Chariot Ltd. (OIGLF)

[douginil]

Chariot Oil

[[ Thanks to Malcy's blog
https://www.malcysblog.com/2022/01/oil-price-chariot-iog-eco-igas-and-finally/
]]

Chariot has announced the result of the Anchois-2 appraisal and exploration well on the Anchois gas project within the Lixus licence, offshore Morocco. Chariot has a 75% interest and operatorship of Lixus in partnership with the Office National des Hydrocarbures et des Mines which holds a 25% interest.

· Anchois-2 well has been safely and efficiently drilled to a total measured depth of 2,512m by the Stena Don drilling rig in 381m of water.

· Comprehensive evaluation of the well has been undertaken through wireline logging, including petrophysical evaluation, subsurface formation testing including reservoir pressures and gas sampling, sidewall cores and well bore seismic profiles.

· Preliminary interpretation of the data confirms the presence of significant gas accumulations in the appraisal and exploration objectives of the Anchois-2 well with a calculated net gas pay totalling more than 100m, compared to 55m in the original Anchois-1 discovery well.

Appraisal Target

Gas Sand B has a calculated total net gas pay of more than 50m in two stacked reservoirs of similar thickness. The upper reservoir is a continuation of a reservoir drilled in the original discovery well, Anchois-1, with the lower reservoir being newly identified.

Exploration Targets

Gas Sands C, M & O were successfully encountered with multiple gas-bearing intervals across a gross interval of 250m measured distance with no water-bearing reservoirs identified, materially exceeding pre-drill expectations.

· Previously discovered Gas Sand A was not targeted in the Anchois-2 well, due to the intention of evaluating it in the subsequent Anchois-1 re-entry operations, however, the Anchois-2 well encountered gas bearing sands at this level providing important additional subsurface data.

· High quality reservoirs were encountered in all gas sands.

· Further analysis will be undertaken to fully understand the positive implications on:

o Gas resources within the expanded Anchois field and the scale of the potential gas development.

o De-risking of numerous additional material exploration prospects within the Lixus licence area with similar seismic attributes to the Anchois discovery now considered to be low risk.

· The well will now be suspended for potential future re-entry and completion as a production well in the development of the field.

· The Stena Don rig will then move to the Anchois-1 gas discovery well to perform re-entry operations with the objectives of assessing the integrity of the previously drilled well, and if successful, providing a future potential production well for the development of the field.

Adonis Pouroulis, Acting CEO of Chariot, commented:

“I am delighted to announce that Chariot, as well as conducting a successful appraisal well operation, has made a significant gas discovery at the Anchois-2 well which materially exceeds our expectations. We continue to conduct further analysis on the data collected from the well, but as it stands, we believe the result is transformational for the Company.

This is a tremendous outcome and I would like to thank ONHYM, our partners on the licence, and everyone involved for their invaluable support, which enabled the well to be drilled safely, successfully and on time during a time of significant operational and logistical challenges posed by the current pandemic.

With the recently announced key terms of gas offtake with a prominent international energy group, interest from two highly regarded institutional lenders to provide debt finance, an ongoing collaboration with a leading constructor of offshore gas projects and now this successful gas well result, the Anchois project is getting closer to helping provide a clean transitional fuel to support Morocco’s industrial and economic growth.

We look forward to providing a further market update once the appraisal campaign has completed.”

This is an awesome announcement from Chariot and the 45% rise in the shares as I write is just the start, even back of envelope calculations make me realise why I have been so positive about Anchois let alone the rest of the company’s operations.

Success at the B sands is good with the bonus of one new reservoir but it is the outstandingly good news at the C, M and O exploration sands where ‘multiple gas-bearing intervals’ which ‘materially exceeded’ pre-drill expectations. This drilling de-risks so many prospects with these sands equivalent to a multi TCF block even before the upcoming well is drilled.

The next well is planned to re-enter Anchois-1, see if it is good condition and was originally to check on the A sands which werent expected to be tested in this recent well. However the well clipped them which has provided valuable technical information.

There is much to expect from Chariot and it has laid the groundwork for this well and significant and swift development in the future in recent months. The announcement indicates that there is an international bank lined up to lead the debt financing and with gas sales agreements already in place and the partnering process well under way, the way forward is extremely bright.

But that is not quite all of the Chariot story, we know that there is much going on in the pan-African mining and hydrogen parts of the business as well as at Rissana and of course other new ventures promised within Total Eren. This looks like being just the start for Chariot and the share price should increase very substantially from here.