Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Doug Leggate - Howard Weil.
Doug Leggate - Howard Weil
I’d like to go back to the first-quarter conference call and I’m sure that Dave Roberts gave to a question relating to DD&A and related to Neptune. If I’m not mistaken, what Dave said at the time was that, you had just about 2 million barrels at out of Neptune and you had written the asset down to about 2 million barrels.
So, I’m trying to understand, why the DD&A is still in the books for Neptune? If you could give a little bit of an update as to how the project is performing? What that DD&A should look like going forward and I have one follow-up.
Clarence Cazalot
I’ll start and then Janet may want to jump in. Your numbers are accurate in terms of what we said the asset was just to recap. We had taken the reserves down from 12 to roughly two and so the DD&A rate for the quarter went up substantially, and that was as a result of the reservoir performing worse than our models indicated.
What we said at that time is we thought the reservoir was more compartmentalized than our models were predicting. I will tell you that, this month we’re going to add back about 0.5 million barrels of reserves and that should then take our DD&A rate down about 30% in Q3 from Q2.
So it will get us back to a more normal rate and the figures that Howard quoted for Q1 will be what we expect on a go-forward basis. The critical aspect here in terms of why this asset wasn’t completely written-down is you understand the write-down test is an economic test. It’s not a financial test and it also considers things on a perspective basis, go forward basis.
We still believe that there’s on the order of 10 million barrels of total resources net to Marathon and there is additional potential on the north flank of the field that it’s not included in those volumes, and we believe that there is potential for this value to be realized and, therefore, we have not elected to take a complete write-down of the asset at this time.
Doug Leggate - Howard Weil
If I could ask a follow up for clarity, so just to be clear, the run rate going forward somewhere in the $17 range for the U.S. is what you’re implying?
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