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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)

Chart.aspx?Provider=EODIntra&Code=SER&Si

relishing - 21 Apr 2008 13:39 - 1732 of 2350

If you say so aldwickk. First time it has, if so.

aldwickk - 21 Apr 2008 13:52 - 1733 of 2350

Thats because it has only just recently become a oil producer of any note.

driver - 21 Apr 2008 15:51 - 1734 of 2350

The phantom 666

ptholden - 21 Apr 2008 16:02 - 1735 of 2350

Curious isn't it Driver? I don't generally watch individual trades, but I don't recall ever having seen such a succession of 666 trades on any other stock. As I recall it's something to do with the consolidation, but surely we're past all that now?

driver - 21 Apr 2008 16:05 - 1736 of 2350

ptholden
Yes it's 1m shares in old money.

relishing - 21 Apr 2008 16:28 - 1737 of 2350

People who got shares in the HB and CE placings 3-4 years ago would have generally bought chunks such as 100k, 500k or 1m. Due to the 15:1 consolidation in 2006 these holdings are now 6,666, 33,333 and 66,666.
Yes, a large proportion will have passed their shares on to more recent investors, but there will always be a few who remain.

relishing - 22 Apr 2008 11:35 - 1738 of 2350

Brilliant news. Sefton will be presenting at the Oilbarrel Conference on May 22nd!

www.oilbarrel.com

kkeith2000 - 22 Apr 2008 11:46 - 1739 of 2350

Thanks relishing looking forward to it, its going to be a big day then

driver - 22 Apr 2008 15:08 - 1740 of 2350

Here's the time and place.

"Thursday May 22nd 2008, 9.30am to 1.00pm
followed by buffet luncheon

Venue: The Brewery, Chiswell Street, London, EC1 In association with BDO Stoy Hayward

The following companies will be making presentations:

Dominion Petroleum Plc
Faroe Petroleum Plc
Heritage Oil Corporation
Nostra Terra Oil & Gas Plc
Sefton Resources, Inc
Tower Resources Plc
Volga Gas Plc

Please note: the companies are currently listed in alphabetical order, not presentation order.
To attend the conference please e-mail: conference@oilbarrel.com requesting a reserved place.

aldwickk - 22 Apr 2008 15:26 - 1741 of 2350

9.25 to buy

driver - 22 Apr 2008 15:32 - 1742 of 2350

Be nice to hold that 11% at the end.

driver - 22 Apr 2008 16:45 - 1743 of 2350

I think we can safely say we have broken though a price range.

driver - 23 Apr 2008 10:06 - 1744 of 2350

Nice bit of volume already today.

2517GEORGE - 23 Apr 2008 10:16 - 1745 of 2350

Will SER catch SEY? It's looking good.
2517

relishing - 23 Apr 2008 12:14 - 1746 of 2350

Eureka!

robertalexander - 23 Apr 2008 12:31 - 1747 of 2350

doing better than my BRR shares at the mo too :-(

2517GEORGE - 24 Apr 2008 07:13 - 1748 of 2350

Haven't they been busy, flow rates to be quantified yet, but looks encouraging from the little I know.
2517

rhino213 - 24 Apr 2008 07:35 - 1749 of 2350

I think Sefton may have finally figured out when to release RNS's now. Great timing and great news....

SEFTON RESOURCES

OPERATIONS UPDATE

Sefton Resources Inc., the AIM listed oil and gas production company with assets
in California and Kansas, announces an update through its wholly owned
subsidiary TEG Oil and Gas USA Inc. (TEG USA) regarding the Tapia 2008 Q1
Drilling and Pilot Steam Programme.

Q1 Drilling Programme Wells
TEG USA has completed the on-site facilities infrastructure for the four new
wells drilled in February/March, 2008. This includes permitting the new
electrical service for the well pumps, installing downhole pumps and surface
pumping units, running new oil flowlines and casing gas flowlines, installing
two new meter runs and manifolds, and installing all onsite electrical control
boxes, subsurface conduits and motors. The Lackie A-4 well hookup was able to
utilize electrical service formally used by the shut-in Lackie A-1 well. All
work is complete on this well, the pump is running and the well is producing
oil. TEG USA will report initial production rates once the optimum pump rate is
established and oil rates have stabilized.

The final item to complete on the three Snow wells is in the hands of the
electrical utility company, Southern California Edison, who still needs to hook
up the inspected electrical infrastructure to the grid. The Snow wells will be
turned on as soon as Edison supplies the power to this new electrical service
panel for this lease. TEG USA has been given an estimated date of Wednesday,
April 23, 2008, for this hookup by Edison.

All wells will now go on full time and the Directors expect a corresponding
upswing in production levels from this point on, as well as no such delays in
the future.

