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

Looks like this is going to be a big one.

Very good results, IMHO. Huge 94% increase in reserves, profit in H2 2005. Looks very promising.

Yep MMs trying all they can to get stock now.

Well they ain't getting mine. With the problems in the market, this is a long term hold, and top-up as and when I can afford it.

Some good press coverage:

From UK Analyst: "Sefton Resources cut its full-year losses and actually moved into profit in the second half of the year and the shares jumped 0.09p to 0.425p. In the 12-month period to December 31st, the US-focused group said that an increase in oil and gas sales by 284% to more than 2.15 million dollars has resulted in the group cutting its pre-tax losses to 694,464 dollars from 1,088,986 dollars. The group also said that it was currently upgrading its surface facilities at its California operations in order to handle future production increases and that it was are in discussions to sell TEG Oil & Gas Canada, with the proceeds planned for further development of its Eastern Kansas assets."

More Press: (same article as This is Money - http://tinyurl.co.uk/i18y)

Life Style Extra
Finance News
Latest UK-related finance news headlines

... Elsewhere, Sefton Resources was up 0.08 at 0.42 after cutting its net loss in the year to Dec 31 2005 to 694,464 usd from a loss of 1.1 mln usd a year earlier ...

http://tinyurl.co.uk/qf82

Should be good for a rise tomorrow.

we got there in the end been in profit from some where 2h 05,so that is already 6 month of 06 at profit,how time flies,now we need to push on to next stage of increased production. which i hope ser can do more than hint at around agm and giVe out some concrete plans for uping bopd. steam assist could giVe 300% improVment to bopd.that would put us in the real money.

16.06.2006
Sefton Resources Reduces Its Losses As It Benefits From Sustained Production And High Oil Prices
With its cash flows stabilized and a long running lawsuit resolved, Sefton Resources is already looking ahead to 2007, when it plans a major ramp up in activity. This year, it seems, will be a year of consolidation to lay the groundwork for next years activity build-up.

The AIM-quoted company is currently pumping about 150 barrels per day from four wells on the Tapia Canyon heavy oilfield in the East Ventura Basin, about 40 miles north of Los Angeles in California. A fifth well is down due to problems with the gravel-packing. A rig is now on site to resolve the problem and it will resume production of around 30 bpd shortly.

Sefton drilled the five Tapia Canyon wells last year and they have already paid back their investment. They are currently generating revenues of around US$250,000 and US$300,000 a month. This has seen the company cut its losses by 36 per cent to US$694,464 for the full year 2005 and move into profit in the second half of the year.

The company is currently upgrading the surface facilities at Tapia Canyon to ensure it has the capacity to handle future production increases: these will come through new drilling and the deployment of steam-assisted recovery technology. The latter has been delayed - investors had expected to see it in action last year - because the company is reluctant to mess around with wells that are proving so successful at restoring its financial equilibrium.

This is a project, after all, that in 2002 was rocked by a devastating well blowout and then, in late 2003, work was hit by the bush fires that swept the state. The first months of 2005 were equally disruptive as drilling had to be suspended when torrential rains hit the region. Those problems are now behind Sefton - and the wrongful death lawsuit resulting from the 2002 blowout has been resolved with no cost or liability for the firm - and with production established it is now on a firmer financial footing.

It is reluctant to disrupt this production stream. While steam assisted recovery would boost output, it would also require the wells to be temporarily shut in while the steam soaked into the sticky oil to improve its viscosity.

We still plan to do steam-assist this year but may wait until we have got a couple more wells down so we will not miss the production, chairman and chief executive Jim Ellerton told oilbarrel.com. We have been so successful with these wells that we do not want to mess with good cash flows until we have had a bit more of them.

Depending on financing, Ellerton hopes to sink at least a couple of wells this year with more to follow in 2007. The company is piggy-backing on the drilling programmes of other operators: by collaborating, the operators have put together a 30-well-programme that is of sufficient size to tempt a drilling contractor and Ellerton hopes to get his share of the rig time this autumn.

Sefton also produces around 30 bpd from very old wells on about 40 acres of its 1,500 acre Eureka Canyon site. These wells are prone to sanding and, drawing on lessons learned from the gravel pack techniques used successfully at Tapia Canyon, Sefton believes the best plan of action here will be to drill new wells rather than rework the old wells.

We plan to do a geochemical, geophysical survey at Eureka Canyon this year and next year we will initiate additional work there, said Ellerton.

Sefton has taken steps to diversify its asset base. An earlier attempt to buy coal bed methane (CBM) assets in Kansas has been aborted due to title issues so the company has instead acquired over 20,000 acres in CBM-rich Eastern Kansas. This is a better fit for the company, said Ellerton.

We are ground floor people, he said. This way we are not buying other peoples stuff at a huge mark up.

The company plans to begin a pilot drilling programme on the CBM lands next year. 2007 is starting to look very busy...


http://www.oilbarrel.com/email_index.html?page=/news/article.html?body=1&key=oilbarrel_en:1150423205&feed=oilbarrel_en

See! I sent that Gary bloke at Sefton an email telling him to release the results pronto and he did. All we need now is the Hardman report and the picture will be looking really good.

Is anyone going to the AGM? If you are and the report hasn't been released I'd appreciate somebody asking when it will be released.

Hopefully we can see a nice upturn in price soon. I'd top up while you can folks!

