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.

Time is of the essence now.
GC is not a miracle worker.
Colombian bureaucracy and also Repsol's dalliance are as much to blame as anything.
All the foundations are in place to produce a good result for all concerned.
Unfortunately that result in financial return terms is still some way down the line, but it will arrive in due time, of that I am completely certain.
Rumours of massive reserves were stamped on and reasonable achievable expectations put in their place but with the proviso that these estimates can very easily be exceeded. Claims of massive numbers only lead to disappointment, was the message, and a collapsing share price. They want to rectify that scenario.
All association with the old crew was ended today imo. GC was coruscating in his criticism of them.

On a positive note one element of Fenix (Fenix South) is claimed to be a mirror-image of the Ecopetrol Bonanza field, next door, is very interesting. Bonanza has been pumping 10k barrels a day for about 40 years according to John Wardle. Notably he does not claim we have that amount but also in La Tigra he says/shows that Texaco, or whoever did original drill 20yrs ago, only entered the top sealed chamber and under it beneath the sheer, or fault line, is a much larger sealed chamber, denoted to the slide on p22. By implication it is a big resource indeed but still conservatively rated as 5-23m bopd. What amount is in the lower chamber?

JW implied we would take 100% stake in Platanillo-3, which new arrival Doug Ellenor confirmed was a very good prospect in his opinion.
Repsol share news could emerge at any stage. Any further interest in Platanillo field may well be 100% Amerisur's now we are the operator and 'in the driving seat'
They want time here to follow their own drummer. So far very impressive. John Wardle is the miracle man in what he has achieved. He has moved mountains to get to where we are. He is also a very clear and able speaker.
We have moved on from the idea of poking a stick in the ground to hit oil. It is simply not that easy. The old board instilled ideas that are simply not practicable or attainable by them. Certainly they never had the wherewithal to achieve what Wardle has done here. JW looked like a fresh faced enthusiastic 25 yr old when he had completed his delivery. Exhausted by nearly an hour's intense Q&A, but he was still smiling broadly looking every content with life as he retook his place at the centre of the board..
It is a very sophisticated operation and wholly down to JW with GC and co providing the financial assistance and essential backing. I do believe GC is getting a taste for it now! He can smell the oil. JW apologised for not bring some of the first flow. He also apologised for the rubbish coffee and said next year it would be a better quality of Colombian bean!
This time last year JW and Amerisur was in a dangeous shrubland. Now he has a road and bridges, tricks and strage tanks; all the necessary equipment ready and waiting to produce and deliver oil in quantity..shortly!
Plat-3 looks like it will dwarf the first drills but those first wells will provide income to finance the new projects.
Very impressed today.
SP wise we took a hit but I think we will recover. We should increase based purely on effort expended alone.
My advice is to hold or acquire a few more at these ridiculous prices.
Good news on Repsol and or other matters may come along very shortly.
As a consequence these shares may well be taken up and be kept in safe hands(institutions) until JW delivers the bonanza we have come to expect as our right, our inheritance.
I am confident the next AGM will see an entirely different picture emerge. By then the sp will have increased significantly, I sense.

As ever, an objective and informative post.

Hey Uponthe low down - where were you ?? Great post - Much more eloquently put than me

Next time please come and introduce yourself - or did you?? - Might be the alzheimers kicking in already

U.O.T.L. Excellent post and many thanks for taking the trouble to enlighten those of us who for whatever reason were unable to attend AGM. While I was initially quite disillusioned with fact that we may have to wait for perhaps another year for any commercial production of note or firm estimates of reserves, I am encouraged enough by the extremely positive feedback I have received from AGM to retain my holding. Regards.

Thanks from me, too, for the various AGM posts. I hope that next time the company has the guts to hold the meeting in London where it will attract a few institutional representitives who will require some exacting answers rather than the first leg of 'the 3 envelope' rule of mgt ie blame your predecessors!
I hope for all our sakes that the ANH do sanction the release of some better information in the next few days - otherwise the presentations next week will not be a great success or even worth doing! Cairn Energy at the comparable stage was much more informative but then this isn't run by Bill Gammell.

Sivad - you seem very quiet. No pearls of wisdom for us?

He has prob sold out!!

M

I can't believe that after so much progress, we are staring 5p in the face!

Cmp, thats the whole point, what progress????

M

CMP, It boils down to whether you trust that the mgt has some excellent developments (yet to be announced,but that the announcement of these is held back for some reason like not yet having the ANH's permission to go public on them) or you judge the mgt to be like many other mgt.s before them - long on hopes and stories but short on delivery. In this market the benefit of the doubt means that many believe the latter. I don't believe that the mgt are untrustworthy or will fail to deliver, a view shared by a few other quite substantial holders, but the company should not try that patience for too much longer.

There's been a lot of hype around this share and this has resulted in unreasonable expectations.

In my view, this has been a medium to long term prospect for some time and not a short term punt. The short termers are now exiting.

Many shareholders have been in this even since the Gold Mines of Sardinia days, then through 3 years of the previous mgt, then 1 year+ of this mgt. Hardly short termism if they do sell now -I wouldn't blame them although I happen to think that they may have sold just too soon, but then that means trusting the current mgt.

I just can't come to terms with the current price, the previous team obviously talked a better job to get the sp up. At present after three long years there seems to be little hope. We need something positive to keep our hopes alive. It appears the current team want us out...

cmp, it's not the share price that matters but the market cap. We have to decide why invest in this company? I am here because I am speculating that in time they will find a substantial oil field. News about Repsol etc will have a modest valuation aspect, it will provide an asset of maybe 10p per share ( I have not done the maths) but if you invest in these high risk shares the upside has to be in the order of 10 times. They haven't got there yet even with the hype on that ridiculous discussion board at advfn!! Believe you me if they do have a big find they will tell us. The day I feel that 50p is not achievable I will be off to find another opportunity.

cmp - one thing that they made clear at last week's AGM was that they were not going to talk it up as per the CHP brigade and indulge in costly ventures which bare no fruit. They will deal only in facts now, and reveal them when they are known. This has been frustrating (in terms of waiting) but surely a much better regime.

Still here and still awaiting updates from the institutional presentations.and still aquiring.

I am confident that the assets are valuable but have yet to make my mind up as to the skill of the management in capitalising on them. However, if they don't there could well be others who would like to buy them and at the current level and that would be a very cheap price.
Just settled for another chunk of stock too - hope that that was a timely decision.

Honk,

Great name - great post.

Those of us - like me - who have been in this since the 1.7p/share days (and have accumulated since then) are happy to wait for proof of the asset backing, which will propel this stock to greater things.

Personally, I have faith in the management. If you don't, then it's probably wise to exit now.

sharesure- "However, if they don't there could well be others who would like to buy them and at the current level and that would be a very cheap price. "

This is the danger, the current management must know this. Nervous times if no news and revaluation in the next few months. I would be very disappointed to give up our shares at this stage.

Nothing new info-wise, but i guess we can only be happy (ish) that they've decided to keep us informed that things are still moving, albeit at a snails pace, but no change there to be honest.