GDN - Golden State Resources

pilots said:

Any well drilled will flow gas, getting it to be commercial is the hard part, this new round of fracking will add more cost to the well, should they ever get it to flow commercial, the well can NEVER pay for itself. You should only flog a dead horse for so long.
Good luck with your trading this year, we all deserve it after what happened last year.

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not true, no one can say for certain beforehand if a well will produce commercially or not after a frac stim, generally a fracture stimulation will result in improved flow rates from a well as long as its designed correctly and undertaken correctly for the specific formation its being targeted for. it can take many goes to get it right.

pilots said:

Sharemadder, they have had all the time they need to frack and test, if we don't get good news by the end of this week, you can kiss the first well good buy. If they can't get the first one commercial, I don't hold any hope getting the money together for the second one.

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pilots, unless your really sure about timings in well operations then statements like that are not going to sound very accurate. you can spend many many weeks on a frac exercise or just a day.. what type of frac is planned for the well? is it simply a mini frac to test the zones or is it a full scale operation?

a formation will either indicate it can flow or not depending on a number of circumstances. in any drilling exercise or fracture stimulation there are plenty of things to go wrong and its always a case of trial and error. having hydrocarbons present in a formation and wanting to flow freely is ideal. if formation damage is suspected or fracture stimulation is common for that formation then its not unreasonable to expect improved flow rates from such an exercise. a fracture stimulation is only done where the probability of success is justifiable and an reasonable odds of success is anticipated in most circumstances.

i agree nothing has gone right for gdn and its had volumes traded like no one has seen on a small cap oil explorer.. some days i look at the trades and think "pump and dump" myself.. this stock has had many issues and problems thus far, and no one knows for certain what the formation is capable of producing. imho the biggest problem for gdn was the exaggerations of the progress reports during drilling where the term "commercial" was used on many occasions yet to this day it appears the outcomes of all the zones appear to differ. that in itself makes it hard to understand the validity and motivations on the reporting as far as i am concerned.. and has made investing in gdn impossible for me..

Yes, GDNs problem I think was the fact that never had a clue about the drilling game, and as a result of this, they them self was screwed as well as the share holders.

i think most people may agree with you pilots , it was perplexing me what was going on hence i stayed out of the share no matter what..

good timing,, some results have come through..

the well appears to have had low pressures needed swabbing on clean up, and obviously didnt clean up well enough to warrant flowing it any further, the results would indicate whether they would warrant any further frac operations in the future, it appears they may want to consider it..

i have no idea if the 2200 psi shut in or the 300 psi on flow is an improvement or not from previous operations? anyone know?

PARADOX BASIN #1 WORK‐OVER
Golden State Resources has completed the re‐perforation and testing of Paradox Basin #1. The shutin tubing pressure increased to 2200 psig before the well was swabbed and a clean‐up flow commenced. Indications are that additional permeability was encountered. The principle objectives of the operation have been met and operations were suspended at 8pm on 31 December.

The well was flowing at 500 Mcf of gas per day with a 300 psi tubing pressure and was still cleaning up when the operations were suspended. The results of the testing give Golden State Resources further impetus to commence planning for a fracture stimulation that would be undertaken in the
northern spring.

Data from the test are being analysed and gas compositional data will be provided to prospective gas gatherers. The work‐over also provides sufficient data to enable the permitting of the production connector pipeline to be completed.

If you have to swabb a gas well it's a good chance it is going to be a dud, any shut in well will have up to 3000psi shut in PSI, this is just normal formation PSI, when a gas well flows at 300PSI you can forget it. Looks like they now have a WA partner, I hope they know about drilling, how ever that won't give them all the money they will need.

Pilots

Money is no issue, they have plenty on tap now and there is a whack of options expiring June 2009.

Para#2 is the main game now.

Para#1 will be frac'd again later but for now emphasis will now move to Para#2.

pilots said:

If you have to swabb a gas well it's a good chance it is going to be a dud, any shut in well will have up to 3000psi shut in PSI, this is just normal formation PSI, when a gas well flows at 300PSI you can forget it. Looks like they now have a WA partner, I hope they know about drilling, how ever that won't give them all the money they will need.

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swabbing and 300 psi is indeed very poor in terms of what you need in a well to produce commercial flows. the results of the frac would give them more data to work with and better frac designs or models to consider later, sounds like a mini frac?

the results would have been extremely disappointing to anyone. but there is not enough technical data nor anywhere enough time for any analysis to conclude if the well is a dud or not imho.. but it looks very bad imho.. 300 psi would not have been the numbers they would have been after..

The bit I don't like is this fracking cost the world, trust me you can spend as much on a frack as it would cost to drill the well, I am not saying this has happened with GDN.
If I was running GDN I would try to get drilling under way before I gave out any crap reports on the first well. With a bit of luck the ramp team will get on board and this will move the SP. I would want to know the big rig was ON SITE AND DRILLING before I would look at them.

The market thinks it is still a no go. GDN must give us some numbers, and facts if they want the market to fall in love again.

This is being capped at 8c pilots.

Been like this for a few trading days.

Hits 8c and then big seller appears to hold it.

First capital issue must be near before Para#2 deep drill starts.

Interesting comments on this thread. Good to read.

