In terms of production, that transaction values the remaining production at 3X the current price. This stock was depressed. In a risky world the debt level was a risk. Aren't its remaining prospects as exciting? They will be using a lot of cash for exploration and development.
The Board of Directors of Long Run has approved a capital budget for 2013. We anticipate a robust exploration and development program of between $260 - $270 million. Our capital plan will focus on the development of key oil resource plays in the Montney zone of the Peace River Arch and in the Viking zone of central Alberta. Exploration initiatives include further delineation of our Duvernay shale resource play, extension of the Triassic oil fairway in the Peace River Arch and initial exploration into our emerging Slave Point oil resource play flanking the Peace River Arch.
As part of our ongoing risk management program, we have recently entered into a number of new financial contracts. Long Run has now hedged approximately 50% of our 2013 forecast production volumes (43% of crude oil and 56% of natural gas). Crude oil is hedged at prices averaging $92.51 per barrel and natural gas is hedged at an average price of $3.72 per mcf.
Long Run anticipates releasing on November 26, 2012, an operational update which will include an overview of current operations and more details on our 2013 budget.