| Home | Log In | Register | Our Services | My Account | Contact | Help |
You are NOT currently logged in
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)
ptholden
- 11 Aug 2006 10:22
- 74 of 2350
Yep, I'm really worried - LoL
Anyone who is concerned about daily fluctuations in the SP shouldn't really be invested in any stock, unless of course you are a day trader. The whole point of investing rather than trading is to take a medium to long term view. SER have just issued an operational update, it is unlikley that further news will be released to stimulate the SP until the Results in September. In the mean time I don't expect any significant moves, indeed it may well drift, small caps often do without news. However, I am quite looking forward to the next 12 months. Why:
1. The Results are expected to be good.
2. The Company is producing approx 180 bopd (perhaps more), this is creating monthly revenues of at least $300k per month
3. The CAZA settlement is expected before the end of the year, no-one knows how much this is likely to be, the Dec 2005 Results state that the case is already settled in SER's favour and can only be a bonus to the balance sheet.
4. New wells will be drilled in the Tapia Field before the end of the year, thus increasing both production and revenues.
5. The under developed Eureka Field will be mapped further. More oil is known to be there, just how much remains to be seen.
6. Further mapping and drilling of the CBM leases in Kansas will be undertaken. The fact that Methane is there is a given, but there is also a possibility of Gas and Oil. Only time will tell if that is true.
So, no, I am not worried at all, exactly the opposite. There is potentially significant news flow over the next 12 months. We shall have to just wait and see. Nothing happens quickly in this business and the quiet periods will, as always, be an opportunity for the bashers to have their say. Best dig in now bashers, because by this time next year, you will be gone.
All in my own opinion, I am sure you can all make your own minds up re SER.
pth
Anyone who is concerned about daily fluctuations in the SP shouldn't really be invested in any stock, unless of course you are a day trader. The whole point of investing rather than trading is to take a medium to long term view. SER have just issued an operational update, it is unlikley that further news will be released to stimulate the SP until the Results in September. In the mean time I don't expect any significant moves, indeed it may well drift, small caps often do without news. However, I am quite looking forward to the next 12 months. Why:
1. The Results are expected to be good.
2. The Company is producing approx 180 bopd (perhaps more), this is creating monthly revenues of at least $300k per month
3. The CAZA settlement is expected before the end of the year, no-one knows how much this is likely to be, the Dec 2005 Results state that the case is already settled in SER's favour and can only be a bonus to the balance sheet.
4. New wells will be drilled in the Tapia Field before the end of the year, thus increasing both production and revenues.
5. The under developed Eureka Field will be mapped further. More oil is known to be there, just how much remains to be seen.
6. Further mapping and drilling of the CBM leases in Kansas will be undertaken. The fact that Methane is there is a given, but there is also a possibility of Gas and Oil. Only time will tell if that is true.
So, no, I am not worried at all, exactly the opposite. There is potentially significant news flow over the next 12 months. We shall have to just wait and see. Nothing happens quickly in this business and the quiet periods will, as always, be an opportunity for the bashers to have their say. Best dig in now bashers, because by this time next year, you will be gone.
All in my own opinion, I am sure you can all make your own minds up re SER.
pth
moonshine - 11 Aug 2006 10:31 - 75 of 2350
Good post pt. Just one query, how did you find out that "the [CAZA] case is already settled in SER's favour"?
ptholden
- 11 Aug 2006 10:59
- 76 of 2350
moonshine, the Hardman report states that SER have been exonerated of all blame re the blow out mand therefore CAZA will have to pay compensation, additionally the Dec 2005 Results state that the case is already settled and that only the amount of compensation remains to be resolved.
pth
pth
moonshine - 11 Aug 2006 11:31 - 77 of 2350
Thanks for the clarification, pt.
ptholden
- 11 Aug 2006 11:35
- 78 of 2350
moonshine, think I am losing my marbles, the case IS settled; from the SER Results Dec 2005:
'The wrongful death lawsuit relating to a blowout when drilling a well in the Tapia Oil field in 2002 was recently settled with no liability or costs to Sefton Resources, Inc. or its subsidiaries and the litigation with the drilling company relating to the drilling costs and possible damages is still in process.'
Edit: I have amended my posts accordingly!! (Again!!!)
pth
'The wrongful death lawsuit relating to a blowout when drilling a well in the Tapia Oil field in 2002 was recently settled with no liability or costs to Sefton Resources, Inc. or its subsidiaries and the litigation with the drilling company relating to the drilling costs and possible damages is still in process.'
