GDN - Golden State Resources

[bigdog]

GDN 0.059 +0.006 +11.32% high of 0.06 4,494,000 shares $260,368 @ 15-Jan 10:44:22 AM

ASX ANN today
15-01-2010 09:45 AM GDN Operations Update Paradox Basin No 3

http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01029322

PARADOX BASIN #3 - OPERATIONS UPDATE

Site preparation for the Paradox Basin #3 Ismay Formation production well is complete
• The rat-hole and cellar is complete
• Mobilisation and rig-up is scheduled to commence on Monday 18 January with an anticipated spud date on Monday 25 January
• Paradox Basin #3 has been designed as a directionally drilled production well with a 5” completion into the Ismay Formation reservoir.
• Drilling time is estimated to be under 55 days
• The Cost estimate for Paradox Basin #3 is significantly lower than the previous wells at $5.5 million
• Discussions with potential financiers to debt fund the expansion of the field is advanced and is the preferred option.

Golden State Resources Limited (ASX: GDN) (“Golden State” or “the Company”) is pleased to announce the imminent commencement of the drilling of Paradox Basin #3. Since the award of the permit by the Department of Natural Resources of the State of Utah on December 21, Golden State Resources has completed site preparations and has prepared the cellar, rat-hole and mouse-hole in readiness for the drilling rig. Mobilisation of Unit Drilling Rig 234 is scheduled to commence on Monday 18 January, and depending on weather, rig-up should take approximately 6 to 7 days after which the well will spud.

Paradox Basin #3 is a directional well which is specifically targeting gas production from the Ismay Formation in the Golden Eagle Gas field. Golden State Resources discovered the Golden Eagle Gas field in 2006 with the drilling of the Paradox Basin #1 well as part of a two well farmin with Eclipse
Exploration LLC.

Paradox Basin #3 will spud from the existing Paradox Basin #1 pad, which has been re surveyed and has been upgraded for re-use. The well will then be directionally drilled into the Ismay Formation gas zone and completed with 5” casing. The objective is a target in the Ismay Formation to the north northeast of Paradox Basin #1. The well deviate from vertical by approximately 30o to intersect the subsurface target in the Ismay Formation 4,437’ (1352m) to the NNE of Paradox Basin #1 on a bearing of 21.94o.

Paradox Basin #3 has been specifically designed as a production well, the lower diameter casing and proximity of the casing shoe to the completion zone will maximise the effectiveness of the cement over the gas bearing strata. Should Paradox Basin #3 prove effective gas production from the Ismay Formation then further works will be performed on the completions of the existing wells. Testing and evaluation of Paradox Basin #1 and 2 indicates that both wells can be effectively recompleted as producers.

The company is also reviewing options to re-enter Paradox Basin #2 to test the Leadville Limestone.

Post drill evaluation of Paradox Basin #2 from the processed VSP suggests that the well was possibly closer than expected to the Leadville target when it was suspended at 14,216’ (4333m) after the bottom-hole assembly became stuck in dispersive claystone.

The Golden Eagle Gas field is located in Grand County in Utah it is located close to the Williams gas distributor which feeds Portland. Production can be readily commercialised once commercial gas production rates are established. Both existing wells on Golden Eagle Field have demonstrated gas flows at rates up to 3.6 million cubic feet per day. Independently evaluated gas resources confirm the Golden Eagle structure contains an appreciable gas resource.

Discussions with potential financiers to debt fund the expansion of the field is advanced and is the preferred option.

 

[pilots]

Dazt49/Sharemadder, Something is wrong here, no one in their right mind would back GDN for a third well, UNLESS they have some concrete evidence that they have Gas, now I have to say that this well is much higher up the formation, so if they do get Gas this time it should not have any water, or it it has any water they will be able to control it. I hate to admit to it but you may now get your money back, and some, you have waited that long you deserve some thing for the wait.

 

[DAZT49]

"I hate to admit to it but you may now get your money back, and some, you have waited that long you deserve some thing for the wait. "
You going soft suzie??
Gas has always been there pilots lol
Just getting the stuff out has been the problem
I am not getting excited yet, 55 days plus till that may happen.
Sp will have to get close to previous all time high for me to be really happy.
Cant see that happening in this market for a LONG time.

 

[pilots]

It has been a long wait, if you buy in now, you know you will win some, as this has gone up each time, but knowing when to get out is the hard part .

 

[rottodiver]

Pilots......
you actually dont realise how refreshing it is to see you being a bit positive here.... it has been a little frustrating over the years seeing you have been right a "few" times... hope you are right again!!!

 

[pilots]

Pilots......
you actually dont realise how refreshing it is to see you being a bit positive here.... it has been a little frustrating over the years seeing you have been right a "few" times... hope you are right again!!!

