Chariot Limited (AIM: CHAR): Drilling update onshore Morocco
• The main target at Gaufrette (onshore Morocco) was water wet. While the reservoirs were thicker and of better quality than expected with multiple gas shows, the trap did not work and the reservoirs are interpreted to be water bearing.• Given the presence of water in the upper reservoirs at the main target, it was decided not to deepen the well to drill the secondary deeper target. Our ReNAV for the well was £0.02 per share.
• The presence of gas and good reservoir quality is a positive for future exploration in the area.
• The Gaufrette well was drilled on time and on budget, in line with expectations.
• Chariot will now drill the Dartois prospect onshore Morocco. The well, which is expected to spud in the coming days, is targeting a different reservoir system and trapping style to the Gaufrette prospect. The main target at Dartois is estimated to hold 12 bcf gross prospective resources. Success would derisk a total of 20 bcf gross prospective resources (+8 bcf) in the Dartois area. A rig-less well test would be run in the case of success. Our unrisked NAV for the well is £0.05 per share with a ReNAV of £0.02 per share.
• The key near-term news flow remains the Anchois East well expected to spud in 3Q24. We re-iterate our target price of £0.50/sh in line with our new ReNAV.
Anchois East
Anchois East is a very important well that could increase the size of Anchois to >1 tcf (300 bcf net to Chariot). Our overall unrisked NAV for Anchois, including Anchois East Footwall and Anchois East North Flank, is £0.42/sh. This represents 4.5x the current share price.
Valuation
We have changed our Core NAV and Sum of the Part to respectively £0.28 per share and £0.49 per share.
Chariot Oil & Gas is an independent oil and gas exploration company focused offshore in West Africa with a portfolio of assets located in the under-explored regions of Namibia, Mauritania and Morocco.
Auctus Advisors is a specialist Equity Capital Markets and Advisory business with a focus in the Energy Sector.
The partners have complementary skill sets, with decades of experience across Equity Capital Markets, Investment Banking and the Energy industry. We have worked at Société Générale, Canaccord Capital, BMO Capital Markets and Schlumberger. Most recently we have worked together for many years at GMP FirstEnergy.
Auctus has been set up at the beginning of a new decade in which we see significant opportunities in the Energy space. Globally, demand for energy is at record levels and continues to grow. Conversely, investment in traditional energy sources has been severely constrained. We believe this imbalance creates opportunities for both companies and investors.
Auctus provides Corporate Broking, Equity Research and Investment Banking services.
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