Company Profile

EXCO Resources is an oil and natural gas company engaged in the acquisition, development and exploitation of onshore North American oil and natural gas properties. We expect to continue to grow by leveraging our management team's experience, exploiting our multi-year inventory of development drilling locations and exploitation projects, and selectively pursuing acquisitions that meet our strategic and financial objectives.

Rapid Growth
Since the beginning of 1998, we have increased our Proved Reserves from 5 Bcfe to 2 Tcfe and our average daily production from less than 1 Mmcfe per day to over 390 Mmcfe per day. The related pre-tax PV-10 of our pro forma Proved Reserves was $2.4 billion as of January 1, 2008.

Operations in the highest potential basins in the United States
Our operations are focused in key North American oil and natural gas areas including Appalachia, East Texas, North Louisiana, Mid-Continent, Permian, and the Rockies. Our assets are characterized by long reserve lives, a multi-year inventory of development drilling, high drilling rate success and a concentration in natural gas.

Experienced management team with significant employee ownership
Our management team has led both public and private oil and natural gas companies over the past 20 years and has an average of over 26 years of industry experience in acquiring, developing, and exploiting oil and natural gas properties. Our management team first purchased a significant ownership interest in December 1997, and since then we have achieved substantial growth in reserves and production. As of October 8, 2008, our management team and employees (excluding our outside directors) own approximately 7.0% of our issued and outstanding common stock and exercisable stock options and our outside directors or their affiliates own approximately 31.6% of our issued and outstanding common stock and exercisable stock options, which aligns their objectives with those of our shareholders.

Company History

1997 - 2004 - Initial Growth - North Coast Acquisition
In December 1997, a change in ownership control was effected when Douglas H. Miller acquired approximately 51% of the outstanding stock of EXCO from various shareholders of the Company. At that point EXCO was a very small public company with only 4.7 Bcfe of reserves.

EXCO began to focus on the acquisition and further development and exploitation of proved producing oil and natural gas properties with enhancement opportunities such as infill drilling, recompletions, repairs and equipment improvements. A critical element of that strategy focused on being the operator of the oil and natural gas wells acquired thereby maximizing the control of enhancement activities.

Early 1998 saw crude oil and natural gas prices fall to new 10 year lows and an opportunity to make acquisitions at lower prices arose. In August 1998, EXCO raised $35 million in a rights offering to shareholders and other interested investors.

After that offering, the Company grew rapidly and profitably by maintaining the "acquire and exploit strategy". In April 2001, EXCO made its first acquisition in Canada when it acquired Addison Energy Inc., a Calgary based independent oil and natural gas company that utilized the same acquire and exploit business strategy.

In July 2003, EXCO went private through a management led buyout financed with $175 million of equity. Shares that were sold at $6.00 in the 1998 rights offering were acquired at $18.00.

In January 2004, EXCO acquired all of the shares of North Coast Energy, Inc., a publicly held Appalachian Basin oil and natural gas company. The transaction valued North Coasts' assets at approximately $225 million.

Also during 2004, the Canadian market for assets similar to those of Addison became so competitive that Addison's management team was having difficulty acquiring any meaningful assets at an acceptable rate of return. EXCO, after consulting with the management team at Addison, decided it was time to explore a potential sale of Addison. The process culminated with the sale of Addison in February 2005 for Cdn. $551 million (US $443 million).

2005 - ONEOK Acquisition and Equity Buyout
On September 27, 2005, our affiliate, TXOK, completed the acquisition of ONEOK Energy for an aggregate purchase price of approximately $643 million ($635 million after contractual adjustments). ONEOK Energy had Proved Reserves, estimated as of July 31, 2005, of approximately 223 Bcfe primarily located in the East Texas and Mid-Continent areas.

On October 3, 2005, EXCO Holdings II, Inc., or Holdings II, an entity formed by our management, purchased 100% of the outstanding equity securities of EXCO Holdings for an aggregate price of approximately $699 million, resulting in a change of control and a new basis of accounting. Immediately following the completion of these transactions, Holdings II merged with and into EXCO Holdings.

2006 - IPO, Canyon Sand Field Acquisition, and Winchester Energy Acquisition
On February 9, 2006, shares of common stock of EXCO commenced trading on the NYSE under the symbol "XCO". EXCO used the net proceeds from the sale of our common stock, together with cash on hand and additional borrowings under the EXCO Resources revolving credit facility, to repay outstanding financing arrangements including the $350 million interim bank loan incurred in connection with the October 3, 2005 equity buyout, redemption of the $150 million TXOK preferred stock issued in connection with the ONEOK Energy acquisition, repayment of the $200 million TXOK term loan and to repay a portion of the TXOK revolving credit agreement.

In April 2006 EXCO began the first of a two part acquisition of interest in West Texas Canyon Sand field. To date, EXCO has spent just over $250 million on these acquisitions. Finally, in October 2006, EXCO purchased Winchester Energy for $1.1 billion.

2007 - Anadarko Vernon Field and Mid-continent Acquisitions
On March 30, 2007, EXCO closed the acquisition of Vernon Field in Jackson Parish, Louisiana, from Anadarko Petroleum Corporation for $1.5 billion after customary purchase adjustments and simultaneously closed a private offering of $2 billion of preferred stock to fund the Vernon Field acquisition. The Vernon Field was producing 160 Mmcfe per day at the time of closing and included 15 proved undeveloped locations. Since closing, EXCO has increased the number of locations to over 280 as of March 31, 2008.

In May 2007, EXCO purchased Anadarko's Mid-Continent and South Texas package for $860 million. Concurrently, EXCO closed a sale of the South Texas assets to Crimson. The net acquisition was for $540 million and included net daily production of 51 Mmcfe per day from more than 1,000 producing wells, and approximately 250 drilling locations.

2008 – EOG Appalachian Acquisition and New Waskom Pipeline Acquisition

To build on the Appalachian position, EXCO acquired Appalachian assets from EOG for a total of $388 million after customary closing adjustments and included 16 Mmcfe per day of net production, 159 Bcfe of Proved Reserves and 182 Bcfe of Probable and Possible Reserves. The package includes in excess of 2,500 producing wells, 2,000 drillable locations and 325,000 gross (283,000 net) acres in Pennsylvania, Ohio and West Virginia.

To enhance the East Texas and North Louisiana transportation and gathering systems, EXCO bought the New Waskom Gas Gathering System for $56 million after customary closing adjustments. It included 230 miles of gathering system pipelines in East Texas. Throughput at the time of acquisition totaled 43 Mmcfe per day. EXCO has continued to expand this system and is in great position to capture value from the Haynesville Play in East Texas-North Louisiana.

Organic Growth - $800 million dollar capital budget in 2008
In addition to the acquisitions, EXCO spent approximately $194 million during 2006, $350 million during 2007 and plans to spend $700 million in 2008 for oil and natural gas drilling and completion on its properties. During 2006, EXCO added approximately 93 Bcfe of proved reserves through drilling and development and 103 Bcfe in 2007. As of January 1, 2008, EXCO had identified 10,000 drilling locations and anticipates developing these locations over the next 10 years and employs 750 full time employees.

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