EXCO Resources (XCO) Q2 2011 Earnings Call August 03, 2011 10:00 am ET Executives Stephen Smith - Vice Chairman, President and Chief Financial Officer Douglas Miller - Chairman of the Board, Chief Executive Officer, Chairman of EXCO Holdings, Chief Executive Officer of EXCO Holdings J. Douglas Ramsey - Vice President, Chief Financial Officer, Chief Accounting Officer and Treasurer Paul Rudnicki - Vice President of Financial Planning & Analysis Michael Chambers - Vice President of Operations and General Manager of East Texas/North Louisiana Division Harold Hickey - Chief Operating Officer and Vice President Analysts Brian Singer - Goldman Sachs Group Inc. David Heikkinen - Tudor, Pickering, Holt & Co. Securities, Inc. Gil Yang - BofA Merrill Lynch Marshall Carver - Capital One Southcoast, Inc. Presentation Operator
And before I get started, I'm going to have Ramsey do our disclosure statement.J. Douglas Ramsey All right. Thanks, Doug. I'd like to remind everyone that you can go to www.excoresources.com and click on the Presentations link in the Investor Relations section at the bottom of our homepage to access today's presentation slides. The statements that may be made on this conference call regarding our future financial operating performance, structure and results, business strategies, market prices and future commodity price risk, management activities, plans and forecasts and other statements that are not historical facts are forward-looking statements as defined in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Please refer to Pages 23 to 24 of the slide presentation for the complete text regarding our forward-looking statements. In addition, please refer to our website for the earnings release, which contains additional information regarding our forward-looking statements and the preparation of our financial disclosures, including reconciliations and other statements, regarding non-GAAP financial numbers, which will be discussed on today's call. Doug? Douglas Miller Okay. Thanks. With this, I hope everybody has the slides because we're going to quickly go over the slides, then we'll open it up for questions. We've had expected accurate results, mostly in our Haynesville area. Our operating people have done a great job. Our partnership with BG continues to be running smooth. We have 22 rigs running out there. Hal and Mike will get into that in a little while. But our volumes were really in development mode up in DeSoto. And we're really working hard down in Texas, slightly deeper, but I think we've had some pretty good results down there. I think they'll get into that. But volumes up. Production, significant. Midstream volumes up significantly. We continue to add on to our Midstream assets in East Texas and North Louisiana. It is growing again. It's a joint venture with BG, growing with leaps and bounds. We're starting to put in some infrastructure up early in the Marcellus, and Hal will get into that a little later. I think, in the middle of the page there, we recently had a couple of delineation wells down in the Shelby area, a couple of them over 30 million a day, and Hal might talk about a couple of them that are -- I got some news this morning that look pretty good also.
We're still buying in both the Haynesville and the Marcellus area. John's in here. I think he's probably got 20 deals, none of them big, but a lot of little deals in the Haynesville and the Marcellus that we're looking at. We have had one recent, what we call, a real good well that IP-ed at 10 million, but Hal will get into -- we're seeing some stuff that's a little unique for shale plays. Hal will get into that here in a minute.And I think the key to this whole thing has been the people. And I told you I've had the best people I've ever had here, the last 2 to 3 years, and it's really showing them in the Haynesville. And we're marching up in the Marcellus. And I know our people are cooperating with the mistakes that we made early on in the Haynesville, either sharing them with the guys up in the Marcellus. And so we're starting to ramp that up. Again, we'll be a little bit slower there for several reasons. Number one is the bulk of our acreage is held by production. Number two, we have 4 or 5 different areas that we're focusing on. And most importantly, again, is service companies moving around the areas in infrastructure. So that'll be a slower ramp up like I've been saying for the last 2 years. But it continues and it looks like we're starting to get some encouraging results there. Read the rest of this transcript for free on seekingalpha.com