Question-and-Answer Session
[Operator Instructions]. Your first question comes from Brooke Glenn Mullin from J.P. Morgan.
Brooke Glenn Mullin - J.P. Morgan
Yes, good morning. Really two questions. One, can you just talk a little bit about your plans for your excess cash flow, particularly in light of the strong commodity prices that you're seeing? And then secondly, it looks like Alagasco's CapEx is going up, can you just let us know what's going on there?
James T. McManus, II - Chairman and CEO
Yes, Glenn. First addressing excess cash flows, as we've talked about, one of the things we would love to do, I believe our capital budget for 2008 at Energen Resources is around $270 million, $290 million. We would love to, based on the results that we have in 2008, try to press forward on that inventory of P2s and P3s and we’ll be evaluating that as we move through the year. So, that obviously would be our highest and best use of capital. Secondarily, we've always got the possibility of considering acquisitions. That market continues to look better, we have been in that market here lately. We've gotten some decent feedback even though we've not been able really to execute on an acquisition. So, we still have that as a source and use of that cash. And as we’ve talked about, obviously if Alabama shale play hits in a big way, that would be a significant user of cash and so we've been willing at this time to be a little bit more equity pick. And then finally, if the... if the stock price were to become very attractive from our perspective, we've still got 9 million shares authorized under our stock buyback in which we could move in to use that excess cash flows to purchase stock. So, that really is kind of how we're thinking about those excess cash flows at this point in time. The utility capital we moved up due to some implementation of some technology. What we are doing, I mean just to give you one example. Over time we're going to go to automated meter reading at the utility and really probably face that function out over the next several years and do that remotely by truck. It really is to try to capture technology efficiencies that reduce cost in the utility and that's why you see that budget moving up.
Brooke Glenn Mullin - J.P. Morgan
- To read the full transcript on Seeking Alpha, click here »
