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KNC. I agree

They told the market and shareholders that they had sufficient cash to last until Q2 at least by which point they were supposed to split and list renewables. But they would have needed capital for this for the renewables float for the first 12-18 months, and that has to be in place before the listing.

With management my issue is with the JMW. I’m fine with DW despite the views of others - and have a lot of time for AP. His latest $2m investment says a lot - he’s not going to waste that willingly . Cash flow management is absolute 101 in this situation. They need to restore institutional confidence! In my view that means a change

IMHO

I would guess Malcy's view was from the below in the initial acquisition RNS. Its a clear change in language and implies sale IMV. There isnt a reference to dual listing or listing - just monetisation.

Any funds raised though the Open Offer, and any other funds received by way of the Fundraising that are not used to part finance the acquisition of the working interest, will be used to supplement the Group's working capital. As at 31 December 2025, the unaudited cash balance of the Company was US$1.2 million. Combined with the funds raised and the potential monetisation of the renewables business the Company forecasts sufficient working capital to reach first cashflows from the Transaction.

DYOR

Correct Surfit, now showing on the halifax SD account

Always hard to tell Surfit - he certainly seems very certain given the repetition in the consecutive posts

Time will tell...

Fernan - thanks for the AI advice! I think we could both benefit from it looking at your recent posts!!!! All joking aside, I think the tax regime is very unclear for the deal we have. Whilst the headline rates you are quoting are directionally right - you have omitted that there are a series of material tax incentives available based on field life, production sharing and I think domestic producers)

Until the SPA is signed and the headlines communicated we wont know.

@surfit, they havent communicated it!!

DYOR

Note renewables direction again being reiterated

Chariot

Chariot reported yesterday that Etana, the South African electricity trading platform in which Chariot’s subsidiary, Chariot Generation and Trading (Pty) Limited holds an economic interest of 34%, alongside H1 Holdings, Norfund and Standard Bank, has signed up a further 150MWAC in sole offtake from the Orkney 219MWDC solar photovoltaic project which has now reached financial close. Chariot Generation and Trading is co-owned by Chariot and the Mahlako Energy Fund.

The Orkney project, located in the North-West province of South Africa, is being built by Mulilo a leading renewable energy developer and independent power producer and will be financed by Mulilo and a consortium of South African financial institutions. Once operational, Orkney will have an export capacity of 150MWAC and is expected to produce around 478GWh of renewable electricity annually, which will be wheeled to Etana’s customers via South Africa’s national and municipal distribution network. This is the second project that has been completed through the Etana and Mulilo partnership, the first being the 75MWAC Du Plessis Dam Solar PV2 project that commenced construction last year.

Benoit Garrivier, CEO of Chariot’s Renewable Power division, commented:

“This is a further example of Etana delivering on its strategy and underlines how its business model is addressing both the supply and demand for renewable energy by enabling and instigating the build of these projects. Etana is executing its plans at pace, closing projects expected to generate in excess of 500MW in the last 12 months, and is, in turn, serving to help redefine and enhance South Africa’s long term energy infrastructure.”

This announcement yesterday shows that the renewable business is growing rapidly and this is another large solar project under construction with Etana to trade the electricity. It can only make the renewable business more valuable at a time when Chariot has announced that it is their intention to now monetise this business and to use the proceeds to reinvest in another oil production deal. I look forward to watching the progress as Chariot in the coming months, they are back on the radar screen, no mistake.

KNC - dont disagree, it could be better.

Fernan - Firstly the output is from Google Gemini (you appear to be using Chat GPT)). Its used for 45 for taxes, capex and opex combined based on a 71USD price.

https://www.trade.gov/country-commercial-guides/angola-oil-and-gas

KNC - quite possibly, but that would only be favourable. I still think they will sell renewables, but happy to be wrong on this. They could fund anchois from borrowing against this - and will certainly get a better farm out.

I think with all the warrant shares in circulation it gives about 5-6p per share at £250m MC.

I think for this very reason they will sell the renewables/power division. Say it yields $75-100m USD inc Nour. They also recover $16m USD over the next 12-18 months. The warrants add a further $37m if fully executed.

The NPV^10 calc on the asset in Angola is roughly $170m to Char allowing for Debt repayment first and then discounting the forward cash etc.

Anchois on the 1C from memory was worth about $500m NPV^10. They would need $50-60m of cash and debt to fully fund this in terms of capex at 30%

Namibia licence issue if they receive - they need to pay for a seismic maybe ($5+m?) - but would add exploration excitement

Adding all together: Angola + Anchois/Loukos + Namibia? = it's not hard to see a market cap of £250-300m, which is 6-8p if ALL warrants are fully executed.

