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.

Nas, Annie38, Roly et al...........aplogies for delay in responding to your inquiries.- l have only juste returned from DRC and this is my first oppertunity to respond to recent news !......Firstly the dark side- To be honest. l fully anticipated such an RNS.. Firstly how ironic the bod should decide to release informations reg that dog of a well called lggy on the very same day RBC should release a note indicative of a 29p Target. .. ...Thankfully we have disposed of lightweight players Astaire- and have RBC as Nomads Thry happen to have a stable of Columbian oil plays in their portfolio, and l have a VERY strong gut feeling ,and big ears that they ( RBC ) are currently mopping up all these " sells" at" approx 11-50/ 11.75 level which would go a long way to explaining the skewed trading pattern whose ratios make an absolute nonsense of "SETS". lf stake bulding or simply laying off to retail clients is their remit we should thank our lucky stars . - mais qui sait ? BUT how long will they be prepared to prop up a stock whose investors patience is all but run out? Couple this with the simple fact that there is no immdediate news on the immediate horizon that could be deemed price sensitive and Hey presto ....over 900 million shares in the heady mix - and yes, of course,PTH could be perfectly correct in stating the s/p could hit 8p..Very easily ..lf i were in his position and didnt know the company as well as i do now l would say exactly the same.But more importantly ln this case l happen to doubt it; as i believe the recent drop was purely dictated to by pure news and had absolutely nothing to do with t/a .. but as i know t/a happens to suggest otherwise and unfortunately is taken most seriously in the city .and appears in a downward trend .But as i say the the drop was news induced..lncidentally.Your variables in charting are not disimilar to mine own .. lncidentally again - PTH good call on CLF..l almost bought at 103 but reached the same conclusion as yourself .. 114p was pure brickwall.....But back to AMER . Annie 38 - You ask how i see things considering i have a wedge of stock . l am philosphiical about things. l sometimes doubt i would ever have need for it anyay . BUT i am never surprised by what happens in the market place . NEVER ..The human churn in personnel in the city is phenomenal due to petty jealosies To be honest its not about l ' argent with me ...My main gripe and sheer frustration reg. Amer expressed in colourful terms in my previos few mailings was the the level of sheer contempt with which AMER b/o/d/ held the PIs ; and both Clarke and Wardle have had many on here labouring labourishly under the impression that the reputations of these men went before them, and as if we should be in awe of them or feel lucky to have them onboard . l was as guilty as anybody else thinking Wardle would replicate past successes ....Shhheeesh They both ran the company like a little sideline. Something to which one would attend in a perfunctional manner A bit of an overthought. .Of course they knew that lggy was in VERY big- well terminal- trouble from the minute they discovered it -we now know the skins of the resavoirs were wafer thin, and they hid this fact for a full year .Schlumber could do little to advance the company towards a producing well as neither could Wearherfords before them ,so why should geosciences be able to do so>?.... ANOTHER wasted year . They then excaserbated their lack of due dilligence with a 15 kilopascal mudweight which i initially presumed to be due to the tremendous specific gravity pressure in the well bore to which they reffered to in a later RNS addressing damage to the well. And now it turns out it was to keep the well from utterly collapsing . Yet rather than come clean they chose to play for time and keep everyone - except insts-in the dark . You can bet institutions did not shell out 16.5p p/s for that debacle . Whilst the board have not technically broken any rules nor regs they should perhaps glance back to the RNS of Decembre 2009 which gave not an inkling of poor resavoir characteristics and virgin pressure- au contraire- they went out of their way to give ONE side of the story- the glowing side -of massive columns of gas on one level and sweetest oil on another . Thats pretty sharp practice by anyones definition along the lines of Frank Timis / Kevin Foo . But thats what makes the city . And one would be remarkably naive to think otherwise .So i am philosphical as i say............lt seems the bigger the lie the more people believe it . { Stalin } ...Quite ironic, isnt it, that in this very area ,in the few short years Shell Texaco and Chevron were in Columbia -before they left due to a plethora of economic and social reasons in the 60s - they managed to twawl 1.92 BILLION barrels of oil from the middle Mag valley. What is more ironic is that over 12 of the big wells were within a 160 km radius of Fenix .lsnt that typical of this company ? Well isnt it ? .Chaco revisited . You have to laugh. ............l would not mind so much had it not been for the fact that ALL of my other Columbian oil juniors have soared recently on the back of the spot oil price !! At Amer senior and middle management are top notch . lts top tier management that need to be reassesed . ..This board need a full time "hands on" younger pure 100% geologist joint CEO who is young and hungry but with big finds under his belt to perhaps initially assist Wardle who lets face it is in the autumn/ winter of his career- and then take over.. But most all it is imperative this company find a chairman who is an oilman through and through.!!! . This is imperative .Lets face it; Clarke would prefer to talk about cricket or fine wines ,for 24 hours non stop than string a sentance together reg. oil . Another few years wasted at great cost to the company ! Someone like Lord Asquiith who recently left JKX would be ideal. .........................BUT dont get me wrong .Not all is bad. . Nothings changed reallyat the coalface , as they say. Not really ;-)) To be brutally honest i am of the opinion that those that have sold their shares at these levels have made an error . You see -As yet everything is there to play for. What varible has changed - lggy was written off by RBC immediately as was lsa and accorded no value in their note ,,, As far as 2011 is concerned we have a high impact drilling prog.in place which is fully financed and CAPEX will be at the lower end as a consequence of lower rotary count .What with one of the wells being perhaps an extension of the giant that sits across the border in Ecuador and a full workover on another that produced 800bbloe p/d with 1960s tec, i see advancement here .And this is what the institutions paid for .Mind you why didnt it occur to them that the most prolific area of Columbia for oil is most certainly in the North with the legandary Llanlos basin which spans both middle and lower magdelena valley.- juste where we are drilling - lf we dont drill another well or two at Fenix we are severeky resticting our COS and would qualify toregister as a charity and start digging roads for the citizens. ............that would be Clarks job ......................anyway Lets play ball

The thing is why wait for the share price to recover when there are so many other investment's to put your money in with a better chance of success within a shorter time frame.

