Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from the line of Ron Mills with Johnson Rice. Please proceed.
Ron Mills – Johnson Rice & Company
A question just about if you’re looking at your $74 million budget, any sense as to what kind of production profile can look like given just your ongoing declines in south Louisiana and with some of the other projects i.e. south central Texas and north Louisiana and plays like that that will develop more over the course of the year. I’m just trying to get a sense of what your 08 production profile looks like.
Joseph A. Reeves, Jr.
Gosh Ron, I wish I had a crystal ball and could answer the question for you. East Texas, as I alluded to in my initial comments is a great area for initial high rates and then developmental declines following but forming a good solid base. With two rigs working and they seem almost to be in tandem but nevertheless almost parallel in some instances. For example, ones being completed now and we probably have three weeks before the other will be completed so they’re taking 100 to 120 days is somewhat similar to drilling deep south Louisiana wells, right. Therefore, creates a lot of lack time for increases in production compared to say some of the plays that we’ve designed and have been developing to increase that cycle time.
If you recall in our Biloxi marshlands area we were able to drill and complete wells about every 30 days and we were able to ramp up production even though we’d start off high and they would also decline we were able to add production on a rapid pace basis whereas here while things are nice and you pick up additional reserves more frequently then you pick up additional production as you do with any conventional play our unconventional style play, what we are shifting to is the style of opportunities that have shallower components that take less time to drill and that are in proven areas rather than what I refer to as white space, unknown or unproven areas that we can have an impact on because of either the technology and drilling technology and the completions that we know about in today’s world. It would be remise on my part to tell you that all of those are going to be successful or to what extent we’ll be able to accelerate those once we prove one up. I can just tell you that the activity level in that area will be sooner and once proven will increase on a much more rapid basis, much akin to the Biloxi marshlands area then what we’ve seen in either south Louisiana and the traditional deep wells or east Texas in the traditional dual laterals where they are deep. They’re sometimes 26,000 feet by the time you get through drilling those dual laterals.
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