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The information is there if you care to look for it. Don't wish to sound rude, but I'm not here to do other people's research for them.
'If the BoD's would issue a statement of assurance it would disprove my doubts'
Or you could just read the most recent RNS's and listen to the most recent investors call ¯\_(ツ)_/¯
*Then take those words as they were intended.
*Like all deals, Dragons den deals only fall through if they fail due diligence (i.e. if the info given during the pitch doesn't match up with the facts).
*I don't see delays. Farm out Anchois was completed by end of 2023, Check. Drilling onshore Loukos Q1 2024, which was again reconfirmed this month, Check.
I have no wish to get into a discussion with bad faith actors on here, so I'll leave it here. Have a good evening.
Mrplow,
Let's not try and twist my words. I said getting as much of the pie as cheaply as possible would be the aim whilst negociations were underway. Each side would of course want to get the best possible deal for their respective side. However, once the deal is signed, the partnership becomes cemented in good faith by both sides.
Peter Jones will negociate hard in the Dragons Den, but once he's shook hands on a deal with another business owner he works positively for both parties for the good of the overall business. He doesn't down tools in an attempt to undermine his business partner. Bizarre why you are even trying to insinuate this is what Energean might do, it does just come across as fud rather than trying to be balanced as you claim. We could all speculate on what wild thing Energean may do next, like offer Chariot a buy out @ £1 per share, that doesn't make it any more believable or true.
Yes, I calculated and stated here that I thought Chariot would get $50m+ in back costs and that's what they got.
Yes, I still think that $50m will be used to develop Loukos further (providing the next two drills are as expected).
*Have you ever had a business partnership? I can promise you, that's not how it goes or how you would want it to go.
*Energean pumping as much gas as they can from their new asset and selling it to a ready market with decent prices would be in the best interest of their shareholders rather than shelling out $25m and then sitting tight. Energean have told their shareholders that they're planning on drilling and developing this asset as quickly as possible. Are Energean actively lying to their shareholders? You decide.
*Morocco got cut off from Algerian gas year end 2021. Morocco have been moving heaven and earth to find companies who will develop in-country supply ever since, including giving the enormous Rissana licence and then Loukos to Chariot (for next to nothing) on the proviso that they get it into development asap. It's just turned 2024 and look where we are. 2 years later. Drilling about to start both onshore and offshore Morocco. In terms of how fast the O&G industry moves - that's very quick indeed.
*Chariot is receiving over $50 million+ in back costs. Read the RNS. $25million + $50 million in convertible loan notes.
Since being cut off from Algerian gas in 2021, Morocco and OHYMN have been crystal clear that they want companies to come in and develop in-country sources of gas.
I run 2 businesses and I have never done a deal or have had another business enter into a partnership with my business only to then try and 'weaken' my business against theirs. It simply doesn't make business sense to act like this.
Chariot have a very good relationship with ONHYM and the Moroccan government, these two entities want gas asap. For a partner to come in, only to then drag their feet with stalling tactics just won't wash with the Moroccans. Also, all of the noises coming out of Energean to its own shareholders regarding Anchois is that they want to crack on with developing it asap. So I think Mrplow is just fear bating.
Mrplow,
It's also correct to point out that all is not lost even if Loukos were to come up short. There are other backstops such as offshore Anchois (farmed in) with drilling happening 6 months after Loukos (H2 2024).
I believe Project Nour - that Chariot founded - is the 2nd largest proposed Hydrogen project in the world, there's also the green energy business that's likely being paired off with the clean energy trading platform as well.
Buying in post-Loukos results (providing the drill results are positive), even at say +45% on the day, may be the better risk/reward option for some.
However, for me, SDX have already proved there's commerical gas under Loukos, Chariot have just defined better drilling targets and extraction locations. So I think the odds are very good, especially at the current SP.
I could be wrong, but being wrong is not going to financially ruin me, sure it'll sting. Like a lot. But not ruin. Position size accordingly.
Gooner,
The fact that the company are already talking about Loukos in terms of production, suggests they know exactly where the gas is located, or rather, exactly where enough of the easily extractable gas is to be found. In conjunction, they also have a very gas-hungry industrial sector who is crying out for more gas. This market it literally on their doorstep - an instant ready & willing customer base to immediately sell in to.
If they are wrong about Loukos, then short term, look out below, all hopes would then have to be placed on the offshore AE drill and our deal/relationship with Energean.
Gooner,
Go back and read my original message. 18p on spud day AE offshore drilling which is post-Loukos onshore drilling.
Gooner,
Yep, still think if drilling onshore Loukos is a success then we go into AE offshore drilling at around 18p.
The best buys of my investing life have been done when I felt slightly sick making the trade. They've always been the ones that have made me the most amount of money.
Must admit, I felt more than a little queezy buying another tranche @ 7.57p this morning.
The drill bit will be moving into our Loukos licence within 4-5 weeks and Duncan Wallace & David Brecknock are two of the best in the business when it comes to finding & drilling for hydrocarbons (especially in proven fairways).
