Future Direction Great post! I agree with you that although the US$410m NPV on Anchois (A, B & C sands) is many multiples of Chariots current market cap, it seems like a very conservative valuation. One of the reasons is that they have adopted an extra layer of risking by ways of assuming a 25% Commercial CoS to factor in the need for a farm-out to fund appraisal drilling. In reality the commercial CoS is much higher. I also consider their cost per well assumptions as much to high. So I am very much looking forward to the Anchois feasibility study and CPR which should be released within the next 2-3 months. Should help to push the shareprice much higher. Incredible that we are sitting on a discovery others have invested over US$200m in and we have paid as good as nothing for a 75% stake. Good to hear that Chariot is optimistic about the start of upcoming 3rd party drilling compaigns in Brazil and also nice to hear about increased footfall in our datarooms. We have a cost pool amounting to US$15m there which Chariot aims to recover by farmout. I also liked the question put forward to LB about staying operator and his answer that they always like to stay operator due to being able to control their own destiny and I agree with you about your thoughts on Chris Zeal and potential external sources of funding the Anchois development. Great stuff happening right now.
Future Direction I have been critical of Management in the recent past based on their performance over the last few years. I have communicated the reasons for my frustration to them many times during AGMs, PI Event, Investor calls and emails. The main reasons were lack of strategic progress, finding a source of revenue, sustainability of the business model, dilution, poor communication and investor relations. It felt like Management were not working to create value for Shareholders. However I now feel cautiously optimistic that Management’s approach has changed somewhat and we seem to be in a much better place especially since the award of the Lixus licence. With the award of Lixus, several boxes have been ticked for me. I would have liked to see some accountability for past mistakes but I think this would be a difficult ask. Even though I have had mixed messages from my communication with them, I don’t think that Management have their heads in the sand. I feel like they have listened to investors concerns and are trying to make amends and learn from past mistakes. For me, the options are to either let my emotions take over or to reassess the current investment case and future direction of the company. Although there are some risks, we are now in a much healthier position than ever before in the company’s history. There is greater clarity around the sustainability of the businesses strategy and the remaining risks should be reduced with third party validation of the assets. I take the following from recent communications from the company: The Lixus licence seems like a great addition to the portfolio, it will bring in significant cash flow in the near future especially with a strong local gas market. finnCap have assigned a conservative $410m net present value for the current discovery that equates to around $1 per BCF according to Larry– there is much more headroom as the recoverable resources could be as much as 900 BCF. finnCap have assigned a conservative 20p/share on a RISKED basis associated with just the Lixus licence, nothing is priced in for the upside potential. Larry said to replicate the data that we have in the Lixus licence would cost in the region of $200m – in the position at Lixus we are at ZERO COST at this point with an excellent data set and we’ve got 75%, it is our intention to partner as we go forward. The partnering process has been initiated to farmout the Lixus licence. The partnering discussions may result in a broader set of companies in the data room compared to other Moroccan licences due to the nature of the discovery. All data rooms are open apart from the central blocks in Namibia where we are reverting back to becoming a fast follower. The company are also acting on behalf of NAMCOR in regards to the southern blocks – CHAR are holding data rooms on NAMCORs behalf and this gives the option to back in for 10% post well at no cost if there is a discovery. During the 3rd April Investor call Larry confirmed that they preference would be to drill the prospects in Mohammadia and Kenitra back to back. He reiterated that there is giant scale prospectivity in these licences in the 10th April final results call. Larry confirmed that there is a material change in the footfall coming to the Brazilian data room. He said that there has been success on the margin and there was optimism in terms of the processes in Brazil with the new administration coming into the Country – things are moving more effectively. The partnering discussions and conversations are ongoing and 3 third party consortiums have well commitments but along the entire margin there have been delays in environmental approvals although this has improved now. Drilling can only take place with the approvals and the timelines that Chariot has set look unchanged. Larry has ruled out an equity raise in the foreseeable future, he says that the company has significant equity positions in all licences and significantly more headroom to do what they have to do. The company have no plans to undergo an equity raise. Partnering should provide