As a result of continued depressed oil prices, EXCO Resources Inc. says it has suspended its Eagle Ford development program in the South Texas region for the remainder of 2015. The company's acreage in the South Texas region is 81% held by production, which allows EXCO flexibility in the timing of development of this region. EXCO will redeploy capital to other regions that can provide higher rates of return.
EXCO has also closed the funding of its 12.5% senior secured second lien term loan in the aggregate principal amount of $300 million (the Fairfax term loan) and its 12.5% senior secured second lien term loan in the aggregate principal amount of $291 million (the Exchange term loan).
Simultaneously with the funding of the second lien term loans and pursuant to a series of purchase agreements, the company completed its repurchase of an aggregate principal amount of $376 million of 2018 notes and an aggregate principal amount of $201 million of 2022 notes. The proceeds of the Exchange term loan were deemed to be used to complete the note repurchase and the proceeds of the Fairfax term loan were used to repay $300 million of outstanding indebtedness under the company’s amended and restated credit agreement. The notes repurchased will be canceled by the trustee following customary settlement procedures.