In 2020 I bought a good chunk of RR. @ 80p (not quite the absolute bottom, but close). This was during a time when everyone was saying it was going to go bust because of the pandemic-induced financial distruction of RR's balance sheet. It was an uncomfortable purchase at the time, but RR. is now @ £3.59. The demand for flight isn't/wasn't suddenly going to dry up forever, nor is the demand for gas as a source of energy and fuel. The uncomfortable periods just need to be waited out.
I've found myself in discussion(s) with bad faith actors on here before. Best thing to do is quickly correct any misinformation with facts and links and then end the discussion.
Never wrestle with pigs.
The pig enjoys it.
You get dirty.
If through drilling AE, we get offshore Anchois above 1Tcf that's able to produce 200mmscfd, then sure 100p is possible in a few years.
But first we need to walk before we can run. Onshore has the potential to make the company self-sustaining and profitable. I think onshore has the potential to cover all of our G&A as well as fund more future onshore wells that will further build up the company's balance sheet, and I see Anchois as this massive royalty asset that we have a decent stake in. I think developing onshore production quickly and cheaply is the right strategy to get the company to positive cashflow.
Cavendish believe the upscaled development of Anchois could support production rates in excess of 150MMscf/d. And assuming Energean exercise their option to acquire the additional 10%, they value Chariot’s net 20% carried interest in Anchois at US$595m or 71p per share.
So, if production is increased to 200MMscf/d come FID, then 100p fits Cavendishes existing model.
Mrplow,
See slide 12.
High historic success rate of 80-85%.
Geological similarity to Chariot’s offshore portfolio.
https://chariotenergygroup.com/app/uploads/2023/09/AGM_070923_Presentation_Final_noapp.pdf
Can't remember where I saw 65%-85% specific to Chariot's Loukos targets (Maybe it was RNS or the post-partnering presentation, can't remeber), but Chariot's upcoming targets have similar CoS as historic drills in the same region.
Henry,
I don't think Chariot would have applied (and received) EIA and permit approval to drill and produce from up to 20 onshore wells within the next 5 years if they weren't planning to expand Loukos onshore gas production further.
If Gaufrette and Dartois are successful and they start producing circa US$25m per well per year, then I think they'll just keep drilling. At $3m per well for $20-25m per year in revenue, it's a no-brainer for Chariot to keep expanding onshore and probably why Auctus has taken such a positive view on the stock.
It's always good to get different perspectives, but let's try and agree to disagree in good faith, both on the positive side as well as the negative.
According to Auctus, each of the two wells being drilled (next month?) could be brought on stream this year (2024) and could produce 5 mmcf/d each in 2025.
From Auctus dated Jan 29, 2024.
The first prospect to be drilled will be Gaufrette (in line with previous indications). A success could unlock 26 bcf of Best Estimate recoverable prospective (gross) resources with an unrisked NAV of £0.06 per share, representing 75% of the current share price.
The most likely second prospect to be drilled will be Dartois. A success could derisk 20 bcf of Best Estimate recoverable prospective (gross) resources with an unrisked NAV of £0.05 per share, representing 75% of the current share price.
A successful discovery could be brought on stream by YE24. We currently forecast that Gaufrette or Dartois could produce ~5 mmcf/d in 2025, generating US$24 mm of after tax operating cashflow per year with overall development capex of US$28 mm (including exploration drilling). We re-iterate our target price of £0.50 per share.
“everything is riding on the back of the next offshore drill now”.
Not true. If onshore is a success (and with 65%-85% CoS, there is a high chance that it will be), then Chariot head on to offshore drilling later in the year in a much stronger position.
It's my guess that if March's onshore drilling campaign is a success, we approach offshore drilling later in H2 2024 at around the 18p mark. Just my view.
Yes, there is risk. There is always risk when it comes to O&G drilling. Chariot's onshore drilling, even at a whopping 65%-85% CoS could still disappoint. However unlikely that is, it could happen.
However, what's also just as likely to happen is that one or both of the wells finds way more gas than anticipated.
To me, Chariots onshore drilling is 2/3 odds on. Which are very good odds.
Scenario 1. As expected. 5 mmcf/d per well.
Scenario 2. Unexpected downside. Duster/non-commercial.
Scenario 3. Massive unexpected upside (Dartois?).
Etana are buying the power from renewable sources and selling it to the commercial/Industry/residential sectors.
Essentially, Etana is to the Hydroelectric plant as Vivo is to Chariot.
If Chariot were to spin this off into a separate business as has been hinted to in the past; what I suspect they would do is roll Etana and the renewables business together into one so that they're able to trade their own excess renewable energy supply, as well as facilitating the trading of other sources they don't own. You can easily see how this could be a very scalable business in its own right, not just in the country of South Africa, but across the entire continent. AP has a wealth of contacts across the whole of Africa.
But first they need to build the business up, hopefully we see a lot more of these trade agreements being announced. The beauty of this business is that it's very low capex.
It's actually 5 out of 6 Directors that have bought in the past 2 weeks.
Adonis Pouroulis (CEO)
George Canjar (Non-Exec Chariman)
Julian Maurice-Williams (CFO)
Duncan Wallace (CTO)
Chris Zeal (Non-Exec)