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It seems I got the 5,000 shares I wanted as well

SF, I would think "sonic boom" would be a fitting name for a day like that :)

So the future price of hydrogen would likely be lower then, assuming it would actually be cheaper to make using 'green' electrolysis versus natgas? Otherwise we'll be relying on govt subsidies

That's a good point medar. The current $6.4/kg hydrogen price is equivalent to $48/mmbtu, quite expensive even compared to the current natgas prices in Europe. At half that price, $3.2/kg, the price would be equivalent to $24/mmbtu which is more reasonable in this current high price environment.

Current natgas price in Europe is about $27/mmbtu.

Nice research as always Jimmy. Quite sturdy numbers from project Nour! Lots of room for bearish adjustments with both the price of hydrogen as well as the production costs, and as you said even if they make $1 per kg while keeping a low ownership interest they would still rake in dozens of millions every year.

Ah, my bad. I was mistaken, the tax is 31% + 3.5% royalty after 10 years. I got mixed up there. But yeah, first ten years tax free, plus lots of tax deduction benefits after that

Certainly Jimmy. As I noted in my post, this is just a conservative "apples to apples" type comparison. When we take a likely higher ownership interest and tax free operations for the first ten years and a mere 16.5% tax afterwards into account, the value is even better. Not to mention, gas prices could be better than the current hedged prices that Vermilion is getting.

Just some very rough and conservative comparisons, the point is to highlight the value we have here. Company should be valued at £1B within four or five years based on Anchois alone, at the very least.

"Looking at Vermilion's market cap of $3.6B and using the previous 43% FFO that comes from Corrib, one could argue that Corrib is worth about $3.6B * 0.43 = $1.548B. Using our previous conservative 3/5 multiplier, Anchois with three wells would then be worth $928.8M."
...for Vermilion and Chariot respectively, assuming ownership interest

Since I noticed that Corrib is extremely similar to Anchois, I decided I should look at Vermilion a little bit and extrapolate on what Chariot's value might be a few years down the line.

Vermilion owns 56.5% of Corrib, and they estimate that 43% of the company's FFO will come from their sales of European natgas produced at Corrib. They estimate $2.3B FFO and $1.1B debt for 2022. $2.3B * 0.43 = $989M FFO would therefore come entirely from the five wells at Corrib this year for Vermilion. If we assume the exact same parameters at Anchois as we do with Corrib (same gas quality, same gas prices, same costs, same taxes, same debt/interest payments, same operating interest) but assume only three wells as opposed to five, a simplified calculation for Anchois annual FFO would be: (3/5) * $989M = $593.4M.

The above is fairly conservative when we take into account that 1) there is the ten year tax holiday & low taxes in general, and 2) Chariot has and likely will maintain a higher than 56.5% interest in Anchois.

Looking at Vermilion's market cap of $3.6B and using the previous 43% FFO that comes from Corrib, one could argue that Corrib is worth about $3.6B * 0.43 = $1.548B. Using our previous conservative 3/5 multiplier, Anchois with three wells would then be worth $928.8M.

Then, 18-20in pipeline and 200mmscf/d (or more) CPF capacity. Sounds reasonable to me. Quite a lot bigger than our initial plans based on 361Bcf! Let's hope the CPR gets us that 1Tcf

Or actually... Are we thinking big enough? If Corrib and Cassiopeia-Argo both have 600Bcf resources and both have processing facilities equipped for 200mmscf/d and up, would it not make sense for Anchois to be equipped for 250-300mmscf/d even? Or is that too greedy for a company of our size? I'm wondering about this pretty seriously now when looking at the comparables. Why not?

14in pipe would probably have about 100mmscf/d capacity or so. If Chariot wanted to double the production at Anchois from there to 200mmscf/d ghey would need to lay another pipeline, maybe into one of the other areas of interest within Lixus. Sounds good to me

I would think the production capacity at the onshore central processing facility will at least be much higher than initially thought. 200mmscf/d or maybe even more. Very feasible when compared to the other projects shown in the new presentation. I suppose we could try to find out about the pipeline diameters in those other projects, namely Corrib & Cassiopeia-Argo?

Maybe they're farming out a part of the Lixus or Rissana license and sharing the exploration costs with the new partner? Third appraisal well at Anchois would also be nice.

Lots of possibilities for what it might be

Whatever the new gas venture ends up being we'll know soon. It's next up in the timeline. After that CPR and then FEED which is ready to be commenced according to the new presentation. Next month or two should be a rapid fire of news for us. Good times

Is a third well at Anchois not the most obvious 'new venture' possibility?

Fernan, AP has been acting CEO since 7/2020.

Hi Fernan,
Yes I agree there certainly is a high risk of dilution. This is obvious to me. The new gas venture will likely consist of at least one well so that may be say min. $20mln. We don't know what that is yet, hopefully it's a third well at Anchois. The green energy projects will likely be entirely funded by cashflow once gas is flowing, in the meantime Chariot wants 30/70 equity/debt financing for those projects. Project Nour is massive but the plan is to get a consortium of bigger companies to do the hard lifting on the capital side.

Ignoring Anchois, how much money do you think Chariot will need to raise in three years? Or five? Do you think they need to raise £850mln? And do you think the share price won't appreciate the closer we get to production from Anchois? Do you believe all of this funding will be done as equity raises? I ask these questions because these are the premises for the assumption of future amounts of shares outstanding. Of course there are many variables and unknowns, but it's still best to consider these kinds of questions when we're speculating on dilution. None of us have the definitive answers to these questions of course, but I tend to believe strongly that reaching a whopping 5b shares outstanding would be rather unlikely.

Speculiar, the advantage of LNG is that you don't need to build a pipeline. When there is a pipeline as well as a good market present like in our case, LNG doesn't really make sense. It would end up as an extra cost due to the liquification and shipping needed.

I posted my observations of the new presentation earlier but I'll summarize them again:

1. CPR scheduled before FEED, and FEED ready to be commenced. Logical conclusion, CPR coming very soon.
2. New gas venture hopefully means a new appraisal well at Anchois, which would lead into a three-well plan.
3. Cassiopeia Argo project in development right now, its CAPEX is $600M which is in line with my expectations of Anchois CAPEX. That project has 600Bcf resource, 60km flowline, 200mmscf/d peak production and five wells initially. This excites my imagination that Chariot could also build a +200mmscf/d onshore processing facility.