Well it could be third time Lucky, same old story, you now have to wait. You can bet as the well gets deeper the day trades will make a killing on this, just as they did on the last two wells, its all in when you sell, it would not surprise me if this runs to close to the one dollar again this time, as this one should be water free. One good thing about this is that IF and I say IF this one flows you can bet that they will go back and get one and two on line, all this well has to prove is that it will flow Gas.

 

[pilots]

Well No 3 at 4200feet, casing point, note this time no BS, ONLY FACTS.
F J Brown now look to be running the show, hopefully this well is the one for you to get back your money.
This well is right on the target zone, looking at the report you can see that they will be drilling in the Paradox for a longer distance. Its my bet that if the Paradox flows they will pull back, and drill along the Paradox, this rig and crew is capable of doing that.
If the gas in this well is the exact same as one of the first wells, you can bet this will give the SP the kick start you have been waiting for.

 

[Atlas79]

It has been a long wait, if you buy in now, you know you will win some, as this has gone up each time, but knowing when to get out is the hard part .

Do you have any conservative best-case-scenario figure range in mind for the sp? (I am asking for opinion, not advice of course.)

 

[pilots]

Do you have any conservative best-case-scenario figure range in mind for the sp? (I am asking for opinion, not advice of course.)

No it is going to be had to tell this time, the day traders have been shut out.
This time it looks to me like they are only going to post facts, when you have the day traders working the SP over you will NEVER get the big end of town in bed with you, who wants to invest in a company that the SP can go up and down 30%

 

[DAZT49]

At what depth should they be getting a "sniff"??
IMO it will never get to that $1.20 level of a few years ago, or even to the level where I bought in

 

[bigdog]

GDN ASX ANN
22/02/2010 8:36:00 AM 3 Drilling Update
http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01039430

ASX ANNOUNCEMENT 22FEBRUARY 2010

DRILLING UPDATE FOR PARADOX BASIN # 3 ON THE GOLDEN EAGLE GAS FIELD, UTAH, DRILLING AHEAD

KEY POINTS:
● Currently drilling ahead at 5,102’
● Drilling of the 8 ¾” section is proceeding to schedule
● Essential repairs were conducted on the Blow-Out-Preventers

US focussed oil and gas company Golden State Resources Limited (ASX: GDN) (“Golden State” or “the Company”) is pleased to update shareholders on the progress with drilling operations at its Paradox Basin # 3 (PB#3) production well, its third well on the Golden Eagle Gas field in the highly productive Paradox Basin region of Utah.

Drilling of the PB#3 production well commenced on 27 January 2010 and operations are proceeding within expectation. During testing of the Blow-Out-Preventers (BOP) several leaks were observed in the both the BOP and the choke manifold, as a result the rig was placed on standby while the repairs were made.

Drilling recommenced once the repairs were completed and drilling of the 8 ¾“ section is proceeding to expectation. The well is currently in the Cutler Formation at 5,102’. Background gas is approximately 6 units with connection gas of 58 units.

The current trajectory will be maintained for the remaining portion of the well into targets in the Pennsylvanian Paradox Group.

 

[rottodiver]

"Drilling recommenced once the repairs were completed and drilling of the 8 ¾“ section is proceeding to expectation. The well is currently in the Cutler Formation at 5,102’. Background gas is approximately 6 units with connection gas of 58 units."


are these considered good gas units or quite standard???

Scotty

 

[WRONG'UN]

I can't answer that, Scotty - Pilots will probably know what it means.
My question is how long will it take for them to get to the Ismay?
The attached GDN section does not appear to be accurately drawn to scale, so scaling distances is not going to be accurate. However, as they have stated that they are on schedule, and have earlier stated that the total planned time for the well is 55 days, and the elapsed time to date is 27 days, they have a theoretical 28 days left to go the remaining distance to the destination Desert Creek FM. As the Ismay is about half way to the Desert Creek, from where they are now, notwithstanding my reservations about the accuracy of the diagram, it is probably reasonable, barring unforeseen contingencies, to expect the middle of the Ismay to be reached in about 14 days time, ie. around 8 March.
Next Monday's progress report will give a better idea.

 

[WRONG'UN]

Attachment to previous post.
These words added to get to the minimum one two three four five six seven eight nine ten - howzat!!!

