LONDON (AFX) - Chaco Resources PLC said it is proposing the reverse takeover
of two Paraguayan companies -- Amerisur SA and Bohemia SA -- from Candey SA and
Daniel Sztern in exchange for 27,322,404 new ordinary shares in the company.
It also plans to raise up to 750,000 stg before expenses in a placing of
36,585,365 new ordinary shares.
The company's shares were suspended on Sept 3 and it said it expects this to
be lifted today. It has called an EGM for Nov 15 to approve the acquisition and
placing plans.
Amerisur holds two oil and gas prospecting permits in Paraguay and is the
registered applicant for exploration and exploitation concession contracts over
the same permit areas. Bohemia holds registered applications for an oil and gas
prospecting permit in Paraguay and for an exploration and exploitation
concession contract over the same area.
The exploration areas covered by these three applications comprise a total of
approximately 48,000 square kilometres of the Curypayty and Parana Basins.
Chaco said these basins extend respectively into Bolivia and Brazil, where
commercial oil and gas production has been established for many years from
similar geological sections.

Suspect some of the better turnover might be because of the strength in the sp of CDS where Chaco Basin drilling result in Paraguay is due very soon. CDS rose today from 7p to 8.75p with one late buy at 10p so there seems to be confidence that they will strike oil. If so, Chaco has a nearby licence area twice as big in acreage as that of CDS so they will have had some of their speculative drilling done for nothing. Should make it easier and less onerous in terms for CHP to tie up a partnership/farm in deal with one of the majors (like Petrobas?)

Sharesure
Were most of the trades buys today-hard to tell from the prices?

Yes they were - I got quoted 6.9 for 100,000 buy earlier today

why didnt the price go up more then with a large amount buys. a big sell order waiting in the wings??

bodeng, the last tranche I bought a couple of weeks ago was shown as a sell because my broker earned his keep and managed to get them at mid price. That tranche was quite a bit over the NMS so was bought over the space of a morning.
The differentiation between buys and sells at this level is very arbitrary. As to why the sp does not respond better maybe there is a seller (one of the placing parties?) who is getting bored. It isn't WDBM who are close to this stock and are still picking up shares as they come on the market as they did yesterday.

Good start to the day!

Mainly buys so far

500,000 'T' trade just before the close. Anybody care to interpret that ??

Read a few posts tonight about Chaco being a takeover target, wondered if anyone had heard anything, its on iii.

Probably nothing but stranger things have happened.

Stewart, A takeover offer is an aim the chairman (according to what he said at the AGM) He wants to give any remaining GMS shareholders the choice of selling out at a decent profit or choosing to stay with CHP in its new venture. The sort of target exit price he has in mind is so well above the current sp that until they win more deals or get some oil flowing it isn't likely to become a proposition.
I think that the small tick up today is likely to be the start of a rally in the price. It briefly touched +0.23p at one stage and if CDS come through with their Paraguay results and these are successful then that might be all that is needed.

bhunt1910 - the 500K T trade looks to be from a seller in the market, helping to feed a large buyer, rumoured to be an institution, the same trade appeared after close of trade last night. DYOR

Rodders

Perhaps the takeover rumour will help the shareprice!

I'd be surprised if we were a takeover target at this early stage.

News next week would be welcome!

http://www.resourceinvestor.com/pebble.asp?relid=15493
worth a look

schiff, very straightforward write-up on Chaco, well spotted. Their views on SA politics are reassuring particularly as some countries, like Bolivia, seem intent on going in a different direction.

message from Martin
Geoff,

I am on holiday this week, as I am "on duty" between Christmas and new year.

We're waiting for an outcome on the third application, but I've seen nothing new.

Have a good Christmas

Regards

Martin

Latin American Oil & Gas Without the Drama?

By Stephen Clayson
19 Dec 2005 at 11:42 AM EST


LONDON (ResourceInvestor.com) -- The significance of the oil & gas endowments of many countries in Latin America is well known, but equally well known are the pitfalls that can in places await those who try to develop these endowments; Venezuela and the heinous spectacle of Hugo Chavez spring most immediately to mind, but Bolivia may to be heading in a similar direction, and various other states on the continent also have their political drawbacks.

