Chariot Oil and Gas, the Africa focused commodities explorer, cheered its investors with a respectable cash position and the promise of multiple targets for drilling future wells.
So despite less-than-impressive well results in recent times, and a half year loss from operations of $84.4m (H1 2011: $4.12m), the share price moved into positive territory during morning trading.
Cash and equivalents at the period end totalled $112.4m, slightly down from $139.6m at the same date the previous year.
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Chief Executive Officer Paul Welch, said: "The initiation of the company's drilling campaign has been a significant achievement for Chariot and the majority of our work prior to 2012 had been leading up to this point. We have positioned ourselves well in anticipation of various outcomes and, as a result of this forward planning, have maintained a strong cash balance.
"Furthermore, we have multiple future targets for drilling in different geographic locations targeting different geological play types, as well as the opportunity to add new assets to our portfolio. Despite the recent well results being disappointing, we are still in control of our next steps and will seek to preserve this position in order to get the best value for shareholders over the longer term. We remain committed to our efforts in Namibia and will update the market with our drilling objectives for 2013 in due course."
In April, Chariot commenced its drilling campaign with the operation of the Tapir South (1811/5-1) exploration well. Whilst the well encountered no commercial hydrocarbons, it said excellent reservoirs were penetrated and it is currently analysing the recovered samples. The analyses of these samples is anticipated to provide a definitive view of the source rock potential in the area and, following on from this, the prospective resources of other prospects identified within close proximity to the well will be updated.
The second exploration well, Kabeljou-1 (2714/6-1), in Namibia, failed to encounter any hydrocarbon shows; however, the reservoir was less developed than anticipated at this location and determined to be non-commercial. Detailed analyses are now underway on the data collected, results of which will be used to calibrate the existing data set and provide an updated resource estimate for this block.
Chariot is planning to drill two further wells offshore Namibia next year.
The share price rose 0.85% to 29.75p by 12:38.
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