploration concession in Sao Tome, an island nation located
      in the Gulf of Guinea off the coast of central West Africa.

      In May 1997, the Company entered into an exclusive joint venture with the
      Democratic Republic of Sao Tome and Principe ("DRSTP") (the "1997 DRSTP
      Agreement"). The 1997 DRSTP Agreement required the Company to pay a
      $5,000,000 concession fee to the Sao Tome government. The 1997 DRSTP
      Agreement is to manage the exploration, exploitation and development of
      the potential oil and gas reserves onshore and offshore Sao Tome, either
      through a joint venture or in collaboration with major international oil
      exploration companies (See Note 3). The Company currently has no other
      operations.

      SIGNIFICANT EVENTS

      CHANGE IN CONTROL
      On February 15, 2001, pursuant to a Purchase Agreement dated December 31,
      2000, as amended by a First Amendment thereto dated January 31, 2001 (as
      amended, the "Purchase Agreement"), between Chrome Energy, L.L.C., a
      Delaware limited liability company ("Chrome"), Talisman Capital
      Opportunity Fund Ltd. ("Talisman"), and TC Hydro Carbon, Inc., a Delaware
      corporation ("TCHC" or "TC Hydro Carbon" and, together with Talisman, the
      "Sellers"), Chrome purchased from the Sellers for $6,000,000 cash the
      following: (a) 375,000,000 shares of Company common stock, par value
      $.0001 per share (the "Common Stock"), owned of record by TC Hydro Carbon;
      (b) 2,244,385 shares of Common Stock held and owned of record by Talisman;
      (c) a convertible senior subordinated note from the Company due October
      15, 2002, in the principal amount of $750,000 owned and held by Talisman;
      (d) a convertible note from the Company due October 26, 2000, in the
      principal amount of $500,000, owned and held by Talisman; (e) a senior
      secured 8.00% exchangeable promissory note from the Company due September
      1, 2004, in the principal amount of $4,000,000 owned and held by TC Hydro
      Carbon; (f) a warrant certificate dated as of October 26, 1998, owned and
      held by Talisman providing the right to purchase 750,000 shares of Common
      Stock until October 26, 2008; (g) a warrant certificate dated as of
      October 26, 1998, owned and held by Talisman providing the right to
      purchase 750,000 shares of Common Stock until October 26, 2008; (h) a
      warrant certificate dated as of October 15, 1997, owned by Talisman
      providing the right to purchase 45,000 shares of the Common Stock until
      October 15, 2002; and (i) a warrant certificate dated as of April 23, 1999
      owned by Talisman providing the right to purchase 1,000,000 shares of
      Common Stock until April 22, 2009. Subsequent to February 15, 2001, Chrome
      transferred to its financial advisors an aggregate of 116,629,564 shares
      of Common Stock acquired in this transaction.

      CHANGE OF COMPANY MANAGEMENT
      Upon consummation of the purchase by Chrome of the foregoing securities of
      the Company, the Company's three directors prior to February 15, 2001
      elected three new directors. Immediately after the election of these new
      directors, the three prior directors resigned from the board of directors.
      The new directors appointed the new executive officers of the Company.


                                     F-7
<Page>


                  ENVIRONMENTAL REMEDIATION HOLDING CORPORATION
                        NOTES TO THE FINANCIAL STATEMENTS


      As a result of the February 15, 2001 Purchase Agreement, Chrome currently
      owns directly 260,614,871 shares of the Company's Common Stock.

      SETTLEMENT AGREEMENT - DERIVATIVE LAWSUIT
      In connection with the transactions contemplated by the Purchase
      Agreement, Chrome is a party to a First Amended Agreement dated February
      9, 2001 (the "Derivative Settlement"), whereby the parties thereto have
      agreed to dismiss with prejudice a derivative lawsuit (styled
      ENVIRONMENTAL REMEDIATION HOLDING CORPORATION, DERIVATIVELY BY AND THROUGH
      KEVIN BARTLEY ET AL V. TALISMAN CAPITAL OPPORTUNITY FUND L.P. ET AL)
      previously filed by certain of the Company's shareholders against several
      of the Company's former directors and controlling shareholders. This
      agreement was executed prior to the Purchase Agreement noted above.
      Pursuant to the Derivative Settlement, the following actions were
      consummated:

      (a) under the terms of the line of credit and the Derivative Settlement,
      the Company executed a new note with Chrome maturing in September 2004 for
      $2,200,000 of the advances made by TC Hydro Carbon outstanding for more
      than 180 days as of January 31, 2001. Such note and the accrued interest
      thereon is convertible at any time at a conversion price of $0.20 per
      share;

      (b) the Company executed a new convertible note for $1,800,000 bearing
      interest at a rate of 10% per annum maturing September 2004. Such note and
      the accrued interest thereon is convertible at any time at a conversion
      price of $0.20 per share;

      (c) the 5.5% Note was cancelled and the Company executed a new convertible
      note payable to Chrome for $804,313, representing the outstanding
      principal balance of the 5.5% Note and all accrued interest thereon as of
      January 31, 2001. Such note is convertible, at Chrome's option, into
      shares of Common Stock at $0.20 per share;

