Sefton Resources

Rising from the depths is US oil and gas play Sefton Resources (SER), which has upped reserves and boosted productivity of its heavy oil deposits. Based in Denver, Colorado and headed by entrepreneur Jim Ellerton, the AIM-quoted company is paying $200,000 (£124,000) to expand its gas interests in the Forest City Basin of East Kansas, having increased its overall proven oil reserves 7.45 per cent last year to 3.8m barrels, with an estimated 2.3 billion cubic feet of gas.

Sefton, which turned $317,000 losses into $338,000 pre-tax profits in the first nine months of 2010 on revenues up 35% to $2.7m, suggests future net cash flows from its Tapia Canyon heavy gravity oil and Eureka Canyon medium gravity oil deposits in California could total nearly $81m over the lives of the projects. Ellerton stresses the cyclic steaming process initiated by the company has significantly improved the viscosity and hence the productivity of its heavy gravity oil.

In addition, Sefton is working with Southern star Pipeline to improve the delivery of its output at a strategic point in the pipeline network. The company could, suggests Ellerton, make money shipping other company's product.

Floated 11 years ago at 5p, Sefton shares were dogs for a long time, as progress seemed painfully slow and they hit 0.5p at one point over the past year. Now 2p, they should rally further if Ellerton maintains present momentum.