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It is great work for a relatively small company which is rapidly demonstrating its ability to get much larger as the Market Cap approaches £200 million. This market cap essentially relates to the Anchois project in Morocco. It seems that little or no value relates to its Renewables or Green Hydrogen project(or it’s legacy oil interests in Namibia and Brazil).
We have seen articles on this bb about the strong interest in massive Green Hydrogen projects from major O&G companies and the large valuations put on such projects. Chariot is setting its stall out to be what the Majors wish to become namely a Transitional Energy company as they move to a greener future. Massive Green Hydrogen projects are the way to go for the majors as it is close to their existing expertise.
Chariot is in the right places at the right time but needs to move quickly to secure maximum benefit. They will be being looked at closely by a number of majors. Do they team up with one for gas and another for Green Hydrogen. Does one take a big stake to do it all or does one major just take them over? There are so many permutations that I think we will have a very interesting summer. It is such an exciting company that I am thinking an outright takeover is becoming the most likely outcome but I am interested to know what our industry experts think.

Continues:
Thirdly, the gas project offers green credentials in a growth market. Currently, Morocco imports around 90 per cent of all its primary energy supply and is heavily reliant on coal. Supplying growing power and industrial energy demand in Morocco will be Chariot's main market, a factor that is supportive of securing the funding for the initial capital expenditure of $300mn (£244mn) needed for the project.

The positive back drop explains why Chariot’s share price has kicked on 11 per cent to 19.55p since I highlighted the progress being made (‘Hitting pay dirt: Chariot on Fire’, 31 March 2022) during which time the FTSE Aim All-Share index has lost 10 per cent of its value. The holding has also delivered a 543 per cent return in my 2017 Bargain Shares Portfolio. Cenkos Securities conservative looking 51p target highlights the value still on offer. Buy.

useful to remind ourselves of the investment case here and the conservative target of 51p as set out by Simon Thompson a month ago:
“ Bargain Shares: Backing an energy transition winner

An African-focused energy group has pulled off a successful fundraise to progress its flagship Moroccan gas project which should create substantial value for shareholders.
May 19, 2022
By Simon Thompson

$25.5mn placing and subscription completed
one-for-47 open offer to raise $4mn
Directors invest $0.6mn in subscription offer
Chariot (CHAR:19.55p), an African-focused energy group, has announced a $29.5mn (£23.6mn) fundraising, at 18p a share, to advance its low-cost flagship Anchois Gas development, offshore of Morocco.

Pitched at a tiny 2 per cent discount to the market price, the placing and subscription element of the equity raise completed in double quick time, a sign of strong investor support. Existing shareholders have until 8 June to submit their open offer applications. I would advise doing so for multiple reasons.

Firstly, at the start of the year, Chariot announced a major gas discovery at its Anchois-2 well. Having encountered multiple high-quality gas reservoirs, net pay estimates – a key parameter in reservoir evaluation – have been raised from 100m to 150m. This has a positive impact on the size of the resource, and on the project economics, too.

A post-drill reserves report is in the process of being updated, but on a base case development with a 70mn standard cubic feet (scf) per day plateau production rate from the 2C contingent resource (pre-drill), Anchois has a net present value of $900mn (applying a 10 per cent discount rate) and is expected to generate an eye-catching 45 per cent internal rate of return for its project owners.

Secondly, Chariot’s board is looking to advance the Front-End Engineering Design (FEED) project to reach the Final Investment Decision (FID) as quickly as possible, whilst progressing the development of the group’s wider portfolio. Around $15mn of the fundraising proceeds will help accelerate this process while a further $5mn has been earmarked to progress Chariot’s renewable power pipeline, strategic partnering and new venture opportunities.

The partnering process is already underway as Chariot looks for long term, strategically aligned partners in both upstream and downstream capacities. The next commercial steps will be negotiating and completing gas sales agreements, and securing project finance. At the end of April, investment bank Societe Generale was appointed to lead the project financing.

Chariot already has a Memorandum of Understanding (MoU) with a leading international energy group for future gas sales agreements for 40mn scf per day for up to 20 years on a take or pay principle, thus anchoring the development whilst retaining the opportunity to sell surplus production into the gas hungry European market which is in urgent need of alternative sources of gas supply.

It is gross negligence on the part of the Bangladesh Government not to mine Phulbari as a matter of urgency. Government’s around the world are increasing coal production as 80% of global power still comes from fossil fuels. The people of Bangladesh are now suffering power cuts and power is becoming unaffordable relying on very expensive imports. Hasina knew this would happen and has failed to address it for years. Phulbari could have been producing coal and affordable power now. I hope the opposition and the people demands that she resigns so that the power crisis can be addressed.

Some decent buys at the close took BLU Up 5% to 0.265 on volume of 17 million. Let’s hope this trend continues as we await news which can’t be far away now. BLU is ridiculously cheap at its current sp.

Six trades and a volume of 40000 suggests that the market does not see it as a major risk factor. However knowing all your comments are made to suit your trading activity at any particular time, I will leave it to others to make their own minds up about whether there are any serious negatives for Condor and it’s fellow Nicaragua based mining companies. But I think the extract mentioned previously is the one most likely to prevail “ According to both sources, for private companies that have concessions to explore or extract precious metals, the risk exposure “is practically non-existent” because its governing entity is the Ministry of Energy and Mines (MEM), not the public company”

“According to both sources, for private companies that have concessions to explore or extract precious metals, the risk exposure “is practically non-existent” because its governing entity is the Ministry of Energy and Mines (MEM), not the public company.”
This is the comment that is relevant to Condor, Calibre(Rio Tinto) and the other private companies. Action relating to a Government entity is of no obvious consequence to Condor apart from the potential benefit that if Americans can’t buy gold from the Government entitity they will do so from companies like Condor.
It is ridiculous to suggest that it would be in the interests of the people of Nicaragua to damage the country’s major source of income. The US Government will not want to punish the people of Nicaragua just because they don’t like Ortega. Sales of gold by private companies will be far more transparent than dealing with a Government entity. Let’s remember that Rio did full due diligence on the Country before investing in Calibre and with their global experience I do not think CNR has cause for concern.