Tend to see both lines of argument as valid. GDN have screwed up in the past. Paradox 1 does look dicey to me. Yet as Sharemadder suggests, Paradox 2 is the main game now and like any drill, there is always the potential (although the odds clearly differ depending on the target at hand) riches at the end of the drill bit.

Glad I sold to a free-carried parcel back when the SP was near 8c. Reckon this SP will tread water and/or slowly edge back toward 5.5c while the funding deal is completed, then start to run again later in the first week of February. If it does, might top up again as a quick BESBS play going into paradox 2 .

sharemadder said:

This is being capped at 8c pilots.

Been like this for a few trading days.

Hits 8c and then big seller appears to hold it.

First capital issue must be near before Para#2 deep drill starts.

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Well whats the hold up this time, we have the lease ready, PLENTY of rigs stacked around that neck of the woods, people tell me we have all the money we need, so just wait two more weeks, getting sick of that old saying.

Looks like GDN has slowly drifted as I suspected. Hovering between 5.6c-6.1c at present.
Sub 6c, I suspect that this might provide a 2nd bounce BESBS play as we enter Paradox 2.

Holding a free-carried parcel

Testing

I see a lot of questing about the flow rates and production pressures on #1. I see 500Mcf as being a very good number for this area without a fracture treatment. We are talking about micro-Darcy perm and therefore lower rates without help.

Many operators just to the east would deem a well at $6.00 gas that IP'd at 1000Mcf to be a success. These wells are drilled to 2700m with 5 to 8 fracs.

As far as the 300psi is concerned I see no reverence to how they were testing the well and what tubulars were involved. They were probably flowing up casing did not have any assist.

Just as I thought on previous posts, GDBN now struggling to hold at 5.5c. Until we get through the first week of Feb, reckon 5c is very likely.

DYOR.Just MHO.

GDN,You have to hand it to them, no mater what they touch turns to trouble, they have trouble with the TBG, why did they not pull it out and fix the problem, or was the problem the fact that the TBG was full of sand. Next they say the completion fluid was lost in to the formation, this is seen as increased permeability,BS, this is all so seen as NOT HAVING ANY GAS PSI TO PUSH IT OUT OF THE HOLE. No matter what, the numbers for the first well is that it is no way ever going to be commercial. Going to be VERY hard to find the money now.

Just had a look at the photo of the rig, hope it is still rigging up, as that photo has NOT got a top drive, have we been screwed again????

pilots said:

Just had a look at the photo of the rig, hope it is still rigging up, as that photo has NOT got a top drive, have we been screwed again????

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ASX ANN Feb 12
12/02/2009 Paradox Basin No 2 Update
http://media.wotnews.com.au/asxann/00926586.pdf

PARADOX BASIN #2 UPDATE
Unit Drilling Rig 234 has commenced drilling of Paradox Basin #2. Rig 234 is a modern top drive capable of drilling and completing the well to 16,000ft. The well is scheduled to take 110 days to drill and test.

Drilling operations are being managed by F.J. Brown and Associates incorporated in Texas.

Golden State Resources Limited has recently engaged RPS Energy to conduct an independent resource assessment of the Golden Eagle gas field.

Paradox Basin #2, the second well on the Golden Eagle gas field is planned to further appraise the extent of gas bearing horizons in Pennsylvanian and Mississippian reservoirs, and is expected to test the Leadville Limestone 600ft higher than Paradox Basin #1.

Paradox Basin #2 is located closer to known faults and is more likely to encounter fracture enhanced porosity, which is a consideration in the placement of potential naturally productive wells.

The Golden Eagle gas field was discovered in 2006 when Paradox Basin #1 produced gas from three separate zones within the Hermosa Group of the Paradox Basin. Gas was produced on test from the Upper Ismay Formation, and the Barker Creek Formation.

Golden Eagle gas field is a deep tight gas accumulation located in the Paradox Basin in Grand County Utah. The structure remained one of the largest untested features in the basin prior to Paradox Basin #1. Most structures in this prolific basin were drilled in the middle of the last century.

Golden Eagle gas field is a high relief structure containing numerous gas zones in low porosity sediments over a 1705m (5594’) section extending from the Upper Ismay Formation at 2964.8m (9727’) to the Pinkerton Trail Formation at 4669.8m (15321’). Structural closure exceeds 600 metres.

Gas is reservoired in a variety of rock types with typical porosity below 8% and low permeability. Independent Log analysis of the Upper Pennsylvanian confirms the presence of 15.5m of net gas pay. Additional gas bearing zones occur in the Lower Pennsylvanian, Pinkerton Trail and Alkali Gulch Formation. The Mississippian Leadville Limestone was not effectively evaluated by the first well.

Big dog, have a look at the photo, no top drive in the mast, a swivel on the ground, you don't use a swivel with a top drive. I worked with a driller called Big dog in Malaysia was that you??

pilots said:

Big dog, have a look at the photo, no top drive in the mast, a swivel on the ground, you don't use a swivel with a top drive. I worked with a driller called Big dog in Malaysia was that you??

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Hi Pilots,

Sorry, but I am not your driller.

Top drive -- what am I looking for?

The photo is dated Feb 9, 2009 - at least they got the date right!

Big Dog, go to Google, enter Top Drive, they have some good photos of them.
Just looking at the GDN rig I cant see that it EVER has had a top drive, you can have them installed but that takes a Long time.
If that rig has a Top Drive why do they have a swivel on site, you can't use both of them.