Pleased with the level of production we saw in the first quarter, considering that much of the capital spending was focused on projects where production gains will come in the third -- will come in the second or third quarter. Furthermore as we stated before, our capital program is not designed to maintain production but to maintain cash flow. Simply because of the nature of our capital program, which is liquids focused, our cash flow may actually while our production on unit base may decrease. This is a function of reporting production on a conventional six to 1 GAAP overall ratio when it's back to oil prices as you all know we are trading at more than 45 times that of GAAP. Over the course of the year, absent any acquisition, we would expect our GAAP production to decrease or we would expect our liquids production to increase.Respect to the CapEx program, during the first quarter we spent $8.2 million, which compares to $3.5 million that we spent in the first quarter of 2011. Approximately $3.7 million was spent on operated properties primarily focused on workovers; download pumps, facilities, and returning wells to production. The remaining $4.5 million or 55% of the total capital spent was related to our non-operated properties. $2.5 million of those funds were spent on drilling in the Bakken, Cleveland, and Rock Springs wells, and $1.3 million on projects related to our Gold Coast acquisition, which we completed in 2011. The balance of the spending was on water floods in the Permian basin and other miscellaneous work.
Vanguard Natural Resources' CEO Discusses Q1 2012 Results - Earnings Call Transcript
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