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SEFTON RESOURCES INC - UNDERRATED OIL PRODUCER (SER)
ptholden
- 04 Aug 2006 19:53
Sefton Resources is an independent AIM quoted Oil and Gas company operating in the US. The companys principal current assets are two producing oilfields in California (Tapia Canyon Field and Eureka Canyon Field); it is also in the process of buying up prospective coal bed methane acreage (CBM) in Kansas.
Update from July 2007 AGM
Finance
I revealed in my annual statement that discussions were well advanced with
Banking institutions. The final phase of the agreement with a suitable bank
without complex and restrictive terms is now very near. This is weeks away
rather than months.
Oil
Oil production at Tapia has averaged 4,100 BO during the last five months. Which
is in line with last years levels. Once this finance is in place we will be able
to move ahead with drilling.
Drilling
We have stayed close to drilling contractors and we are ready to move forward
quickly when this finance is available.
Steam generation
The equipment is now in place at Tapia. Preparation time is needed to connect
the equipment and carry out the necessary trials required to get the main work
started. We anticipate this steaming will start in the next couple of months. If
successful a significant amount of oil resources will move into the Proven
Producing Reserves category.
Joint Ventures
Discussions continue with a number of interested parties to develop our Anderson
counties gas assets.
New finance team
A new CFO has been appointed with good knowledge and experience of the oil
industry. A new assistant to undertake all the daily needs has also been
appointed.
SWOT ANALYSIS
STRENGTHS:
Sefton has two oil fields, both producing. One is already profitable, and the other is breaking even. This should generate good cashflow for the company over the medium term.
Sefton owns 100% of both its major oil interests and is now demerging its non-controlled oil interests in order to concentrate on those where it has full control (Sefton has recently disposed of its Canadian assets for CDN450k cash).
Sefton is establishing a track record of using modern extraction technologies to improve the efficiency of its fields.
WEAKNESSES:
Sefton has suffered from a number of one-off factors. While these were out of the companys control the problems it has faced since 2002 have held back development and taken up management time. Investor disenchantment may account for the current low rating.
OPPORTUNITIES:
Sefton has acquired acreage for CBM (coal bed methane) in Kansas. CBM gas production is a thriving market and Sefton believes it has acquired the acreage at advantageous prices. While this is a longer term prospect it is an exciting one and could eventually eclipse the oil interests.
There are a number of other fields in the Ventura Basin and more generally in California as a whole that Sefton may look to target now its cash flows are stronger.
Eureka is a semi-exploration play which may contain further upside. This cannot yet be evaluated.
At this valuation the company may prove an attractive target for a larger player.
THREATS
Owing to its geographical location the company continues to be exposed to the threat of bush fires, canyon floods and geological interruption (earthquake risk). Sefton is taking steps to mitigate this risk by investing in Kansas and although Forest Basin area is susceptible to tornados - gas facilities have a minimal surface footprint.
LINKS:
Sefton Resources Web Site
Quarterly Update (Mar 08)
Operations Update Dated 14 January 2008
Hardman Report
Final Results - Year Ended 31 Dec 2006
2007 AGM & Update
In The News - Oil Barrel Dated 31 January 2007
Daily California Crude Oil Prices (MIDWAY SUNSET 13)
driver
- 29 Jan 2008 10:07
- 1462 of 2350
He must have been up all night.
kkeith2000
- 29 Jan 2008 10:35
- 1463 of 2350
It's an excellent report, many thanks
Keith
Keith
ptholden
- 29 Jan 2008 11:11
- 1464 of 2350
I think you can sum it all up as jam tomorrow which has been the case for the last two / three years. SER are paying for CBM leases for which they have little or no financial capacity to develop. Personally I continue to be disappointed with the snail like pace at which SER crab ever sideways.
relishing
- 29 Jan 2008 11:27
- 1465 of 2350
Personally I don't call increasing production by 60%+ in December with another 3-4 wells to follow from next month (taking production up conservatively another 50bopd+)? going sideways. The thrust of the article is although on the surface they appeared to do very little over the previous few years, they were in fact laying all the necessary groundwork for when they got the finance in place that they now have.
That's jam that has been delivered and potentially lots more jam to come next month - not exactly too long to wait.
Hardly something to be disappointed about in my view.
But if that's what you enjoy doing - feeling disappointed, then continue seeing everything in a negative light, ignoring Sefton's achievements so far, and pooh-pooh'ing the idea of any achievements to come.
Me, I will continue to be patient and look forward to the management delivering the rapid growth they have promised this year.
That's jam that has been delivered and potentially lots more jam to come next month - not exactly too long to wait.
Hardly something to be disappointed about in my view.
But if that's what you enjoy doing - feeling disappointed, then continue seeing everything in a negative light, ignoring Sefton's achievements so far, and pooh-pooh'ing the idea of any achievements to come.
Me, I will continue to be patient and look forward to the management delivering the rapid growth they have promised this year.
ptholden
- 29 Jan 2008 11:36
- 1466 of 2350
And the SP has done what exactly?