It is also interesting to note the confidence shown in the project by todays RNS as it has leap frogged 2 events shown on the time line in the May presentation namely “New Gas Venture” and “Reserves Report”. The news flow is going to be strong and the fact that everyone involved in the FEED has seen enough from the CPR already to proceed to engineering is very encouraging. Every effort is being made to accelerate this project and one can’t help feeling that some of the big boys are very keen to be involved this and/or make a bid. I think we should expect an exciting summer and let’s not forget the other business streams!

The very positive RNS this morning confirms that CHAR is going full steam ahead to fast track this project to cash flow.
“ Adonis Pouroulis, Acting CEO, Chariot Limited, commented:

"Signing this agreement with Schlumberger and Subsea 7 is further evidence that we have accelerated development plans for the Anchois Gas Project, a key tenet of our recent fundraising. It is a pleasure to work closely with both companies on this integrated design phase, to benefit from their experience in working on several similar projects globally, and to leverage their standardised technology which is directly applicable to the Anchois development.

We look forward to building on this relationship and to realise the benefits of an integrated project execution. Reduced interfaces, fewer contingencies, and strong leverage over procurement and the offshore construction schedule will help shorten time to first gas. This streamlined approach will benefit all stakeholders which is a key objective of fast-tracking the project towards cashflow."

What we do know is that an RNS announced the appointment of Mr Seaborg so one would expect a formal RNS about his departure. If he has gone then perhaps it will be announced when his replacement is appointed. It is also possible that he will continue as CFO on a part time basis as was the case with our previous CFO as per this statement in the RNS appointing Seaberg:” On behalf of the Board, I would like to thank Jeffrey Karoly who has served admirably as Condor's part time CFO for 4 years while simultaneously serving as CFO of Rupert Resources, listed on the TSX-V (TSX-V: RUP)".
Another possibility is he realises that CNR will soon be sold and therefore he has decided to take on a new job as his job at CNR will soon disappear.

New investments soon. Seed will not raise more money from shareholders. It will raise cash by selling investments.
A very informative 30 minute interview that is a must listen for anyone interested in SEED. Leap is going to deliver for us in the coming months. We are affected by general market conditions at the moment which are responsible for our current sp and that the value of a number of our investments are not properly reflected in our sp.

No action from Barclays yet

This was raised last week on another thread but is of little consequence as they have the same arrangement with the USA and others:
“ The Nicaraguan government also authorized the presence of small contingents of Russian troops for “exchange of experiences and training.”

Russia’s foreign ministry spokeswoman, Maria Zakharova, told the Russian news outlet Sputnik that the measure was “routine.”

“We are talking about a routine — twice a year — procedure for the adoption of a Nicaraguan law on the temporary admission of foreign military personnel to its territory in order to develop cooperation in various areas, including humanitarian and emergency responses, combatting organized crime and drug trafficking,” Zakharova said.
She noted the law also authorizes troops from the United States, Mexico and other Central American countries for such purposes.“
There you have it from the Russians themselves that the US, Mexico and other Central American states have the same arrangement that Russia has joined.

That was a large buy at the close 237555 at 30.75p. A £72000 bot of confidence. Let’s see what next week brings as someone looks keen to get in.

One would imagine they are awaiting the CPR whereupon a farm out can be finalised.

You would think they would be encouraged to cash them in. If they don’t they will lose the opportunity to to buy 30p shares for 25p. It’s easy money for them if they want to sell them. If they believe in the future of the company now would be a good time for them to buy and help the company. It is not in their interests to risk being diluted in a future placing.

There was a late reported sell trade of 2.3 million at 20p which put the final volumes of the day at 1.8 million Buys v 3.9 million sells. That is what pulled the sp down but it was concealed during trading hours.

If you look at Chariot (CHAR) which is a very similar story but the appraisal drill was offshore Morocco by a company that had been at a vert low price for some time. They announced their 3D seismic in September 2020 and it moved the sp above 2p for the first time in along time . It was 6.9p at the end of October and 8.2p at the end of November even though the drilling was over a year away in December 2021. AEX will drill in less than 6 months. CHAR’s drill was successful and started this week at 23p. That is an illustration of a 10x increase in sp starting from the release of seismic.
So I don’t think the people who are suggesting the seismic results will have little effect know what they are talking about and look rather like derampers perhaps.
Good to see all buys this morning and Up 3.2%

It may well be the case that Mark is focusing on the water issue for local reasons. It is clearly very important to keep the locals happy and is a condition of the permission to mine that social issues are addressed. We are all frustrated that the BFS has not been issued but I don’t think it is helpful to attack Mark for doing his job. He understands the local issues far better than we do and he should be allowed to do so without abuse.

The allocation of excess shares will be announced tomorrow so you don’t know whether you will get any yet. RNS tomorrow morning should tell you but One would imagine excess requests will be scaled back as everyone will be very keen on shares at the placing price. If you want to avoid dilution you need to increase your holding by 14% but the basic entitlement will only give you 2%. Therefore you will need to buy in the market.