Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Evan Calio - Morgan Stanley.
Evan Calio - Morgan Stanley
I had two questions; my first question John is regarding capital structure. I know your opening language has softened over the last few quarter introductory comments, and omitted here in your opening comments that you just made was regarding potentially accessing the debt or equity markets, which was a potential overhang and a concern for some investors.
Clearly as market conditions have improved, commodity markets have improved, your cash flows have improved. I mean is it safe to say that in a reasonable price band in the commodity, that this potential overhang has largely been mitigated or was there any other additional element that maybe I didn’t appreciate with regard to increased capital spending into 2010 etc.?
John Rielly
It’s a fair question. Obviously the financial condition and some headwinds we were facing in the last few conference calls of lower prices, and I would say fairly uncertain financial markets weighed on our mind in terms of how we would fund our future growth. Obviously since then the oil prices improved, as well as the financial markets.
So as a consequence, as we look forward, we feel pretty good that the majority of our future funding requirements will be met from cash flow from operations going forward, but we will also continue to do what is required to ensure our balance sheet is sufficiently strong to fund our growth of reserves and production for the long term.
So as a consequence, we will always have as an option redeploying capital internally through asset sales or maybe even bringing partners in for some of the exploration prospects that we have as they mature, and also raising new capital externally in the form of debt or equity. As you know, we accessed the public debt market in the first quarter for $1.25 billion. All this is on the table, and I think that’s the real takeaway.
Evan Calio - Morgan Stanley
And my second question if I may, in the last conference call we talked about potential unitization of Pony and the discussions you have with Knotty Head partners, ongoing yet premature. This morning lynxes announced that they’ve finally taken delivery of a rig, with results in its delineation well expected in the second quarter of 2010.
Would it be fair to assume that it is going to be after those parties have figured out what they have, that we would expect some potential decision regarding unitization of those blocks, meaning it’s something in a mid 2010 type of event?
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