______

UPDATED 22/1/07

Valuation of Chaco Resources : 'Rule of Thumb' based on 550m shares and using 10% DCF on oil at $60/barrel is 1p on the sp for every 1m barrels (CHP's share) that is proved. Until oil reserves are proven the 1p/1m barrels will be discounted by the market.

Chaco Resources now has three exploration blocks in Colombia and three areas in Paraguay. The next year should see a steady news flow as it establishes the companys transformation from being an exploration company only to also becoming a significant oil production company. Set out below are some of the milestones which should produce announcements and have a positive effect on the share price. All reserves are quoted in recoverable oil assets.



Alea, Colombia :

25% interest in a field currently assessed at holding 38.1m barrels of light sweet crude oil. Drilling of the field by the operating partner, Ecopetrol, was programmed for 2006 to provide early cash flow, but a shortage of drilling rigs, then the rainy season and increased environmental requirements have caused a re-think and it is now expected that this block will be drilled in first half 2007.The proposal to drill a step out well as part of that drilling programme will also provide the opportunity to establish if the estimate of recoverable oil should be increased. (Some estimates suggest the field contains as much as 70m barrels.)

RNS : Updated w/c 30/4//07. Drilling contract should be imminent but actual drilling unlikely to take place second half 2007.



Puerto Lopez, Colombia :

54% Interest in a field containing light sweet crude oil.On 3.10.06 CHP announced that the original TEA area had been extended by the ANH to include further territory which it is expected will greatly increase the potential to find and exploit a structure which may contain as much oil as there is believed to be in Primavera, where Hardman and Co estimate that there is a potential value of 120p per CHP share.

RNS :Updated 22/1/07. Further seismic now obtained and decision not to proceed made because closures too small to be economic and drilling funds earmarked for this project now being retained for use on a more prospective block yet to be announced



Primavera west, Colombia :

55% interest. Two shallow drills in April turned out to be dry. Areas adjacent to this block contain oil (Cana Limon, also in the Mirador basin, the largest oilfield so far, 1.8b barrels) Chaco believe that the area in their block contains the thicker end of a wedge shaped oil-bearing sandstone structure; the area to the east in the neighbouring block has been estimated as containing 400m barrels and the El Miedo oilfield, 8 kms.away has 325m barrels. ANH Contract signed w/c 8/5/06 (1 week sooner than forecast). GED are drilling their neighbouring block in February 2007; two of their targets may contain oil deriving from Chaco's area so some earlier cash flow may result.

RNS : The drilling programme has now been completed but the company has yet to say whether the block will be explored further or abandonned.

New block announced in April known as Tigra in the Magdelana Basin. CHP has a 48.75% interest. Believed to be very promising but company is doing 3-d seismic over the next 18 months with drilling projected in the following 16 months. (Timescales seem to be set to allow a lot of room for delays or speeding up if progress is easier than anticipated)



Curupayty Block, Paraguay :

1.39m hectares in north, close to Bolivia. Two wells previously drilled and both showed oil.

RNS : Expect partnership with larger producer.



San Pedro Block, Paraguay :

1m hectares in south-east. Previous drilling showed oil.

RNS : Expect partnership with larger producer.



Parana Basin, Paraguay :

Canindeyu block covering 1,789,000 hectares. Bordering Brazil. Oil field on Brazilian side already drilled. Chaco also expect to find oil and, at a deeper level, considerable quantities of gas. Chaco has obtained valuable historic seismic for re-evaluation.

RNS : Presidential Decree received 2/11/06.. Petrobras has announced its intention to increase substantially its effort to exploit Paraguay's hydrocarbons and has announced a farm-in on CDS's adjacent block. Possibility that they or another major will do likewise with CHP



Corporate Activity :

CHP obtained an independent evaluation of their exploration assets by Hardman and Co., during July 2006.This is updated monthly. As Chaco Resources line up their assets ready for production they may attract a bid. There are also other actions that the mgt. could take to increase the Chaco's asset share subject to negotiation since the position of the Colombian state oil company, Ecopetrol, is believed to be under review. Other actions could be taken which would have the attraction in bringing more resources to bear on a quicker timeframe plus help streamline the management of their assets. De-merging the Colombian and Paraguayan assets at an appropriate time might hold out some advantages to shareholders at some stage.
Last Placing announced at 15.1p per share on 18/5/06.
Chairman and FD bought shares 8/06 and the Chairman recently exercised his option on further shares which would suggest that he regards the share price to be going north from here on.
Updated 22/1/07.