 

[WRONG'UN]

Attached is an attempt to value the RPS estimates, taking account of the various quantities and probabilities presented in the table in the GDN activities report to 31 Dec 2009.
At the current price and exchange rate, the low (90% probability) estimate for the Ismay is valued at 11c ($A) and the entire field 80c.
These values, of course, have to be discounted to allow for the fact that the gas resources still have to be proven, and the costs of extracting and transporting, etc. determined . But at a current sp of 5.7c, there would seem to be a case for some re-rating, on a reward/risk basis.
Any comments?
(DYOR)

 

[bigdog]

ASX ANN
2/03/2010 8:27:00 AM Drilling Update
http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01043041

ASX ANNOUNCEMENT 2 MARCH 2010
DRILLING UPDATE FOR PARADOX BASIN # 3 ON THE GOLDEN EAGLE GAS FIELD, UTAH, DRILLING AHEAD

KEY POINTS:
● Currently drilling ahead at 6,600’
● Drilling of the 8 ¾” section is proceeding to plan
● The well is drilling ahead at approximately 25-30’ per hour and is on target and maintaining a steady trajectory
● The Paradox Formation is expected at 9,941’

US focussed oil and gas company Golden State Resources Limited (ASX: GDN) (“Golden State” or “the Company”) is pleased to update shareholders on the progress with drilling operations at its Paradox Basin # 3 (PB#3) production well, its third well on the Golden Eagle Gas field in the highly productive Paradox Basin region of Utah.

Drilling of the PB#3 production well commenced on 27 January 2010 and operations are proceeding to plan.

The well is currently at 6,600’ in 8 ¾“hole. Operations over the past few days included a period of circulating and hole conditioning to ensure that the lost circulation zones previously reported do not become problematic. The bottom-hole assembly was also modified to optimise the directional stability over the lateral section. Since replacing the bottom-hole assembly rates of penetration are averaging 25-30 ft per hour.

The well has a current angle of 34o from vertical and a heading of 18.9o. The current trajectory will be maintained for the remaining portion of the well into targets in the Pennsylvanian Paradox Group. The Paradox Formation is expected to be intersected at 9,941’ and the Ismay Formation is expected at 11,063’.

Golden State is pleased with the overall progress of the well, and through the excellent contributions of all involved we have been able to maintain efficient operations through one of the worst winters on record.
0462

 

[WRONG'UN]

According to the figures they have given, at 25 - 30 ft/hr, and drilling 24 hrs/day, they will reach the Ismay 8 - 10 March.
The progress over the previous two reporting periods (each 4 days) was 174 ft/day and 200 ft/day respectively, a lot slower than 25 - 30 ft/hr, and consistent with down time for the other activities mentioned in the latest report. With the same rate of down time, the Ismay would not be reached until 24 March, but I somewhat doubt they will need to take that long, if there is no trouble - the recent down time has hopefully enabled them to drill non-stop.
Any comments / better estimates?

 

[bigdog]

ASX ANN

4/03/2010 8:25:00 AM Drilling Update
http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01043847

ASX ANNOUNCEMENT 4 MARCH 2010
DRILLING UPDATE FOR PARADOX BASIN # 3 ON THE GOLDEN EAGLE GAS FIELD, UTAH. CURRENT OPERATION DRILLING AHEAD

KEY POINTS:
● Paradox Basin #3 is drilling ahead in the Cutler Formation at 7,425’
● Back ground gas has increased from 5 to 17 units
● The rate of penetration is approximately 20-25’ per hour and the well is on target and is maintaining a steady trajectory
● The Paradox Formation is expected at 9,941’

US focussed oil and gas company Golden State Resources Limited (ASX: GDN) (“Golden State” or “the Company”) is pleased to update shareholders on the progress with drilling operations at its Paradox Basin # 3 (PB#3) production well, its third well on the Golden Eagle Gas field in the highly productive Paradox Basin region of Utah.

Drilling of the PB#3 production well commenced on 27 January 2010 and operations are proceeding to plan.

The well is currently at 7,425’ in 8 ¾“hole. Since Monday drilling has progressed well as the changes made to the bottom-hole assembly have increased average rates of penetration and directional stability.

Background gas has increased from 5 to 17 units with connection gas to 31 units. The lithology now shows minor carbonates as we approach the Paradox Basin sequence. Initial stratigraphic comparisons to Paradox Basin #1 indicate the well is slightly higher on the structure as expected.

The well has a lateral reach extending some 2177’ to the north of Paradox Basin #1 and is closing on subsurface targets in the Paradox Basin Sequence. The Paradox Formation is expected to be intersected at 9,941’ and the Ismay Formation is expected at 11,063’.

 

[DAZT49]

Seems to be going along smoothly.
Are those background and connection gas reading good?
and what of this..
"The lithology now shows minor carbonates... "?
I dont recall mention of this in P1 and P2

 

[pixel]

"Are those background and connection gas reading good?"

The Market seems to think so and that's what matters :