We are spread out across the country. We have operations in California which is the Legacy business, Wyoming which is the next business we acquired about 10 years ago and then subsequently we have added Michigan, Indiana, Kentucky and Florida to the base of operations. Very different footprint than some of the other E&P companies you see. These are nonetheless attractive places for us to be in business and we have a significant presence in each of these geographies.We’ve grown significantly the acquisition since this is an A&D panel since going public. Again we were in two States at the IPO. We’re now diversified into six and we’ve expanded from just an oil platform to an oil and natural gas platform. Let me touch on a few of our principal strategies. In terms of production growth, we’d like to grow the business organically in the low single digits on a year-over-year basis. That’s where we grew from 2009 to 2010. We are generally on that track from ’10 to ’11. Obviously with acquisition, those growth numbers are going to hopefully change pretty dramatically. But year-over-year if we can continue to grow the business organically in the low single-digits, that’s not a bad place for us to be. We have significant financial flexibility today. All of the panel participants I think have grown pretty materially since having gone public. We currently have an $850 million borrowing base on our revolver and I think as all of us have grown we’ve increased our general access to the capital markets which has lent itself to better financial flexibility overall. We are currently distributing at $1.74 per unit rate. We’ve increased distributions in each of the last six quarters and our strategy, like the balance of our peers, is acquisition oriented. So with a few $100 million of acquisitions in any given year, that can really move the needle for a company like ours in terms of size.
A key to our strategy is hedging. We are generally between 80% and call it 50% hedged in year one through year five. We like that profile. We’ll continue to see that profile roll forward for us hopefully. And in the context of an acquisition we look to hedge the expected production from that acquisition very quickly. Our most recent transaction for example, we set up a structure where we hedged all of the expected production for the next five years between signing and closing just to alleviate any commodity price risk in the interim.Hedging serves a very effective and – has a very effective and useful purpose for us. This graph illustrates over time what our quarterly EBITDA looks like, which is generally pretty flat since the early part of 2008. Obviously that was during a period where the financial markets and commodity prices were very volatile. Under imposed on this graph are oil and gas prices during the same period and you can see from the middle of 2008 where commodity prices were around $140 a barrel and $14 prim, they collapsed all the way down to $40 a barrel and $4 prim. During that period wipe, prices went down by plus or minus 70%. Sur EBITDA was only down by call it 15% or 20%. So hedging is a tool that we and others use, is incredibly important for our business model. Read the rest of this transcript for free on seekingalpha.com