Question-and-Answer Session
Operator
Thank you. (Operator Instructions) Thank you. Our first question is coming from David Snow of Energy Equities.
David Snow - Energy Equities
Hi, good morning. I'm trying to remember -- Itochu contracts at $14 a pound, now your release says that this action eliminated the potential for reinstatement of the original 2003 delivery contracts. I am trying to recall how did that go away if you reversed this joint venture?
David Clark
There were certain conditions, and Tom is going to elaborate if he remembers those that if in the Preliminary Investment Decision, if I recall it correctly probably, if we didn't want to go forward, and they didn't want to go forward or something to that degree that you could revert it back to those original contracts.
Thomas Ehrlich
That's precisely it. If Itochu were to have make a positive investment decision and we were going to make a negative investment decision meaning that the joint venture did not go forward. And the terms and conditions of the original sales contracts would have been reinstated from that point going forward.
David Snow - Energy Equities
So you didn't reinstate the original contracts, right?
Thomas Ehrlich
That is correct. We did not.
David Snow - Energy Equities
And the chance to do that is now gone.
Thomas Ehrlich
Correct.
David Snow - Energy Equities
So are you out of the $14 contracts and the fixed delivery obligations?
Thomas Ehrlich
Well we have been out of those since we renegotiated the contracts. However, pending the outcome of the joint venture decisions they're allowed for the opportunity for us to step back into those. With this decision, it eliminates the opportunity for us to be required to step back into those old contract terms.
David Snow - Energy Equities
So you'd rather be old contracts all together?
Thomas Ehrlich
Yes.
David Snow - Energy Equities
Okay.
David Clark
And part of that the renegotiation was -- the renegotiation at $14 contract was the new pricing structure in Texas and the joint venture at Church Rock. Those two were tied together.
David Snow - Energy Equities
Okay. And I was trying to remember and I couldn't. So you're basically benefiting twice, you got out of any of those contracts and you're 100% in New Mexico.
Thomas Ehrlich
Now, David, remember, we were not under the conditions of those old contracts. The specter of them being reinstated is what we got out under.
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