8-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): November 28, 2018

Commission file number: 001-32743

EXCO RESOURCES, INC.

(Exact name of Registrant as specified in its charter)

Texas (State of incorporation)	74-1492779 (I.R.S. Employer Identification No.)
12377 Merit Drive, Suite 1700, Dallas, Texas (Address of principal executive offices)	75251 (Zip Code)

Registrant’s telephone number, including area code: (214) 368-2084

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Item 7.01. Regulation FD Disclosure.

EXCO Resources, Inc. (the “Company”) is furnishing certain information regarding its internal mid-year reserve update as of June 30, 2018 (the “Interim Reserve Update”) and certain financial projections used in the five-year business plan prepared in connection with the Company’s emergence from Chapter 11 bankruptcy (the “Financial Projections” and, together with the Interim Reserve Update, the “Presentation Materials”), included as Exhibits 99.1 and 99.2, respectively, to this report, pursuant to Regulation FD promulgated by the Securities and Exchange Commission ("SEC"). The Presentation Materials will be used by the Company's management beginning on November 28, 2018 in meetings with potential lenders for the issuance of certain debt instruments in connection with the Company’s emergence from Chapter 11 bankruptcy.

Incorporation by Reference

The information contained herein and in the accompanying exhibits shall not be incorporated by reference into any of the Company's filings, whether made before or after the date hereof, regardless of any general incorporation language in such filing, unless expressly incorporated by specific reference to such filing. The information in this report, including the exhibits hereto, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended. By filing this report on Form 8-K and furnishing this information, the Company makes no admission as to the materiality of any information in this report that is required to be disclosed solely by reason of Regulation FD.

The information contained in the Presentation Materials is summary information that includes certain internally-prepared mid-year reserve information and certain financial projections and is intended to be considered in the context of the Company's SEC filings and other public announcements that the Company may make, by press release or otherwise, from time to time. The Company undertakes no duty or obligation to publicly update or revise the information contained in this report, although it may do so from time to time as management believes is warranted. Any such update may be made through the filing of other reports or documents with the SEC, press releases or through other public disclosure.

Presentation of Reserves

The information included the Interim Reserve Update was prepared based on the Company’s internal estimates of reserve quantities and future net revenues. The oil and natural gas reserves and PV-10 data in the Interim Reserve Update were based on August 17, 2018 NYMEX futures prices, in each case adjusted for estimates of geographical differentials. In addition to “proved” reserves, the Company included information related to “probable” reserves, “possible” reserves and other quantities of hydrocarbons estimated to be potentially recoverable from known accumulations where evaluation of the accumulation is insufficient to clearly assess commerciality. 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. The oil and natural gas reserves and PV-10 included in the Interim Reserve Update do not purport to be prepared in accordance with the rules and regulations promulgated by the SEC. Accordingly, it is not practicable for us to reconcile the PV-10 to the GAAP standardized measure of discounted future net cash flows. See the Company's Annual Report on Form 10-K for fiscal year ended December 31, 2017 as filed with the SEC for further discussion of the Company’s oil and natural gas reserves prepared in accordance with GAAP.

Cautionary Statement Regarding Forward-Looking Statements

The Presentation Materials include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, that address activities that the Company assumes, plans, expects, believes, projects, estimates or anticipates (and other similar expressions) will, should or may occur in the future are forward-looking statements. These forward-looking statements are based on management's current belief, based on currently available information, as to the outcome and timing of future events. The Company cautions that its future oil and natural production, revenues and expenses and other forward-looking statements are subject to all of the risks and uncertainties normally incident to the exploration for and development and production and sale of oil and gas. These risks include, but are not limited to, price volatility, inflation or lack of availability of goods and services, environmental risks, drilling and other operating risks, regulatory changes, the uncertainty inherent in estimating future oil and natural gas production or reserves, and other risks as described in the Company's 2017 Annual Report on Form 10-K for fiscal year ended December 31, 2017 as filed with the SEC and other periodic filings. Any of these factors could cause the Company's actual results and plans to differ materially from those in the forward-looking statements.