I think personally this is a possibility by year end if :

i) they farmout anchois

ii) sell renewables (I think they need the cash to fully fund Anchois)

iii) are issued a Namibia licence

in late 2027 into 2028 doing a bigger deal with Chevron (or other upstream) becomes a reality because they are no longer servicing the debt and the asset is fully cash generative

All IMHO

Im not sure thats the right maths. KNC is right about from beginning of Jan, therefore the debt will be significantly less given the deal resets to Jan 25 and all economic benefit from that point belongs to Etu and partners. The debt then has to be repaid first, including the Chariot deposit. Using Gemini and calibrating $71d oil

Here is the precise recalibration of the Angola deal model using a flat $71 per barrel Brent crude price.

Keeping the fixed operational costs the same ($20 OPEX + $25 Taxes/CapEx = $45 total deductions per barrel), the math shifts slightly from our earlier $71.20 and $65 calculations.

Here is exactly how the 8,000 bopd asset pays down its own debt at $71 oil:

1. The "Locked Box" Accumulation (Pre-Completion)

Net Cash Margin: $71 (Price) - $45 (Deductions) = $26 net profit per barrel.

Daily Production: 8,000 barrels.

Annual Net Profit (at $26/bbl margin): 8,000 barrels x 365 days x $26 = $75.92 million per year.

18 Months of Accumulated Profit (Jan 2025 to Mid-2026): $75.92m x 1.5 years = $113.88 million.

2. The Slashed Purchase Price (At Completion)

On the day the deal legally closes in mid-2026, that accumulated pre-completion cash is deducted directly from the headline price.

Original Purchase Price: $195 million

Less Accumulated Profit: -$113.88 million

Net Cash Needed to Close: $81.12 million.

3. The Debt Drawdown

Because the asset generated nearly $114m during the 18-month waiting period, Etu Energias needs to draw down less than half of the $170m Shell Trading loan.

Etu draws down $81.12 million from the Shell facility.

Total Debt to Repay: $81.12 million (Shell) + $16 million (Chariot’s loan) = $97.12 million.

4. The Repayment Phase (Post-Completion)

Once the deal completes, 100% of the cash flow from the 8,000 bopd goes toward paying off that $97.12 million debt pile.

Annual Cash Flow Available for Debt: $75.92 million per year.

Time to Clear the Debt: $97.12m / $75.92m = 1.28 years (roughly 15.3 months).

The Final Timeline Verdict at $71 Oil

If the deal closes in July 2026, adding 15.3 months of debt repayment takes us exactly to October 2027.

By early Q4 2027, the "switch flips." The asset is entirely debt-free, and Chariot steps into its unencumbered 4,000 bopd entitlement.

What does this mean for Chariot's bottom line?

Once the debt is cleared in Q4 2027, Chariot's 50% share (4,000 bopd) generates:

1,460,000 barrels per year x $26 profit margin = $37.96 million (~£28.1 million) in pure annual free cash flow.

JT - I suspect they will want to sign the SPA first before they talk it up. Cavendish have held back their revised target price until then as well, which they commented in their broker note last week.

Full expecting the current investor raise to be oversubscribed for exactly the reason Gardie and Obscure calling out - folks selling and buying back in

IMHO

No problem, Gardie. All IMHO

I think if they can farm out Namibia after some form of Seismic, fully fund anchois (say 30% post FO to murphy or other) and enter into something further with Etu to buyout Chevron on 14+14k or something similar upstream then this can go further in 2027 - maybe 12p+ if the environment is favourable for O&G investment. It feels like its shaping that way at the moment

On the warrants - the value is £27m to Char if holders fully execute them. I guess for us, if the price hits 6p-8p by end year its 3x plus on the investment which you can buy and realise straight away if the price goes up. I fully expect this will be oversubscribed.

IMHO

Https://www.investorschronicle.co.uk/content/d708c086-235b-4163-85b9-3fd344996f04

Keep going Obscure - it's good to have healthy debate, conversation and a balance of views - we're more likely to get a more rounded picture between us all if we do.

If think the renewables piece is really positive (not saying otherwise), and am glad they have it. They have enough cash to list it without raising on the new listing now (and will have an obligation when they list to the market to have enough cash to cover ops and initiatives for the first 12 to 18 months anyway (can't remember which timeframe).

I however suspect they will sell this. The narrative felt it had changed a bit last time - and I suspect the prospect of realising cash of 1.5-2p per share with the warrants executed will be too great. It should also boost the investment narrative for upstream if they have £100m including the sale value of renewables and nour, executed warrant income (£27m) and their deposit back of c. £10m alongside the weekly income from Angola. Add the Anchois/Loukos FO, a Namibian issue and further upstream involvement with the likes of Etu - and its believable the market cap could hit c. £250-£350m this year (6-8p) +. It was £180m with no angolia income, no cash, no meaningful renewables, and just hope that they could FO Anchois.