      (d) the 20% Note was cancelled and the Company executed a new convertible
      note payable to Chrome for $631,667 representing the outstanding principal
      balance of the 20% Note and all accrued interest thereon, as of January
      31, 2001. Such note is convertible, at Chrome's option, into shares of
      common stock at $0.20 per share;

      (e) the Company executed an additional $5 million senior convertible
      promissory note bearing interest at a rate of 10% annum maturing February
      2003 convertible at the lesser of $0.20 per share or such price as shall
      be determined by the board of ERHC based on an independent determination
      by a recognized investment banker;

      (f) the Company issued 8,500,000 shares of common stock to an attorney to
      settle certain legal obligations of the plaintiffs involved in this
      settlement.

      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      USE OF ESTIMATES
      The financial statements have been prepared in conformity with accounting
      principles generally accepted in the United States of America. In
      preparing the financial statements, management is required to make
      estimates and assumptions that affect the reported amounts of assets and
      liabilities and disclosure of contingent assets and liabilities at the
      date of the financial statements and revenues and expenses during the
      reporting period for the years then ended. Actual results could differ
      significantly from those estimates.

      CASH EQUIVALENTS
      The Company considers all highly liquid debt instruments with an original
      maturity of three months or less to be cash equivalents.


                                      F-8
<Page>


                  ENVIRONMENTAL REMEDIATION HOLDING CORPORATION
                        NOTES TO THE FINANCIAL STATEMENTS


      CONCENTRATION OF RISKS
      The Company primarily transacts its business with one financial
      institution. From time to time the amount on deposit in that one
      institution exceeds the $100,000 federally insured limit. The balances are
      maintained in demand accounts to minimize risk.

      IMPAIRMENT OF LONG-LIVED ASSETS
      The Company evaluates the recoverability of long-lived assets when events
      and circumstances indicate that such assets might be impaired. The Company
      determines impairment by comparing the undiscounted future cash flows
      estimated to be generated by these assets to their respective carrying
      amounts. Impairments are charged to operations in the period to which
      events and circumstances indicate that such assets might be impaired.

      INCOME TAXES
      The Company accounts for income taxes under the provisions of Statement of
      Financial Accounting Standards ("SFAS") No. 109 - "Accounting for Income
      Taxes", which provides for an asset and liability approach in accounting
      for income taxes. Under this approach, deferred tax assets and liabilities
      are recognized based on anticipated future tax consequences, using
      currently enacted tax laws, attributable to differences between financial
      statement carrying amounts of assets and liabilities and their respective
      tax bases.

      COMMON STOCK ISSUED FOR GOODS RECEIVED AND SERVICES RENDERED
      The Company has issued shares of common stock for goods received and
      services rendered. The costs of the goods or services are valued according
      to the terms of relative agreements or market value on the date of
      obligation. The cost of the goods or services has been charged to
      operations.

      NET LOSS PER SHARE
      Net loss per common share - basic is computed by dividing the net loss by
      the weighted average number of shares of common stock outstanding during
      the period. Net loss per share - diluted is not presented because the
      inclusion of common share equivalents would be anti-dilutive.

      NEW ACCOUNTING STANDARDS
      In July 2001, the Financial Accounting Standards Board issued SFAS 141,
      "Business Combinations", and SFAS 142, "Goodwill and Other Intangible
      Assets." SFAS 141 requires that the purchase method of accounting be used
      for all business combinations initiated or completed after June 30, 2001.
      SFAS 141 also specifies criteria intangible assets acquired in a purchase
      method business combination must meet to be recognized and reported apart
      from goodwill. SFAS 142 requires that goodwill and intangible assets with
      indefinite useful lives no longer be amortized, but instead tested for
      impairment at least annually in accordance with the provisions of SFAS
      142. SFAS 142 also requires that intangible assets with definite useful
      lives be amortized over their respective estimated useful lives to their
      estimated residual values, and reviewed for impairment in accordance with
      SFAS 121, "Accounting for the Impairment of Long-Lived Assets and for
      Long-Lived Assets to Be Disposed Of".

      The provisions of SFAS 141 are effective immediately. The provisions of
      SFAS 142 are effective for fiscal years beginning after December 15, 2001.
      Earlier adoption is permitted for entities with fiscal years beginning
      after March 15, 2001 but not required.

      SFAS 141 will require that upon adoption of SFAS 142, the Company evaluate
      its existing intangible assets and make any necessary reclassifications in
      order to conform with the new criteria in SFAS 141. Upon adoption of SFAS
      142, the Company plans to reassess the useful lives and residual values of
      all recorded intangible assets, and make any necessary amortization period
      adjustments by December 31, 2001. In addition, to the extent an intangible
      asset is identified as having an indefinite useful life, the Company will
      be required to test the intangible asset for


                                      F-9
<Page>


                  ENVIRONMENTAL REMEDIATION HOLDING CORPORATION
                        NOTES TO THE FINANCIAL STATEMENTS


      impairment in accordance with the provisions of SFAS 142 by December 31,
      2002. Any impairment loss will be measured as of the date of adoption and
      recognized as the cumulative effect of a change in accounting principle.
      Upon adoption of SFAS 141 and SFAS 142, the Company does not anticipate a
      material impact to its financial statements.

