8th Oct 2012 07:00
Sefton Resources, Inc.
("Sefton" or the "Company")
8 October 2012
September production update for California
Sefton Resources, Inc. (AIM: SER), an independent oil and gas exploitation and production company with interests in California and Kansas today announces a production update on its operations in California.
A preliminary oil production estimate has been compiled for oil production in the month of September, 2012 using operational data. This data indicates an estimate of 3,244 barrels of oil produced or approximately 108 barrels of oil per day (BOPD) albeit this operational data will need to be adjusted for any shrinkage to oil quality specifications and water content. This compares to an average of 98 BOPD in August as reported to the California Division of Oil Gas and Geothermal Resources (DOGGR). Water disposal issues continue to be the limiting factor in the Company's production. Over the course of the next three months, the Group has planned a number of production enhancements including: workovers, additional drilling, cyclic steaming, water disposal restriction resolution and surface equipment optimization which are expected to have a positive impact on its daily average production rate once they are operative. With uncertainties associated with resolution of water disposal and timing of other factors, the Company expects to see production steady for the balance of the calendar year with some mild improvements associated with the Group's ongoing cyclic steaming and production enhancements.
The final production number for September will be available after oil sales numbers are provided to the Company by the oil purchaser, which the Company expects to receive about mid-October. The final production numbers by well will then be submitted to DOGGR for posting on its website.
The Company has historically relied on equity and debt to finance its capital budgets. The Company currently is investigating a number of financing options such as equity, debt and joint ventures, to finance future growth capital needs.
Further information of the production including graphs will be posted on the Company's website shortly.
For further information please visit www.seftonresources.com or contact:
Sefton Resources, Inc. Jim Ellerton, Chairman Dr Michael Green, Investor Relations |
Tel: +1 (303) 759 2700 Tel: 020 7448 5111 |
Fox-Davies Capital Limited Susan Walker (Nominated Adviser) Daniel Fox-Davies/Richard Hail (Joint Broker) | Tel: 020 3463 5000 |
Dowgate Capital Stockbrokers (Joint Broker) Neil Badger | Tel: 01293 517 744 |
Cadogan PR Alex Walters | Tel: 07771 713 608 |
About Sefton
Sefton Resources is an AIM-listed oil and gas exploration and production company with tremendous scope to grow within its 100%-owned and operated assets in the US. The business strategy is to acquire long life, controlling interests, partially developed reserves and add value using its own funds and then maximise shareholder value through asset development involving third party capital, farm-out or merger. Currently the Company has a market capitalisation of approximately £8 million.
Oil in California - In East Ventura, the Group owns 100% of two oil fields, Tapia Canyon (heavy gravity oil) and Eureka Canyon (medium gravity oil). Estimated 2011 year-end proved reserves stood at 3.8 million barrels. The near term focus is on Tapia Canyon where Sefton drilled additional wells in 4Q 2011, to increase production and also continue the use of steam to improve recovery and reserves. The Company has engaged Dr Farouq Ali to advise on a full steam flood development of the Tapia field and the report is expected shortly.
Pipeline systems in Kansas - Three pipelines have been acquired. The two pipelines in Leavenworth County have been refurbished and are in the process of being connected to the Southern Star Interstate Pipeline system that will allow the Group to flow gas in due course. Following the completion of the Southern Star interconnect, the priority will be joining the LAGGS and the Vanguard pipelines thereby increasing equity and third party gas into the system. The third pipeline (Waverley) is in Anderson County where the plan is to test, fix and certify this pipeline ahead of negotiating contracts to connect to an interstate system once the LAGGS/Vanguard system is fully operational. This move is expected to provide additional redevelopment of oil, equity and third party gas opportunities.
Oil & Gas in Kansas - In East Kansas, Sefton has over 45,000 acres in the Forest City Basin, where conventional oil and gas deposits have been targeted. The near-term focus for a planned well recompletion program will principally see oil wells brought back into production with the objective of accelerating oil revenue while gas production will be processed through the LAGGS-Vanguard pipeline system as additional gas wells are accumulated. The leasing program is also being accelerated with the plan to double the Group's acreage holdings in Kansas. In the near term the focus will be on oil revenue while gas opportunities are accumulated as part of this accelerated leasing program.
Related Shares:
SER.L