This stock looks like the most undervalued oil company on the stock exchange. >
Sefton Resources epic SER. It is currently trading at a price of 0.275p valueing the whole company at just 4M.

You might look at the market cap and assume that this company is just an explorer or a shell, but in fact Sefton is producing over 6000 barrels of oil per month with a monthly revenue of over $300k. It's recent work on it's Tapia oilfield exceeded expectations, meaning the company hit it's 200BOPD target 5 months early, and is now expecting resource and production estimates to be further upgraded. This is before it embarks on a steam-assisted programme early next year which
could see production rates multiplied 2-4 times! It is also looking at drilling further wells on the rich Tapia field in the light of the better than expected results.

So why is it only valued at 4M? The primary reason is lack of awareness of the stock, the sub-1p price puts many people off straight away, and a large overhang.

A year or so ago the company was put in financial dire straits by a
well blowout and had to undertake large discounted placings to get
itself back on track, which it has done with a vengeance. However,
some of these placing shares, which represent some 25% of the company
are being sold into the market, depressing the price so that despite the fact that the companies prospects have improved dramatically over
the past year, the price has dropped by nearly 60%.

This makes the company an absolute bargain at these rock-bottom prices. In 6 months time I expect this to be worth 3-5 times the current price. SERIOUSLY.

There is plenty of research to get your teeth into, the best place to start is the website :

www.seftonresources.com

There are 2 excellent articles on Sefton on the following website by Ian Mclelland (Jan/Feb 2006) - well worth a read to get up to speed on this company and it's prospects:

www.proactiveinvestors.com

mjr, thats too rich for my blood i will just sit and wait. like i said i am an amateur and small bit player. thanks for the offer though

the morning should dictate how this shares going to pan out. I think theres method in the purchase, as long as a disposal is on the horizon.
Potatohead.... care to spell out why its bad news?
personally I see no NET loss.

robertalexander,

I was just taking the michael. RNS's are of course free to read - just click on the link on the Quote page or on the 'N' next to the price.

tweenie,

Potatohead is the same poster as Luckypicker on advfn. A known dickhead and wind-up merchant and should therefore be treated as such (filtered/squelched).

At first glance, the extra shares generated by this deal could be seen as a negative, but then you realise that what we are getting for those shares is extra value which almost definitely exceeds the value of those shares, thus there is not actual dilution, and rather the opposite (condensation?) instead.

For the issue of shares (assuming all TEG Canada holders decide to take them up - anybody wanting out can take the quick and easy cash option instead), SER is of course getting it's hands on the entire cash raised for the Monument deal, as well as the assets of TEG Canada, which has a small oil production in its own right.

I also don't believe they would have done this deal without already having one or more interested parties lined up to buy TEG Canada off them. After all the stated purpose of this acquisition is to generate cash (and plenty of it as they are talking about using it to develop CBM assets!) in the short-term.

This could actually be a very shrewd move.

The overall implication of this announcement is that they are intending to
DEVELOP THEIR CBM ASSETS IN THE SHORT-TERM

Which is very good news.

MJ - I am still to digest todays RNS, I was however under the impression that SER already owned TEG Oil & Gas Canada as per the below statement taken from SERs own web site.

"Sefton Resources, Inc. is in the business of oil and gas production through wholly owned subsidiaries, TEG Oil & Gas USA Inc., TEG Mid-Continent Inc., and TEG Oil & Gas Canada Inc. Administrative offices are in Denver, Colorado. The company now trades on the London Stock Exchange AIM Market. The trading symbol is SER. The initial public offering occurred on December 8, 2000."

I am of split opion as to weather this really does add any shareholder value, at present I'm inclined to only see added director value!!

My question really is simple. Why has Sefton bought the remaining element of TEG Oil & Gas and not sold its holding to immediatly generate cash?

i just hope we can make a profit out of this deal,it could be taking up hard cash that should be bringing up more oil.this is going to take months to complete we need oil not monopoly. think we are in for a good pull back.

I can only assume that Sefton has good reason for buying the remaining shares of TEG Canada before selling the company on rather than simply selling it's stake. Eg they have a buyer lined up who wants to buy the whole of TEG Canada.

cellby, the deal has not cost Sefton any money as they have bought it with equity. The stated aim of this deal is to sell TEG Canada off in the short-term in order to raise money to expand CBM. This must surely mean they anticipate getting a significant amount of money ($M's) for TEG Canada? And of course this also means they won't need to go to the market for funds to develop CBM.

Having said that, the share price could go either way tomorrow. I can see the MM's using possible worries about the share issue as an excuse to knock the price down and try to get a few weak sellers at cheap prices.
But I know myself and other long-term holders who hopefully see the bigger picture, and how this deal could be a good move, will be using any pullback as an opportunity to buy, as will people waiting on the sidelines I'm sure.

Therefore, I expect any decent pullback to be very short-lived.

yer right, you are costing us money with your ramping.. its going drop back to .0020p.. dont see how this is good news at all, I expected as much

Sorry, a slight error in my last post - the deal will cost some money depending on how many TEG Canada shareholders decide to take the money rather than the shares. But I reckon the majority will choose the shares since they look the best value option. I know which I'd choose anyway.

god if i was them I would take the money.. these shares are terrible

I can't see your post Katcenka, but assuming it's the same pap you just posted on advfn about "dilution",

There is certainly no dilution here. What the extra shares/cash are buying is almost definitely of greater value than the value of the shares/cash. If you don't understand this point, go look up what dilution actually means. (Hint: it means the value of the share of the company you own has reduced).

Overall this is a positive move, and if anything it shows a strength and a disciplined approach which is very good to see.

if there are shares to be had wednesday around .25 i will be in for more,but i do think this will slow things down.they could of at least droped something in about production.

cellby,

I would say you have a better chance of winning the lottery than buying these around 0.25p again. There is strong support below 0.4p now.
Having thought more about this, I think they are getting TEG Canada for a very good price and I can easily see these ending up blue tomorrow.

The RNS was about the acquisition of TEG Canada, not a general trading update, so why would they drop something in about production?

And as for slowing things down, I think you will find this deal could speed things up tremendously!

Katchenka.......or should we say "Luckypicker" you are a paid deramper, the fact that you are here means that SER are hot.
MT

Very brief shake then going blue - as predicted.

Oh, it's nice to be right :)

short.
MY ARSE!
lol

MJ - well done on the prediction.. And your right there is very strong support below the .4 mark, I for one am happy to buy below .4..

Mickey - Can't realy see Katchenka being a paid deramper, he/she doesn't seam to be very educated in equities!! That however doesn't mean your wrong, more like they could have picked someone more informed...

Katchenka - How can MJ cost us money with his ramping? Do you really think that on the back of an MJ post on this BB a significant amount of investors would all of a sudden sell........ Of course not, we make decisions for ourselves. We may agree and enjoy sharing opions on this share but at the end of the day were all masters of our own money.

good day today mjr spot on,i thought we would go down and stay for a time until price of canada asset was known.they raised funds against this from priVate placeing.wont they haVe to buy these back at premium now.buying at close .5 my target is 1.46 for a bit of top slice.