Wednesday, July 16, 2008

Dallas-based EXCO Resources, Inc. acquires several natural gas properties in East Texas

By Pegasus News wire

DALLAS — EXCO Resources, Inc. announced today that it has closed an acquisition of producing oil and natural gas properties, acreage and other assets in Gregg, Rusk, and Upshur Counties, Texas for approximately $252 million from private sellers, subject to customary post-closing purchase price adjustments.

Photo not provided by Exco

The company expects to make back the $252 million purchase price in about a week and a half

EXCO’s estimate of net proved reserves acquired is 109 Bcfe and estimated total net reserves (proved, probable and possible) exceed 370 Bcfe exclusive of Bossier/Haynesville shale potential, all based on NYMEX strip pricing at the contract effective date of March 1, 2008.

The assets include producing properties with more than 15 Mmcfe per day of net production from 83 producing wells and approximately 11,000 gross acres. Also included in the assets is a 50 mile gathering system with compressors, a dehydration unit and a refrigeration plant.

EXCO estimates that there are more than 500 additional drilling locations in the Cotton Valley and Travis Peak formations, of which 92 are proved. EXCO will operate the field and estimates a capital budget of $20 million to drill 9 wells during the remainder of 2008. The current primary productive formations in the field are the Upper Cotton Valley, Pettet and Travis Peak. Recent industry activity in the vicinity of the acquired acreage has confirmed the presence of shale potential. EXCO plans to drill at least one vertical well in 2008 to further delineate potential of the Bossier/Haynesville, and EXCO estimates that there could be more than 100 potential shale locations across the acquired acreage.

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.

Source: Exco Resources

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