Any financial projections or forecasts included in the Presentation Materials were not prepared with a view toward public disclosure or compliance with the published guidelines of the SEC or the guidelines established by the American

Institute of Certified Public Accountants regarding projections or forecasts. The projections do not purport to present the Company’s financial condition or results of operations in accordance with accounting principles generally accepted in the United States. The Company’s independent public accountants or independent engineering firms have not examined, compiled or otherwise applied procedures to the projections and, accordingly, do not express an opinion or any other form of assurance with respect to the projections. The inclusion of the projections therein should not be regarded as an indication that the Company or its affiliates or representatives consider the projections to be a reliable prediction of future events, and the projections should not be relied upon as such. Neither the Company nor any of its affiliates or representatives has made or makes any representation to any person regarding the ultimate outcome of the Company’s Chapter 11 proceedings compared to the projections, and none of them undertakes any obligation to publicly update the projections to reflect the occurrence of future events, even in the event that any or all of the assumptions underlying the projections are shown to be in error.

Item 9.01. Financial Statements and Exhibits

The exhibits listed below are filed herewith.

(d) Exhibits.

Exhibit Number	Description
99.1	Mid-Year Reserve Report prepared by Management.
99.2	Exhibit E to the Disclosure Statement filed with the Court on November 5, 2018.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: November 28, 2018		EXCO RESOURCES, INC.
	By:	/s/ Heather L. Summerfield
	Name:	Heather L. Summerfield
	Title:	Vice President, General Counsel and Secretary

EX-99.1

Exhibit 99.1

EXCO Reserve Summary

Based upon the Company’s Business Plan, an estimate of the unrisked reserve values are summarized below.

EXCO Resources Reserves Summary
RSV_CLASS/RSV_CAT	Gross Well Count	Net Remaining Reserves (MMCFE)	NPV-10% ($M)
PROVED	2,227	1,972,731	$	1,117,858
1PDP	1,311	696,954	728,842
2PNP	5	4,123	964
2PBP	2	2,250	905
4PUD	909	1,269,404	387,147
PROBABLE	112	232,265	36,368
POSSIBLE	1,996	1,697,390	189,708
CONTINGENT	1,059	8,138,247	1,872,691
Grand Total	5,394	12,040,633	$	3,216,624

Note:

• Based on strip pricing as of 8/17/18. Assumes effective date of 7/1/18.

• Reserve quantities and values are based on EXCO internal valuation

• Contingent resources are those quantities of hydrocarbons estimated, as of a given date, to be potentially recoverable from known accumulations where evaluation of the accumulation is insufficient to clearly assess commerciality

EX-99.2

Exhibit 99.2

Exhibit E

Financial Projections

Financial Information and Projections

I.    Financial Projections

For purposes of demonstrating feasibility of the Plan, the Debtors have prepared the forecasted, post reorganized, consolidated balance sheet, income statement, and statement of cash flows (the “Financial Projections“ or the “Projections”) for the annual periods ending December 31, 2019 (fiscal year 2019) through December 31, 2023 (fiscal year 2023) (the “Projection Period“). The Financial Projections were prepared based on a number of assumptions made by the Debtors’ management team as to the future performance of the Reorganized Debtors, and reflect management’s judgement and expectations regarding its future operations and financial position.

The Financial Projections are subject to inherent risks and uncertainties, most of which are difficult to predict and many of which are beyond management’s control, including the exploration for and development, production, gathering and sale of oil, natural gas and natural gas liquids. In addition to the risk factors set forth in Article VIII of the Disclosure Statement, Factors that may cause actual results to differ from expected results include, but are not limited to:

i. fluctuations in oil and natural gas prices and the Reorganized Debtors’ ability to hedge against pricing changes;

ii. the uncertainty inherent in estimating reserves, future net revenues and discounted future cash flows;

iii.the timing and amount of future production of oil and natural gas;

iv.changes in the availability and cost of capital;

v. environmental, drilling and other operating risks, including liability claims as a result of oil and natural gas operations;

vi.proved and unproved drilling locations and future drilling plans; and

vii. the effects of existing and future laws and governmental regulations, including environmental, hydraulic fracturing and climate change regulation.

