GDN - Golden State Resources

ongchuan said:

$1.20 is heavy resistance. Never stay above $1.20 for more than half an hour. Wondering why ppl want to sell at $1.20.Hmmm

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Yes i have noticed that too. There seems to be lots of buying early morning ... followed by the opposite at the end of the day ... im

How much further untill the hit the bottom of leadville?

zt3000 said:

Yes i have noticed that too. There seems to be lots of buying early morning ... followed by the opposite at the end of the day ... im

How much further untill the hit the bottom of leadville?

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According to last Drill Rep. 544 feet to top of McCracken.

Seems like this one is running out of steam and getting tired and tired.....but the seller seems to reduce now and buyers are increasing. Better news expected today?

They gave an update yesterday, next one will either be Mon morning or Tue Morning. It could even take 6 dyas if they decide to release when they hit the next target.

People selling at this stage makes no sense as the potential is still the same with some encouraging info being released yesterday.

I'm out.... reckon they're 350ft into limestone with no major gas interval... this means potential is less than 440bcf... so even if there is a major show from here on it'll only be enthusiasm that carries the share price over the $2 mark.... it's tough... but had to make the call.....

Re: GDN - McCracken Sandstone

I hope GDN can/does take the well into the McCracken Sandstone (16300'). Sandstone intervals around the Paradox Basin are sporadic but often highly gas-charged. GDN's 11/16/06 update indicated they could go below 16000 feet with three inch drill pipe. They now appear to need to do this to get to the bottom of the Leadville Limestone so I hope they also can go to the bottom of the McCracken Sandstone, which is listed at 16400 feet.
Good luck everyone.

hello rosesny_1, interesting comments... do you know if they'll have to run a liner prior to drilling on with a yet smaller string? and re. current background gas levels ... has the mud weight been changed to a level that suppresses the influx of gas??

ASX ann today
GDN 10:18 AM Drilling status report
http://www.asx.com.au/asxpdf/20070423/pdf/3121x6l0gk8qrj.pdf

Market did not like the ANN with SP down 16.5 cents
GDN $0.91 -$0.165 -15.35% 3,995,227 shares $3,699,129
23-Apr 10:42:58

Drilling Status Report – 23 April 2007
• Paradox Basin #1 oil & gas well, Grand County, Utah, is at 15,979 feet (4,870 m) in the Mississippian Leadville Limestone Formation, the well’s primary objective.

• Background gas levels have increased. Minor 60 foot gas show from 15,822’ to 15,883’.

PARADOX BASIN #1 OIL & GAS WELL, UTAH USA
Golden State Resources is pleased to announce that drilling at the Paradox Basin #1 oil & gas well is proceeding satisfactorily within the Leadville Limestone Formation.

Paradox Basin #1 is at 15,979 feet (4,870 m), in dolomitic crinoidal limestones of the Mississippian Leadville Limestone Formation, the primary objective of the well.

A minor gas show was intersected from 15,822’ to 15,883’ at 200 units of C1 (methane) and C2 (ethane). Background gas levels have since increased to 300 units with connection gas up to 600 units.

Following a bit change, the well will drill ahead at 6⅛” into the Leadville Limestone Formation.

Connection gas: Pressured formation gas introduced into the well during short periods of mud pump shutdown, such as when connecting additional drilling pipe. The consistent levels of elevated connection gas in this well are highly significant.

Gas units: 10,000 units = 100% gas i.e. 1,000 units = 10% gas in drilling mud.

Connection gas. The last drilling update included, "The consistent levels of elevated connection gas in this well are highly significant." A much earlier update contained the same statement. I looked over all the drilling updates on the GDN website to see if I could better understand this statement. Here is a list of drilling levels and what was said of connection gas at that level.

9740' "connection gas peaked at 3120 units."
10152' connection gas levels of "3000 units."
10470' "increasing levels of background gas and influx of connection gas."
11950' "strong formation gas pressures and gas influx into the well upgrade
production potential."
12490' "strong background and connection gas continues."
12985' "connection gas ranges from 2000 - 3300 units."
13720' "the well continues to have consistent levels of background
and connection gas."
15165' "background, trip and connection gas are all at elevated levels."
15397' "after a significant gas interval located from 15292 - 15322 feet,
background gas rises to 800 units." [note: this says nothing of
connection gas but if it is related to background gas in the same
degree as at 12985' then connection gas here is about 3000 units.]
15531' "background gas... averaging 40 units."
15756' "background gas levels increasing, averaging 100 units, as porosity
increases."
15979' "background has... increased to 300 units with connection gas up to
600 units."

