gdn to evaluate upper zone gas discovery ...

Source: www.proactiveinvestors.com

Golden State Resources to evaluate upper zone gas discovery
Wednesday, May 13, 2009



Golden State Resources Ltd (ASX:GDN) has provided an update at Paradox Basin #2 Well in Grand County Utah.

Paradox Basin #2 is currently drilling at 12,966’ in the Barker Creek Formation. The formation integrity test and further testing of the stack was completed overnight.

As previously reported the 7” casing was set without significant incident, and has since been subjected to a casing pressure test and stack test. As a result of those tests several seals are being replaced on the Blow-out preventer. These are normal good oil field practices which are particularly rigorous for deep high pressure gas wells. All operations have been conducted efficiently and within normal time ranges and safety requirements. As Paradox Basin #2 is now approximately 4 kilometres deep the round time for tripping is about a day.

Paradox Basin #2 will test major objectives in the Barker Creek Formation, Alkali Gulch Formation, Pinkerton Formation and Leadville Limestone. The Lower Barker Creek Formation is one of the principle objectives of the well. In Paradox Basin #1 the Lower Barker Creek Formation displayed up to 2313 units of gas over an interval of 220’. The Lower Barker Creek Formation is anticipated to be encountered within 300 feet of the current depth. The Alkali Gulch is immediately below the Barker Creek Formation.

Next Steps

The company has indicated several groups have been approached to provide expert advice in regards to the completion of the discovered gas in the Upper zones in Paradox Basin #2 and to assist in commercialising the Golden Eagle Field.

Proactive Investors Comment:

With Paradox Basin #2, the company has moved light years from Paradox Basin #1. This is clearly shown in the operating procedures undertaken to date. What will be interesting will be news on pressure readings for remainder of the zones, gas composition and gas saturation and the report from RPS Energy. Together with incoming news when principle objectives are reached in the well, sets the scene for a potentially explosive news patch and price break-out.


Ends.

Cheers, Pie :)