Kevin MacCurdy: Great. And there’s obviously a lot of attention around the shareholder vote and you’ve been pretty clear about your views on the valuation of the KTG asset. Just kind of curious, I mean, you’ve kind of touched on this on your view on M&A and the other transactions you’ve done, but what kind of scale do you foresee being able to add from M&A just instead of the KTG assets?
Sean Woolverton: I probably won’t speak to any specific layer or maybe target there. Would tell you and I think everyone knows this, we’ve been the most aggressive acquirer in the basin with eight deals done over the last couple of years and there’s still plenty to do. So as you look at consolidation in the basin, I think, there’s plenty of opportunities. We’re very diligent around what those deals must look like. We’ve been very vocal around our criteria. It needs to have industrial logic. It needs to deepen our inventory and compete for capital immediately. One of the things that we struggled with the KTG proposal is we haven’t been drilling gas down in Webb county or limited amounts for the past two years. It just doesn’t compete for capital in a 250 world.
In fact, I think KTG may be one of the only companies down there drilling. Others have all pulled their rigs out. So deal has to have inventory that competes for capital and it has to be accretive to our shareholders. So those are the type of deals we’re looking for. And what I’ll tell you is, hey, we recognize that scale is important for either the public investor or for companies looking to do acquisitions. And we’re open to consolidate. We’re open to be a buyer and open to be a seller. So I think that Eagle Ford has a great future in front of it as other basins get consolidated. This one should be the next basin up in our minds.
Kevin MacCurdy: Great. Thank you for the answer.
Sean Woolverton: Yes.
Operator: Your next question comes from the line of Paul Diamond from Citi. Your line is open.
Paul Diamond: Good morning. Thanks for taking my call. Just a quick one I want to touch on Slide 13. The operational plan for the rest of the year, how much of the, I guess, further improvement in some of these metrics are you all expecting? Or is it a kind of run rate from here?
Sean Woolverton: Good question, Paul. I keep thinking that, hey, can you get any more efficient. On the completion side, we’re down to trying to find 5, 10 minute slots. So when you’re fracking 20 hours a day, you do have time where you have to fuel engines back up and run tools in the hole. We’re getting down to where, boy, can you get more efficient. And I’ll tell you all that completion efficiency, we haven’t changed our design in terms of going to smaller stage design. In fact, we’re continuing to enhance it. So completions, team always surprises. Drilling, I think with the scale that we have, we continue to get large the balance sheet, the inventory allows us to do larger pads that generate some efficiency from a drilling standpoint just being on larger pads.
We still think probably optimal for us right now is in that four to six wells range, but there could be efficiencies there. And then having just again the opportunity to go to different inventory, be it gas or oil, we can always and we’ve proven to be very effective on allocating capital to the right returns. So there’s kind of my thoughts. One area that we could add some efficiency gains on is just leveraging the existing infrastructures scale that we have. A lot of the assets that we’ve acquired had infrastructure already there and we’re going back in over the top of them. We’re doing that significantly where we’re drilling Austin Chalk wells over the top of Eagle Ford. So that has some cycle time efficiencies where you don’t have to go back in and build pads, roads and put in new pipes.
So maybe a combination of a lot of things. It’s getting harder and harder, but we’ll keep on grinding at it.
Paul Diamond: Understood. Thanks for clarity. And just one quick follow-up on the refrac opportunity. 100 plus potential targets, how should we think about the economics of those in just a run rate basis? Should we expect or are you expecting similar kind of decreased cluster spacing, proppant intensities like how homogeneous is that opportunity versus a well by well kind of what works best?
Sean Woolverton: Yes. No, great question. Obviously, we’ve done two thus far. We’ve looked at other operators to see how their wells performed to kind of put a risk percentage on consistent performance. We’ll see if we can prove that up. But we’re seeing a pretty high performance from well to well. You do run into risks around mechanical issues going back into wells, but in talking with other operators, they’re seeing high percentage there. So I think it’s probably 75%, 80% plus in terms of mechanical as well as well performance. Would tell you the 100 inventory — the 100 refracs we’ve identified, we’ve looked thus far mainly on our oil assets. We’ve yet to look at our gas assets. And what’s really good and I will keep on saying this is, all these refracs are on assets that we’ve acquired.
The one that we really need to tear into is the Chesapeake asset. Those areas — a big chunk of those wells were done in the 12 to 16 range, kind of where they were just going in and doing the same design again and again and again. So we’re really excited about pulling the onion back there some more. And what’s always great when you do acquisitions is when you unlock even more value on than what you paid for.
Paul Diamond: Understood. Thanks for the clarity.
Sean Woolverton: Yes. Thanks, Paul. Appreciate you. Have a good day.
Operator: [Operator instructions] And your next question comes from the line of Donovan Schafer of Northland Capital. Your line is open.
Donovan Schafer: Hey, guys. Thanks for taking the questions and congratulations on the quarter. I have to admit, I feel like I’m going a little crazy here and pulling my hair out. So, I know you, you don’t want to dwell on the Kimmeridge stuff too much. But — and this is my own view. But, you know, they don’t seem to be, like, particularly good actors with respect to sincerely having interest for the rest of shareholders beyond their own 12% ownership. You put out a detailed chronicle of all of the interactions that you’ve had with them with dates and kind of like a journal or a log, if you will. And you shared that. I think that was part of a response letter you issued at one point, and that was included as, like, an appendix, and I think all of that was filed to the SEC.