Received the full report by post this morning. Here are the operations reports:

TEG Oil & Gas USA Inc

Tapia Canyon Field - TEG OG USA made great strides forward during 2005. The key to this success was the drilling of five new wells in the Tapia Oil Field in Southern California. TEG has long believed in the undeveloped oil reserves of this field. Oil production from these wells not only exceeded the engineering studies that outlined the potential, but bolstered the reserves for this field. The long-lived reserves appear typical of many California oilfields and we therefore continue to be very enthusiatic about our California oil and gas development
The new oil development boosted production from an average 20 bopd in the first six months of 2005 to an average of 180 bopd for the last size months, which is a nine-fold increase. Gross revenues increased during the same period from an average of $30,000/mo to over $288,000/mo while lifting costs were reduced to less than $8.00/bbl.
Extremely wet conditions in California during the winter months meant that the drilling programme originally scheduled to begin in February did not start until May. It took seven weeks to complete at a cost of just over $1.8M. We assembled a top-notch team to engineer and drill these wells and this paid great dividents with increased levels of safety and higher than expected oil production rates.
The facilities at Tapia were adquate for producing and separating low volume oil at pre-drilling production rates. They were not, however, adequate to handle the nine-fold increase in production. It was not possible to justify capital improvement prior to seeing the drilling programme's results. Once the results were in, however, the field operations team worked seven days a week to install the equipment necessary to produce oil at the new rates.
Additional improvements are planned for 2006 that will include the realignment of the water injection system, tank repairs and the completion of an improved gas recovery and flare system. The updated facilities will handle increase in oil production rates from planned new wells and from cyclic steam operations.
As a result of the successful drilling programme, TEG Oil & Gas USA, Inc has identified at least nine additional new well locations for drilling at Tapia with limited risk. These include two locations on the Hartje lease, three on the Yule lease, three on the Snow USL lease and one on the Lackie USL lease. Drilling rig availability, which is very tight, will be key to the timing of these future plans, once proper permits are in place.

Eureka Canyon Field - Eureka production is from eight wells. When free of sediment, production averages 25 to 30 bopd. This gradually declines to about 10 bopd as the wells fill with fine sediment over a two to three month period following well cleanouts. None of the wells, drilled by previous operators, are protected with gravel pack completions which proved successful in the completion of recent wells at Tapia.
Over the past months, TEG OG has examined and tested the available 'orphaned' wells on the lease and determined that they have bery limited recompletion potential. As a result we have obtained some valuable exploration leads and improved well data that can be used in the mapping of the area.
During 2005, TEG Oil & Gas USA inc chose to maily invest in the Tapia field, but Eureka Canyon shows tremendous promise for development and exploration on the 1500 acres of mineral leases that TEG Oil & Gas holds. A reconnaisance exploratory programme for the entire area is planned for late 2006.

Summary - The combination of a successful drilling programme in 2005, a strong oil price forecast for the foreseeable future and an excellent asset base on which to continue growth, has placed TEG Oil & Gas USA, Inc. in an opportune position from which to grow at a steady and profitable rate. We look forward to continuing with our plan to expland the development of our current assets and add additional areas to deveop our oil and gas portfolio.

TEG MidContinent Inc

Leavenworth County - The acquisition of the aforementioned company's assets [Monument I guess] was not successful, but TEG MC Inc is still of the opinion that the Leavenworth area is a viable project, and during the year, undertook a lease acquisition programme, which resulted in 2,240 net mineral acres of land being acquired with an average bonue per net acre of $16.41.
Since the start of 2006, we have increased our acreage holding to 4,300 acreas. Currently TEG MC Inc is in contract negotiations with a pipeline operator that has access to the Southern Start Gas System. This pipeline could provide an immediate market hook-up for several wells.
Anderson/Franklin Counties - We are excited about the considerable acreage we have accumulated in A/F. This is not currently producing, but is close to pipelines and supported by extensiv geology and Coal Bed Methane production in the immediate area. During 2005 TEG MC acquired over 20,000 acres. The lease bonus price averaged less than 23 per acre; the leases are for a minimum of five years with most having an option to extend for an additional 5 years.

Summary - Since the beginning of 2006, TEG MC, increased its acreage holdings by an addtional 6600 acres. The opportunities in Kansas are extensive and TEG MC will continue its acquisition and development programme.

Also there is going to be a resolution at the AGM on consolidating the shares by 15 to 1:

1. To receive and adopt the financial statement for the year ended 31 December 2005 together with the reports of the directors and auditors.
2. To authorise the Directors to appoint auditors and fix remuneration for same.
3. To elect Harry Barnum as a Director of the Company.
4. To amend regulation 91.1 of the companies Articles of Association changing the age 65 to 75.
5. To amend regulation 85 of the companyies Articles of Association limited Director's employment.
6. To amend regulation 57 of the companies Articles of Association giving guidelines for conducting business at the AGM.
7. To re-elect Norman Thachuk as a Director of the Company.
8. To re-elect Tony Ashton as a Director of the Company.
9. To amend the Companies memorandum to permit the Company to combine its shares.
10. To authorise the company to consolidate it's authorised and issued ordinary shares on the basis of fifteen (15) shares into one ordinary share.

I think the consolidation will enable smaller investment companies to invest in SER, as they could be precluded from investing in companies with sp's less than a penny.

IMHO, it is very good news, but the market will decide.

15-1, and you think this is a good thing, I suppose it all depends on the spread when this happens. Lets hear the price before commenting further.

Hardman report is out:

http://www.hardmanandco.com/Research/Sefton_June_2006.pdf

MOVEMENT, at last! :-)
I can now rest and watch my money grow.

Wait for it TFC to tell us how right he was.

Check out the Hardman report released today:

http://www.hardmanandco.com/Research/Sefton_June_2006.pdf

Its already been posted.

And exciting reading it is, too. My money's tied up in BLR, though, but am expecting that one to turn a similar performance in due course.

Well that was an exciting day. More to come tomorrow I suspect once the papers report on this rise. Well done to all long term holders. We've waited long enough for this.