Here are some dates for your diary courtesy of KJKelly, who posts on ADVFN

1. Curupayty - complete reprocessing of seismic by end July 06
2. Curupayty - complete interpretation of seismic by end August 06
3. Curupayty - decide whether to proceed to drilling or proceed with a farmout campaign - end September 06
4. Platanillo - commence re-entry of Alea 1 early in 1st quarter 2007
5. Primavera - two structural targets will be selected from 10 potential targets for drilling commencing Feb. 2007.
6.Hardman updates should now happen monthly.

RNS tomorrow would make up for slow progress today.

Bodeng, There is bound to be a pre-AGM RNS; quite surprised that this didn't come out today. No doubt we'll get answers as to whether there is a distressed seller of CHP stock having to liquidate to pay for losses elsewhere; it's the only plausible explanation I can think of for the sp to be still stuck at current levels.
The AGM promises to be one of the more interesting ones of 2006; particularly as Graeme Stephens is bound to give a presentation like last year but this year he should have a lot more firmer information and timetables for future events.

a 500,000 buy just gone through at 14.47 - not a bad price - lest ways I am assuming it is a buy.

sharesure

It would be nice to see the sells actually shown!!!
Would have thought we would have seen the trade by now, it's been several days.

yuff, I agree although I think some of those large 'buys' eg that 500,000 at the end of trading, may not be - perhaps someone being helped out? Looking fwd to that line of stock coming to an end - was told earlier that that was thought to be the case but I am not sure that they were right.

sharesure

I don't think I have seen enough sells to cover all the buys and the price not be higher.
I would hate the seller to get the benefit of a nice juicy RNS!

well np rns this morning - does that mean there is NO news - or does iy mean that news will be released while we are at the GM - I hope not

may well be released during the morning , 10.30am, or even 12.00noon.

bhunt1910, I too was expecting some news prior to the meeting and not to have to wait too long for it this morning.There is also likely to be more news given out at the AGM as part of the presentation which Graeme Stephens is likely to give and which would then need a follow-up RNS on Wednesday; that may have something to do with the meeting being timed at 15.00 and likely to last beyond 16.30?

I don't see how any new news can be released at the AGM, that would be breaching rules. I would imagine now more news in the coming days/weeks. Nothing untoward just that things take time and don't always meet eager investors' timetables.

We haven't yet seen official drilling dates for Alea and Primavera, but the expecting drilling schedule is on anh website (although you do need a magnifying glass) with Alea mid December and Primavera scheduled for Feb/Mar. This will surely be highlighted later today.

There wil be an RNS today for sure, post-AGM, but only to confirm all resolutions passed.
All we will get today is what those who are lucky enough to pick up 'on the quiet' from informed sources in the room, after the AGM is over. I would guess that will not be before 16.29.
The next RNS of significance is most likely to be tomorrow when many of those who attend the AGM will still have a fuzzy head and a fuzzier recollection of what they actually heard.
Read the posts post-AGM to get an idea of what news we can expect soon.

Drilling dates: tomorrow
Paraguay: Bohemia concession 1st week November.
Petrobras successful E&P Paraguay coincidental with above.
Petrobras takeover attempt? Who knows? Now 35p. Later on 10.00+

Good luck today.

So newsflow has started. Usual sell the fact scenario, the market doesn't appear to like the "very expensive" rig option at this point in time.

rns out

Shows what I know. No Alea for a while then? Thought they may surprise us there.
Ecopetrel are not the fastest hare in the field then!
We need a new partner out there, and quick!

Was there not an AGM today which a considerable number of "friends" were attending? ...... If so, was it so dull that everyone has fallen into deep slumber from which they have yet to awake?

I'm sure that we will get an update from Sharesure when he gets back from the AGM.

But quiet - everyone else at a party or summat?

The RNS this morning was so dull, I decided not to go to the AGM and went to the gym instead - another way to lose a few pounds!

if you fancy GAINING a few pounds from "sensible" stocks, you may like to consider PRU and SHP ..... The latter has had a great result, at which point sp shot up 130 .... profit-taking today brought it back about 40 and with luck there will be more in the next day or two ..... upside is considerable with some possibility that the company will become a t/o target

thanks for the thought Cynic - talking of which it's supper time!