Should one or more of the risks or uncertainties referenced above occur, or should underlying assumptions prove incorrect, actual results and plans could differ materially from those expressed in the Financial Projections. Further, new factors could cause actual results to differ materially from those described in the Financial Projections, and it is not possible to predict all such factors, or the extent to which any such factor or combination of factors may cause actual results to differ from those contained in the Financial Projections.

II.    Accounting Policies and Disclaimer

THESE FINANCIAL PROJECTIONS WERE NOT PREPARED WITH A VIEW TOWARD COMPLIANCE WITH PUBLISHED GUIDELINES OF THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS FOR PREPARATION AND PRESENTATION OF PROSPECTIVE

FINANCIAL INFORMATION. THE FINANCIAL PROJECTIONS DO NOT REFLECT THE FORMAL IMPLEMENTATION OF REORGANIZATION ACCOUNTING PURSUANT TO FINANCIAL ACCOUNTING STANDARDS BOARD ACCOUNTING STANDARDS CODIFICATION TOPIC 852, REORGANIZATIONS (“ASC 852”). OVERALL, THE IMPLEMENTATION OF ASC 852 IS NOT ANTICIPATED TO HAVE A MATERIAL IMPACT ON THE UNDERLYING ECONOMICS OF THE PLAN. THE FINANCIAL PROJECTIONS HAVE BEEN PREPARED USING GENERALLY ACCEPTED ACCOUNTING POLICIES (“GAAP”) THAT ARE MATERIALLY CONSISTENT WITH THOSE APPLIED IN THE DEBTORS’ HISTORICAL FINANCIAL STATEMENTS. THE FINANCIAL PROJECTIONS HAVE NOT BEEN AUDITED OR REVIEWED BY A REGISTERED INDEPENDENT ACCOUNTING FIRM.

ALTHOUGH MANAGEMENT HAS PREPARED THE PROJECTIONS IN GOOD FAITH AND BELIEVES THE ASSUMPTIONS TO BE REASONABLE, THE DEBTORS AND THE REORGANIZED DEBTORS CAN PROVIDE NO ASSURANCE THAT SUCH ASSUMPTIONS WILL BE REALIZED. THE FINANCIAL PROJECTIONS HEREIN ARE NOT, AND MUST NOT BE VIEWED AS, A REPRESENTATION OF FACT, PREDICTION, OR GUARANTY OF THE COMPANY’S FUTURE PERFORMANCE. AS DESCRIBED IN DETAIL IN THE DISCLOSURE STATEMENT, A VARIETY OF RISK FACTORS COULD AFFECT THE REORGANIZED DEBTORS’ FINANCIAL RESULTS AND MUST BE CONSIDERED. ACCORDINGLY, ANY REVIEW OF THE PROJECTIONS SHOULD TAKE INTO ACCOUNT THE RISK FACTORS SET FORTH IN THE DISCLOSURE STATEMENT AND THE ASSUMPTIONS DESCRIBED HEREIN, INCLUDING ALL RELEVANT QUALIFICATIONS AND FOOTNOTES.

MOREOVER, THE PROJECTIONS CONTAIN CERTAIN STATEMENTS THAT ARE “FORWARD-LOOKING STATEMENTS” WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. THESE STATEMENTS ARE SUBJECT TO A NUMBER OF ASSUMPTIONS, RISKS, AND UNCERTAINTIES, MANY OF WHICH ARE BEYOND THE CONTROL OF THE DEBTORS, INCLUDING THE IMPLEMENTATION OF THE PLAN, THE CONTINUING AVAILABILITY OF SUFFICIENT BORROWING CAPACITY OR OTHER FINANCING TO FUND OPERATIONS, ACHIEVING OPERATING EFFICIENCIES, EXISTING AND FUTURE GOVERNMENTAL REGULATIONS AND ACTIONS OF GOVERNMENTAL BODIES, INDUSTRY-SPECIFIC RISK FACTORS, AND OTHER MARKET AND COMPETITIVE CONDITIONS, INCLUDING WITHOUT LIMITATION THOSE SET FORTH HEREIN. HOLDERS OF CLAIMS AND INTERESTS ARE CAUTIONED THAT THE FORWARD-LOOKING STATEMENTS ARE AS OF THE DATE MADE AND ARE NOT GUARANTEES OF FUTURE PERFORMANCE. ACTUAL RESULTS OR DEVELOPMENTS MAY DIFFER MATERIALLY FROM THE EXPECTATIONS EXPRESSED OR IMPLIED IN THE FORWARD-LOOKING STATEMENTS, AND THE DEBTORS UNDERTAKE NO OBLIGATION TO UPDATE ANY SUCH STATEMENTS. THE PROJECTIONS, WHILE PRESENTED WITH NUMERICAL SPECIFICITY, ARE

