Question-and-Answer Session
Operator
(Operator Instructions). Your first question comes from Ron Mills - Johnson Rice.
Ronald Mills - Johnson Rice & Company
A couple of questions. If you look at your budget, it sounds like you still have one rig in Woodford, did you say it’s not currently drilling now, Charlie?
Charles Goodson
That’s correct.
Ronald Mills - Johnson Rice & Company
And I am just trying to get a break down. If you look at your $80 to $100 million budget you said about 70% of it will be spent in long-life basins. How do you get to that level if given your current activity levels, how would your activity levels trend to be able to spend that much capital in those places, the Woodford was as I recall, the biggest component of your long-life spending?
Todd Zehnder
Ron, that assumes that, that rig is back to work here in a about a month or two. We are waiting to see the continued trend of service cost and we are seeing pull back across every area of service cost. The rig makes up one piece of it so we made the decision to go ahead and we’ve got already a couple of completions that are stacked up and we are going monitor that. We do assume that we are going to get that rig back to drilling, we are just waiting to better align the cost structure knowing that this gas price is so much weaker than we have expected.
Charlie Goodson
We also had a lot of non-op AFE sitting out there that we will be drilling and like Todd said, we anticipate some clarity later in the year and it’s probably going to be in the form of service costs coming down and we will be able to take a back up and hope to increase.
Ronald Mills - Johnson Rice & Company
Okay. And what’s your completion plan, I know in the Woodford it sounds like you kind of creating a little bit of backlog of completion opportunity is in and as it relates to that what’s the plans with your 7000 foot lateral that you talked about in January’s release.
Charles Goodson
Well, I really, at this point, the well is still flowing at a, may be a couple of million a day, they hadn’t looked at a recent rate on it. There is really no reason in our opinion to go and spend the capital, the frac the other 20 or so stages. Because, the rate of return on that is not acceptable to us. So it does really no good to expand that capital until gas prices come back with the known fact that service costs are continuing to go down and if we fraced it right now, we would almost be guaranteeing a work rate of return than by delaying it.
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