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Good posts, Fernan! Thanks for sharing

I think you're missing Namibia in your summary, Surfit.

The thing I heard from the last webcast is that they think this is in play... If they secure a higher proportion of their existing blocks (where they have current 10% back in rights and no doubt very useful seismic) .. and short term operatorship until they partner (with Total or whoever ?!?) this could rerate quickly

I agree with you on the Anchois value

IMHO

Let’s see Goon. If Namibia comes off, new power deals and they announce partners for Morocco on and off, maybe not so long - plenty of potential momentum on the 6-12 month horizon

Chariot

I for some reason didn’t get invited to the Chariot webcast the other day, bound to be my fault but I have since watched the tape and it makes interesting viewing. Basically we are now at a junction for the company, the traumas of Anchois are largely behind them and the slow and steady build of the renewable power business can now be recognised.

So the Chariot board has decided that following a successful raise of some $7.1m, they are in a strong enough position to separate the two key businesses and in the second half of this year will de-merge. The upstream oil and gas business will contain the existing Moroccan business in particular the Anchois offshore and the onshore potential. Despite the third well at Anchois being a disappointment and led to Energean walking away, they are now the operator again and with a genuine feeling that it can become a profitable play.

The other half will be the renewable power business which is operating initially in the power-short market in South Africa, armed with a trading licence three years ago, in the Etana business which buys in electricity, transmits it through the grid and with its 34% has a valuable holding. Indeed with a $20m recent injection from Norfund for its 20% stake has drawn a line through the value of the business. Add to this the potential from the generation projects, already funded and net to them, bringing in funders here will add to the return.

The Etana business has considerable potential, look to the new presentation to show growth opportunities in South Africa and beyond, in sales, trading and generation, a huge potential market where I think Etana is the leading player and remember financed.

From now on there is a great deal to think about in Chariot which will take about 18 months to separate the businesses but will see benefits coming through in both upstream and renewables in Morocco and Africa in their own ways. The recent funding will start off the developments in upstream there but there is exciting potential in Namibia and other areas for backing in west Africa.

A bit early for Bucket List selection obviously and which side of the business might be quickest off the mark will be interesting, I have always had a great deal of time for the Etana business and as it is funded and has a read through value of the same as the whole group.

With green hydrogen as yet not the flavour of the month and other parts of the business yet to demonstrate profitability, there is upside potential in the renewable power area across many countries and with no value yet.

It’s early days and there will be plenty of time to assess if and where money can be made out of the ‘New Chariot’ but knowing Adonis and the team as I do I wouldn’t rule anything out…

https://www.share-talk.com/malcys-blog-oil-price-chariot-genel-energy-gulf-keystone-petroleum-petro-matad-sintana-energy/

I'll always make my own mind up, Surfit - but always value a balance of perspectives. It was simply an observation that 'they' were less active after a period of activity..

You're very quiet. Any thoughts on the recent update?

Agree Fernan. The NPV for the project value over time is $500m gross at 300 bcf. That will be conservative. As you say the annual operating cash should materially create capex cash for new resource exploration. Whichever way you cut it, and even if Char only retain 25 percent … it’s worth a great deal more than today’s market cap

Ignoring everything else … and there is a lot of everything else

If they can get partnering moving, this should start to shift upwards …

Hope so re Namibia, JT. The timing would make sense and align broadly to the timeline they presented last Friday - which was roughly in line with the latest power projects reaching financial close …

DYOR

Hey Surfit. They have spent a lot of time mapping Loukos and are definitely pitching it as a low cost, high value op with c 100bcf. Will be interesting to see whether they can get someone to farm in to the broader Loukos play without the flow test of OBA1. I suspect someone will, I guess the question is at what cost and caveat. I am also assuming this will fall under the ‘morrcanise’ umbrella so guessing it will happen

Re the NPV 10 calc its net cashflow for any given year inclusive of capex and opex with a factor 10 discount so it should provide a decent view of the value to Char compared to its lowly market cap.

It will be interesting to see the Morocco strategy later this year and their definition of the term fast track,.,

IMHO

For context though, even at 25 percent it’s $125m of an $500m npv10 - assuming 300BCF. That doesn’t include any exploration upside for Lixus, Risanna, Namibia, Etana, broader Power, Hydrogen or Loukos

And even then it’s still about 4x the current market cap… (converting £ to USD)

DYOR

The more interesting standout for me was the use of the words 'Fast Track' - I dont think they really talked to that at the webinar, although it was perhaps implied.

