ann out

Golden State Resources Limited has run 13⅜” casing to 3,806’. The well is
currently circulating through the stage tool waiting for the stage 1 cement
to set, prior to cementing the upper stage. The well is expected to drill out
of casing once the second stage cement has set.
Operations on the Paradox Basin #2 well are proceeding ahead of schedule. Unit Rig 234
drilled to the surface casing point at 3,806’ in approximately 7 days and has run the 13 ⅜”
casing and set the first stage of two stages of cement. The second stage cement is
expected to be completed today before continuing to air hammer drill in 12 ½“ hole to
approximately 6,000’ before switching to a conventional mud system and rotary drilling.

Current operations are eight days ahead of schedule and are 16 days ahead of the
equivalent operations in the Paradox Basin #1 discovery well. Rig 234 has performed
reliably through‐out operations with minor lost time due to a minor electrical problem.
Minor time losses have also been attributed to reliability of the air hammer.