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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.

SS - i know its an almost impossible question but what do you rate our chances of finding oil at Cachapa? 50/50? they must be almost at TD by now so should have some indications. Im very excited but also quite nervous, preparing myself for any bad news, however, the new block should help support the SP.

I posted this on the advfn site and felt the need to post it here...

I want to see is if PV actually holds 400 million barrels which it is rumoured to hold.

The bit where many PI's with CHP/GED have gone wrong is to they have attached us to GED too much which caused many to have a decreased in the confidence of our own well and caused the last drop in our SP when GED issued their RNS.

I for one would like to say there are many companies operating in the Llanos basin. All ARE seperate entities and have found oil. Only GED with a questionable drilling method we're unssuccessful. I do sympathise with all those who lost money in GED but guys this is CHP. Different block, different mapping, different technique. Some strike oil, some don't risk ratio is 1 to 3 and we all take our chances. All this talk about the management not being up to standards . I think we should take some acceptance that we caused the SP to dip by linking these two companiess too closely together.

Someone here, after all of this gossip and rumours, I challenge you to show me PROOF that we SHARE the same block as GED. Otherwise lets just talk about CHP and stop linking the two as this doesn't do us any favours and if we can link ourselves to GED, lets do the same for LUKIOL and everyone else in the Llanos basin who have found oil.

And I for one will buy when funds are free as I have seen nothing from OUR COMPANY (NOT GED) to state otherwise! until then its business as usual. rant over!

Thats all well and good FG,but have you not said in previous posts that our sp would rocket as ged news got closer???.

capetown - good! The past few months have been a bit of drag but it will require a CHP announcement or two to spread the excitement.
I don't relish the idea of more "no news" torture esp (as robbi points out) we must have reached TD by now.
Good luck.

I thought it would add confidence yes but now we have to look forward and wait and see what we have as until the results come we don't know

why is our ceo so lackluste is he any good.

spread now 10.75 / 11-50. .quis custodiet ipsos custodes

"But who will guard the guardians? ...

spread now 10.75 / 11-25 and softening .....Regards Roly ....So you rememebr your schoolboy Latin then ?....Better translated in this instance as the rather more sinister " But who is WATCHING the WATCHERS !!... .......methinks you know the answer to that

looks like insider dealing going on,

I think the MM's had plenty of surplus stock, and took the oppertunity to run the price up when the spudding RNS was announced. Given the price didn't fly up, the speculators probably decided to sell their stock back, and so the MM's quickly dropped the price. I believe TFC warned in an earlier posting that the MM's may have more stock than they need. It's also worth noting that volumes may be lower during the short Easter weeks, which may skew the price action.

I don't hold CHP, but do enjoy reading the thread.

In my opinion. Etc.

Strawbs.

now 10.5 / 11.25

TFC - u seem to enjoy watching people potentially lose money as the share price slips! what a sorry state of affairs!

Robbi, I'm not sure that's fair. TFC has at least been consistent as far as I can see.

consistent would mean , when he or she, says she will go, does in fact go...get the fcuk out! ( in the politest sense)

Good point, forgot about that one.

welcome to the board Garf !!

Can't make up my mind about this share, promises a reasonable return yet now doubtful whether it will deliver.

Heres hoping they find the black stuff, oil or Guinness will do me..................

Robbi re #2921 Impossible to estimate when TD will be reached as CHP have shut off all comment on spud start dates. Our main broker supporter who seems to buy regularly when there are dips has been very confident that there is only one outcome for CHP and that is for it to go higher. Might be difficult to accept that right now but even without any input from Primavera (and he seems to think that it could be huge) the new block is also expected to add value immediately (think it might be akin to the position with Alea but several times bigger). But until the company decides to announce things there is not much any of us can do but wait. The new chairman comes with a reputation for being excellent for shareholders although he is reputed to want there to be far fewer. I'm reserving my judgement on how he will do although institutions have not suddenly become fans of CHP just because he is there which I think he may have led many to believe would be the case.

Robbi123 ..hate seeing peoples lose monies !!..,,,VISA - BASED on a single days negative trading you tell me to F*** off merely because what i said has occured in the market .Tommorrow is another day !! ............but you got a lot of waiting to do before any USEFUL data on this acreage is known .A day is a long time in this deliciously cruel waiting game. Time begets sellers . Such is the way of things . l dont make the rules. l am not the mm. BUT i think like one ! . . ...l merely call it as i see it .!! ls that such a crime in your eyes ? Would you prefer i lied to you and ramped this to the skies ? ,,,,, Try following after hours auctions and you may get a better feel for the stock . Thats when i usually trade.