Such as?

TFC thanks.

How sure are you about your comment below??
This is very important.

They then excaserbated their lack of due dilligence with a 15 kilopascal mudweight which i initially presumed to be due to the tremendous specific gravity pressure in the well bore to which they reffered to in a later RNS addressing damage to the well. And now it turns out it was to keep the well from utterly collapsing . Yet rather than come clean they chose to play for time and keep everyone - except insts-in the dark .

Blackdown

For me it was PAL and BEM

Tfc
Jw's comment at agm"iguasa had greater pressure than macondo well in gulf of Mexico"

Someone made the interesting observation on another board that Amer " can only produce what they can handle" ie. storage capacity (which is being expanded as we speak) is limited, and there may be logistical constraints on the amounts that can be transported by tanker. Would it be reasonable to conclude that flow rates therefore are purposely being restricted at present at Plat. in line with storage capacity ?

Also, I think it would have been only possible to analyse the permeability problem after the formation damage had been cleared up.
The puzzle is why there was no problem in the first place with permeability when the pressure at TD was off the scale.
Pressure and permeability are closely linked.
I wonder if they had a experienced Mud engineer or Drilling Fluids Technician 24 hours on site with Iggy, althought the high Skin Factor was cleaned up I cant help but be concerned that the remedial action has in some way inadvertently made things worse, as the oil production seemed to drop off as Iggy was being worked on, I have read about "stranded oil" problems with oil in place but dont know if that issue applies here?
Even if the reservoir is tightly compacted, leading to low permeability, this may vary greatly within a field, so a few hundred feet away you could have a great producing zone if the type of reservoir rock changed.

Yuff ...Either that or they overeamed the well ... after Amerisur announced via RNS postponement of drilling at lggy, Astaire quickly issued a reassuring note on April 10th saying " the reason for suspension of testing was the neccassary use of a mudweight which led to formation damage ( effecting wellbore permeability ) ........" But why did they use a 15 kiliopascal m/w when the API lays down in its code that 7.5 is the norm and 10 the maximum .....lggy could have a real gem of a well -..but reading between the lines and now knowing the highly dangerous hydrostatic pressure, (specifiv gravity) in the wellbore it would seem the instruction was given to use the mudweight whose weight ( amongst other things ) protects the casing and open hole be used to trap the gas at all costs even at the expense of damaging the integrity of the well characteristics. .With pressure in the wellbore off the guage was lggy a potential blowout scenario ?? ...lt has all the hallmarks..l think Weatherfords and Sclumberger initial remit was to make the well SAFE above all other variables such as establishing production -..but from whatever vantage point you look at lggy the company itself kept people believing what with a little tinkering all would turn out okay...................lncidentally if you believe in the concept of actualism in that the past and present provide the key to the future you will see that ALL the big oil /gas fields in Columbia are to be found in the North with its numerous 6,000 to 30,000 bbloe strikes and NOT the in the south which is well known for its average strike of a mere 600 to 800 bbloe p/d wells ...Evermore -... i fully concur with your saying more wells being sunk on Fenix block - during early North sea " drilling BP only missed the enormous isolated "Beryl" field by less than 500 metres .it was only its second drilling that revealed the mega billion bbloe oil find .....Fenix definately has the potential geology for the truly big finds ....,,,,,,,,,,,,,,,,,,,,,,,,,,,,.interestingly, however both RBC and Astaire desk notes accord COS at Fenix at 10% and Nil value yet give two of the plat drills a 100% COS with a TP of 29p.... ....

TFC, thank you for your post.

Reservoir permeability within a field can vary enormously, and I think I read that Frontera would be examining surface geology in and around Iggy so maybe another well is possible financed by surplus free cash flow from Plat 3 and Plat 4 late in 2011.
Poor permeability in one area of the field does not mean the entire field.

I suspect the COS would have to be high for another Fenix drill, 50% plus and include new geological data so far unknown to avoid another $5m Iggy 1 disappointment.

Are most of those sell trades at 13.50 buy's ?

Frankly : I don't know why you lot bother with the south american oilies...apart from EEN,...I have never been able to make a profit...much better elsewhere....(FI stocks apart)....

RF

You have just been unlucky ..... try West Africa , afren , Cove and DPL

In AFR and COV....

Just sold all mine @11.50 for a 28% lost , but had been banking profit up to around 18 to 19. put most of the proceeds into Afren and Cove.

Ald,

I don't blame you at all. I am thinking the same thing after 6 long years...

You know what's going to happen now , a RNS that will see these rocket

There is always that chance, maybe I'll keep a few just in case.

I wouldn't hold your breath!

I would-this share still has an awful lot to offer-what with a planned back to back drill programme in Q1 at Plat.

If Iggy cannot be resolved a new Iggy 2 will be drilled alongside once Fronterra release their findings.