the capital required for further drilling. The final results state that the company intends to seek strategic partnerships and alliances to progress FUNDING SOLUTIONS for a potential appraisal and development of the Anchois discovery. With the CEO ruling out an equity raise, I think that they could be looking at external sources of funding to develop the discovery along with other options. This would be a positive move IMO because we wouldn’t have to give away a large chunk of the licence. There is a clear route to market and Larry mentioned the expertise of Chris Zeal on the 3rd April Investor Call (16:40 onwards) he also said: “…in addition to approaching E&P companies, we can also approach energy companies, midstream and downstream players, off takers and customers, we can also engage in potential contractor strategic alliances and build/operate transfer options. In addition to partnering and partner funding there is also a number of other methods we could employ as we progress through this project: delayed payment from production as an example, the potential to engage with multilateral development agencies that have a focus on Morocco and/or gas to power schemes and the usual range of debt instruments that are available within the development. So certainly over this initial period our focus will be on partnering and on strategic alliances.” The company now have discovered resources with plenty of upside potential, it has a balanced portfolio, giant scale prospects, a decent cash balance of $19.8m, is debt free and has no remaining commitments apart from $1m for Lixus data reprocessing. It is disappointing to see that the market hasn’t appreciated the award of the Lixus licence but Larry says that the company need to walk the market through the story. I am hopeful that once the company progresses the data reprocessing, gains strategic alliances and moves forward with funding options to develop this discovery the market will take notice especially with such attractive commercial terms in Morocco. Comparisons have been made with SDX and SOU over the last week, when you look at these companies it is clear how undervalued CHAR is at the moment. If a new company was to list on AIM and just had the Lixus licence, I am sure that it would have a much larger market cap than Chariot has. Investors have been beaten and battered in the past and this is being reflected in the share price but I think the future proposition looks very attractive. I think I will regret not buying at these prices so, will add as much as I can on any weakness.
2020 Market Cap Poll Chariot Oil & Gas CFO: “Even taken into account the recent rise we are still only valued at cash. And therefore the value of the Lixus license has yet to feed through to the shareprice.” Conference Call Audiocast (04/10/2019) [link] Anchois Cash Value.png1147x634 72.7 KB
Final Results 2018 Tomorrow Chariot keen to see Anchois reflected by shareprice “what we need to do is just to walk the market through the story”
Final Results 2018 Tomorrow thanks PM, very useful
Final Results 2018 Tomorrow [link]
Final Results 2018 Tomorrow Was there a recording of the Final results conference call? I am currently unable to find it on the CHAR website. Thanks DC
Malcy's Blog: Oil price, Chariot, JOG, Soco, IOG And finally Malcy on Chariot O&G: “(…) looks like a plan that shareholders will appreciate.” - I do! twitter.com Malcolm Graham-Wood (mgrahamwood) Malcy's blog today: Oil price, Chariot, Predator And finally... - [link] 1:51 AM - 10 Apr 2019
Final Results 2018 Tomorrow Final Results Investor Conference Call: Management will host a conference call for investors at 12pm Noon (BST) today, 10 April 2019. Dial in details for the call are shown below and participants should request to join the “Chariot Oil & Gas - Investor Call”. Dial in number: +44 (0)330 336 9411 Conference Code: 8960196 New Venture, Lixus licence, containing Anchois-1 discovery, secured in Morocco Debt free with a cash balance of US$19.8 million as at 31 December 2018 [link] [link]
Final Results 2018 Tomorrow 27% churn in five days. Interesting!
Final Results 2018 Tomorrow The volumes have been extremely high over the last 5 trading days, I would be surprised if we didn’t get holding notifications in the next couple of days. Nearly 98m volume with 367m shares in issue. DATE Volume 3rd Apr 2019 (Wed) 14,834,283 4th Apr 2019 (Thu) 43,950,985 5th Apr 2019 (Fri) 12,171,378 8th Apr 2019 (Mon) 18,663,018 9th Apr 2019 (Tue) 8,031,950 TOTAL 97,651,614
Final Results 2018 Tomorrow …spreading the news to the instis tomorrow
Final Results 2018 Tomorrow [link] Final Results – Investor Call 10 April – 12 noon (GMT)
Malcy's Blog: Oil price, Chariot, JOG, Soco, IOG And finally Can’t remember him ever being so upbeat on Chariot at all. Anchois really seems to be a great deal. I wonder if Finncaps numbers are actually to conservative. On their unrisked NPV10 calculations (62p/sh or $7.8/boe) they factor in US$50m drilling and completion costs per well and a long term gas price of US$9/mcf. I assume Chariot can do the job for far less cash (#gross drilling cost in Namibia US$16m) and long term we may see much higher gas prices in Morocco. Curious what Chariots feasibility study will say in June.
Billion Barrel Play Openers CHAR… XXXX Noticed this rising this morning would of been a smart buy as it kept going up in the afternoon . Most probably better then the faller’s i went for lol