GDN - Golden State Resources

[urgalzmine]

If your concerned with cash .. look here :

Financial Performance

GDN raised $5.2m through share placements in the March quarter to help fund the operational costs of the Paradox Basin #2 well. This was required as significant expenditure is being made on the current drilling program, with $4.01m being spent on exploration and evaluatoin for the March quarter alone. Cash at the end of March was $2.2m and cash burn would be continuing as drilling continues.

GDN has a substantial holding in White Canyon Mining (WCU) and sold off 6m shares in the quarter at 20c each. The $1.2m is to be used for ongoing development at Paradox #2. Following the sale, GDN still has 45.67m shares in WCU which at current prices is worth $16.7m and has voting power of 25.0%.

The company has no debt. Of note is that 139.1m options are in existence with an exercise price of 20c and expiry date of 30 June 2009. These will most likely be exercised should the stock be trading above 20c at that date which will be a handy capital injection of $27.82m. Exercise of these options would be beneficial for the continuous drilling program.

 

[sharemadder]

urgalzmine

Actually there is

152,288,664 Listed Options exercisable at 20 cents each on or before 30 June 2009. Totalling $30,457,732

And also 15,400,000 Unlisted Options exercisable at 20 cents each on or before 22 May 2009. Totalling $3,080,000

The later being director oppies, so interesting to see were that goes by end of this week.

Cheers
:jump:

 

[sharemadder]

sharemadder

how do you view the current well repair operations? with gdn putting in daily reports on how wonderful the operation is going, with world best practices etc etc.. and most oilers knowing that in any well there is rarely a well completed trouble free, surely the glow comes off when you hit a snag when the reports are all designed to give you that comfortable secure feeling that nothing is going wrong.. it the use of daily reports getting gdn unstuck here? are the holders edgy and jumpy?

is it feasible the 3 trips are indicating a well problem?

Agentm

Possible problem, yes maybe, go fish :bonk:

I hope not but, its not the end of the world hey!

As pilots pointed out its not uncommon to change bits regulalry and as he PM's some of us and to paraphrase in my words, "the PDC bit is not the 'saviour' of drilling but just another tool in the shed to be used when the right conditions present themself."

GDN drillers tried it, didn't like it and subsequently moved on to a 'button bit'. Now if they are fishing etc well we wait some more. If they missed the mark on lower zones of well and the drill has traversed passed the faulted section then we only get to test the gas shows on the upper section. We know gas is there. It flowed at PB#1 from there. This would be sad but again not a total disaster for investors like me.

Again I hope not and wait to see if we hit the lower zones. I'm sure news by end of week updating us will come. Maybe today.

I'm an LT investor in GDN not trader sitting on the edge of my pants with baited breath buying and then selling on a whiff of emotion. I enjoy watching HC one day wonders posting there every thought as they jostle to make $500 (if their lucky). Some very bad posting over there much about nothing lately.

I have traded GDN though with smaller parcels and done quite well but have a reasonably big holding sitting nicely, majority under 6c.

Also, the company will do its best to see everyone of those options excercised and I don't blame them. That's a huge load of dosh that will see another couple of wells drilled. I like that, don't you.

Cheers

 

[DAZT49]

If those rumours of a board meeting yesterday were true I would think there would be a TH called before the market opens today, otherwise any insiders would be able to take advantage of the situation, one way or the other.

 

[bigdog]

SP GDN 0.145 -0.005 -3.33% @ 21-May 10:35:31 AM with HIGH of 0.17

ASX ANN
21-05-2009 10:07 AM GDN Paradox Basin No 2 Update
http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=00954847

• A gas show of 207 Units was encountered in fractured limestone and sandstone of the Barker Creek Formation from 13,430’ to 13,440’.

• The well is currently at 13,839’ (4218m) in the Alkali Gulch Formation and is drilling ahead at rates ranging from 16 to 37 feet per hour.

• Final petrophysical results confirm a minimum of 95 ft of net gas pay in 6 intervals, three of which have commercial potential and will be tested at the completion of the well. It is likely actual pay is higher.

• Drilling progress was slowed when the well encountered a thick extremely hard and abrasive dolomite cemented sandstone which has required four bit changes since 12,967’.

• The abrasive sandstone corresponds to a subtle fault zone on the seismic and current indications are that the well has crossed to the upthrown fault block into the Alkali Gulch Formation.

