______

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.

volume picked up at the end I see.

bas - No worries. Glad you liked it. I may have to start doing extremely abusive versions as long as GC is prepared to make us suffer.

could do with a flat no change day or close in blue. to break current run.

could do with some oil

Nothing is going to happen until the company provides details of the drilling results. The outcome is then unlikely to be neutral: good news - decent rise; bad news - significant fall.

would like to see this new deal rns'd though.
it has been due would think if it is soon to be confirmed they will put in a drilling update also in one rns.

where is our main man sharesure ,

we are now well into the second half of the month now so we must be drilling.... I cannot see us being delayed now as we would have been informed by now...

Still around! Since new Ch. arrived getting anything of interest to post has become more difficult. Like FG, I think it will soon be confirmed that drilling has already started but I suspect it will be tacked on to much more information about the new block which seems to have made the right people even more optimistic about how things will turn out.
If GED confirm that they have oil that will be very good news as their oil is formed from oil that has flowed west to east; it follows that if their stucture is full then CHP's are virtually certain to be as well.
Meanwhile it just seems to take endless patience.

thanks sharesure nice to see you post, off subject what your view on cey sp.

Tanker, CEY is another of Bob Catto's selection; he is generally regarded as a good stock picker. An investing friend who died before xmas had a large holding in them, knew the mgt. well and rated the company's prospects very highly. I doubt that he would have been remotely interested in selling at current levels, but as with CHP it has not been an overnight sensation. I still think that if we have got CHP right, the next few weeks will prove that one way or the other and then there would still be time to switch some profits to CEY since I am not aware that anyone is expecting it to run away in that timeframe. Now watch me be proved totally wrong!!!

bought 54000 cey at 36p thanks very much will not sell,

http://www.hardmanandco.com/Research/monthly/March07_Monthly.pdf

Not much to say here...LOL.

Beau

L2 looking better.

2.9m broker to broker. mmmm interesting who's having them?.

Copied from across the way - hope someone here can decipher it better than I can

nala2 - 21 Mar'07 - 17:05 - 26872 of 26879


Lines 132 -133 may be of interest ?

http://www.anh.gov.co/html/cache/gallery/GC-2/G-6/2007Perfo_160307.zip

Bad news on GED, just water!!!


Due to the additional drilling and testing period
that was required for the Luna Llena 1 well and the narrow timing to release the
drilling rig before the start of the rainy season, which is expected to commence
shortly, the Company has also elected not to proceed with a third well at this
time, namely the re-entry of the existing El Miedo 4 well.

M

this is a different block. ged still have another well to test.good info for chp.
still confident.

So how is it good for chp if ged find the black stuff,but not a problem or cause for concern for chp if ged find water????

The structures in Primavera apparently are formed in a west to east progression. If GED do genuinely still think they have oil, just not where they tried to find it with their first drilling, then not much has changed. Disappointing in the meantime for GED shareholders nevertheless.