NOTE 2 - GOING CONCERN

      The Company's current liabilities exceed its current assets by $3,909,464
      at September 30, 2001. The Company has incurred net losses of $6,394,810
      and $1,958,880 in 2001 and 2000, respectively. These conditions raise
      substantial doubt as to the ability of the Company to continue as a going
      concern. The Company is in ongoing negotiations to raise general operating
      funds and funds for specific projects. Management will be required to, and
      expects to, raise additional capital through the issuance of debt
      securities and offerings of equity securities to fund the Company's
      operations, and will attempt to continue raising capital resources until
      such time as the Company generates revenues sufficient to maintain itself
      as a viable entity. However, there is no assurance that such financing
      will be obtained.

      The Company's sole asset is its interest from the 1997 DRSTP Agreement,
      which will not become effective until the treaty between the DRSTP and the
      Federal Republic of Nigeria becomes effective (See Note 1). The failure of
      the treaty to become effective could have a materially adverse effect on
      the Company's planned operations.

      The Company has a total of $6.8 million available under debt agreements of
      $1,800,000 and $5,000,000, respectively, entered into by and between the
      Company and Chrome (its majority shareholder). The Company has drawn the
      full amount of the $1,800,000, and $829,883 from the $5,000,000, for a
      total outstanding of $2,629,883 as of September 30, 2001. It is expected
      that the Company will continue to borrow funds from Chrome in the future
      but there is no assurance that funds will be made available or under
      similar terms. In prior years, the Company was able to raise funds in a
      timely manner, but there is no assurance that they will continue to do so
      in the future. The accompanying financial statements have been prepared
      assuming that the Company will continue as a going concern. If the Company
      is unable to continue as a going concern, the values realized from the
      Company's assets may be less than the carrying amounts reported in its
      financial statements. The accompanying financial statements do not include
      any adjustments relating to the recoverability and classification of asset
      carrying amounts or the amount and classification of liabilities that
      might result should the Company be unable to continue as a going concern.

NOTE 3 - SAO TOME CONCESSION

       CONCESSION FEE PAYMENT
       The 1997 DRSTP Agreement required the Company to pay a $5,000,000
       concession fee to the Sao Tome government.

       In October 1999, the government of DRSTP claimed that the Company had
       breached certain terms of the 1997 DRSTP Agreement and announced a
       termination of the Agreement. The Company immediately exercised its
       rights to have the matter settled via international arbitration in
       accordance with the terms of the 1997 DRSTP Agreement. The arbitration
       process continued through fiscal year 2000.

      CONCESSION FEE AGREEMENT
      After the acquisition by Chrome in February 2001, the Company initiated
      negotiations with the DRSTP concurrent with the arbitration process. On
      May 21, 2001, the Company and the DRSTP reached a Memorandum of Agreement,
      witnessed by the Federal Republic of Nigeria, ("2001 DRSTP Agreement")
      which replaced the 1997 DRSTP Agreement and suspended the arbitration


                                      F-10
<Page>


                  ENVIRONMENTAL REMEDIATION HOLDING CORPORATION
                        NOTES TO THE FINANCIAL STATEMENTS


      process. The 2001 DRSTP Agreement will be embodied in a Consent Award to
      be issued by the Arbitrator and will remain in effect through September
      30, 2024 upon the ratification of a treaty between the Federal Republic of
      Nigeria and the DRSTP relative to the Joint Development Zone ("JDZ")
      between the countries. If the treaty is not ratified by May 21, 2003, (i)
      the 2001 DRSTP Agreement will be null and void and (ii) the parties will
      revert to the 1997 DRSTP Agreement and the arbitration proceedings
      regarding the agreements will resume. No further action has been taken by
      the Company or the DRSTP and the treaty between the DRSTP and the Federal
      Republic of Nigeria has not been ratified. Although the Company believes
      that this ratification will occur during early-to-mid year 2002, there is
      no assurance that it will be completed in such time frame, if at all.
      There can be no assurance that the treaty will be ratified, or that if a
      treaty is not ratified, that the results of any future arbitration
      proceedings will result favorably to the Company.

      The 2001 DRSTP Agreement gives ERHC rights to participate in exploration
      and production activities in both the exclusive territorial waters of the
      DRSTP (its Exclusive Economic Zone "EEZ") and an area between DRSTP and
      the Federal Republic of Nigeria that the two nations have designated as a
      JDZ. Since the 2001 DRSTP Agreement replaces the 1997 DRSTP Agreement, it
      requires the Company to relinquish its rights arising under the 1997 DRSTP
      Agreement including any interest it had in STPetro.

      If the 2001 DRSTP Agreement becomes effective, the Company will be
      entitled to the following:

      - 10% of the DRSTP share of all Profit Oil received from operations
      conducted in the JDZ. Profit Oil means the available crude oil and natural
      gas minus all royalty payments and costs associated with the exploration
      and development of such oil and gas.

