Question-and-Answer Session
Operator
(Operator Instructions) First question comes from Noel Parks. Please state your company name followed by your question.
Noel Parks - Ladenburg Thalmann
Ladenburg Thalmann. I just have few questions. On the acquisition front as far as the Gulf itself, do you have any sense at this point whether you have much in terms of pref rights opportunities just from properties you know or you think are going to be on the market, and if you have any sense of whether that would be major or minor?
Tracy Krohn
The short answer is, yes. We always have preferential right opportunity. We have got a lot of acres and we've got a lot of leases out there. As far as what might be coming up on the horizon, we're certainly aware of properties that are being marketed. As to whether those will sell sooner or later is not something that we really have a good feel for, but in the event that we're not the purchaser.
We would have significant opportunity. I don't know that I can give you an effective timeline, whether that's going to be major or minor. It depends sometimes on how they structure these things whether it's for instance a sale of all or substantially all the assets and that may negate certain pref rights and that sort of thing. So I don't really have an accurate feel for what it would be, but feel fairly certain that [if it met] our criteria that we would be able to gather that fairly quickly.
Noel Parks - Ladenburg Thalmann
On Mahogany, as far as the deep drilling you're looking to do there, having had a few more quarters to study it, do you have any update as far as your expectations or time to drill, cost to drill that you might need out there, thinking that we've seen this pullback in cost and develop?
Tracy Krohn
The good news is costs are going down. Certainly, drilling rig costs are going down. I don't really have a good feel for a bottom-line number on what it's going to cost to drill that well. The rig costs are going down. [Boat] costs are going down. Ancillary service providers are starting to go down. They are not going down quite as quickly think. So, I don't really have an accurate number.
Certainly the reserves aren't going down other than what's being affected by price. This is a substantial prospect. This is one that would certainly move the needle pretty dramatically for us. It's a deep well and we're looking at somewhere around 25,000 feet right now, so we'll probably have a little bit more data in the next two or three months as to whether we'll be drilling that well in the near term or a little bit further out.
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