• Remaining targets are the Alkali Gulch, and Pinkerton Trail formations and Mississippian Leadville Limestone.

 

[sharemadder]

Maybe hit something in the the Alkali Gulch overnight at those drill rates.

Announcement was ok but I see sp is being sold down, people taking profits.

Cheers

 

[DAZT49]

Market hates it.
dont see how the oppies will get up now.
Target depth only 200ft away???
Well should be finished in a few days IMO

 

[DAZT49]

They missed the LBC target, guess they can pick it up again when they rework Para 1.
We will get our rewards ONE day sharemadder lol

 

[sharemadder]

Have some faith Dazt mate

Oppies will get there yet imo.

Or they will be prearranged to convert (underwritten).

The well is going great, top section has indicated gas pay.

The lower section not fully drilled.

Cheers

 

[hsv2001]

OMG!

How can the options fall so far, isn't there still a month to go ? I can't believe I get in at .03 and now this!!!

Hoepfully the well can show some results so I may even break even

 

[BMW540]

Unfortunatly for GDN holders, I think that no matter how good their annoucements are over the coming weeks, we won't see the desired share price increase that everyone is expecting.

And as expected, today's cascade sell-off was triggered by stop losses rolling down the lines. They are not "stupid sellers" or "weak hands" or "emotional traders" - they are simply traders observing their trading rules and hitting their stop losses. It's a matter of fact, not emotion.
They could have also being people locking in their profits if they bought GDN at much cheaper prices - doing the sensible thing. Protecting their capital.

In my opinion the smart money has left the building long ago. We may see another significant fall in share price tomorrow as people assess their situation and sell-off again, realising that the risk/reward profile for GDN has dramatically changed over the last few days.

Technically weak. Momentum is shockingly downwards. 11.5c gap could be filled. This could again trigger stoplosses down through the 10c barrier.

 

[sharemadder]

Unfortunatly for GDN holders, I think that no matter how good their annoucements are over the coming weeks, we won't see the desired share price increase that everyone is expecting.

And as expected, today's cascade sell-off was triggered by stop losses rolling down the lines. They are not "stupid sellers" or "weak hands" or "emotional traders" - they are simply traders observing their trading rules and hitting their stop losses. It's a matter of fact, not emotion.
They could have also being people locking in their profits if they bought GDN at much cheaper prices - doing the sensible thing. Protecting their capital.

In my opinion the smart money has left the building long ago. We may see another significant fall in share price tomorrow as people assess their situation and sell-off again, realising that the risk/reward profile for GDN has dramatically changed over the last few days.

Technically weak. Momentum is shockingly downwards. 11.5c gap could be filled. This could again trigger stoplosses down through the 10c barrier.

Although the sp could drift lower I doubt very much it would capitualte. Most of those holding nervously would of exited today and judging by the volume there was a number of buyers prepared to take those shares. The volume turnover was huge.

The risk / reward has not changed at all. The upper zones have 95ft possible gas pay as indicated by RPS and independent cross check. Also they have 3 other target zones to go.

Now 11c is very possible of course because thats what the institutions bought at in capital raisings. So is a good target for negative territory.

Regards the sellers I pretty much can guess some of those that stopped today would of had to sell anyway as they trading T+3. very ST.

Time will tell.

 

[z8ball]

Was my titanic call far off?

Honestly, when the company continues with these "hot air" announcements that say practically nothing of substance what can holders expect?

Every second day an update comes out which basically says "We're drilling deeper". There are no stats or figures other than rate of drilling or current depth.

Really looks like the company or institutional investors have pumped up this stock and now they're taking a dump on the GDN cheer squad.

 

[bigdog]

The market did NOT like the ANN!!

GDN 0.11 -$0.030 -21.43% 14,129,477 shares $1,674,839 @ 22-May 11:02:32 AM

ASX ANN 22-05-2009 10:05 AM GDN Paradox No 2 Update
http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=00955146

The well is currently at 14,108’ (4300m) in the Alkali Gulch Formation and is drilling ahead at rates ranging from 16 to 37 feet per hour.

Current lithology is evaporites comprising anhydrite and salt.

The estimated tops for the Pinkerton Formation and Leadville Limestone are 14,875’ and 15,168’ respectively.

Remaining targets are the Pinkerton Trail formations and Mississippian Leadville Limestone.