      - 5% of the DRSTP share of all Signature Bonuses paid by contractors
      operating within the JDZ. Signature Bonuses are funds paid by an operator
      or contractor to acquire the right to enter into an exploration and
      production agreement.

      - A 1.5% overriding royalty interest in all the production of crude oil
      and natural gas in the JDZ.

      - The option to acquire up to a 15% paid working interest in up to two
      Blocks of the Company's choice in the JDZ (this interest option must be
      exercised by the Company prior to the signing of an exploration and
      production agreement with an operator or contractor). A Block is an area
      designated as an individual unit for exploration or production of crude
      oil and natural gas.

      - Subject to certain restrictions, the Company shall receive up to two
      blocks of the Company's choice in the EEZ but outside the JDZ for
      development (the DRSTP will have the prior right to reserve up to a
      maximum of the first three Blocks).

      - The option to acquire up to a 15% paid working interest in up to two
      blocks of the Company's choice in the EEZ but outside the JDZ (this
      working interest option must be exercised by the Company prior to the
      signing of an exploration and production agreement with an operator). The
      Company would be required to pay its proportionate share of the signature
      bonus and all other costs related to the exploration and exploitation of
      the Blocks.

      SETTLEMENT AGREEMENT (PROCURA)
      On February 10, 2001, Chrome entered into an Assignment and Settlement
      Agreement with Procura Financial Consultants, C.C., a South African
      closely-held corporation ("Procura"), and STP Energy Corporation, a
      British Virgin Islands international business company ("STP"). Procura and
      STP had asserted claims and rights against the Company's business
      opportunities and contractual relationships with the Democratic Republic
      of Sao Tome and Principe claiming, among other


                                      F-11
<Page>


                  ENVIRONMENTAL REMEDIATION HOLDING CORPORATION
                        NOTES TO THE FINANCIAL STATEMENTS


      things, to be a joint venture partner of the Company in such relationship
      and also an indirect participant in STPetro, S.A., the national petroleum
      company of the DRSTP in which the Company owns a 49% equity interest.
      Under the Assignment and Settlement Agreement, Procura and STP assigned
      all such claims and rights to Chrome in exchange for $550,000 cash paid
      by Chrome. To the extent that any such claims were not assigned or not
      assignable to Chrome, Procura and STP released and covenanted not to sue
      the Company and the DRSTP. Subsequently, Chrome assigned the Procura and
      STP claims and rights to the Company, subject to repayment of the cash
      consideration it paid to acquire such claims and rights.

      INVESTMENT IN AND ADVANCES TO STPETRO, S.A.
      In July 1998, the government of the Democratic Republic of Sao Tome and
      Principe established the Sao Tome and Principe National Petroleum Company,
      SA ("STPetro") as the national petroleum company. The charter established
      the initial ownership of STPetro as 51% by DRSTP and 49% by ERHC in
      exchange for $51,000 and $49,000, respectively. Through June 30, 2001, the
      Company expended $1,076,557 on behalf of STPetro. As a condition of the
      2001 DRSTP agreement referred to above, should a treaty between the
      Federal Republic of Nigeria and DRSTP on the joint development of
      petroleum and other resources in areas of the exclusive economic zone of
      the two nations become effective, the Company would no longer pursue
      collection of its investment or the amounts expended on behalf of STPetro.
      Although the Company believes that this ratification will occur during
      early-to-mid year 2002, there is no assurance that it will be completed in
      such time frame, if at all. Accordingly, management has elected to write
      off its investment in STPetro as well as the amounts expended on behalf of
      STPetro resulting in $1,125,557 being recorded as write-offs and
      abandonments during the year ended September 30, 2001.

NOTE 4 - RESTRICTED CASH

      At September 30, 2001 and 2000, the Company has restricted cash of $17,529
      and $15,811, respectively, which is invested in an interest-bearing
      certificate of deposit, pledged as collateral for a performance bond
      covering certain oil and gas properties in Wichita Falls, Texas. These oil
      and gas properties were abandoned and written off during the year ended
      September 30, 1999 and the Company is currently investigating the release
      of the performance bond.

NOTE 5 - NOTES PAYABLE

      CONVERTIBLE DEBT
      The following describes the original terms of the Company's convertible
      debt at the indicated dates of issuance:

      In November 1997, the Company issued 5.5% convertible senior subordinated
      secured notes due 2002 in exchange for $4,300,000 cash. These notes are
      convertible into shares of the Company's common stock at a conversion
      price no less than $1.25 per share. If all of the notes are converted at
      the lowest possible price, the Company would be required to issue
      3,440,000 shares of common stock. These notes also carried warrants for an
      additional 283,800 shares of common stock with an exercise price of $3.17
      per share, or total additional proceeds to the Company of $899,636 in cash
      in the event all of the warrants are exercised.

      In April 1998, the Company issued 12% convertible subordinated unsecured
      notes due January 1999 in exchange for $300,000 cash. These notes are
      convertible into shares of the Company's common stock at a conversion
      price of $1.50 per share. If all of these notes are converted, the Company
      will be required to issue 200,000 shares of common stock. These notes also
      carried warrants for an additional 210,000 shares of common stock with an
      exercise price of $1.25 per share, or total additional proceeds to the
      Company of $262,500 in cash in the event all of the warrants are
      exercised.


