Broker snap: Chariot close to farm-out deal

31st May 2011 13:48

Ambrian keeps its 'buy' rating on Chariot Oil & Gas after its results for the full-year ended 28 February which presented no surprises.The broker said that Chariot has a robust balance sheet - helped by April's placing which raised $140m - and enters the second half of 2011 in rude health, "well-placed to fund its portion of costs for the planned upcoming drilling programme."However, Ambrian said that the "elephant in the room" is the news on a farm-out ("farm-out datarooms have received strong interest from numerous majors with deepwater expertise", Chariot said) as investors have been waiting for a completion of a farm-out deal for some months."We understand that a transaction is close and we would be hopeful that a deal could be finalised in a matter of weeks and not months," Ambrian said.The target price of 421p is kept.---BC