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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
- 14 Dec 2006 16:45
- 209 of 2350
Still holding and accumulating at these levels hope to see 20+ some time in 2007 after new financing is announced and in place.
ptholden
- 17 Dec 2006 18:47
- 210 of 2350
Still in Driver, but still away, so just a long term view, both from an investing and distance perspective. Will try and update the header over Xmas though.
pth
pth
NabCom - 18 Dec 2006 08:13 - 211 of 2350
Oilbarrel: 18.12.2006
Mature Producing Fields Test Sefton Resources Technical Credentials
lots in the mill for the coming year.
A new research report from analysts Hardman & Co. is expected imminently,
http://www.oilbarrel.com/news/article.html?body=1&key=oilbarrel_en:1166407248&feed=oilbarrel_en
Mature Producing Fields Test Sefton Resources Technical Credentials
lots in the mill for the coming year.
A new research report from analysts Hardman & Co. is expected imminently,
http://www.oilbarrel.com/news/article.html?body=1&key=oilbarrel_en:1166407248&feed=oilbarrel_en
capetown
- 18 Dec 2006 08:24
- 212 of 2350
NabCom,
Thx for that,interesting,lets hope the sp reflects better value soon
Thx for that,interesting,lets hope the sp reflects better value soon
driver
- 18 Dec 2006 10:12
- 213 of 2350
NabCom
Yep cheers an excellent bit of reporting from Oilbarrel.
Yep cheers an excellent bit of reporting from Oilbarrel.
cynic
- 18 Dec 2006 15:56
- 214 of 2350
driver .... glad you also hold quality like DNX to offset the dross
driver
- 18 Dec 2006 16:14
- 215 of 2350
cynic
Read the link and get on board.
http://www.oilbarrel.com/news/article.html?body=1&key=oilbarrel_en:1166407248&feed=oilbarrel_en
Read the link and get on board.
http://www.oilbarrel.com/news/article.html?body=1&key=oilbarrel_en:1166407248&feed=oilbarrel_en
cynic
- 18 Dec 2006 17:08
- 216 of 2350
too small for me driver ...... only invest in companies with cap >10m ..... also, am shifting the balance of my portfolio away from oilies
driver
- 18 Dec 2006 17:47
- 217 of 2350
cynic
That is the point (small?) and it shouldn't be.
That is the point (small?) and it shouldn't be.
cynic
- 18 Dec 2006 17:55
- 218 of 2350
can't help that! ...... currently it is and therefore of no interest to me ...... and it's yet another highly speculative (flaky) E&P companmy, little or no better than CHP or VOG, both of which I (stupidly) currently hold ... and did GOO, though now out
oilwatch - 18 Dec 2006 18:33 - 219 of 2350
"currently it is and therefore of no interest to me" - which begs the question...
cynic
- 18 Dec 2006 20:37
- 220 of 2350
????? .... try "begs the question" but no matter ..... at its present cap, it is below my personal radar and as i posted earlier, am (have) lowering my exposure to oilies in general and E&Ps in particular ..... just do not feel this is the right sector at the moment
driver
- 18 Dec 2006 21:21
- 221 of 2350
cynic
If you buy or not it will not move the sp I was trying to do you a favour by putting it on your radar at these low levels. I won't say I told you so when it hits 50p+
If you buy or not it will not move the sp I was trying to do you a favour by putting it on your radar at these low levels. I won't say I told you so when it hits 50p+
cynic
- 18 Dec 2006 21:59
- 222 of 2350
your advice appreciated driver, but it's just a personal rule .... will continue to watch and hope that you have a 25 bagger in hand
explosive
- 19 Dec 2006 18:40
- 223 of 2350
Makes me wonder why you even bother to follow the thread cynic if its not even on your radar.
cynic
- 19 Dec 2006 19:06
- 224 of 2350
so keep wondering then ...... i follow all sorts of threads for my own interest or even amusement and just occasionally because i finally decide to invest (eg SOLA) .... in fact, i find most of my investments do not seem to have good following here, even when i post about them and they perform well (eg PFC, DOM, RTN etc etc)
Marcel1970 - 20 Dec 2006 11:30 - 225 of 2350
Can anyone tell me when SER are due an update
griffzino - 20 Dec 2006 13:15 - 226 of 2350
January and it should be good
driver
- 10 Jan 2007 16:35
- 227 of 2350
Hardman update Jan 2007
They are not saying much until news comes from SER.
They are waiting news of a drilling rig being contracted
to expand oil production at the Tapia Oilfield.
They are going to generate fresh estimates as soon as they are able to do so, when a rig date is confirmed.
They are not saying much until news comes from SER.
They are waiting news of a drilling rig being contracted
to expand oil production at the Tapia Oilfield.
