Amerisur Resources is exploring for oil and gas in South America, currently in Colombia and later it plans to exploit its licences in Paraguay. It has a new Board of Directors and following a recent Placing at 6p (250m shares) sufficient cash to see through its current drilling plans and carry out some further corporate asset improvement opportunities.

Valuation of Amerisur Resources : 'Rule of Thumb' based on c.800m shares and using 10% DCF on oil at $70/barrel is 0.75p on the sp for every 1m barrels (CHP's share) that is proved in the ground.

Amerisur (formerly Chaco Resources) now has two exploration blocks in Colombia which it is currently evaluating and preparing to drill, one of these in the last quarter of 2007. It has also applied for further blocks in Colombia which are also believed to offer near term production. It also has three substantial areas in Paraguay and is awaiting news on a fourth. The next six months (May-November 2008) should see a steady news flow as it establishes the companys transformation from being an exploration company to 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. Any potential reserves are quoted in recoverable oil assets.



Platinillo, Colombia :

100% interest in a field currently assessed at holding 38.1m barrels of light sweet crude oil. Previously this a well flowed at 533 b/d before it was capped.Modern extraction methods may achieve up to double this output/well. Drilling completed for assessment and details of reserve figures and resumption of production daily figures awaited at Dec.2009. (Some guessestimates suggest the field might contain as much as 70m-100m barrels.)

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Tigra/Fenix block

100%% Further 3D seismic is completed; previous drilling has resulted in 30,000 barrels of oil from this block. Other blocks nearby in the Magdalena basin have also produced well. Drilled 11/2009; optimistic RNS (17 leads to follow)but reserve figures awaited

RNS :Expect further news on this block imminently and maybe a JV or other arrangement to speed up the timescale to production



Additional blocks to be announced

New local management team, in particular the CEO, is reputed to have some excellent contacts which will bring some high quality blocks to Amerisur in the coming months.

Curupayty Block, Paraguay :

1.39m hectares in north, close to Bolivia. Two wells previously drilled and both showed oil.

RNS : Expect JV with larger producer.



San Pedro Block, Paraguay :

1m hectares in south-east. Previous drilling showed oil.

RNS : Expect JV 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 Amerisur



Corporate Activity : The new Chairman is believed to have been brought on board to prove some or all of the existing Colombian assets and get these oil producing, arrange a JV on the Paraguayan assets before negotiating a sale of the company as consolidation of explorers in the region continues. An exit sp north of 1.00 over the next 12 months might be a reasonable target provided the drilling programme lives up to expectations, the price of oil remains at/above current levels and an approach is made for the company.

ss - off topic but have looked into early stage miner herencia resources. i would value your opinion on them if you have chance.

catto and clarke are both large investors.

Annie, Thanks - unfortunately I couldn't get that to work from a first attempt. I'll try again later. If you have accessed it already can you discern any increase in revenue/barrels from the position stated at the AGM?
Raznum - I'll take a look. Do you get Catto's bulletin on the stocks he suggests? If so it would be worth checking that out although from experience he is usually reliable as to the final outcome he is usually far too optimistic on timing. Amerisur being a case in point.

SS: The production figures for June (shown to be 349 , down from 439 in May) were drawn to my attention by the author on 25/8. so perhaps they are only published app. 2 months in arrears. For a direct link visit A**** (AMER 25/8 (10924). Hope this is of some assistance.

Thanks SS, i am not registered for Catto's bulletin on stocks. how do you go about registering?

Raznum, By becoming a client of Evolution.

I have asked RBC about their coverage of AMER. They were unable to provide a date for publication. That was more than two weeks ago. I'm not a client so I didn't press the matter.
Maybe they are waiting for a definitive answer regarding Iguasa and will release it on the back of some positive news. Just guessing.
I can think of no other reason after going to the considerable time and expense of having an analyst in south America for several weeks.
If we are now out of the woods as far as Iguasa is concerned, and it has settled down to consistent flow rates, then we should be notified of course. Fenix is not where the future of this company lies, in my opinion, but that is what investors are concerned about in the near term.

Patience being tested BWD but have more than enough faith in the team.

One day we will wake up and this will be so so much higher than it is today. Just very wearing at this time.

Annie, another investor has reminded me that the apparent drop in production you have referred to in #2355 was as a result of Amer needing to do some particular work but that by the time of the AGM in July it was back up to c 500 b/d from that well. Shame that the company is so shy.

AMER has a market cap of around 125m so 500 bopd is not a lot to write home about.

RKH isn't producing anything.

Ss

The pre agm announcement told us revenue had passed $1m in July so production increase was announced to the market

Nasdaq, Agreed that there is some information; it's just that there isn't full information. It would be of interest to know the detail of the long term test on wells like Iguasa; is it being tested on a choked trial etc. Other oil explorers keep their investors informed. I don't get the impression that the current Board believes that to be necessary.

SS the board obviously has its reasons whether we like it or not. JW said they prefer to always underplay expectations and announce news when it is factual.

What I want to know is why the delay in RBC note on Amer. Maybe waiting for long term test confirmation on Iguasa??

Plenty still to look forward to though with a planned 11 well drill programme. in 12 months.

If Iguasa is now on LTT, does it mean the clean-up operation was successful? If it does, then surely it requires an RNS. Don't tell me that is not price sensitive info!

PS: fund managers at AXA and Henderson bought more during July lows.

I am sure they will issue a RNS when they are good and ready, i am more concerned about the quality than quantity of news flow.
The company should not have to micro-manage news flow in order to manipulate the share price up to keep PI's happy-the long term growth of intrinsic value should do that job-hopefuly!
Any idea where the change in AXA and Hendersons stakes came from?

As we grow steadily, we will attract the attention of the majors as to the asset acreage we hold. This is turn will attract real investors interest and then we will see a prolonged and steady rise. 11 well drilling target is ambitious by anyones standards. Wardle believes he can do it.Paraguay is the unknown in this evolving story.
We seem to have found support at 14p Positive news will take us up and we still await the numbers of OIP to cement further gains.

A very exciting time in the company's evolution from being a small producer to a medium sized one.

Evermore: yes, according to data on ft.com, AXA added circa 9m; the Henderson buying revealed by fund manager Stephen Peak (although he did not say how many).

Ooops: re my earlier post about Henderson. They sold their holding (according the FT they had about 4.2million) in July. Apologies all. Genuine mistake.

12.50 bid now ...... any theory's on what's going on ?

Low volume and disinterest. The RBC Broker report is due according to the comments at the AGM but until it is published and, assuming that they are still pleased they took on Amer - and why shouldn't they be? - or the company releases its drilling programme, clean up results etc, this just look like it will be overlooked.