Question-and-Answer Session
Operator
Certainly. (Operator instructions) And your first question comes from the line of Ron Mills of Johnson Rice. Please proceed.
Ron Mills – Johnson Rice
Good morning.
Jim Palm
Good morning, Ron.
Ron Mills – Johnson Rice
Couple – a couple of questions for you. Should I read into your comments that the basic – you are cutting your CapEx literally to a point where it’s basically maintenance CapEx in order to hold production flat, and if so, what’s entailed in that budget? Is it mainly recompletions or are there new wells also being added as – particularly in South Louisiana?
Mike Moore
Yes, I think that’s right, Ron. We are basically – the budget that we are using currently is a maintenance budget. It’s about $22 million of CapEx, which includes about $4.3 million of Grizzly. So, the rest is spent to drill just a few wells in West Cote, Hackberry, and Permian, and Bakken, just a few there, and then some recompletions in West Cote Blanche Bay.
Ron Mills – Johnson Rice
In the March production volume that Jim mentioned, is that purely in response to the recompletions that you outperformed in February down in South Louisiana?
Jim Palm
Yes, that’s pretty much it, Ron. We are – primarily the recompletions, we are doing a few stimulations and things too, but main thing is recompletion.
Ron Mills – Johnson Rice
Okay. And then, when I look at either your cash flow or the EBITDA and as you all talked about, is the plan then to first and foremost use excess cash flows that you generate to pay down debt in the absence of oil prices being at $50 or $60 or an attractive acquisition coming your way? Because I assume your redetermination is coming up shortly or is currently ongoing for your year-end reserves. Can you comment on that borrowing base?
Mike Moore
Yes, that’s right. We are in the middle of a redetermination. We don’t have the final numbers; we’re comfortable with where we are. We think we’re going to come back somewhere north of where we are now. Certainly all banks have changed their price deck, but the answer to your first question, I think for the excess cash that we are going to throw off this year, as well as on future years, we’ll just have to evaluate opportunities that we have to drill. Costs are going to have to come down obviously before we decide what we are going to do and what levels of activities we are going to have, but in the absence of that, as long as they do come down, then we’ll just have to evaluate where we think the best use of that money is for our shareholders.
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