Chariot Limited (AIM: CHAR):Onshore drilling to start in 1Q24
• Drilling at Loukos in Morocco is expected to start around the end of 1Q24 with Chariot expecting the imminent approval of environment permit for up to 20 drilling locations. The company has secured the 101 rig, which is already operating in the country.• The first prospect to be drilled will be Gaufrette (in line with previous indications). A success could unlock 26 bcf of Best Estimate recoverable prospective (gross) resources with an unrisked NAV of £0.06 per share, representing 75% of the current share price.
• The most likely second prospect to be drilled will be Dartois. A success could derisk 20 bcf of Best Estimate recoverable prospective (gross) resources with an unrisked NAV of £0.05 per share, representing 75% of the current share price.
• A successful discovery could be brought on stream by YE24. We currently forecast that Gaufrette or Dartois could produce ~5 mmcf/d in 2025, generating US$24 mm of after tax operating cashflow per year with overall development capex of US$28 mm (including exploration drilling).
• We re-iterate our target price of £0.50 per share.
On track offshore Morocco
Regulatory approval of the farm-out of Anchois to Energean is expected shortly. On completion, Chariot will receive US$10 mm. Energean and Chariot are negotiation a contract for a drilling rig for the 2024 campaign.
Valuation
Our Core NAV for Chariot is £0.28/sh. Taking FID on the project by YE24 would add £0.05/sh. A success at Anchois East is worth £0.25/sh. Our Sum of the Parts valuation stands at £0.53/sh.
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.
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