Question-and-Answer Session
Operator
(Operator instructions) Your first question comes from the line of Mike Scialla with Thomas Weisel Partners. Please proceed.
Mike Scialla – Thomas Weisel Partners
Hi, guys.
Mel Riggs
Mike, how are you doing?
Mike Scialla – Thomas Weisel Partners
Just fine, thanks. Question on the asset sale, can you give us the reserves associated with that and how much production?
Mel Riggs
First of all, I will take the production. We sold about 700 net barrels of oil production and about 11 million cubic feet of gas. I think what will happen, we are going to update our guidance here shortly for the rest of the year and I think you will see a little dip in second quarter, but with the activity level we have, we are going to probably be right back to kind of the original plan pretty quickly, if we continue at the same pace. And on the reserves we sold, it is roughly 1.8 million barrels or 11 Bcf, about 4% of the company's proved reserve volumes.
Mike Scialla – Thomas Weisel Partners
Okay. The timing of the close, that was I believe you said April 1. So, none of that production will be in your second quarter numbers?
Mel Riggs
That's right. Actually, (inaudible) was March 1 I believe on that. So, we have already – it will not affect – that production will not be in the second quarter at all.
Mike Scialla – Thomas Weisel Partners
You said you have paid down $113 million of debt. Where does your debt to cap stand now?
Mel Riggs
We are down to – in effect we are still around 60%, something like that.
Mike Scialla – Thomas Weisel Partners
Okay. And then last one on the Bill Simpson and the Margarita, do you have any sense on the timing of when you'll know how much you are going to impair there or if you are going to impair some?
Mel Riggs
No. We don't really know yet. There is just going to be – I think there is still little work to do on those wells, (inaudible). Clayton may be able to talk about that in a minute. But, the wells are producing and we will look at that each quarter and see if there is an impairment needed. It has to do a lot to do with what we plan to do in the area too around those wells, our future activity.
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