Edit: I have amended my posts accordingly!! (Again!!!)
pth
stewart3250
- 11 Aug 2006 13:35
- 79 of 2350
pt, Good board by the way apart from that muppet Laila, regarding Caza, my understanding was that the only matter to be resolved was if the drilling company were liable how much Sefton would receive in the form of comp for loss of earnings, I understood that if successful and I understand that they will be that most likely outcome would be that Sefton will have some wells drilled for free.
ptholden
- 11 Aug 2006 13:47
- 80 of 2350
stewart,
Pretty much my understanding also. Drilling of free wells would suit both parties. A cash settlement would obviously impinge on Caza's balance sheet, whereas if they were to offer free wells, the costs of that would have much less of an impact. We know that SER are planning to drill additional wells in the Tapia Field this year, so would seem a sensible resolution. An amount of $1m is being bandied around to compensate SER for costs and loss of revenue compensation, although I have no idea if that figure is accurate. Having a few wells drilled for 'free' would certainly support SER's claim that additional funding is not required to support further organic growth.
pth
Pretty much my understanding also. Drilling of free wells would suit both parties. A cash settlement would obviously impinge on Caza's balance sheet, whereas if they were to offer free wells, the costs of that would have much less of an impact. We know that SER are planning to drill additional wells in the Tapia Field this year, so would seem a sensible resolution. An amount of $1m is being bandied around to compensate SER for costs and loss of revenue compensation, although I have no idea if that figure is accurate. Having a few wells drilled for 'free' would certainly support SER's claim that additional funding is not required to support further organic growth.
pth
markusantonius
- 11 Aug 2006 15:14
- 81 of 2350
Laila, How many SER do you actually hold (if any?), if you don't mind me asking?
Laila, How many SER do you actually hold (if any?), if you don't mind me asking?
Laila, How many SER do you actually hold (if any?), if you don't mind me asking?
Laila, How many SER do you actually hold (if any?), if you don't mind me asking?
Laila, How many SER do you actually hold (if any?), if you don't mind me asking?
Laila, How many SER do you actually hold (if any?), if you don't mind me asking?
Laila, How many SER do you actually hold (if any?), if you don't mind me asking?
moonshine - 11 Aug 2006 15:18 - 82 of 2350
pt There are two cases, and the announcement you refer to was for the first case. That case was the Currington Litigation vs CAZA (the drilling operator) and Sefton. Currington was the name of the employee that was killed, and his family were suing CAZA & Sefton for damages. Sefton were indemnified by CAZA's insurance company against loss, and there were no damages awarded against Sefton for that case.
The second case is Sefton vs Caza, which could be brought by Sefton once the original case was settled, and is for compensation for damages, production loss, etc. I understand questions were tabled around the middle of May, but I haven't heard that this case has been judged, or any out of court settlement decided. But if found in Sefton's favour, then it could mean substantial compensation to Sefton, or CAZA drilling wells for nothing, or a combination thereof. At a cost of US$400k per well, drilling wells for nothing would be good.
I don't think it is a foregone conclusion that the case will be found in Sefton's favour. I didn't go to the AGM, but this is a comment from someone who did go:
The claim is awaiting a ruling but this should all be soterd within the next couple of months. Costs(if they arise) are already provided for. Upside could be large but ultimately will be negotiated. Mgt are keen to move on from the episode.
The second case is Sefton vs Caza, which could be brought by Sefton once the original case was settled, and is for compensation for damages, production loss, etc. I understand questions were tabled around the middle of May, but I haven't heard that this case has been judged, or any out of court settlement decided. But if found in Sefton's favour, then it could mean substantial compensation to Sefton, or CAZA drilling wells for nothing, or a combination thereof. At a cost of US$400k per well, drilling wells for nothing would be good.
I don't think it is a foregone conclusion that the case will be found in Sefton's favour. I didn't go to the AGM, but this is a comment from someone who did go:
The claim is awaiting a ruling but this should all be soterd within the next couple of months. Costs(if they arise) are already provided for. Upside could be large but ultimately will be negotiated. Mgt are keen to move on from the episode.
Laila25 - 11 Aug 2006 21:42 - 83 of 2350
Blue day maybe...but the price still couldn't break the strong resistance at 8 pence....5 pence soon.
ptholden
- 11 Aug 2006 23:03
- 84 of 2350
Moonshine,
Thank you for the update, much appreciated. I believe the worst that SER could suffer is approx $150k, which has already being set aside?
pth
Thank you for the update, much appreciated. I believe the worst that SER could suffer is approx $150k, which has already being set aside?
pth
Laila25 - 11 Aug 2006 23:31 - 85 of 2350
5 pence soon then.
moonshine - 12 Aug 2006 05:12 - 86 of 2350
pth, that is what I understand.
