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.

This is good news:
All figures are recoverable oil

38.1m x $5bp (in the ground) = $190.5m
25% for chaco = $47.625m = 27.2m

27.2/390m = 7p per share.

Just on this deal alone in the ground.

At the wellhead based on $35 per barrel and 500m in issue to allow for the placing the figures give a 38pence share price.

You get the potential other licenses and paraguay thrown in for free with those figs.

Baza, I'm glad chaco have finally released some news, we should see a significant lift from here onwards. Especially if the other applications are successful.

Now up 10%, this news will get noticed and all set for the next RNS on Paraguay

MPH, re projections. Thanks for redoing them to reflect today's news. I will be interested to see if others side with the mgt's view that oil in the ground is worth $10/barrel. That would effectively double our short term sp calculations. Anyone any views on the value of oil in the ground? $5/barrel or $10/barrel?

ss - ,..and I thought you were the expert !!

Hopefully more news on its way

Baza

Baza, Don't think I've ever said that! I always use $5/barrel because it generally means that the actual figures turn out better. At the AGM CHP were using $10/barrel. (as does a mining friend of mine)
The implications of CHP winning Deals 2 & 3 where they would have a 55% share (cf 25% on Deal 1) would give an sp of around 80p. A big IF, but if CHP's anticipated timetable of within 10 & 20 days of the AGM for each of the next two deals, that should make the next 2 weeks exciting for the sp.

Sharesure, I have asked around and have been told that the last takeover in the sector valued reserves in the ground at approx $17 per barrel (I'll try and find a link to that and post it). However $12 is considered a conservative estimate.

So recalculating the figures using $10 and $12 per barrel in the ground gives 14p and 16.7p respectively for the share price.

I don't want to repeat myself but I must stress that those share price calculations are for the first confirmed deal ONLY. Paraguay is not included, nor are the other potential deals.

MPH thanks. I knew that I was being conservative but didn't realise I was so low.
Looks like the sp can afford to rise quite significantly when the deal is more widely appreciated. It was highlighted tonight in one of the market round-up reports so should open stronger tomorrow. I would also expect WDBM to be back in the market for more stock as I am pretty sure they know that the other negotiations are going to be concluded favourably.

How long before the market properly wakes up to CHP's actual & potential assets? I wasn't overwhelmed by yesterday's uptick at all.

ss,

Do you think that the uncertainty over the placement price will hold us
back a little?

cc

Morning all,

Perhaps someone could explain to me, I have seen various valuations of the value of the oil in the ground in respect of the Alea deal , I calculated it at about 11p however why have we not seen a significant rise in the SP yet, surely none of this is already factored into the price.

I understand that it may take a little time to come through into the price but the SP is actually down slightly as I post , am I missing something here?

Market sentiment or lack of market awareness perhaps is keeping this down!! - just needs a bit of publicity

they all ways buy after the rise thats why fund managers are crap.i would not trust them with a penny.

CC, possibly, as I cannot see why else this stock doesn't move up sharply. Maybe it takes the weekend press to involve more investors. The only consolation is the knowledge that in the end value always get reflected in a share price; in my experience if a stock stays undervalued too long it gets taken over.
Stewart, I don't think you are missing anything on this one; it's just one of those times when the market has to catch up. Since there are at least 3 pieces of impending news, 2 in Colombia and 1 in Paraguay, there is likely to be plenty of opportunity to jolt the sp into life. If you take the view that a 50p sp will follow getting Alea oil out to the well head in say 6-8 months, I reckon it's going to be easy to just sit on your shares for that, knowing that other favourable events may happen in that time frame.

Also, it is a very red day today......

.......except for seo !!!

Baza

as a general comparison, accepted all the other variables, (incl. poss total reserves, amount of exploration activity, costs of delivery to land and safety factors in areas concerned, plus many more)


sh.p, Mkt cap, bopd, ratio of Mkt cap/bopd
CHP 6.9p, 27m, 533 (est), 20, (bigger the better)

EEN 166, 80, 4300, 53,

DNX 820, 600, 18,800, 31,


accept that this is a generalisation so would value thoughts

the only thing holding this back is the state of the market.

no, Tanker, you're quite wrong - the only thing keeping the price low is the low price that anyone's prepared to pay for it - nothing to do with the market, silly. lol!

Have you tried brain surgery, or are you more drawn towards rocket science. Let me know if you try either - so I can avoid!

sd

I believe that the major uncertainty still hanging over this share is the placement volume and price. The Repsol deal cannot go through without raising funds via placement and the potential dilution could be UP TO 30% of shares (roughly equal to a 25% reduction in SP). I believe the lack of placement news is holding back SP progress.

The SP calculations on this thread tend to use some level of pre-placement volume of shares but still assume the Repsol deal is in place. I don't think that is realistic.

Once the placement news is released and the impact known/understood/absorbed, then the SP on this share can move onwwards to a true underpinned valuation- the uncertainties will be reduced dramatically. All the potential (and probable) positive news can then have a full effect.

As usual all the above IMHO. WDIK, PDYOR.

camlad