______

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.

I think TW is being given too much credit over this, he has recently tipped stocks and had no effect on the sp performance.
The thing I liked most about Chaco when I bought in was the early guaranteed production/earnings from Alea which could then be used to help finance the other assets or at least shore up the sp as a producer.
We all know the reasons behind that delay now but a delay it is, whoever you blame.
Now that we await overdue drilling dates nervous or impatient sellers are almost inevitable imo.
There is little patience or forgiving in the current market especially on aim so I hope that Alea is our only delay but I don't think TW should get all the credit.

It's a fickle market, punters seem happy to pick up stock at 11p this morning. I for one was never in this stock for the short term fluctuations.

over 1m M trades this morning at full offer - and no movement - I dont understand ?

Dibbles, I'm not crediting him with all of the fall, but either it was coincidence or his comments were the catalyst for a spate of sells. In the current market it doesn't take much to spread nervousness. I have seen it used elsewhere when it is believed that a company may be nearing putting out news but that it is not quite ready. There are a range of items which could/should be issued over the coming weeks. Whilst these are certain to be reaassuring to shareholders and may strengthen the price if the market appreciates their significance, only positive drilling results in the New Year will really move CHP forward.

come on guys - help me out here - over 5m shares traded and no move in the sp. A big sell, an overhang ???

Looks like last nights 2m was a sell then ?

see my posts 1648 + 1655 ..... says it all

Have been sat on my hands all morning waiting to buy another 500000 but now glad i didn`t,more likely to drift further down at present although 10p will make me think again.

what a bizarre day. I am sure there will some explanation for it soon. At least I hope so. Again, I cannot help feeling suspicious (now more than ever) that there's a link between recent cautious comments in a tipsheet, the tick down and the massive amount of buying today.

most odd, but also interesting that with the greater volumes we go up. I find that more encouraging.

Can't believe it,s not up to 12p on the buying volume very weird!

11.25 to buy, but looks like a tick up soon .

Several mm's buying as well, alot of people think they know something positive is around the corner. Must admit I nearly topped up myself.
2517

It seem a bit strange that yesterday 4mil share traded share price goes down .5p today 11 mil + nearly all buys & only up .25p anyone any thoughts.

Sea of blue .

I would guess there's one heck of a T trade hidden away in all of this. In fact probably several, some buys some sells, given the MM buying activity. Much better volume, so the MM's should be happy with the turnover....don't know what the fallout will be for the share price though.

In my opinion anyway.....etc etc.

Strawbs.

I tried to tell myself I had enough invested/risked in oily's but I couldn't resist, and have topped up, again.
2517

I seem to recall that a few weeks before Gold Oil spiked recently there was a Mr Mopp in the background with a powerful Hoover. Turned out to be a guy called Iraj Parizi. Maybe he had a Dyson because by the time he'd finished he had sucked up about 40million shares and 10 per cent of the company. Of course, he got in just before some drilling news. I am not saying there is any connection - there probably isn't and I am not a GOO expert. But I wonder if something similar has been going on with CHP.

I too could,nt resist bought 275,000 today even though i can't understand why it has'nt gone up more considering the buying volume!

Last chance to buy at 11.25 , going up soon i think .

Not so sure SCAP has just dropped from 11 to 10.50p waht's that all about?