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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.

itam,

Why do you think he is pretending, and why should he ?

Strawbs,

Yes, thats right.

Oilyrag, Easy mistake, sorry.

What was the point you wanted to make, asking about closing a short.

By my understanding, taking a short position is when you sell a stock with a view to buying it back cheaper, later. My point was, if TFC was never going to buy CHP again then he couldn't ever close his short. What I believe he was saying is, that he has sold out all his intrest in CHP. That is not the same as shorting. I am sorry if this is getting confusing and I didn't want to sound pedantic, but I was just intrigued by what was said. Hope this explains why I asked.

Rather pedantic but a moot point i guess ....of course i must buy again to make the point of the exercise -making money ... Surely manifestly self evident but perhaps it would have been better had i said i would never go long again ,,,,But with ref. to my posting 2993 i stated quite clearly my job was done and quote .."10p was my target but the spread of 10.25 /10.50 had to suffice ".........and therein lies my first short ....Also i never went short after RNS ,,,,,,,,satisfied ? sheeesh

aldwickk,
His spelling is awful, grammatically it is wrong most of the time, and the meaning (or what I make of it) is pretty random.

But entertaining nevertheless!

Oilyrag,

Ok , understand.

agggghhhh !! Now this is getting utterly irrelevant and absurd and starting to annoy me !!!!! . l am Brive-La-Gaillarde born;and very proud to be so . My French is neither YOUR bog standard O/ A level or worse still -online translated- which is a joke ....l speak colloqial French as spoken as where i am from .lt is ALWAYS gramatically correct !! Unlike English, French syntax makes strict translation very random and in 99% of instances adjectives follow nouns and dont proceed them .As for my spelling. French has many incnsistencies ....EG -- Take the simple word "WHO " ...ln Paris, and in the North , it is "QUI" . but in the south it is KOI; and in the provinces of Alsace and Lorraine it is "WEN or "WER" ,,,Likewise the city of Marseille (s) has 5 different variations and quite strangely is spelt with a "Q" and "U" rather than the "S" and "E" by its inhabitants...-MARQUILLE.............lf truth be known you simply dont understand it and only illustrate your pettiness and ignorance in having a pop at me in a such a personal way . ca pue !..FINI !!! @+ J.

l KNOW I AM SHORT which renders objectivity impossible .. But after scrutinizing the book on CHP and although i know they are collecting for CF but i suspect a little front running here. All is not as it seems . Also its susceptible to naked shorting bigtime . Lastly if you are really convinced of the case for CHP stick with it !! But please dont use stop losses so near the mid as MMs will merely take you out for fun.or boredom ... @+ J

I think Spanish will be more easy to learn.

Oh dear, this is becoming like the SEO thread when things went tits up, the thread became utterly boring with childish slanging off rather than discussing the topic. TFC's posts can be very annoying mainly because you often have to read twice to understand BUT (and despite me also currently nursing a paper loss on CHP) he is only "guilty" on here because he has a different opinion and believes that CHP was overstated/overvalued and for that reason he would be shorting the company. Perhaps he went on too often and actually putting trades on the thread for others to analyse was in hindsight a mistake as it will always raise accusations.
We all know E&P companies are a huge risk, I too didn't buy at 13p as CHP has bounced about between 10.5-13.5p for over a year whilst we wait actual news. I set my buy limit at 11p and through it went a few weeks ago so I am >30% down on paper and annoyed but I knew the risk attached. Once the Primavera drilling was announced this share was either going one way or the other and whoever called correctly would make a lot of money over the short term. Whats next, well if CHP had found oil on this drill the sp would have raced up 30% but then would have steadied awaiting the next drills which as Cynic pointed out many times could have been duds therefore it would make sense that all is not lost either until after the next drilling.CHP still has a good portfolio of licences and for those investing the choice is whether to add at these levels, hold and see what happens or move on, these should be individual choices and respected by others.
Personally I will wait a few days to decide whether to hold or sell and top-up my only other E&P, PTR which seems to have Directors with the local knowledge and experience of their target areas and have recently stumped up 200k of their own cash buying shares.

Good Luck with your own decisions.

TFC,
Utter non-sense. You are pretty imaginative though, I have to say.
On peux converser en francais quand tu veux, on parlera du Pays et de la belle region du Sud-Ouest d'ou Moi je viens.

Why doesn't anybody think of cutting there loses , you could have sold at 9p, and if you still had faith in CHP bought back again when the result of the 2nd drill was known.

Holding on to a share and even adding to it on the way down is the way a novice would react. You can talk the talk, on this thread and then act like compleat novices when it comes to making the right decisions, just like they did over on the SEO thread.

ps Beware of people who say they have contacts in the company, they only have half the story usually.

That's why market psychology works in favour of the market makers and traders. People hate to sell at a loss, or feel they were wrong in their investment decisions, so will often hold on or add to a losing position. People are also greedy, so if they think they're right, they'll buy up cheap stock hoping to sell higher.

Strawbs.

SEE WHAT PRESS HAS TO SAY IN CASE IN MORNING BUT WILL BE HOLDING ON TO WHAT IVE GOT BUT IVE GOT SUFFICENT MEDICATION+ FINGER NAILS TO CHE!!!

wisdom Strawbs!

ITAM / Casse toi !! Les mots me manquent !!.Sidere completement et totalement . En voila des manieres !! .Ta gueule et fous-moi la paix ! Fini. ...,,,,,,,,,,,, AS for CHP:. Why should a Financial giant in Cantor Fitz purchase such a vast wedge of stock in the full knowledge that the following day a duster would be made known . Also why the sudden change in CHP s planned drilling location. Could the two be related ?Personally l cant see the logic in any of it . Unless theres a trick in the tail ......Qui sait ? .....................@+ J.......

didnt someone say that cantor hedge their postions against cfd's. From another board (iii):

The way this works is clients sells CFD's, Cantors buy the underlying as hedge
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Amities Robbi . Thank you. You have found the illusive last piece of the jigsaw that elluded me so . Feel much better now ...STRAWBS ---Here Here ,,,,Theres only two factors in REAL play in this cruel game -GREED and FEAR. Both are, as Kipling would have probably said nothing but sheer imposters, yet both envelop and digest even the most seasoned traders/brokers let alone green PIs ...@+ J

so i was correct the board are rubbish. and have still not giving out there thoughts for the company, very bad .

have lost patience far too late in the day ..... in fact should have paid heed to my own advice 6/8 weeks ago ..... am now out and hope i have the sense to stay out