However, Colombia and Paraguay seem to be among the better Latin American investment destinations, and these are the two states in which Chaco Resources [AIM:CHP] has built up an interesting portfolio of oil & gas prospects. The company was previously known as Gold Mines of Sardinia, but following its cessation of the activities implied by its previous moniker, it was renamed and refocused to become Chaco.




Colombia

The popular perception of Colombia is largely a negative one dominated by imagery of private armies funded by the proceeds of cocaine production, communist guerrillas, and pervasive violent crime. However, the reality is quite a bit tamer, and the investment climate in the country can be regarded as acceptable. Notable quantities of oil and coal have long been produced by European & American companies active in Colombia, and the gold explorer Greystar Resources [AIM:GSL; TSX:GSL], provides an example of a relatively small European company seemingly operating in the country without undue hassle.

Chaco is presently involved in two projects in Colombia, Alea and Puerto Lopez Oeste, with an application for a third project awaiting government approval. The Alea project is a joint venture with Spains Repsol and Ecopetrol, the national oil & gas company of Colombia, within which Chaco is required to spend $7.4 million in order to gain a 25% stake in the project. The reprocessing of pre-existing seismic data has mostly been achieved, and the companys next intended action is to test the project through the re-entry of one old well and the drilling of one new one.

The Puerto Lopez Oeste project is felt by Chaco to require some new seismic surveying in order to achieve the level of detail necessary to define drillable structures, and the company expects to have completed this by the end of 2006, at a cost of just over $1 million. Chaco will retain 54% ownership of Puerto Lopez Oeste, conditional on its funding of the seismic programme plus one exploration well, which should ensure that the company receives a greater share of any spoils that may be won than is the case with the Alea project.

Some news on Chacos application for a third Colombian project is expected shortly, and in addition, the company intends to be on the look out for further opportunities in the country. These may be derived from the existing contacts in Colombia of Chacos management, which have been gained through prior involvement in the oil & gas sector there.

Paraguay

The government of Paraguay is reportedly keen to encourage exploration for oil & gas within its territory, both because relatively little of this has taken place in the past and of course because the value of these commodities has risen fairly conspicuously of late, making the government mindful of the potentially positive impact on Paraguays economy of domestic oil & gas production.

Chaco has been granted two out of the three projects that it has applied for in Paraguay, and suspects that new seismic surveying of these two may prove illuminating of their potential. It is notable that in addition to having some domestic demand, Paraguay is well situated to serve gas markets in Brazil, Argentina and Chile.

The politics of Paraguay seem relatively conducive to the safety of any significant investment in it by Chaco, with influences as diverse as existing Taiwanese and Japanese investors, local Mennonite Christians and the governments strong relationship with the government of the U.K. all conspiring to keep the country on something of an even political keel.

Investment Outlook

Chaco undertook a placing some months ago in order to raise approximately 5 million with which to fund elements of its planned exploration programme, and this means that investors should be able to expect results from this work, good or bad, as 2006 progresses, perhaps with consequent effects on the companys share price.

Shares in Chaco have ascended in price fairly consistently throughout much of this year, and now stand at around 7 pence, after beginning the year at just over 2 pence and almost touching 9 pence in September. This may indicate that the market considers Chaco to be more or less fully valued at its current stage, taking account of the uncertainties inherent in oil & gas exploration and of the political risk innate, albeit at a relatively low level, to its countries of activity.

From their current valuation there is certainly potential upside in Chacos shares, though it is likely to be derived from positive exploration news rather than a growing awareness of the companys prospects, which seems to already be fairly comprehensive.

the market considers Chaco to be more or less fully valued at its current stage, 7p ?

aldwickk, think a few of us, including CHP's mgt. and brokers like WDBM would disagree with that valuation. The market has yet to catch up on this one, but it will eventually.