                                      F-12
<Page>


                  ENVIRONMENTAL REMEDIATION HOLDING CORPORATION
                        NOTES TO THE FINANCIAL STATEMENTS


      In June 1998, the Company issued 12% convertible subordinated unsecured
      notes due December 1999 in exchange for $425,000 cash. These notes are
      convertible into shares of the Company's common stock at a conversion
      price of $1.00 per share. If all of these notes are converted, the Company
      will be required to issue 425,000 shares of common stock. These notes also
      carried warrants for an additional 531,250 shares of common stock with an
      exercise price of $0.50 per share for the first two years, and $0.85 per
      share thereafter, or total additional proceeds to the Company of $265,625,
      or $451,563 in cash in the event all of the warrants are exercised.

      In June 1998, the Company issued 5.5% convertible subordinated unsecured
      notes due June 2000 in exchange for $1,250,000 cash and $43,750 of broker
      fees. These notes are convertible into shares of the Company's common
      stock at a conversion price to be determined by a stated formula. If all
      of these notes are converted using the conversion price at the issuance
      date ($0.69517), the Company will be required to issue 1,798,124 shares of
      common stock. These notes also carried warrants for an additional 230,000
      shares of common stock with an exercise price of $0.8634 per share, or
      total additional proceeds to the Company of $198,582 in cash in the event
      all of the warrants are exercised.

      In July 1998, the Company issued 8.0% convertible subordinated unsecured
      notes due July 2000 in exchange for $1,200,000 cash. These notes are
      convertible into shares of the Company's common stock at a conversion
      price to be determined by a stated formula. If all of these notes are
      converted using the conversion price at the issuance date ($0.478723), the
      Company will be required to issue 2,506,668 shares of common stock. In
      connection with this funding, the Company issued warrants for 108,000
      shares of common stock with an exercise price of $0.74375 per share, or
      total proceeds to the Company of $80,325 in cash if all of the warrants
      are exercised.

      In July 1998, the Company issued 8.0% convertible subordinated unsecured
      notes due August 2000 in exchange for $275,000 cash. These notes are
      convertible into shares of the Company's common stock at a conversion
      price to be determined by a stated formula. If all of these notes are
      converted using the conversion price at the issuance date ($0.644878), the
      Company will be required to issue 426,437 shares of common stock. In
      connection with this funding, the Company issued warrants for 24,750
      shares of common stock with an exercise price of $0.73125 per share, or
      total proceeds to the Company of $18,098 in cash if all of the warrants
      are exercised.

      In August 1998, the Company issued 8.0% convertible subordinated unsecured
      notes due August 2000 in exchange for $1,010,000 cash. These notes are
      convertible into shares of the Company's common stock at a conversion
      price to be determined by a stated formula. If all of these notes are
      converted using the conversion price of the issuance date ($0.979813), the
      Company will be required to issue 1,030,809 shares of common stock. In
      connection with this funding, the Company issued warrants for 90,900
      shares of common stock with an exercise price of $0.9938 per share, or
      total proceeds to the Company of $90,336 in cash if all of the warrants
      are exercised.

      In October 1998, the Company issued a 20% convertible subordinated
      unsecured note to Talisman Capital, in exchange for $500,000 cash. This
      note is convertible into shares of the Company's common stock at a
      conversion price to be determined by a stated formula. If the note was
      converted using the conversion price at the issuance date ($1.00), the
      Company will be required to issue 500,000 shares of common stock. This
      note also carried warrants for an additional 1,500,000 shares of common
      stock with an exercise price of $0.40 per share, or total additional
      proceeds to the Company of $600,000 in cash in the event all of the
      warrants are exercised.


                                      F-13
<Page>


                  ENVIRONMENTAL REMEDIATION HOLDING CORPORATION
                        NOTES TO THE FINANCIAL STATEMENTS


       In October 1998, the Company issued 12% convertible subordinated
       unsecured notes due December 31, 1999 in exchange for $800,000 cash.
       These notes are convertible into shares of the Company's common stock at
       a conversion price to be determined by a stated formula. If all of these
       notes are converted using the conversion price at the issuance date
       ($1.25), the Company will be required to issue 640,000 shares of common
       stock. These notes also carried "A" and "B" warrants for an additional
       1,200,000 and 1,200,000 shares of common stock, respectively, with
       exercise prices of $0.50 and $3.00 per share, or total additional
       proceeds to the Company of $4,200,000 in cash in the event all of the
       warrants are exercised.

       In October 1998, the Company received conversion notices on $412,350 of
       the convertible debt issued in July and August 1998. This debt, and
       accrued interest amounting to $7,497, was converted into 1,210,686 shares
       of common stock under the applicable conversion formulas during the year
       ended September 30, 1999.

