You have those ability to make good decisions when the market gives them to you.
Donovan Schafer: Okay. Very helpful. Thank you guys.
Operator: Your next question comes from the line of Lloyd Byrne of Jefferies. Please go ahead.
Lloyd Byrne: Hi guys. Thanks for all the info. Let me come about the CapEx differently. It seems like there’s a lot of concern. But if I look at the CapEx versus the tills, it feels like the AFEs are either in line or coming down. And maybe you can comment on that. And then also you talked about a little bit of a deflation at Mascot and Novo. Maybe you can just comment on that as well.
Adam Dirlam: Hi Lloyd, this is Adam. I made some comments in my prepared remarks. We’re definitely seeing it across the board, both from an absolute and normalized on a lateral foot basis. We’ve certainly seen that with our Mascot assets as well as our Novo assets. And I think that’s both the function of what we’re seeing in terms of drilling as well as just kind of spud to till timing as well. I think some of the tangibles casing those types of things are still pretty sticky. But operators are doing a pretty good job of being able to kind of pick away around the edges and see that persisting.
Lloyd Byrne: Thanks. And then, Nick, just remind us, more free cash flow coming forward, debt targets?
Nick O’Grady: Yes. We still target around one time. And I think we were about 1.1 last quarter. We’re about just over 1.2 this quarter. And that’s just a function that we closed our Northern Delaware acquisition. So we did that. We should see, absent any material changing again, we’re already close to May here, a material step down this quarter again, absent some unforeseen change in commodity prices over the next couple of months. But just given the fact that CapEx is scheduled to step down some, so we should see a material step down on the revolver balances in the second quarter. We should be right down the trend.
Lloyd Byrne: Thank you, guys.
Operator: Your next question comes from the line of Paul Diamond of Citi. Please go ahead.
Paul Diamond: Thank you. Good morning. I appreciate you taking my call. Just a quick one on the M&A purchase cadence. So you had a pretty good except in Q1. Are you seeing the same type of opportunity given current pricing levels and as you look forward through, what’s expected to be a relatively volatile period in the market?
Nick O’Grady: I mean, there’s certainly no shortage of opportunities. I think it’s always about balancing the risk you, right? It’s just about, I think I would just tell you, I think the higher, the lower the price goes, I think our risk appetite increases. I think the higher the price of oil go is probably the more wary we’re going to become. So you have sort of, I’d say, from a $65 to $85 range, it’s probably a better rate than above those, I’d say, below $70, I think you’re going to find that sellers are probably going to dry up because they’re going to feel that they’re not getting good value for their assets. But I think that, you know, in that range, that’s sort of a good enough environment from a pricing perspective. I think that we’re in a relatively decent market.
I think that, again, the beginning of the year is always kind of a tricky, if you look at our pattern, generally, we’ve done less M&A in the first half of any year, historically speaking, for whatever reason. It’s just, if you go back, historically speaking, I’ve done very little stuff in the calendar going back my entirety of my time here. So it tends to be something that happens towards the middle or the back half of the year. So stay tuned. But I do think that we’re not short opportunities, I can tell you that much.
Jim Evans: No. I think Nick you nailed it. I think it’s a function of banks and organizations bringing these packages to market and what the lead time is on a lot of that stuff. You’ve got the smaller competition coming in with the bullish view on oil pricing, which creates some volatility in terms of the ground gain, what I’d say, I mean even just looking at some of our April activity as we’ve been making some pretty strong headway in that regard, being able to pick things up across all three of our respected basins. And then to Nick’s point, it’s really just going to be a balance of what that quality looks like, seller expectations can be wildly different, especially in a volatile commodity environment. And so for bone along at relatively static pricing for an extended period of time that generally level set expectations and narrowed spread, but if you have a material step up or a material step down in the short term, that’s going to just widen it.
Paul Diamond: Understood. Thanks for the clarity. And just a quick follow-up. You’ve talked pretty at length about the product improvements on the oil side, what does your perspective sit on the net gas side of I know it’s a much small perspective or a much smaller piece going forward? Should we expect to see the a similar cadence in your view?
Nick O’Grady: Yes. I’ll just tell you from my perspective and I’m not an engineer here, but our Marcellus assets have outperformed really from the get-go. They have outperformed our internal modeling. They’re really every quarter since we’ve owned them. Literally, I think there’s not a month tell me I’m wrong, but they have done a excellent job and I think we’ve had a little bit less development than we had initially modeled. But the decline rates have been shallower. They have just consistently outperformed, no wonder if gas is $1.80, because they just simply don’t decline. I don’t know if you want to add to that?