NECESSARILY BASED ON A VARIETY OF ESTIMATES AND ASSUMPTIONS WHICH, THOUGH CONSIDERED REASONABLE BY THE DEBTORS, MAY NOT BE REALIZED AND ARE INHERENTLY SUBJECT TO SIGNIFICANT BUSINESS, ECONOMIC, INDUSTRY, REGULATORY, LEGAL, MARKET, AND FINANCIAL UNCERTAINTIES AND CONTINGENCIES, MANY OF WHICH ARE BEYOND THE REORGANIZED DEBTORS’ CONTROL. THE DEBTORS CAUTION THAT NO REPRESENTATIONS CAN BE MADE OR ARE MADE AS TO THE ACCURACY OF THE PROJECTIONS OR TO THE REORGANIZED DEBTORS’ ABILITY TO ACHIEVE THE PROJECTED RESULTS. SOME ASSUMPTIONS INEVITABLY WILL BE INCORRECT. MOREOVER, EVENTS AND CIRCUMSTANCES OCCURRING SUBSEQUENT TO THE DATE ON WHICH THE DEBTORS PREPARED THESE PROJECTIONS MAY BE DIFFERENT FROM THOSE ASSUMED, OR, ALTERNATIVELY, MAY HAVE BEEN UNANTICIPATED, AND THUS THE OCCURRENCE OF THESE EVENTS MAY AFFECT FINANCIAL RESULTS IN A MATERIALLY ADVERSE OR MATERIALLY BENEFICIAL MANNER. EXCEPT AS OTHERWISE PROVIDED IN THE PLAN OR THIS DISCLOSURE STATEMENT, THE DEBTORS AND REORGANIZED DEBTORS, AS APPLICABLE, DO NOT INTEND AND UNDERTAKE NO OBLIGATION TO UPDATE OR OTHERWISE REVISE THE PROJECTIONS TO REFLECT EVENTS OR CIRCUMSTANCES EXISTING OR ARISING AFTER THE DATE HEREOF OR TO REFLECT THE OCCURRENCE OF UNANTICIPATED EVENTS. THEREFORE, THE PROJECTIONS MAY NOT BE RELIED UPON AS A GUARANTEE OR OTHER ASSURANCE OF THE ACTUAL RESULTS THAT WILL OCCUR. IN DECIDING WHETHER TO VOTE TO ACCEPT OR REJECT THE PLAN, HOLDERS OF CLAIMS MUST MAKE THEIR OWN DETERMINATIONS AS TO THE REASONABLENESS OF SUCH ASSUMPTIONS AND THE RELIABILITY OF THE PROJECTIONS AND SHOULD CONSULT WITH THEIR OWN ADVISORS.

III.    General Assumptions

a. Overview

The Debtors are an independent energy company focused on the acquisition, production, exploration and development of onshore liquids-rich oil and natural gas assets in the United States.

b. Methodology

Key personnel from all of the Debtors’ operating areas and across various functions provided input in the development of the Projections. In preparing the Projections, the Debtors considered the current commodity price environment, historical operating/production performance and operating costs. The Projections were developed taking into consideration the Debtors’ current scope of operation and development of its acreage position based on projected commodity prices, capital

investment and return requirements, and other operating and non-operating considerations at a granular level.

c. Plan Consummation

The Financial Projections assume that the Plan will be consummated on or around December 31,

2018.