       In April 1999, the Company received conversion notices on $750,000 of the
       convertible debt issued in November 1997. This debt, and accrued interest
       and penalties thereon of $400,110, was converted into 5,750,550 shares of
       common stock. Also in April 1999, the Company received conversion notices
       on $1,362,650 of the convertible debt issued in July and August 1998.
       This debt, and accrued interest and penalties of $675,216, was converted
       into 11,714,293 shares of common stock during the year ended September
       30, 1999.

       Effective April 1999, the Company negotiated a Standstill Agreement with
       each of its convertible noteholders. The Standstill Agreement essentially
       waived all interest and penalties from the effective date of the
       agreement (April 23, 1999) through October 15, 1999, changed the
       conversion feature of each note so each note's conversion terms were
       uniform, and fixed the conversion price to be $0.20 per share. Each
       noteholder also agreed, until October 15, 1999, (i) not to convert all or
       any part of their notes, (ii) not to declare a default or seek
       acceleration of any payments under the notes; (iii) not to commence any
       foreclosure or bankruptcy actions under the note; (iv) not to declare an
       event of default or commence any arbitration action under any of the
       transaction documents. In addition all interest and penalties accrued
       through the effective date of the Standstill Agreement were converted to
       common stock of the Company. Accordingly, the Company issued 12,815,321
       shares of common stock in exchange for accrued interest of $562,848 and
       accrued penalties of $1,831,392 during the year ended September 30, 1999.

       In October 1999, the Company received a conversion notice on $150,000 of
       the convertible debt issued in July 1998. This debt, and accrued interest
       and penalties of $145,881, was converted into 7,607,092 shares of common
       stock during the year ended September 30, 2000.

       CONVERTIBLE DEBT PAYABLE TO SHAREHOLDERS
       In August 1999, in conjunction with the change in control of the Company
       involving TCHC, the Company entered into a $4.0 million senior secured
       8.00% exchangeable promissory note. As of September 30, 2000, the
       outstanding balance of this note was $2,444,944. This note was acquired
       by Chrome, effective February 15, 2001, as a part of closing of the
       Purchase Agreement discussed below under "Lines of Credit (Chrome)".

       ESCROW AGREEMENTS (CHROME)
       During January 2001, Chrome entered into escrow agreements with a
       financial institution for the benefit of the holders of $6,178,750 or
       83.2% of the aggregate principal amount of the Company's outstanding
       convertible debt securities, which, together with the convertible debt
       securities held by Chrome of $1,250,000 (excluding convertible lines of
       credit currently held by Chrome), constitutes 100% of all of the
       Company's outstanding convertible debt securities at that date. These
       escrow agreements provide for the amendment of the outstanding
       convertible debt held by the parties to the escrow agreements so that (i)
       the maturity date is extended to January


                                     F-14
<Page>


                  ENVIRONMENTAL REMEDIATION HOLDING CORPORATION
                        NOTES TO THE FINANCIAL STATEMENTS


       31, 2003, (ii) interest will be payable by the Company on January 31,
       2002 and at maturity, (iii) the conversion price is fixed at $0.20 per
       share, subject to standard anti-dilution adjustments, and (iv) all prior
       defaults by the Company are waived. Substantially all note holders
       agreed to the amended terms. The original notes were canceled and
       replaced with new debt instruments. Additionally, accrued interest of
       $782,372 as of January 31, 2001 relating to these convertible notes was
       converted into principal resulting in the total of the new notes being
       $8,211,122, including $1,435,979 held by Chrome.

       As of September 30, 2001, if this debt was converted using the conversion
       price of $0.20 per share, the Company would be required to issue
       41,055,610 shares of common stock based on an outstanding principal
       amount of $8,211,122, of which 7,179,895 shares of common stock would be
       issued to Chrome. Additionally, interest accrued and unpaid on these
       notes as of September 30, 2001 is $452,718, of which $114,661 is owed to
       Chrome. At the option of the noteholders unpaid interest can be converted
       into common stock of the Company. As of September 30, 2001, if this
       accrued interest were converted using the conversion price of $0.20 per
       share, the Company would be required to issue 2,263,590 shares of common
       stock, of which 573,305 would be issued to Chrome.

       LINES OF CREDIT (CHROME)
       In connection with the Purchase Agreement between Chrome and TCHC, the
       TCHC $4.0 million 8% exchangeable promissory note, referred to above, was
       acquired and assumed by Chrome. Chrome and the Company subsequently
       agreed to amend and restate the promissory note into a $2.2 million note
       maturing in September 2004 and Chrome has made available, a new working
       capital line of credit in the amount of $1.8 million maturing in
       September 2004 at terms similar to the TCHC line of credit. These lines
       of credit are convertible at the lesser of $0.20 per share or such price
       as shall be determined by the Board of Directors of ERHC based on an
       independent determination by a recognized investment banker. In addition,
       as provided for by the Derivative Settlement on February 9, 2001, Chrome
       executed an additional $5.0 million senior convertible promissory note
       ("$5.0 Million Line of Credit") bearing interest at a rate of 10% per
       annum, maturing in February 2003. The $5.0 Million Line of Credit is
       convertible at the lesser of $0.20 per share or such price as shall be
       determined by the Board of Directors of ERHC based on an independent
       determination by a recognized investment banker. As of September 30, 2001
       the total outstanding under these debt instruments was $5,233,527, of
       which $4,829,883 of the amount is convertible into shares of common stock
       of the Company.

