Chariot Ltd (AIM:CHAR, OTC:OIGLF) farm-out of its flagship licences offshore Morocco provides key validation of this potentially prolific acreage position, notes house broker Liberum.
It also gives development financing for the Anchois transitional gas field and also has the potential to carry the company to first gas assuming successful drill results.
"Crucially, Chariot has secured a partner that is aligned to the development of Anchois and we note the partners’ plans to evaluate the undrilled low-risk deeper sands, targeting a material increase in the resource base to >1Tcf, considerably upsizing the development from c.640Bcf."
Elsewhere, the upcoming Loukos licence drilling campaign represents a material near-term valuation catalyst for Chariot.
“We highlight that the drilling of these wells will also have important read-through to the offshore prospect portfolio due to the reservoir fairways that extend across the areas.”
Buy with a target price of 39p, adds the broker.