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.

I do hope you are wrong Cynic.

cmp - Agree that it is frustrating but there is every liklihood that August will produce 3 announcements, new areas (near production opportunities), an increase in the Amerisure % of Platinillo and around the end of the month the result of the step out well scheduled to be drilled to determine if there is a bigger field at Platinillo. Nobody at the company will confirm this directly but that is what some City brokers have been led to believe. Until the first piece of news confirms that the new mgt. is going to start delivering the goods little is likely to happen in my view. Where the sp drifts to in the meantime isn't worth guessing but the impact of say an increase in the Platinillo stake to around 45% and the confirmation that the field has up to 80mb (top end of the estimate) should produce a rapid reappraisal of the sp.
Anyone else figuring that oil might go to $90-100/barrel by the y/e?
No doubt some will rubbish any optimism on Amerisure at the moment. My money is on the above happening soon and some news on Paraguay before December.

Sharesure,
I suspect that the large trades of late 'mid price may be buys,if thats the case there is some confidence in AMER,had they all been sells the SP would not have recovered from it 5/5.25.
Good to see you.

can't see 90$ a barrell but it to me $65 - $80 looks likely over the next 6 months.

My money is on the chairman and his management team delivering. GC has an impressive track record and I am sure that he is far too shrewd to have taken on something unless he felt it was going to deliver something pretty substantial.

No need to worry. There was always going to be a wait for news.

blackdown, I am sure you are right although the wait (and slide in price) is testing.
The following was posted on another bb yesterday, and appears to confirm that progess is being made, ahead of schedule, despite the lack of news. I reproduce it here. From a broker's note to clients:

Amerisur Resources Plc (formerly Chaco Resources Plc): (5.63p) Shares in issue: 807.43m
AMER.L www.chacoplc.com Market cap: 45.46m
We spoke briefly with Giles Clarke, Executive Chairman, and were reassured that the new management team is making solid progress. Indeed, due to the weakness of the US currency it would appear that costs will be under budget and the timetable for drilling at Platanillo will be slightly advanced. Clearly the company has both the management and the funding, and is operating in a favourable fiscal environment with a background of increasing demand for both oil and gas.

Thanks Sharesure, I'll take a hit if I have to, worth the risk I believe.

Sharesure ..... now why on earth should you think anyone would rubbish your optimism? ...... heaven forefend! ..... i remain speechless - lol!!

So is everyone else by the look of things ha! ha! and just when I thought there was no benefit in holding these. Only joking cynic.
2517

there isn't!

Up on sells.STRANGE

Cynic - forgive me for correcting your execrable French. The correct expression is
"plus ca change, plus c'est la meme chose"

thank you .... i knew i hadn't got it quite right, but was damned if i could remember what it should be ...... bloody foreigners should speak English!

With the alarming drops, now on a daily basis, would it not be the correct thing to do for the company to issue an update on how operations are going, if only to allay a few fears that investors must be feeling, or at least try and stop the continual drop in sp by the market ? There really doesn't seem to be any more confidance in this new management, than there was in the old one.

Here's hoping to be proved wrong

tudwick

This is less than a week old!

From a broker's note to clients:

Amerisur Resources Plc (formerly Chaco Resources Plc): (5.63p) Shares in issue: 807.43m
AMER.L www.chacoplc.com Market cap: 45.46m
We spoke briefly with Giles Clarke, Executive Chairman, and were reassured that the new management team is making solid progress. Indeed, due to the weakness of the US currency it would appear that costs will be under budget and the timetable for drilling at Platanillo will be slightly advanced. Clearly the company has both the management and the funding, and is operating in a favourable fiscal environment with a background of increasing demand for both oil and gas.

and that says bugger all! ...... mere panacea with no substance

So, why the daily drops, every single day without fail ? It would appear the market obviously didn't take in the good points raised from the broker note then as much as say, you did...why not ?

because second liners and lower tat are currently unloved by the market ..... certainly no resson to buy; therefore sell

Cynic, I already know you really don't like this share and never have done, but i was just interested in Moneylenders reply