Note Kenitra link

https://www.pipeline-journal.net/news/morocco-plans-700m-lng-terminal-alongside-major-pipeline-network

I'm with you, Klein.

If you take the revised Anchois economics alone ignoring broader Lixus, Risanna, Loukos, all of Renewables inc the whole 500MW pipeline, Nour, and anything they get on Namibia . Anchois is worth $500m NPV10 on 300 BCF, and say Chariot keep 40% then it's $200m for that alone. Today's market cap is just over c. £20m GBP

It's not hard to see 13p ...

DYOR

... under 3 years

A not insignificant project - 'Commercial fundamentals of revised development remain due to the robust gas market fundamentals in Morocco, with strong gas demand, gas prices and excellent fiscal terms. We estimate that a c300Bcf development with a 70MMscf/d production plateau and a gas price of US$10/Mcf could generate a NPV10 of >US$500m, an annualised FCF of >US$150m and project payback of

I think we are due another surprise (or two), Gooner! The AGM is only 2 months away, actually a little less now.

I suspect the issue facing many is do you make an investment ahead of the demerger, or wait until after it when you know what you're getting and what they might raise at IPO.. Auctus for example have put their price 'under review' at the end of last week awaiting further clarity.

The bit that particularly caught my attention on their timing slide (slide21) was that new renewable projects were due to financially close shortly at the start of H2 assuming it's chronological (not a surprise) but that adjacent to this on the upstream business (same timeline) was 'announce new ventures' - ie Namibia. That seemed very confident as a near term projection....

Add their MMSCFD numbers for A3 from the pres (page 8) / and Fernan's net to Chariot numbers - even if you half that , you have a very valuable business on that alone given the market cap. I wonder if Onhym as a PLC will be able to better help with financing as well (there was a gentle nod to this)

DYOR

There are some interesting near term milestones coming up re-looking at their plan for H2 2025.

1. Financial close on further renewables activity

2. Morocco Strategy - To Fernan's earlier economics on Anchois, and reiterated in the SP Angel note a month or so ago, it's still currently the most important value driver

3. Loukos news? Partnering discussions have been ongoing for some time

4. Producing asset acquistion?

5. Namibia? They sounded more confident about this in the way they described it on Friday, and were more specific about the 'what'

Potentially a lot of meaningful news flow coming during H2 2025

I am surprised that they haven't had takeover interest for the whole thing to be honest given the current price. I would think the combined group would be interesting to a major like Total. If they get the Namibian licence award it may further accelerate interest here, ahead of the renewables being split out.

IMHO

Surfit - I’m assuming it’s entirely based on the data they have - blended with a relationship with Namibia and other potential partners.. . They sounded confident on the call on this particular point in my opinion ..

IMHO

Decent find Fernan. Thanks for posting!

Agree on DW, JT.

Power definitely has a lot of potential, but you also heard the language on the call. It's slightly different to the language they have used recently.. I dont think that they should sell it either - but by the nature of the fact they have raised it - it's clearly a consideration.

Re: Anchois and Loukos they are definitely doing a local deal in my view - which should help derisk things and enable further drilling

DYOR

It's an interesting question, JT.

I thought it/they was/were quite honest, with a few 'mea culpa' bits in their update. They are clearly thinking about the need to generate cash now - which whilst late is good to understand. I am not clear on what the near term generation asset is though in terms of O&G, so that will be interesting to see. I thought the expression of "Morrocanise' the gas assets was pretty clear in terms of direction of travel for Anchois + Loukos. They also must have a lot more data on the multi TCF gas targets that they are working toward. They are either doing a deal with a local business, or Onhym or both - but I suspect there is a backstop with Onhym here as part of them reclaiming the operatorship. I am disappointed in lack of funds returned in the sub from Enog - but not overly surprised.

The other standout was whether they are going to sell the power business - it's the first time I've heard them say that recently. I wonder if they are concluding that a demerger through IPO (on AIM or other?) and the governance of a separate businesses is pain and risk compared to monetising the whole asset. You could see it being worth 5p+ a share and I suspect the likes of Total might be interested. I suspect they have expressions of interest.

Looking at their timing roadmap, Namibia seems more likely to me now and clear they are going for something beyond their back in rights. Curious as to what the short term O&G cash generation asset looks like - given their cash position.

Curious as to whether OILtdr's 'there is a reason why they only raised a relatively small amount for working cap - $1.5m' still holds true..

Overall I think they probably said as much as they could at this time - they need to put the plans in action, especially on partnering.

DYOR