Err, drop. My interest in SER has always been the CBM potential, not some diddy little oil fields which hold no surprises. It's taken so long to increase production to be in a position to finance the CBM prospects that any SP value from CBM is probably years away. If you factor in the ineptitude of the management at moving forward at a reasonable lick make that 3-5 years.
Err, drop. My interest in SER has always been the CBM potential, not some diddy little oil fields which hold no surprises. It's taken so long to increase production to be in a position to finance the CBM prospects that any SP value from CBM is probably years away. If you factor in the ineptitude of the management at moving forward at a reasonable lick make that 3-5 years.
ptholden
- 29 Jan 2008 11:40
- 1467 of 2350
I see you have edited your post since my response.
What a totally stupid thing to say, 'enjoy feeling disappointed'?
I'll reserve judgement on 'achievements to come' when they achieve something of note, ie actually doing something that enhances my investment. So far all they have achieved is an ersoion of that investment.
What a totally stupid thing to say, 'enjoy feeling disappointed'?
I'll reserve judgement on 'achievements to come' when they achieve something of note, ie actually doing something that enhances my investment. So far all they have achieved is an ersoion of that investment.
relishing
- 29 Jan 2008 11:43
- 1468 of 2350
The 'diddy little oil fields' may be unlikely to hold surprises in terms of high impact new reserve discoveries (although you could argue Eureka offers a lot of unexplored acreage which has the possibility of holding deeper high pressure reserves) , but on the other hand they do offer a predictable and relatively low risk path to significant increases in production. For this 5m cap company, producing 250, 300, 350 bopd etc with the economics of the field leads to very high profitability - I wonder whether you have done the sums on this?
The CBM has always been a longer-term play. They have acquired a sizeable acreage in a prime location at low prices. I believe this will be financed by a institutional placing at a much higher price level rather than revenue or debt - as this will be a higher risk, higher reward play. But they have already commissioned an exploratory drilling plan for this year so it may not be as far away as you think.
The CBM has always been a longer-term play. They have acquired a sizeable acreage in a prime location at low prices. I believe this will be financed by a institutional placing at a much higher price level rather than revenue or debt - as this will be a higher risk, higher reward play. But they have already commissioned an exploratory drilling plan for this year so it may not be as far away as you think.
relishing
- 29 Jan 2008 11:44
- 1469 of 2350
"What a totally stupid thing to say, 'enjoy feeling disappointed'?"
Then why put yourself through the constant disappointment you clearly feel in holding this stock, if you don't enjoy it?
Surely the sensible thing to do would be either to sell out and end your misery, or change your way of looking at things?
(unless you enjoy not enjoying things of course :)
Then why put yourself through the constant disappointment you clearly feel in holding this stock, if you don't enjoy it?
Surely the sensible thing to do would be either to sell out and end your misery, or change your way of looking at things?
(unless you enjoy not enjoying things of course :)
driver
- 29 Jan 2008 11:54
- 1470 of 2350
I enjoy feeling disappointed, also a bit of pain usually with a whip.
ptholden
- 29 Jan 2008 11:56
- 1471 of 2350
I put myself through the 'constant disappointment' with the rather hopeful expectation that SER might actually do something that allows me to escape from this rather ill judged investment at break even.
I don't need to change my view, the success of a company or otherwise is usually reflected in its SP. It's up to SER to alter my stance, not the other way round.
I don't need to change my view, the success of a company or otherwise is usually reflected in its SP. It's up to SER to alter my stance, not the other way round.
capetown
- 29 Jan 2008 12:42
- 1472 of 2350
Meantime the SP is at an alltime LOW!
explosive
- 29 Jan 2008 12:55
- 1473 of 2350
Been in this since just after the blowout, the sp is always down this time of year but will pick up....
halifax - 07 Feb 2008 09:02 - 1474 of 2350
See RNS operations update looking good.
rhino213
- 07 Feb 2008 09:25
- 1475 of 2350
To save you guys having to go and find it......
2008 DRILLING PROGRAM
Sefton Resources, Inc., the AIM listed oil and gas production company with
assets in California and Kansas, announces that its wholly owned subsidiary TEG
Oil & Gas USA, ("TEG") has commenced the drilling of the Snow #3 development oil
well. The well is the first in a series of the three to four wells in the Tapia
2008 Q1 drilling program. The Snow #3 well spudded on Sunday, February 3,
2008.
Each of these three to four wells are step-out wells designed to extend the
productive limits of the Tapia Oil Field to both the east and west. The three
Snow Lease wells are anticipated to encounter a thickened section of Yule oil
sand reservoir. The Yule sand productive thickness is mapped at greater than
120 feet for each of the planned three Snow lease wells. Each well will take
eight to ten days to drill and complete.
TEG will evaluate these wells over the coming months and use the data to plan
the next round of drilling at Tapia.
STEAM PROGRAM
TEG is awaiting final approval from the Los Angeles Air Quality Control Board
(AQMD) for firing the TEG steam generator with propane. TEG will commence with
the steaming of the Yule #7 well once this final approval is given. The AQMD
has already given approval for the construction of the steam equipment capable
of burning lease gas, natural gas and propane. This final approval is believed
to be purely an administrative one which TEG is endeavoring to expedite.