One benefit of consolidation has been the spread of the individual MMs. Pre-consolidation the normal spread was .2p (eg WINS would normally be on the bid with a spread of .45p/.65p and HOOD would be on the offer with a spread of .30p/.50p, giving a price of .45p/.50p). SCAP were the only MM with a different spread and that was .25p. A .2p spread is equivalent to a 3p spread after consolidation. However, after consolidation, SEYP have narrowed their individual spread to 1p, SCAP to 1.5p and the rest are on a 2p spread. The effect of this is that SEYP are now dictating the prices, not HOOD. If the spread is 1p, SEYP are both on the bid and the offer at the same time. Finally, at current prices the most the spread can be is less than 13%. Which, IMHO, is a lot better than it was pre-consolidation. (The MMs can widen/lessen their spread at any time, and they will widen the spread when/if the price rises. For instance on DES, with a price in the 30/40p region, the individual MM spread is 3p.)
At consolidation the mid-price was .51p. Two weeks in the price hasn't dropped as many predicted it would. SEYP are more supportive, too. Patience with this stock will, I believe (and hope), be rewarded.
One benefit of consolidation has been the spread of the individual MMs. Pre-consolidation the normal spread was .2p (eg WINS would normally be on the bid with a spread of .45p/.65p and HOOD would be on the offer with a spread of .30p/.50p, giving a price of .45p/.50p). SCAP were the only MM with a different spread and that was .25p. A .2p spread is equivalent to a 3p spread after consolidation. However, after consolidation, SEYP have narrowed their individual spread to 1p, SCAP to 1.5p and the rest are on a 2p spread. The effect of this is that SEYP are now dictating the prices, not HOOD. If the spread is 1p, SEYP are both on the bid and the offer at the same time. Finally, at current prices the most the spread can be is less than 13%. Which, IMHO, is a lot better than it was pre-consolidation. (The MMs can widen/lessen their spread at any time, and they will widen the spread when/if the price rises. For instance on DES, with a price in the 30/40p region, the individual MM spread is 3p.)
At consolidation the mid-price was .51p. Two weeks in the price hasn't dropped as many predicted it would. SEYP are more supportive, too. Patience with this stock will, I believe (and hope), be rewarded.
moonshine - 12 Aug 2006 09:49 - 87 of 2350
I don't know if anyone has posted the Hardman Monthly Update for July/August. Apologies if you have all read it:
http://www.oil-barrel.com/advisers/hardman/julymonthly.pdf
Might be a good link for the header. Hardman publish monthly updates, and each company that they cover is included in the update, so we should get the monthly updates about Sefton from Hardman. Not the impact of an RNS, I know, but at least at update.
http://www.oil-barrel.com/advisers/hardman/julymonthly.pdf
Might be a good link for the header. Hardman publish monthly updates, and each company that they cover is included in the update, so we should get the monthly updates about Sefton from Hardman. Not the impact of an RNS, I know, but at least at update.
austing2253
- 12 Aug 2006 15:58
- 88 of 2350
I think the best thing we can all do is totally ignore the '5p' poster and she will eventually go away. Unfortunately our replies assist with her attention deficit disorder.
TheFrenchConnection
- 12 Aug 2006 17:09
- 89 of 2350
Amities mes potes - Still no response as to if L actually holds a position in this stock . Obviously not from his repetitive derogatory posts. So why the "sudden intense interest L. " ? . l am the first to support anyone with a contrarian view to the general consensus of opinion on any individual board { as i did myself with NML , SEO , & TMC } . But at least i tried to give rational reasoning behind my decision. .......lncidentally most consolidations do not act as a prerequisite to a falling s/p ....that is pure nonsense and research into this very matter by JP Morgan illustrates otherwise.. lf yours was the case certain ftse 100 companie would have dissappeared let alone mere minions .........Let the results at interims and drilling statements do the talking and i think we shall all be in for a nice surprise come next interims ............................and it wont be 5p !.@+ J .
aldwickk
- 12 Aug 2006 18:40
- 90 of 2350
' J '
Long time no see , was getting concerned about you hope you have been keeping well. Roly.
Long time no see , was getting concerned about you hope you have been keeping well. Roly.
kkeith2000
- 12 Aug 2006 18:53
- 91 of 2350
Hello aldwickk and j
I was just thinking that myself aldwickk, nice to hear from you j also any comment's on afr am still in there
thanks Keith
I was just thinking that myself aldwickk, nice to hear from you j also any comment's on afr am still in there
thanks Keith
Laila25 - 13 Aug 2006 14:36 - 92 of 2350
Should drift down next week IMHO.
Laila25 - 13 Aug 2006 15:48 - 93 of 2350
Even ptholden agrees....wot a load of balls and 5 pence soon.
| About MoneyAM | Ts and Cs | Privacy Policy | Investment Warning | Content Standards | Corporate Solutions | Advertise With Us | Site Map | © 2025 MoneyAM |
Register now for FREE
Share Prices,
Stock Quotes,
Charts, Bulletin Boards, Indices, Watchlists, Portfolio, Market News, Research
or see our Premium Services including Level 2, Terminal and much more.
Follow us on Twitter