DALLAS–(BUSINESS WIRE)–Oct. 9, 2007–EXCO Resources, Inc. (NYSE:XCO) today announced it has closed the acquisition of an additional 45% interest in 28,000 acres of leasehold interests and 135 producing wells in its Canyon Sand field in West Texas for $156.6 million from private sellers, subject to customary post-closing purchase price adjustments. This acquisition brings EXCO’s working interest in the field to 97% with a net revenue interest of 73%. EXCO acquired its initial interest in the field in April 2006. This acquisition increases EXCO’s estimated proved reserves in the field by 60 Bcfe and increases its estimated total reserves (proved, probable and possible) by 129 Bcfe, all at NYMEX strip pricing at the effective date of September 1, 2007.
EXCO estimates that there are as many as 600 additional drilling locations, of which 187 are proved. EXCO will operate the field and estimates a drilling budget of 27 wells and $18.0 million for the remainder of 2007 and 144 wells and $98.0 million for 2008. Current gross production from the field exceeds 28 Mmcfe per day. The primary productive formation in the field is the Canyon Sand. Additional productive formations include the Clearfork and Wolfcamp.
EXCO Resources, Inc. is a public oil and natural gas acquisition, exploitation, development and production company headquartered in Dallas, Texas with principal operations in Texas, Louisiana, Oklahoma, Ohio, Pennsylvania, and West Virginia.
Additional information about EXCO Resources, Inc. may be obtained by contacting EXCO’s Chairman, Douglas H. Miller, or its President, Stephen F. Smith, at EXCO’s headquarters, 12377 Merit Drive, Suite 1700, Dallas, TX 75251, telephone number (214) 368-2084, or by visiting our website at www.excoresources.com. Our SEC filings and press releases can be found under the Investor Relations tab.
This release may contain forward-looking statements relating to future financial results or business expectations. Business plans may change as circumstances warrant. Actual results may differ materially from those predicted as a result of factors over which EXCO has no control. Such factors include, but are not limited to: acquisitions, recruiting and new business solicitation efforts, estimates of reserves, commodity price changes, the extent to which EXCO is successful in integrating recently acquired businesses, regulatory changes and general economic conditions. These risk factors and additional information are included in EXCO’s reports on file with the Securities and Exchange Commission.
The SEC has generally permitted oil and natural gas companies, in filings made with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. We use the terms “probable,” “possible,” or “unproved” to describe volumes of reserves potentially recoverable through additional drilling or recovery techniques that the SEC’s guidelines prohibit us from including in filings with the SEC. These estimates are by their nature more speculative than estimates of proved reserves and accordingly are subject to substantially greater risk of being actually realized by the company. While we believe our calculation of unproved drillsites and estimations of unproved reserves have been appropriately risked and are reasonable, such calculations and estimates have not been reviewed by third party engineers or appraisers. Investors are urged to consider closely the disclosure in our Annual Report on Form 10-K for the year ended December 31, 2006 available on our website at www.excoresources.com under the Investor Relations tab or by calling us at 214-368-2084.
CONTACT: EXCO Resources, Inc.
Douglas H. Miller, 214-368-2084
Chairman
or
Stephen F. Smith, 214-368-2084
President
www.excoresources.com
SOURCE: EXCO Resources, Inc.