       As of September 30, 2001, if these debt instruments were converted using
       the conversion price of $0.20 per share, the Company would be required to
       issue 24,149,415 shares of common stock to Chrome. Additionally, interest
       accrued and unpaid on these notes as of September 30, 2001 is $469,213,
       of which $436,165 is subject to conversion. As of September 30, 2001, if
       this accrued interest was converted using the conversion price of $0.20
       per share, the Company would be required to issue 2,180,825 shares of
       common stock to Chrome.

NOTE 6 - ACCRUED SALARIES

       At September 30, 2001 and 2000, the Company has accrued salaries of
       $1,013,035 owed to two former officers of the Company. The amounts and
       rights claimed by these officers are subject to lawsuits in which the
       Company is negotiating a final settlement. As of September 30, 2001 no
       agreement has been reached, but the Company expects that a negotiated
       settlement may result in the issuance of additional shares of common
       stock of the Company (See Note 11).


                                     F-15
<Page>


                  ENVIRONMENTAL REMEDIATION HOLDING CORPORATION
                        NOTES TO THE FINANCIAL STATEMENTS


NOTE 7 - ACCRUED INTEREST AND PENALTIES

       Accrued interest and penalties consisted of the following:

                                                          September 30,
                                                      ---------------------
                                                        2001         2000
                                                      --------     --------

         Accrued interest - non-convertible
           shareholder loan                           $ 33,048     $   -
         Accrued interest - convertible
           shareholder loans                           550,824      174,190
         Accrued interest - convertible debt           338,057      579,351
                                                      --------     --------

         Total                                        $921,929     $753,541
                                                      --------     --------

       As referred to in Note 6, effective January 31, 2001, Chrome entered into
       escrow agreements with a financial institution for the benefit of the
       holders of all of the Company's outstanding convertible debt securities
       at that date. As a condition to the escrow agreements all accrued
       interest up through and including January 31, 2001, totaling $782,372
       was capitalized as part of the amended note agreements.

NOTE 8 - INCOME TAXES

       At September 30, 2001 the Company has a consolidated net operating loss
       carry-forward ("NOL") of approximately $53 million expiring through 2021.
       The Company has a deferred tax asset of approximately $18.69 million
       resulting from this NOL. The loss carryforwards are subject to certain
       limitations under the Internal Revenue Code including Section 382 of the
       Tax Reform Act of 1986. ERHC believes that the utilization of these net
       operating loss carryforwards could be significantly limited due to the
       changes in ownership and control. The ultimate realization of the
       resulting net deferred tax asset is dependent upon generating sufficient
       taxable income prior to expiration of the NOLs. Due to the nature of
       these NOLs and since realization is not assured, management has
       established a valuation allowance relating to the deferred tax asset for
       both 2001 and 2000 in an amount equal to the deferred tax asset.

NOTE 9 - SHAREHOLDERS' EQUITY (DEFICIT)

       The Company has authorized 950,000,000 shares of $0.0001 par value common
       stock and 10,000,000 shares of $0.0001 par value preferred stock.

       From time to time, in order to fund operating activities of the Company,
       common stock is issued for cash or in exchange for goods or services.
       Generally, offerings of the Company's common stock include warrants to
       acquire common stock of the Company at fixed exercise prices.
       Occasionally, depending on the nature of the offering and restrictions
       imposed on the shares being acquired, the exercise price of the warrant
       may be below the fair market value of the underlying common stock on the
       date of issuance.

       During the year ended September 30, 2001, the Company issued 8,500,000
       shares of common stock to an attorney to settle certain legal obligations
       of the plaintiffs involved in the Derivative Settlement referred to in
       Note 1. The fair value of these shares upon issuance was $425,000 based
       on a $0.05 per share price determined from quoted market prices of the
       Company's common stock on the date of issuance. This amount has been
       recorded within general and administrative expenses during the year ended
       September 30, 2001.

       During March 2001, the Company issued 10,000,000 shares of common stock
       to an entity controlled by an officer and 18,500,000 million shares of
       common stock to a consultant for services rendered in connection with
       the February 15, 2001 change of control transaction referred


                                     F-16
<Page>


                  ENVIRONMENTAL REMEDIATION HOLDING CORPORATION
                        NOTES TO THE FINANCIAL STATEMENTS


       to in Note 1. The fair value of these shares upon issuance was
       $1,425,000 based on a $0.05 per share price determined from quoted
       market prices of the Company's common stock on the date of issuance.
       This amount has been recorded within general and administrative expenses
       during the year ended September 30, 2001.