Assumptions With Respect to the Projected Income Statement

a. Production

Forecasted oil and natural gas volumes for operated production are based on production estimates by the Debtors’ management team and contemplate future commodity prices and anticipated operated rig activity. Forecasted volumes for non-operated production are based on anticipated development plans of outside operators obtained through active dialogue with those operators.

b. Revenues

Revenues are derived from the sale of the consolidated Reorganized Debtors’ share of oil and natural gas production primarily from their owned working interests in the Eagle Ford formation in Texas, the Haynesville formation in North Louisiana and East Texas, and the Marcellus and Utica formations in Pennsylvania, as well as the Debtors’ respective ownership interest in non- operated wells.

c. Commodity Pricing

Revenues are sensitive to changes in the prices received for oil and natural gas production. Oil and natural gas production is sold at prevailing market prices, which may be volatile and subject to numerous factors that are outside of the Reorganized Debtors’ control. The Projections assume New York Mercantile Exchange (“NYMEX”) futures strip pricing as of October 10, 2018 for crude oil and natural gas as shown in the chart below:

Calendar Year	2019		2020		2021		2022		2023
Oil ($/bbl)	$	72.22	$	68.80	$	65.03	$	61.80	$	59.47
Gas ($/mcf)	2.89		2.68		2.60		2.60		2.65

Assumptions regarding realized pricing (i.e., “differentials”) from NYMEX are based on input from the Debtors’ management, recent historical rates and existing marketing, gathering and transportation contracts with purchasers of the Reorganized Debtors’ production and are consistent with recent realized pricing.

d. Production Taxes

Production taxes are based on production volumes and projected commodity pricing, as well as management’s estimates of future tax obligations.

e. Operating Costs

Lease operating expenses (“LOE”), workover expenses, and gathering expenses are based on historical levels and management estimates of future expectations. LOE includes, among other items, lifting costs, fuel, certain field level payroll and benefits, maintenance, repair and outside services.

f. Equity Income

Equity income is based upon historical levels and management estimates of future expectations. Equity income includes income related to the Reorganized Debtors’ ownership of midstream assets.

g. General and Administrative

General and Administrative Costs (“G&A”) are primarily comprised of labor costs and other expenses associated with the Debtors’ corporate overhead. Projected G&A is based on historical G&A costs, adjusted for recent cost reduction efforts.

h. Income Taxes

Incomes taxes are based upon the assumption that the Reorganized Debtors’ will have substantial net operating losses as a result of receiving 382(l)(5) treatment from the IRS. As a result, the Reorganized Debtors are not expected to pay taxes during the forecast period.

i. Interest Expense

Interest expense is comprised of interest on a $350 million reserve based revolving credit facility and interest on a $350 million second lien financing. Interest expense on the reserve based revolving credit facility and the second lien financing is based on anticipated funding costs.

Income Statement
	Forecasted
($ in millions)	2019			2020			2021			2022			2023
Realized Oil Price	$	70.12		$	66.32		$	62.99		$	60.09		$	57.80
Realized Gas Price	$	2.58		$	2.32		$	2.20		$	2.16		$	2.20
Oil (Mbbl)	1,926			2,222			2,843			2,400			1,826
Gas (Mmcfe)	91,496			84,610			76,818			90,381			118,495
Total (Mmcfe)	103,051			97,939			93,874			104,780			129,451
Oil	135			147			179			144			106
Gas	236			196			169			196			261
Total Revenue	$	371		$	344		$	348		$	340		$	367
LOE	(40		)	(40		)	(41		)	(42		)	(43		)
Severance Taxes	(10		)	(11		)	(12		)	(11		)	(9		)
Ad Valorem Taxes	(12		)	(12		)	(12		)	(11		)	(10		)
Gathering and Transportation	(53		)	(48		)	(44		)	(53		)	(68		)
Depletion, Depreciation and Amortization	(124		)	(138		)	(154		)	(146		)	(97		)
General and Administrative	(21		)	(21		)	(21		)	(21		)	(21		)
Total Operating Costs	$	(259	)	$	(269	)	$	(284	)	$	(283	)	$	(248	)
Interest Expense	(48		)	(46		)	(46		)	(46		)	(45		)
Equity Income	—			—			—			—			—
Income Before Taxes	$	64		$	29		$	18		$	11		$	74
Income Taxes	—			—			—			—			—
Net Income	$	64		$	29		$	18		$	11		$	74
Reconciliation of Net Income to Adjusted EBITDA
Net Income	$	64		$	29		$	18		$	11		$	74
(+) Income Taxes	—			—			—			—			—
(+) Equity Income	—			—			—			—			—
(+) Interest Expense	48			46			46			46			45
(+) Depletion, Depreciation and Amortization	124			138			154			146			97
Adj. EBITDA	$	236		$	212		$	218		$	203		$	217

