We have a handful more that we can do. We have some kits on the ground. Our strategy is to use those kits when there is opportunities to earn that incremental payback over the course of the contract, and we have been able to do that now twice. So, it’s flexibility for us. Those – when we talk about our 200 Series rigs, they are super spec, they are pad optimal. They have all the bells and whistles that the standard super spec pad-optimal rig has. But as the unconventional play continues to play out as the laterals continue to get longer, if our customers need that added capability, we have the flexibility to be able to offer it.
Don Crist: I appreciate all the color. I will turn it back. Thanks.
Philip Choyce: Thank you, Don.
Operator: Thank you. And our next question today comes from Steve Ferazani with Sidoti. Please go ahead.
Steve Ferazani: Good afternoon Anthony and Philip. Regarding your commentary around day rates in the Permian and then your guidance for margins going into 3Q, it sounds like day rates might be coming down a little bit, but certainly not necessarily significant given how much rig count has dropped. What are you seeing in day rates? And are the conversations getting harder?
Anthony Gallegos: Yes. Day rates have softened some, Steve. But just to put it into perspective, when you look at what’s happened year-to-date, the Permian market is only off a dozen or so rigs and 4% since the beginning of the year. So, there has been some trimming as you guys know, but there has been some people that have added some rigs as well. There is a lot of churn in the background that you probably don’t have the insight into. But regardless, day rates have obviously held up pretty nicely. When you look at the margin per day that we just reported, very proud of that. We are guiding down a little bit as we think about Q3 and we are saying Q4 is going to be flat with Q3. And if you think about that, especially on a historical basis for these kind of margins, that’s really good.
And it’s another reason why we are very optimistic about what the next several quarters are going to allow ICD to do on those big important strategic initiatives that we have underway.
Steve Ferazani: What’s your confidence level now in getting some rigs back to work in Q4?
Anthony Gallegos: Very high. We are going to bring out, I think, it’s three minimum before the end of the year. And they probably happen sooner rather than later.
Steve Ferazani: Excellent. Any kind of color you can give around the early termination with those rigs in the Haynesville? And did they have a lot of term left given the 5 million?
Anthony Gallegos: Yes, one is still on contract on standby, in fact, through November of this year. The other one, it’s early term provision ended here about 10 days ago. So, of the three rigs that we have working in the Haynesville today, only one is sitting there earnings standby. The other two are on a day work basis.
Philip Choyce: Yes. So, the 5.1 million, it was really three rigs and pretty much all of it ended by the end of the second quarter.
Steve Ferazani: Okay. It took a lot of costs out here, obviously helped out a lot. How much of that do you think comes back with getting those rigs back to work? Was that a lot of very temporary cuts, or was there anything you took out that could be permanent?
