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.

Chaco must now be one of the most undervalued companies out there at the moment,great news this morning, must admit thought they would hit 20p+ on the announcment. Will be interested to hear what sharesure thinks later in the day. Still a cracking company and still holding for the next 12 months at least.This is just the start boys.

The market doesn't seem to appreciate fully just what the Primavera west area allocation should mean to Chaco. The original incumbent's Primavera block to the east is believed to contain 400m barrels of oil. The seismic shows that the oil bearing sandstone substrate extends in a wedge shape to the west (ie Chaco's area) and that the thicker end of that wedge is in Chaco's area. This is supported by the 1.8b barrel oil field found in the Mirador field adjacent to Chaco's area. Graham Stevens believes that the Primavera west block is part of the same oil bearing basin and that the early drilling of two shallow test areas will prove his interpretation of the seismic. The sp reaction based on this potential is underwhelming but in my view will not last when the market wakes up to this potential.

I don't think it will take too long. I've just seen some big T trades go through, which confirms my suspisions that the price was being held down for the institutions. If the brakes are off now, then we should start seeing the price creep up today, and hopefully over the next few days. All just my opinion of course.

Strawbs.

All a bit of an anti climax today so far - I expected more of a reaction to the news -especially as this does appear to be a bit of a coup.

Thanks again to SS for showing me the way and helping me keep the faith

Baza

News from Oilvoice.com (http://www.oilvoice.com/Chaco_Joint_Venture_Awarded_Primavera_West_Block_in_Colombia/6051.htm)


Primavera West Exploration and Production Block awarded in Colombia
Chaco to hold 55% equity share in joint venture.
Chaco to fund 100% of phase 1 seismic re-interpretation and drilling of two shallow wells
Estimated cost of phase 1 approximately US$2m.

Chaco Resources Plc has nnounced that a joint venture group, in which Chaco will hold a majority equity interest of 55%, has been awarded an Exploration and Production Contract over the Primavera West Block in the Llanos Basin of Colombia, subject to agreement on work programme details ('the Contract'). The Contract will be finally negotiated and executed with the Colombian Hydrocarbons Agency in the next few weeks.

The Company regards this part of the Llanos basin as extremely attractive and has therefore endeavoured to secure a substantial acreage. In practice, this has not been easy as there is strong competition for terrain and incumbents would usually exercise their pre-emption rights.

After extended and discreet negotiations, the Company was able to secure the block which covers an area of approximately 146,100 hectares and lies north east of Bogota. The first year programme involves the reprocessing of 300 km of 2D seismic data and the drilling of two shallow wells to approximately 3,500 feet in order to penetrate the Mirador formation, which is the principal reservoir in the Llanos Basin. Other productive formations, such as the Carbonera, are also present within the block acreage.

The Company had originally applied for acreage mainly to the east which was partially pre-empted. A revised application was then made to include the portion not pre-empted, enlarged predominantly to the west and re-submitted. Significant portions of previously identified structures within the original submission extend into the revised block, which contains the same reservoirs and similar targets as the original acreage, plus a number of attractive undrilled structures identified from previous seismic work and on-trend areas that have not been explored.

The partners in the joint venture are Expet S.A. and Argosy Energy International (operator).

Chaco will fund 100% of the first year programme in order to retain a 55% equity interest. The cost of the programme is estimated at approximately US$2m

Chairman Jon Pither commented 'Securing this third consecutive participation in an E&P contract in Colombia is very important to the Group's progress. Chaco has now established a significant presence in a country which is gaining in international approval and which has both the organisational and fiscal structure to allow companies such as ours to thrive. Coupled with its activities in Paraguay, where it also receives a great deal of official support and encouragement, Chaco has created the potential to deliver real long term value to its shareholders.'

bhunt,

I was looking at HML a few days ago as that was flying up like a rocket. Today it's coming down to earth. A quick rise would be exciting, but give me the tortoise any day. It may be slow, but in my opinion it should be a winner in the end.

Strawbs.

I hold a few HML, huge potential imo......

I guess todays limited reaction is due to Chaco getting slightly different area, it seems that some are questioning whether they've lost 400mbls or gained more?

Dibbles,

Didn't mean to criticise any HML holders. Just used it as an example of what can happen when the price flies too quickly. Good luck with your investment.

Strawbs.

Thank-you George and Strawbs for your kind words, this board is a pleasure to read and post on.

I think most including me are interpreting the news as superb. However the market is a funny animal and it looks like the real sp mover in relation to the Primavera block will be the RNS containing reserve estimates after the seismic re-interpretation is complete.

News from Alea and Paraguay should provide steady fuel until then.

Incidentally keep an eye out for an RNS from Global Energy about their reserves in the adjacent block. The good thing is that they have a tiny headstart over Chaco so any RNS from them will give us a good clue as to what Chaco's might contain.

MPH - what is the EPIC for Global Energy?

I do believe its GED

For the info. of those who believe that CHP has not just announced a superb opportunity which will surpass what might have been obtained to the east of this block. ( The incumbent of Primavera also tried to get this block but was precluded on the grounds that they already had 90% of their allowable acreage in this area. They were also prevented from switching their allocation - that must tell you something about who got the better of this deal!)
The market doesn't seem to appreciate fully just what the Primavera west area allocation should mean to Chaco. The original incumbent's Primavera block to the east is believed to contain 400m barrels of oil. The seismic shows that the oil bearing sandstone substrate extends in a wedge shape to the west (ie Chaco's area) and that the thicker end of that wedge is in Chaco's area. This is supported by the 1.8b barrel oil field found in the Mirador field adjacent to Chaco's area. Graham Stevens believes that the Primavera west block is part of the same oil bearing basin and that the early drilling of two shallow test areas will prove his interpretation of the seismic. The sp reaction based on this potential is underwhelming but in my view will not last when the market wakes up to this potential.
Give this a few days to sink in and the market reaction will be very different.

Sharesure. Hows the timetable your putting together panning out? Eagerly awaited like this mornings RNS.

Sharesure
Also looking forward to your timetable. It would be great to see some upward movement in the last hour just to confirm there are some sensible people out there!

Vistauk, sidetracked this morning + awaiting a couple of additional pieces of info. on CHP. Will post all of it very soon as a new thread so that each item can be ticked off as achieved during the next 3/4 months.

Why has CHP gone down today with the good news?

hlyeo98, there is a saying that it is better to travel than arrive, and that's what has happened here, however the journey for CHP is only just beginning imho of course.
2517

hlyeo98 - people taking profits, possibly news factored into the share price and/or investors not appreciating how Primavera could transform CHP. I seem to recall when the prior 2 contracts were awarded not much happened straight away. Patience is the key.

hlyeo98, Not many yet know that the seismic for the western end of Primavera shows an even thicker wedge of oil bearing sandstone than the area in the east. Once that starts to sink in the sp will move up; with CHP it also cannot be ruled out that one of the bigger players may decide they would like to acquire CHP to gain access to their TEA areas whilst the sp remains at these levels. Personally I hope nothing like that happens before the company has drilled and evaluated the areas and also gained their third Paraguayan acreage where there is expected to be a large gas field below the oil-bearing strata.
CHP is really only at the beginning of its journey, although as of today it is even better under-pinned with assets.

I'm still expecting to see a large T trade or two at the end of the day. We shot to 19 and the price has been down or hardly moved ever since, and the number of trades is pretty even. If somebody put a large buy order in at a higher level, the MM's won't be keen to pay more than the price they've agreed to sell at. Plus a falling price encourages people to sell just as much as a rising one. I could be totally wrong of course (wouldn't be the first time). As always, it's just my opinion, please do your own research.

Strawbs.