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.

It all sounds very promising, as usual, but barely been acknowledged by the market, looking at the miserly uplift in sp, yet any negative announcements causes the sp into freefall.......

Nice summary of figs by sharecast:
LONDON (SHARECAST) - South America focused oil and gas firm Amerisur Resources moved back into the black in the first nine months of its financial year.

Operating profit in the nine months to the end of 2011 was $2.24m, versus a loss of $2.85m in the 12 months to 31 March 2010. The company is in the process of changing its year end to 31 December.

Profit before tax was $2.3m in the latest nine month period, compared to a loss of $1.96m in the prior 12-month period.

Revenue soared to $9.01m from $2.75m the year before as production ramped up at its Platanillo asset in Colombia.

At the end of the 2010 the group had cash of US$20.7m (2009: US$8.0m), following the successful completion of a share placing to raise US$ 20.8m in April 2010.

The company said it continues to generate positive monthly cash flow and during January 2011 hit a new monthly cash flow record from sales of $1.73m.

Post period end we have modified our operational plan following the positive results of the interpretation of the 3D3C seismic survey over Platanillo and we expect to begin drilling before mid-year, company chairman Giles Clarke said.

http:///www.sharecast.com/cgi-bin/sharecast/story.cgi?story_id=4157742

tudwick-happy now at the market reaction-always takes time for results to sink in. News on drill results whether + or- attract an immediate reaction.

Only one direction now for AMER-the next 6 months will be very very exciting.

Daniel Stewart reiterate buy recommendation.

Certainly happier.....

RBC new target. Now 40p.

Target price based on what BWD ?
As in when all results are known from the recent 3D surveys carried out or from info already known ?

Tudwick - no idea, I'm afraid. I haven't seen the details. Their initial coverage, which I have seen, was based purely on Platanillo, as a year-end target. I'd guess the same applies here - but including the recent reserves upgrade, higher oil price and better chance of success with drilling now focussed on sweet spots at the southern end of the field. (Maybe someone who has seen it can give the gist).

Ok, thanks

Anyone attending the AGM this year.

Its at the usual venue - St Mellons Hotel - just outside of Cardiff, on Tuesday 10th May at 9.30am??

Whats happenee to French Connection, sold out again?

lol

Hi ml,

Yes, where is he and nobody heard today's news or what?

Never mind frenchconnection, it's cynic's views on this year's happenings I want to hear!!!!!

Today's RNS has to be good news for Amer to make quicker progress. 16 wells in the next 18 months, at least 5 of them in Platinillo and one in paraguay before December. As JW points out, Fenix would have been a distraction or would not have been moved forward as quickly. Now it will be.
RBC has a new price target of 44p, up 12p on the last one. It's seems that it is just a case of watching the plans being executed over the remainder of this year and into the next.
Suspect that the AGM will be used to provide more immediate production news.
Once some more drilling is happening and assuming the seismic is accurate this should start living up to my high expectation of where it can go to.
Thursday should see Shares magazine comment again if others don't before.

sharesure what is your target price on these over the next year or 2?

razmun, it all depends how much oil there is and how much companies are prepared to pay for oil in the ground. Not very helpful - but then I doubt the directors even know that. They appear to think that there is a lot more to go at in Platinillo - so better to watch that drilling process closely over the next two quarters. If their hunch is correct then there is every reason for the sp rise to be spectacular. Meanwhile it is just a case of waiting...... something some of us have had to learn to become very good at, unfortunately!

happy to admit that i don't like this stock, but as you will note from the chart below, since the back end of 2010, sp has almost without fail rallied from 25 dms support - which looks to be challenged again

C,

AMER has (rightly) been criticised in the past for promising a lot and delivering not a lot. It does now seem, however, that there is considerable potential for increased production with relatively low production costs.

The Fenix farm out is a smart move as it will allow management to concentrate on Platanillo, where the chances of success look to be above average.

leave this one to you guys .... i'm happier with holding better quality

Remarkably thin trading, considering. Really thought the Fenix deal/broker upgrade etc would generate more interest.

Cynic a few of us have some profit to spend, why dont you give us the benifit
of your knowledge and give us some tips with your stocks.