Proactive Investors - Run By Investors For Investors
Why invest in CHAR?
Chariot Oil and Gas: DEEP DIVE
OVERVIEW

Chariot Oil & Gas turns focus to Moroccan and Brazilian assets

The oiler is targeting the drilling of the Mohammedia licence prospect MOH-B, which has a gross mean prospective resource of 637mln barrels in two targets
Oil barrels
OVERVIEW: CHAR The Big Picture
The group has also evaluated acreage in offshore Brazil with a portfolio of seven prospective targets, each seeing up to 366mln barrels

Chariot Oil & Gas Limited (LON:CHAR) has launched drilling preparations at its Morocco assets as it looks to shift focus towards delivering an exploration well in the country.

The oiler has identified an inventory of prospects in the Rabat 1 play, offshore Morocco, and is targeting the drilling of the Mohammedia licence prospect MOH-B, which has a gross mean prospective resource of 637mln barrels in two targets.

The group has also worked to evaluate acreage offshore Brazil and has put together a portfolio of seven prospective targets, each seeing up to 366mln barrels with the potential to test multiple ‘stacked’ targets with single vertical wells.

In a pre-close operational update in December, the company said it had begun the preparations through the approval of the drilling environmental impact assessment, long lead items identification and other operational arrangements. The company’s management believes that this preparatory work will enable Chariot to avoid unnecessary delays associated with its plans to drill in the near term.

The company, which retains a portfolio of highly prospective assets in Morocco and Brazil, said it is keen to take advantage of rig rates, which are currently at historic lows. Its in-house subsurface team continues to develop an inventory of drill-ready prospects with material follow-on potential and has initiated partnering processes in Morocco and Brazil.

“Importantly, the Rabat Deep 1 well has demonstrated a new petroleum system in the offshore sector of Morocco, one [of] which may be significantly more robust than that previously extensively explored by the industry, which materially de-risks the Mohammedia and Kenitra licences,” said Chariot chief executive Larry Bottomley.

“Looking ahead, we are focused on delivering an exploration well in Morocco utilising our established in-house drilling team to deliver this programme safely, efficiently and cost-effectively.

“With all licence commitments now met across the entire portfolio, the company is fully-funded to progress our assets in Morocco and Brazil whilst remaining vigilant to other value accretive opportunities," the CEO added.

The company has a strong cash position, with unaudited year-end cash estimated to be US$19 million. The company remains debt free with no licence commitments across its entire portfolio.

Prospect S disappointment

The refocus followed a disappointing result for the group’s Prospect S exploration well, offshore Namibia, which did not encounter any hydrocarbon accumulation and was plugged and abandoned.

However, Bottomley said data gathered from the prospect had provided the firm with “valuable information about the reservoir potential of these turbidite systems which form the primary targets across many of the prospects within the Central Blocks portfolio”.

READ: Chariot Oil & Gas reveals disappointing Prospect S well result

“In Namibia, Chariot also demonstrated it is capable of safely and efficiently operating a deep-water well, delivering the operation within a short time-frame to capture the optimum point of the cost cycle,” he added.

Thanks to partnering arrangements and the low-cost nature of the drilling off the coast of Namibia, the cost of the failure was not too onerous, allowing the firm to progress with its other assets.

With shares trading around 2.7p as of 8 January, Chariot carrier a market cap of £9.9mln.

View full CHAR profile View Profile

Chariot Oil and Gas Timeline

Related Articles

falcon oil
November 23 2018
Falcon Oil & Gas narrowed its first-half loss as it continued to focus on tight cost control
Ukraine oil well
February 01 2019
In Ukraine, the Group’s assets are located near to Poland and Romania
1537919971_Centrica-Lynn2_opt.jpg
September 26 2018
The company expects its oil and gas exploration efforts will add to shareholder value.

© Proactive Investors 2019

Proactive Investors Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use