I think this is the fastest route to value - and perhaps for the business to be acquired in time. And no I didnt anticipate or guess this - but I can see the logic behind it. It will be intereesting to see what they say at the next update which I suspect will be shortly after the SPA has been signed

IMHO

No, I didn’t see the raise coming. I have no issue with them raising as long as it boosts the SP materially. If this gives them sufficient cash to now invest in multiple upstream options, unlock Namibia and fund Anchois at say 30 percent - I can live with it.

And with Whimax Fernan, no chance Shell would allow ETU to do that. The deal will be backed with strict covenants. ETU also want to be the preeminent player, they need Shell on board (or other financial backers) for their future ambitions. NO chance that will happen

JT - agree, an explainer is definitely due on this

Obscure - have conservatively calculated the market cap based on a best guess of the value of the assets Angola (80m), Anchois (50-80m), Cash (60m) and Namibia Licence (30m - assuming they sell power and invest 20m into Anchois). I have then assumed all warrants executed and reversed the price out from there. It's just a view

I'm pro power, but if they had split and raised - even with a high PE assumption on earnt EBITDA I dont see it being worth more than 2p in the short term. The upstream approach is a faster route to value given the environment for O&G is more investor friendly again

If they make progress on a Namibia FO and either support ETU buyout Chevron or go after something else upstream I could see it hitting a bigger number

It looks like the deal has an economic effective date of 1 Jan 26 - so I assume there is a benefit from the income from that date once the SPA is signed?

IMHO

To put this into perspective I think the market cap at 6p with the warrants fully executed is about £240m. In 2021/22 it hit £183m on Anchois alone with no cash at all and renewables wasn’t a thing at that stage. Yes the investor environment was more friendly following the Russia/Ukraine war and Anchois appeared to have greater potential

However they now have a renewables business which is probably worth £50-£75m (say up to $100m)

Inc Etana, Nour. They have an economic deal in a producing asset worth a lot in terms of cash flow, a likely farmout deal on a reduced Anchois - but with potential.

They also may have a Namibian licence by then

And they are secure, with 12m back from the Etu deal, say 75m from renewables and 27m from the warrant execution plus any current working cap they have. Maybe 100m?

With that security they will attract institutions

And investor sentiment is changing toward O&G at least short term

I don’t think 6-8 by year end is impossible at all

IMHO

I don’t disagree with your sentiment Obscure, but that adds another £25m into the bank as well, plus the return of their deposit from Angola

The world is definitely skewing toward oil investment again short to medium term as there is a clear recognition it’s needed for the energy transition. Investor sentiment is also moving that way. I guess it depends what the ultimate exit route is - ie acquisition by a larger company

Even with the warrants fully exercised I can see a point where I think Gooner is right and 6p+ by year end is workable

On Anchois, I missed the point initially that Murphy aren’t required to drill a well in their first three years. I wonder why that is 🙂 it feels like Morocco is lining these guys up to partner and operate the Anchois development?!? They have the funds and will learn a lot about their own licence from doing it. Who knows where and how big that could get… and for once we will have the funding to deposit and debt fund our 30 percent (assuming that’s what we end up with). We certainly have a stronger hand.

There are two considerable value creators beyond this in my view : 1) supporting funding of Etu, with Shell to buy out Chevron in 2027 or another upstream activity where a major is pulling out. 2) Namibia issuing us a licence now we have funds in exchange for seismic which we then farm out.

The Namibia licence issue and the Anchois farmout seem likely in 2026 to me.

If they execute well I think 6-8 by year end with the warrants fully executed is possible

All IMHO

Fernan. How can you say it’s poorly structured when you haven’t seen the framework ? Correct me if I’m wrong on that!?!

I’m intrigued about the rumour on Chevron wanting to divest their mature deep water asset (SP Angel)

We note that Chevron is also rumoured to be interested in divesting its operated interest in this mature deepwater asset that currently produces ~40kb/d gross from nine fields, with Block 14K contributing 2kb/d via a unitised development between Angola and the Republic of Congo.

I’m also very interested in any renewable sale - having listened to it again AP has defo very slightly changed his language. Malcy has also clearly got this from somewhere and it’s quite a big statement

Add JTs comment on Onhym, AP continuing to wax lyrical on Namibia, and this all starts to feel more interesting ..

IMHO

I don’t buy it Fernan. Shell are hardly going to let that happen, the deal will be structured to make clear its maintenance capex only with various debt covenants to prevent it happening

Imho