Challenger Energy (CEL)

Business description

Challenger Energy is an ASX-listed E&P with a 95% interest in an application for an exploration permit in the Karoo basin, South Africa, which is prospective for shale gas. It is awaiting award of a permit to start drilling.

Emerging South Africa shale story

Initiation | Oil & Gas | 28/10/2014

Challenger Energy (CEL) offers pure-play exposure to a frontier shale area, South Africa’s Karoo basin. The Karoo, the world’s eighth largest shale gas deposit, is estimated to contain 390tcf of recoverable gas by the EIA and has attracted interest from supermajors Shell and Chevron. South Africa’s worsening energy shortage implies significant latent gas demand, and President Zuma has described shale as a “game changer” for the country. CEL was first mover in the basin, applying for a licence surrounding a key well that flowed gas in the 1960s. Its EV of A$29/acre is consistent with Australian pre-feasibility farm-out valuations, though CEL is arguably more advanced given the original well success. On 26 October the government announced it was proceeding with the licence applications. A licence award, expected in Q115, would remove timing uncertainty and pave the way for a farm-out. These milestones could lead to a near-term re-rating, with longer-term upside based on drilling success.

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Stock data

Market cap.A$5.5m
Last closeA$0.014
High / Low (52 weeks)A$0.0 / A$0.0
Stock market listingAU
Forecast net debt (m)N/A
Forecast gearing ratio (%)N/A
TeamResources - Oil & Gas
SectorOil & Gas

Price performance

%1m3m12m
Actual(6.7)(39.1)(62.2)
Relative *(6.8)(40.4)(66.4)

* % Relative to local index

Company news

Challenger Energy

Wed, 16 Mar 2016 23:26:15 GMT

Challenger Energy

Tue, 14 Mar 2017 03:00:00 GMT

Challenger Energy

Tue, 15 Nov 2016 03:17:30 GMT

Challenger Energy

Sun, 27 Sep 2015 23:04:39 GMT

Challenger Energy

Wed, 20 Apr 2016 08:05:01 GMT