       WARRANTS
       From time to time, in order to fund operating activities of the Company,
       common stock and convertible debt are issued for cash and common stock is
       issued in exchange for goods or services. Generally, offerings of the
       Company's common stock and convertible debt include warrants to acquire
       common stock of the Company at fixed exercise prices. Occasionally,
       depending on the nature of the offerings (common stock or debt) and
       restrictions imposed, the exercise price of the warrant may be below the
       fair market value of the underlying common stock on the date of issuance.
       As of September 30, 2001 and 2000 the Company has 7,511,825 and
       8,242,825, respectively, of warrants outstanding to acquire the Company's
       common stock at exercise prices range from $0.25 to $3.17 per share.
       During the year ended September 30, 2001, 731,000 warrants expired
       unexercised having a weighted average exercise price of $0.70 per
       warrant. As of September 30, 2001 total cash proceeds to the Company
       would be $7,480,272 with an average exercise price of approximately $1.00
       if all of the outstanding warrants are exercised. These warrants expire
       on various dates throughout the period June 18, 2002 to April 22, 2009.

NOTE 10 - COMMITMENTS AND CONTINGENCIES

       PENDING LITIGATION AND OTHER CONTINGENCIES
       During August 1999 and February 2001, the Company underwent changes of
       control. Following the changes of control of the Company, new management
       and the new board of directors were required to expend significant
       Company resources to settle claims and expenses arising out of the
       conduct of prior management. In addition, the Company faces additional
       unresolved claims and disputes, including suits seeking recoveries in
       excess of $1.0 million brought by an employee and prior officers for
       back salary and other amounts. The Company is defending its position
       vigorously, but there is no certainty that the Company will prevail. The
       Company is proceeding in the hope that a settlement can be reached. As
       of September 30, 2001 and 2000, officers' salaries of $1,013,035 have
       been accrued and management believes this amount will be sufficient to
       settle any amounts that may be due.

       The Company is subject to other legal proceedings which have arisen in
       the ordinary course of business and have not been fully adjudicated.
       Although there can be no assurance as to the ultimate disposition of
       these matters and the proceedings disclosed above, in the opinion of
       management, based upon information available at this time, the cost of
       defense or settlement of these actions, individually or in the aggregate,
       will not have a materially adverse effect on the financial position,
       results of operations, or cash flows of the Company.

       Additionally, 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.



                                     F-17
<Page>


                  ENVIRONMENTAL REMEDIATION HOLDING CORPORATION
                        NOTES TO THE FINANCIAL STATEMENTS


       SEC INVESTIGATION
       During the year ended September 30, 2000, the Company was advised by the
       Enforcement Division of the Securities and Exchange Commission ("SEC")
       that they had begun an investigation of the Company's past activities.
       The Company is cooperating fully with the SEC's investigation and has
       provided documentary support as requested. Although the Company has been
       advised that the focus of the investigation is actions taken by the
       Company prior to August 1999 (date of the 1999 change of control) there
       is no assurance that the investigation will not be expanded to later
       dates. As of December 20, 2001 there has been no recent contact from the
       SEC requesting additional information for the investigation. Until the
       Company receives notice informing otherwise, the investigation by the
       SEC remains pending.

       COMMITMENTS
       The Company entered into a management services agreement with Chrome Oil
       Services, Ltd. ("COS") in February 2001. Pursuant to that agreement, COS
       provides the Company with management and business development services
       in addition to providing specified services in the areas of refinery
       maintenance, engineering design, and upstream oil industry services. COS
       provides these services to the Company for a management fee of $68,000
       per month. Messrs. Mba, Echesi, and Ntephe are employees of COS that
       provides services to the Company and these persons receive salaries and
       expense reimbursement from COS, not from the Company. This agreement has
       no expiration date but does expire 30 days following the delivery of a
       written notice of termination by either party. During the year ended
       September 30, 2001 total expenses incurred under this management
       services agreement were approximately $505,000. During the year ended
       September 30, 2001, total direct expenses reimbursed by the Company to
       COS for travel and related expenses were approximately $962,000.

       The Company's Houston, Texas office is leased by COS, pursuant to the
       management services agreement, and is provided for the Company pursuant
       to such agreement.  This lease for approximately 1,900 sq. ft. of office
       space expires February 2006.

       The Company has not entered into any employment agreements directly with
       its officers and directors. To date, members of the board of directors
       have not received any compensation, but have been reimbursed for expenses
       incurred in the performance of their duties. In the future, the Company
       may decide to pay its directors.

       The Company currently has three officers and support staff that provide
       services to the Company pursuant to the management services agreement
       with COS.

NOTE 11 - SUBSEQUENT EVENTS

       During October 2001, the Company issued 713,739 shares of common stock to
       three creditors for conversion of debt and payment of accrued interest in
       the aggregate amount of $142,748.

       As referred to in Note 10, the Company is involved in pending litigation
       with former officers and an employee of the Company regarding back salary
       and other amounts. On November 13, 2001, a settlement was reached with
       one of the former officers in return for the issuance of an additional
       2,500,000 shares of the Company's common stock valued at $250,000 based
       on a fair market value of $0.10 per share. Additionally, the Company
       agreed to lift a "144 Restrictive Legend" from an existing 2,500,000
       shares of common stock currently held by this officer. In return, this
       officer agreed to release the Company from all claims and rights brought
       about as a result of that suit. As of September 30, 2001 the Company had
       accrued the entire amount owed under this claim.


                                     F-18