Golden State Resources is currently designing the testing programme for the Ismay, Chimney Rock and Barker Creek Formations

 

[pilots]

Was my titanic call far off?

Honestly, when the company continues with these "hot air" announcements that say practically nothing of substance what can holders expect?

Every second day an update comes out which basically says "We're drilling deeper". There are no stats or figures other than rate of drilling or current depth.

Really looks like the company or institutional investors have pumped up this stock and now they're taking a dump on the GDN cheer squad.

The ramp team was good at telling us how fast we was drilling and how we was ahead of time, GDN has averaged about 160 feet aday, AZZ who have a rig on turnkey has averaged 890 feet aday. AZZ are building a gas line to the rig b4 for the well is over, they must be very sure of them self. With out any doubt GDN have drilled out of the fault, all GDN can do now is to talk about how good the zones are at the top of the hole, and how big the gas field is, as yet they have no gas, so how can they talk about a gas field. I do feel sorry for the new kids here who have averaged down on this stock, this was a train wreak b4 GDN started.

 

[nunthewiser]

LOL well silly ole me .....

i just bought this poundpup today at 11.5 as a BOUNCE TRADE ONLY ....... i WILL stopout at designated point and not in the habit of falling in love with dodgy little drillers ..

lol they really need to release some actual data one day to kill it or make it fly BUT all this messing around with smoke and mirrors anns has killed off any hope of sending this one into orbit from here .

BOUNCE PLAY ONLY and will drop it like the sack of poo it is if it hits my stop

 

[Agentm]

pilots,,

O/T here a little, regarding the AZZ yellow rose well, its very upsetting too the locals to see black smoke flaring in these regions in texas, and AZZ will have to do a lot of very expensive testing on the pilot hole and do flow tests on the formation.. so with the volume of flow that well will put out, these counties are now requiring the operator to no longer flare and test, they prefer to see it done through a pipeline. (your allowed a certain level of flaring during drill and clean up, only) so having a pipe connected to a vertical pilot-test hole is very practical, its a requirement by the county and state legislators, and of course the initial flow wont be at commercial rates, it will be like all the other vertical pilot/test wells in the region, sub commercial, you and i know that the well would need to be completed as a horizontal well to be potentially commercial, and the frac techniques would be very expensive for azz. btw i have no doubt in my mind that the well will find activity in the eagleford.. but we should discuss that one in the azz forum..

regarding gdn, for 2 days there has been hard selling, and its agrred by me that its very hard to read these announcements of GDN with a lot of excitement, i have been looking at each one trying to see the things i need to see that would make me want to invest in the share.. i have yet to see the words i need to see before i step in..

they use the term gas pay?? what is that? i cant find any industry standard matching that saying..

the investors certainly keep mods on their toes in the forums with the amazing statements on the gas shows,, but imho there is little there to be upbeat about at the moment. i will wait and see if any decision is made to test any zones, and then wait for the outcome of flow tests before looking at gdn as an investment, imho its oversold and the real value of the share is impossible to pick right now. but in a 6 months or so i will look again and see how or if they will actually test anything in this second well. but imho gas prices need to be at a comfortable and solid $6 for a good while before the play becomes viable, and i base that on the analysts in the USA gas industry who do the numbers on a lot of plays.. i am staying where the oil is myself..

its been a day traders stock imho, and a difficult stock for a LTH to deal with

 

[pilots]

Agentm, You are correct on the flaring, in Europe you can't flare any thing, they said we are no longer going to waste energy.

GDNs next report will be this. """"We are happy to announce that the well as been completed, the lower Gas zones was not found due to faults in the lower formations , this gave us false readings on the seismic, how ever GDN are now negotiation with a drilling contractor to bring in a work over rig to test the many feet of Gas pay zones on the upper reaches of the hole'''''''

 

[BSDL]

If Basin #2 comes up with nothing, what other fall back plans does the company have? Does GDN have any stable income?

Cheers

 

[mastatrada]

Agentm, You are correct on the flaring, in Europe you can't flare any thing, they said we are no longer going to waste energy.

GDNs next report will be this. """"We are happy to announce that the well as been completed, the lower Gas zones was not found due to faults in the lower formations , this gave us false readings on the seismic, how ever GDN are now negotiation with a drilling contractor to bring in a work over rig to test the many feet of Gas pay zones on the upper reaches of the hole'''''''

Sounds spot on actually, does anyone know if what they've found so far is likely to be commercially viable?