The Oak Bloke - latest18 Sep 2024 08:01
Disaster off the coast of Africa
The Oak Bloke
Sep 17
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CHAR
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Not without risk I said about Chariot. Wasn’t kidding about that. But the fall to 1.4p seemed well overdone so today’s retracement back towards 2p didn’t feel like a surprise.
The precise Anchois-3 result is yet to be revealed in any detail but it would appear 1.4 TCF is now looking to be downgraded to 0.35 TCF based on the north/south Flank results, and this could now be a case of “make me an offer” from ENOG. i.e. a low ball offer or it might be ENOG simply walk away having lost $10m plus the cost of the vessel and drill. But I would once again remind readers that the wider Lixus/Rissana could have serious amounts of value. Energean are being conspicuously silent but I would wonder whether they didn’t have a poke around before moving on:
Additional Lixus Prospects:
• Updated assessments on two key undrilled prospects (Maquereau, and Anchois West) with improvements in both prospective resource potential and probability of geological success and the newly identified Anguille prospect, which are all part of the same tertiary gas play as the Anchois gas field
• Combined, 2U prospective resources of 838 Bcf with an estimated probability of geological success ranging from 30-52%, with closely related additional targets in the areas surrounding the prospects
• The total remaining recoverable resources (2C plus 2U, comprising audited and internal Chariot estimates) in the entire Lixus portfolio stands at approximately 4.6 Tcf
Rissana Offshore:
• Early assessment of the areas covered by 3D seismic, provides a total 2U prospective resource of over 7 Tcf, combining a high-graded prospect 'Emissole' within the lower risk Anchois tertiary gas play and multi Tcf prospects in a higher-risk Mesozoic play, inherited from Chariot's legacy Mohammedia Offshore licence area.
The value of Loukos, the the onshore Gas prospect, is still worth something although not without risk either.
Etana is also potentially valuable although we have yet to quantify exactly how much.
If we assume Anchois is a total write off but Loukos succeeds even modestly CHAR arrives to a break even (based on some level of cost cutting).
If Anchois continues but the additional 10% is not taken or is renegotiated then things remain much brighter.
Obviously the above two outcomes could be seen as two of several outcomes (including one where Loukos is also water wet or unsuccessful).
It’s too early to conclude CHAR is an absolute failure; it still has more throws of the dice. It also has a couple of other projects which I’ve assigned zero value including the Mauritania green hydrogen with Total. That might prove to not be worth zero. Hydrogen is moving forwards with a wall o
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