They are going to generate fresh estimates as soon as they are able to do so, when a rig date is confirmed.
driver
- 10 Jan 2007 16:40
- 228 of 2350
A post from the other side to cheer us up courtesy of graylyn
First half produced a pre-tax profit of $175,647 U.S. lets convert that to @ (1.90 = 1) 92,044.00 Sefton said in the accounts that first half included "Increased production costs" primarily as a result of repair work, this was $151,157 U.S. higher than the comparable period last year (79,055.00) so on the assumption that the second half should not repeat these same extra costs we would have $ 326,804 U.S. (171,099.00) profit on top of that during the first half production was affected by quote "Key wells being down for mechanical reasons for over TWO months, whilst awaiting a service rig" even so the av bopd was 130 at Tapia 100% owned oil field, once all service rig work was completed the production for Tapia was approx 150 bopd, at the second 100% owned oil field Eureka Canyon well clean-outs and pump changes were addressed whilst a service rig was available during late July, early August this had the effect of doubling production from 10 bopd to 20 bopd.
Teg has upgraded the facilities at Tapia, and the tanks and piping should now be completed, which will allow Higher volume of oil, also the tanks are to be insulated and fitted with heating equipment, this will facilitate better oil separation during the cold winter period, so I am hoping for a pre tax profit of around 250,000 on which no tax will be paid.
So with 115m shares in issue that would give approx EPS of 0.22p @ 4.75 today`s mid price would give a Historical PE of 21 Sefton are planning around 9 wells in the current year at Tapia, (this of course is as we know subject to rig availability) lets say they only get 5 wells extra online this year, assuming oil remains circa $60 per barrel and the new wells produce similar to the existing wells at Tapia, Sefton will be looking cheap I think, and they would not need huge financing to drill 5 wells, as some of this could be raised from cashflow, now all we need then is a joint venture for CBM with perhaps Petrol, which could be part of the reason for delaying financing, as until they have some sort of agreement with a partner over the financing of CBM they would hold off their final target loan requirement so as to roll out events in an orderly manner this year, It would make no sense to obtain a loan to expand the oil fields If they needed to go back to the banks within months and thrash out a new deal for CBM which I suspect they are going to partner with Petrol, also the hold up re-rigs may also be partly down to the finance issue as well as the availability, because until Sefton know exactly how much they can raise, and/or need to raise they can not commit to any thing other than a small drilling program and that may not be enough to entice the rig company as they will have bigger fish to tend to, my point is this, the market price for Sefton Resources shares is now really "Bargain Basement price" yes we know its Speculative but the upside If the afore mentioned comes together this year will be huge. good luck DYOR
First half produced a pre-tax profit of $175,647 U.S. lets convert that to @ (1.90 = 1) 92,044.00 Sefton said in the accounts that first half included "Increased production costs" primarily as a result of repair work, this was $151,157 U.S. higher than the comparable period last year (79,055.00) so on the assumption that the second half should not repeat these same extra costs we would have $ 326,804 U.S. (171,099.00) profit on top of that during the first half production was affected by quote "Key wells being down for mechanical reasons for over TWO months, whilst awaiting a service rig" even so the av bopd was 130 at Tapia 100% owned oil field, once all service rig work was completed the production for Tapia was approx 150 bopd, at the second 100% owned oil field Eureka Canyon well clean-outs and pump changes were addressed whilst a service rig was available during late July, early August this had the effect of doubling production from 10 bopd to 20 bopd.
Teg has upgraded the facilities at Tapia, and the tanks and piping should now be completed, which will allow Higher volume of oil, also the tanks are to be insulated and fitted with heating equipment, this will facilitate better oil separation during the cold winter period, so I am hoping for a pre tax profit of around 250,000 on which no tax will be paid.
So with 115m shares in issue that would give approx EPS of 0.22p @ 4.75 today`s mid price would give a Historical PE of 21 Sefton are planning around 9 wells in the current year at Tapia, (this of course is as we know subject to rig availability) lets say they only get 5 wells extra online this year, assuming oil remains circa $60 per barrel and the new wells produce similar to the existing wells at Tapia, Sefton will be looking cheap I think, and they would not need huge financing to drill 5 wells, as some of this could be raised from cashflow, now all we need then is a joint venture for CBM with perhaps Petrol, which could be part of the reason for delaying financing, as until they have some sort of agreement with a partner over the financing of CBM they would hold off their final target loan requirement so as to roll out events in an orderly manner this year, It would make no sense to obtain a loan to expand the oil fields If they needed to go back to the banks within months and thrash out a new deal for CBM which I suspect they are going to partner with Petrol, also the hold up re-rigs may also be partly down to the finance issue as well as the availability, because until Sefton know exactly how much they can raise, and/or need to raise they can not commit to any thing other than a small drilling program and that may not be enough to entice the rig company as they will have bigger fish to tend to, my point is this, the market price for Sefton Resources shares is now really "Bargain Basement price" yes we know its Speculative but the upside If the afore mentioned comes together this year will be huge. good luck DYOR
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