Assumptions with Respect to the Projected Balance Sheet and Projected Statement of Cash

Flows

a. Capital Expenditures

Projections for capital expenditures were prepared with consideration of the Debtors’ current drilling program and future estimates in the development of the Eagle Ford formation in Texas, the Haynesville formation in North Louisiana and East Texas and the Marcellus and Utica formations in Pennsylvania. These expenditures include capital associated with drilling and completing new producing wells, improving operational efficiency and capitalized maintenance expenditures. Capital expenditures also include expenditures directed at maintaining lease acreage positions and capitalized G&A.

b. Working Capital

The Projections contemplate timing of forecasted receivables, payables and pre-funding of capital expenditures associated with the Debtors’ Haynesville assets that are consistent with the timing experienced with the Debtors’ historical receipts and payments.

c. Pro Forma Adjustments Related to Emergence

The Balance Sheet included in the Projections presents a pro forma view assuming the effect of certain adjustments related to the Debtors’ emergence from the Chapter 11 Cases. These adjustments primarily relate to the additional borrowings under the Reorganized Debtors Exit Facility and the exchange of the 1.75 Lien Term Loan Facility Claims, Second Lien Term Loan Facility Claims and Unsecured Notes Claims for equity. The Financial Projections include pro forma adjustments to reflect the proposed restructuring, but do not purport to represents all aspects of the Financial Accounting Standards Board ASC 852.

d. Capital Structure

The Projections assume that the Debtors are able to secure financing in the form of a $350 million reserve based revolving credit facility and a $350 million second lien financing at emergence, which will allow the Reorganized Debtors to fund operations.

Opening Balance Sheet
	Predecessor			Reorganization			Successor
($ in millions)	Dec-18			Adjustments			Dec-18
Assets
Current assets:
Cash and Cash Equivalents	$	10		$	—		$	10
Restricted Cash	33			—			33
Total Cash	$	43		$	—		$	43
Accounts Receivable, Net:
Oil and Natural Gas	82			—			82
Joint Interest	40			—			40
Other	6			—			6
Total Receivables	$	128		$	—		$	128
Inventory and Other	8			—			8
Total Current Assets	$	179		$	—		$	179
Non-Current Assets:
Equity Investments	5			—			5
Oil and Natural Gas Properties:
Unproved Oil and Natural Gas Properties	221			—			221
Proved Developed and Undeveloped Oil	3,281			—			3,281
Accumulated Depletion	(2,849		)	—			(2,849		)
Total O&G Properties	$	653		$	—		$	653
Other Property and Equipment, Net	39			—			39
Deferred Financing Costs, Net	—			18			18
Goodwill	163			—			163
Total Non-Current Assets	$	860		$	18		$	877
Total Assets	$	1,039		$	18		$	1,056
Liabilities
Current Liabilities:
Accounts Payable and Accrued Liabilities	115			(67		)	48
Revenues and Royalties Payable	269			(228		)	41
Current Portion of Asset Retirement Obligations	1			—			1
Total Current Liabilities	$	385		$	(295	)	$	89
Non-Current Liabilities:
Long-Term Debt	1,767			(1,184		)	583
Asset Retirement Obligations and Other	29			(3		)	26
Total Non-Current Liabilities	$	1,796		$	(1,187	)	$	609
Total Liabilities	$	2,180		$	(1,482	)	$	698
Shareholders Equity
Total Shareholders Equity	$	(1,142	)	$	1,499		$	358
Total Liabilities & Shareholders Equity	$	1,039		$	18		$	1,056

