Sefton Resources (LON:SER) is planning to buy more assets in Eastern Kansas, through a deal with Cholla Production.
Last year Sefton acquired a pipeline from Cholla. Now it has agreed a deal to buy around 1,200 net leasehold acres, which already has 18 wellbores that could be ‘re-completed’.
It will pay US$200,000 for the assets.
Separately Sefton also announced it 2010 Year-end Reserves. At 31 December 2010 the company had 3.8 million barrels in proved reserves. These proven reserves had grown by 7.45 percent from the preceding year. During the period it replaced 512 percent of its estimated net production volumes for 2010.
It produced about 51,225 barrels of oil in the year and it made upward revisions – resources moving into reserves - of 262,290 barrels of oil.
The company said that the upward revisions were mainly due to the successful cyclic steam pilot program at the Tapia Field.
The company valued its reserves (present value of the estimated future net cash flows) at around US$80.6 million, based on an average price of US$71.38 per barrel for the Tapia and Eureka Canyon Fields.
It said the pre-tax PV10 value of Sefton's proved reserves would have been US$109.9 million, using strip prices.
Additionally it has 2.3 billion cubic feet (Bcf) of estimated possible gas reserves from the Eastern Kansas assets.