As can be seen there is a major drop off in background gas at 15531' in the Molas Formation. This gas then goes up 1.5times in the next 220' and then triples to 300 units in the next 220'. If the background gas triples in the next 220' it will be at 600 units. In upper levels of the well this is consistent with connection gas being at about 2000 units. If background gas quadruples (this is consistent with the acceleration of background gas increases at the previous two levels as porosity increases) then connection gas will be at 3000 units. This would put the well in the last 100' of the Leadville Limestone. If this has the best porosity of the Leadville and if the McCracken Sandstone has good porosity, then there could easily be a major gas interval
in these two zones. In any case, the connection gas figures appear to indicate that this well is gas charged through over 5000' from about 10000' to about 15000'. Since that appears to be the case I intend to hold onto my GDN stock.

Hi roses... don't understand your logic for turning 300 units of background gas into 3000 units... and saying it's gas charged over 5000' is a bit misleading as there are only a few zones that are around 100ft each that could be productive.... the leedville has definitely got gas in it...but at this stage inications are that it's certainly not a gusher... whatever the question is will the gas be commercially recoverable?... but i think the price is now reflecting the increased risk..... so may get back in with a smaller holding....... good luck

I remember they have some U prospects in the US, with some very good grades, its seems they're not focused on it atm, a possible spin off? Would that be feasible?

Time to pick up some of the discounted share? SP has been down to the level of previous 3 month. Good entry at current SP?

Looks like a good buy atm but i have to buy a house so i may get myself into trouble if i were to buy some shares!

Good announcement but dipping SP....

Time to reenter i guess...

todays ASX ann
26-04-2007 02:04 PM GDN Drilling Status Report

Today's report at at 16,153 feet (4,923 m) and 23 April report was at 15,979 feet (4,870 m) = 174 feet deeper in three days!

GDN $0.82 -$0.035 -4.09% with $0.90 high and $0.76 low; 5,728,102 shares $4,733,430
@ 26-Apr 14:47:47

http://www.asx.com.au/asxpdf/20070426/pdf/3123y3hkgmbnq5.pdf

Drilling Status Report – 26 April 2007
• Paradox Basin #1 oil & gas well, Grand County, Utah, is at 16,153 feet (4,923 m) in the Mississippian Leadville Limestone Formation, the well’s primary objective

• Continuing elevated background gas levels

PARADOX BASIN #1 OIL & GAS WELL, UTAH USA
Golden State Resources is pleased to announce that drilling at the Paradox Basin #1 oil & gas well is proceeding satisfactorily within the Leadville Limestone Formation.

Paradox Basin #1 is at 16,153 feet (4,923 m), in dolomitic limestones and shales of the Mississippian Leadville Limestone Formation, the primary objective of the well.

Background gas levels continue to be elevated. Connection gas is up to 150 units. Trip gas is up to 1100 units.

The well is drilling ahead at 6⅛” in the Leadville Limestone Formation.

PRODUCTION AND PERMITTING
So far eleven potential gas production intervals have been defined in Paradox Basin #1 between the Upper Ismay and the Leadville Limestone, as well as one potential oil interval.

Additional zones are expected in the remainder of the well. Permit applications for a connector production pipeline to the nearby Williams Northwest Pipeline have been lodged. Permitting for an onsite gas plant awaits completion of the well.

The production potential for the intervals annotated below will be determined upon setting production casing and conducting flow tests at the completion of drilling.

Trying to figure the rationale behind today's sell off... stop losses.. or last minute 'profit taking' ... at 80c seems like a good buy.... oh well... one man's stop loss is another man's buy opportunity.... need to hear some news on when production testing will occur once drilling is stopped... wondering if they'll keep the rig in situ to do the test or demob and bring in another test rig... if they do that'll be a turn around time of at least a month..... maybe that's the reason for the sell down....

oh my God... a trading halt.... all the last one's have been followed by good news... hope this one is the same!!!

I would expect if they have found nothing, that the drilling would continue down deeper without any announcement!!!

Must assume good news to be reported!!

Thought it was a drilling issue but it's uranium.... that's come in from left field! No idea what the price implication could be....

... definitely buys some time for the share price given the extra drilling time and no trading...

chance fate said:

Thought it was a drilling issue but it's uranium.... that's come in from left field! No idea what the price implication could be....

... definitely buys some time for the share price given the extra drilling time and no trading...

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What the?!?? Since where did you get word that its uranium?

I think there are a fair few like me out there who are trying to wait the 12months out...