Yule #7 Well - Cyclic Steaming Pilot
The one-week steam and two-week soak cycles have now been completed on the Yule
#7 well. The steam packer was pulled from the well and a temperature survey run.
The temperature survey was encouraging, indicating that after the initial
two-week soak period, the temperature across the Yule sand was at 403 F. Primary
steam injection temperatures were approximately 485 F. It appears that the
steaming has transferred a considerable amount of heat energy downhole since we
have observed only an 80 F drop in temperature over two weeks time. TEG USA
therefore increased the Yule #7 soak time to three weeks prior to installing the
production equipment, so that the heat energy could better dissipate into the
oil reservoir.

The Yule #7 well is now on production. TEG USA expects to produce only water
from the well for a few weeks until the injected steam (water) is produced back
and the relative permeability equilibrates in favour of oil production. The
gross fluid production rates, oil/water cuts, dynamic fluid level, and flowing
temperature will all be monitored during this time to learn more about the
specific parameters unique to this reservoir. These data will be used to refine
the steaming operation for the future.

The steam injection packer has been sent to Halliburton in Bakersfield to be
re-worked and prepared for installation in the Yule #10 well shortly. The Yule #
10 well will be steamed for a period of 14 days using lease gas from the Snow #1
well to fire the steam generator. The soak period was originally programmed for
21 days, however this may be modified pending the results at Yule #7. The
natural gas burner jet module has been reinstalled and reconfigured in the
boiler unit, replacing the propane module. Additionally, the high pressure pump
has been serviced and the water softening units have been upgraded to handle
higher hard-water supply rates. We will begin steaming the Yule #10 once the
redressed Halliburton steam packer is available. This is expected early in the
week of April 28, 2008

Production Levels
Tying in the new well facilities, adding injection facilities and Hartje Lease
tank work disrupted the production stream during the month of February and part
of March. Field personnel were forced to temporarily shut some wells in for
about one-third of the time during this period. All wells are now on full-time
and we expect a corresponding upswing to normal production levels from this
point on.

Other news

On April 18, 2008, TEG Oil & Gas USA, Inc. ("TEG USA"), was informed by Global
Signal Acquisitions IV LLC ("Global") that they had executed the Letter
Agreement negotiated with TEG USA, whereby Global would acquire from TEG a
perpetual easement on the land currently utilized by Global for its cellular
tower located immediately south of TEG's Tapia oil field but within its fee
property boundaries. Upon execution of a mutually acceptable Grant of Easement,
TEG will receive a purchase price of Three Hundred Seventy Five Thousand Dollars
($375,000.00). This transaction should close on or before Nov. 1, 2008. The
easement will utilize existing oil lease roads and therefore TEG does not
foresee the Grant of Easement as interfering with its existing oil and gas
operations. The Directors believe that consummating this transaction will
maximize surface land use.

The website re-construction is nearly complete and will be available shortly at
www.seftonresources.com.

Enquiries:

Jeremy Delmar-Morgan, Chairman, Tel: 077 8900 4874
John James (Jim) Ellerton, CEO, Tel: 00 1 303 759 2700
David Millham, Investor Relations, Tel: 020 7796 9999
Nicola Marrin, Seymour Pierce Ltd., Tel: 020 7107 8000

Note: The information in this release has been compiled and reviewed by Harry
Barnum, a director of Sefton, who is a qualified person for the purposes of the
AIM Guidance Note for Mining, Oil and Gas Companies. Mr. Barnum has Bachelors
and Masters Degrees in Geology and over 20 years of experience in the oil and
gas industry. He is a registered professional geologist in the State of
California.

Sefton Resources is an AIM listed oil and gas production company. Its main core
area of activity is in the East Ventura Basin in California, where it owns 100%
of two oil fields, Tapia Canyon (heavy gravity oil) and Eureka Canyon (medium
gravity oil), both of which have over twenty years of expected production life.
In addition, Sefton has over 40,000 acres in the Forest City Basin of Eastern
Kansas where Coal Bed Methane gas, as well as conventional oil and gas deposits,
are targets.

driver - 24 Apr 2008 08:34 - 1750 of 2350

Nice update highlights taken from the other side and the RNS onward and upward as they say.

TEG USA has completed the on-site facilities infrastructure for the four new
wells drilled in February/March, 2008.

The Lackie A-4 is producing oil.

The Yule #7 well is now on production.

All wells are now on full-time and we expect a corresponding upswing to normal production levels from this point on.

The Yule # 10 well will be steamed for a period of 14 days using lease gas from the Snow #1 well to fire the steam generator.

Steaming has transferred a considerable amount of heat energy downhole since we
have observed only an 80 F drop in temperature over two weeks time.

$375K cash from another company for something they werent utilising them selves.

driver - 24 Apr 2008 08:49 - 1751 of 2350

Interesting heavy oil Manual from Halliburton while we are waiting.

http://www.halliburton.com/public/common/Brochures/H06153.pdf
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