Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Michael Scialla – Thomas Weisel Partners, LLC.
Michael Scialla – Thomas Weisel Partners, LLC
Any update on potential alternative financing for the Green line?
Gareth Roberts
Well, I don’t think we really have anything to announce on that. I think we’ve mentioned that we were looking at some either straight financing and I don’t know if we’ve really got anything else to report other than that.
Phil Rykhoek
Mike, we looked at that a little but we kind of just looked at the cost of capital and even though sub debt was not cheap it was less expensive than probably a private equity financing or some other financing on the pipeline. So, with the sub debt offering we’ve kind of tabled the financing on the pipeline.
Gareth Roberts
The simplest way to look at it Mike is we basically financed the pipeline with sub debt. I mean, it’s virtually the same number of capital and that was the best rate we could get on financing that pipeline.
Michael Scialla – Thomas Weisel Partners, LLC
That $430 million estimate you got, has any cost savings been built in to that for the pipeline?
Mark C. Allen
No, for the Green pipeline $430 is a good number for us moving forward for this year.
Gareth Roberts
We’ve already trimmed it back a little bit from where it probably would have been. We are hoping I think that we’re going to save something on the rest of the budget but that’s really a hard number to come up with. We’re seeing some costs continue to fall, some costs have come down by 20% to 30% so the average I think will be somewhat less than that. But, we haven’t really built those kinds of potential savings in to the overall budget so there might be a little bit left over at the end of the year.
Michael Scialla – Thomas Weisel Partners, LLC
Then with a lot of companies still forecasting some pretty decent production growth this year despite cutting back their ’09 budgets but I think the real impact is going to be felt in 2010, I’m just wondering is that the case for you guys? It looks like you’re still going to have a ramping production probably from Heidelberg, Delhi and Cranfield?
Gareth Roberts
I think our delay is more like two years than in typical companies it’s either that year or maybe it’s built in to the next year. So, we’re still forecasting pretty decent growth in to 2010 and we haven’t really delved in to 2011 yet. But we’re basically forecasting pretty decent growth in 2010 with the money that we’re spending in 2009. What we actually spend in 2010 probably won’t have a whole heck of a lot to do with the production in 2010.
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