In the Gulf Coast, the Company's Thunder Bayou well is currently flowing at approximately 30 MMcfe/d (NRI-37%) and its production profile continues to exceed the Company's original expectations. Based on continued outperformance in the lowest interval, the Company now expects to recomplete into the upper section of the Cris R-2 formation (154 net feet of pay) during the third quarter of 2016. The Company's second quarter production guidance incorporates anticipated declines at Thunder Bayou relative to the timing of the third quarter recompletion. In the Gulf of Mexico, the Company expects to commence a three well recompletion program at its Ship Shoal 72 field at the end of second quarter. The Company estimates this program will cost approximately $600,000 and contribute approximately 3 MMcfe/d of production during the third quarter of 2016.
Borrowing Base Update
The Company currently has no borrowings outstanding under its Credit Facility and is undergoing a borrowing base redetermination. Due in part to the April 2016 sale of the East Hoss assets in Oklahoma, the Company expects that the borrowing base and aggregate commitments under the Credit Facility will be reduced. Until the ongoing borrowing base redetermination is complete, the Company has agreed to not request any borrowings or issue any letters of credit pursuant to the Credit Facility.
"During the first quarter we took several positive steps, building upon efforts started with our June 2015 Woodford sale, aimed at repairing our balance sheet," said Charles T. Goodson, Chairman, Chief Executive Officer and President. "The debt exchange reduced fixed charges, improved our leverage profile and extended debtmaturities, while the recent non-core asset sales increased cash on hand."