Chairman, Jeremy Delmar-Morgan commented, "It has been a good start to the year
with the drilling program now underway. As a result of the planned step-out
wells in 2008 and the drilling in late 2007, our cash flow has improved
considerably. The improved cash flow will allow Sefton to develop its assets
without substantially increasing its debt."
Looks like decent news to me. I even learnt a new word "spudded". What does that actually mean? And if they did it on feb 3rd then I think they should be done with the drilling around the 13th (if they work weekends which they appear to do as the 3rd was a sunday)
Small upward movement in the SP already today. Hopefully this RNS will increase potential buyers confidence in our little oil company.....fingers crossed!
2008 DRILLING PROGRAM
Sefton Resources, Inc., the AIM listed oil and gas production company with
assets in California and Kansas, announces that its wholly owned subsidiary TEG
Oil & Gas USA, ("TEG") has commenced the drilling of the Snow #3 development oil
well. The well is the first in a series of the three to four wells in the Tapia
2008 Q1 drilling program. The Snow #3 well spudded on Sunday, February 3,
2008.
Each of these three to four wells are step-out wells designed to extend the
productive limits of the Tapia Oil Field to both the east and west. The three
Snow Lease wells are anticipated to encounter a thickened section of Yule oil
sand reservoir. The Yule sand productive thickness is mapped at greater than
120 feet for each of the planned three Snow lease wells. Each well will take
eight to ten days to drill and complete.
TEG will evaluate these wells over the coming months and use the data to plan
the next round of drilling at Tapia.
STEAM PROGRAM
TEG is awaiting final approval from the Los Angeles Air Quality Control Board
(AQMD) for firing the TEG steam generator with propane. TEG will commence with
the steaming of the Yule #7 well once this final approval is given. The AQMD
has already given approval for the construction of the steam equipment capable
of burning lease gas, natural gas and propane. This final approval is believed
to be purely an administrative one which TEG is endeavoring to expedite.
Chairman, Jeremy Delmar-Morgan commented, "It has been a good start to the year
with the drilling program now underway. As a result of the planned step-out
wells in 2008 and the drilling in late 2007, our cash flow has improved
considerably. The improved cash flow will allow Sefton to develop its assets
without substantially increasing its debt."
Looks like decent news to me. I even learnt a new word "spudded". What does that actually mean? And if they did it on feb 3rd then I think they should be done with the drilling around the 13th (if they work weekends which they appear to do as the 3rd was a sunday)
Small upward movement in the SP already today. Hopefully this RNS will increase potential buyers confidence in our little oil company.....fingers crossed!
relishing
- 07 Feb 2008 09:40
- 1476 of 2350
Excellent news. "spudded" is the term for when the drill rig begins drilling the well as you correctly inferred.
Am I correct in saying Sefton have under-promised and over-delivered this time?
Am I correct in saying Sefton have under-promised and over-delivered this time?
kkeith2000
- 07 Feb 2008 10:09
- 1477 of 2350
It now looks like the company is moving forward step by step, sometimes a slower than we all wanted, but progress is being made
I do agree relishing under-promised and over-delivered
I do agree relishing under-promised and over-delivered
driver
- 07 Feb 2008 14:22
- 1478 of 2350
All good stuff I like this bit.
Chairman, Jeremy Delmar-Morgan commented, 'It has been a good start to the year
with the drilling program now underway. As a result of the planned step-out
wells in 2008 and the drilling in late 2007, our cash flow has improved
considerably. The improved cash flow will allow Sefton to develop its assets
without substantially increasing its debt.'
Chairman, Jeremy Delmar-Morgan commented, 'It has been a good start to the year
with the drilling program now underway. As a result of the planned step-out
wells in 2008 and the drilling in late 2007, our cash flow has improved
considerably. The improved cash flow will allow Sefton to develop its assets
without substantially increasing its debt.'
NabCom - 08 Feb 2008 07:17 - 1479 of 2350
Sefton Resources says TEG unit begins drilling Snow 3 development oil well
LONDON (Thomson Financial) - Sefton Resources Inc said its TEG Oil & Gas USA unit has started drilling the Snow 3 development oil well at Tapia Field in California.
As a result of the planned step-out wells in 2008 and the drilling in late 2007, its cash flow has improved considerably, which will allow Sefton to develop its assets without substantially increasing its debt, the company said.
http://www.hemscott.com/news/latest-news/item.do?newsId=59596966212652
LONDON (Thomson Financial) - Sefton Resources Inc said its TEG Oil & Gas USA unit has started drilling the Snow 3 development oil well at Tapia Field in California.
As a result of the planned step-out wells in 2008 and the drilling in late 2007, its cash flow has improved considerably, which will allow Sefton to develop its assets without substantially increasing its debt, the company said.
http://www.hemscott.com/news/latest-news/item.do?newsId=59596966212652
driver
- 08 Feb 2008 13:12
- 1480 of 2350
The sp is going well today up 12+% and this is with out any steaming started yet, with more news of the progress of the wells being drilled and further wells to be drilled plus the steaming should keep the momentum of the sp in an upward direction from here on.
halifax - 08 Feb 2008 13:25 - 1481 of 2350
Onwards to 10p.
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