Balance Sheet
	Forecasted
($ in millions)	2019			2020			2021			2022			2023
Assets
Current assets:
Cash and Cash Equivalents	$	10		$	10		$	10		$	10		$	10
Restricted Cash	7			5			11			9			5
Total Cash	$	17		$	15		$	21		$	19		$	15
Accounts Receivable, Net:
Oil and Natural Gas	84			77			74			77			85
Joint Interest	31			30			27			29			32
Other	6			6			5			6			6
Total Receivables	$	121		$	113		$	106		$	111		$	123
Inventory and Other	8			12			9			9			15
Total Current Assets	$	147		$	140		$	136		$	139		$	152
Non-Current Assets:
Equity Investments	5			5			6			6			6
Oil and Natural Gas Properties:
Unproved Oil and Natural Gas Properties	372			509			653			795			964
Proved Developed and Undeveloped Oil	3,281			3,281			3,281			3,281			3,281
Accumulated Depletion	(2,973		)	(3,111		)	(3,265		)	(3,411		)	(3,509		)
Total O&G Properties	$	680		$	679		$	669		$	665		$	736
Other Property and Equipment, Net	39			39			39			39			39
Deferred Financing Costs, Net	18			18			18			18			18
Goodwill	163			163			163			163			163
Total Non-Current Assets	$	904		$	904		$	895		$	890		$	962
Total Assets	$	1,051		$	1,044		$	1,031		$	1,030		$	1,114
Liabilities
Current Liabilities:
Accounts Payable and Accrued Liabilities	24			29			19			23			25
Revenues and Royalties Payable	57			62			43			45			51
Current Portion of Asset Retirement Obligations	1			1			1			1			1
Total Current Liabilities	$	81		$	91		$	63		$	68		$	76
Non-Current Liabilities:
Long-Term Debt	522			476			472			454			457
Asset Retirement Obligations and Other	26			26			26			26			26
Total Non-Current Liabilities	$	548		$	502		$	498		$	481		$	483
Total Liabilities	$	629		$	593		$	561		$	549		$	559
Shareholders Equity
Total Shareholders Equity	$	422		$	451		$	469		$	481		$	555
Total Liabilities & Shareholders Equity	$	1,051		$	1,044		$	1,031		$	1,030		$	1,114

Balance Sheet
	Forecasted
($ in millions)	2019			2020			2021			2022			2023
Cash Flow From Operating Activities:
Net Income	$	64		$	29		$	18		$	11		$	82
Adjustments to Reconcile Net Income to Cash
Depletion, Depreciation and Amortization	$	124		$	138		$	154		$	146		$	97
Other Non-Operating Items	—			—			—			—			—
Changes in Assets and Liabilities:
Restricted Cash With Related Party	26			3			(6		)	2			4
Accounts Receivable	6			8			7			(5		)	(12		)
Inventory and Other Current Assets	—			(4		)	3			(1		)	(5		)
Accounts Payable	(24		)	5			(10		)	4			2
Royalties Payable	16			5			(18		)	1			6
Accrued Interests	—			—			—			—			—
Total Cash Flow from Operating	$	212		$	184		$	148		$	159		$	174
Cash Flow From Investing Activities:
Drilling & Completion, Operations and Capitalized G&A	$	(147	)	$	(133	)	$	(140	)	$	(138	)	$	(165	)
Lease Acquisition	(4		)	(4		)	(4		)	(4		)	(4		)
Total Cash Flow from Investing	$	(151	)	$	(137	)	$	(144	)	$	(142	)	$	(169	)
Cash Flow From Financing Activities:
Debt Borrowing/(Repayment	$	(60	)	$	(46	)	$	(4	)	$	(18	)	$	3
Total Cash Flow from Financing	$	(60	)	$	(46	)	$	(4	)	$	(18	)	$	3
Net Cash Flow	$	—		$	—		$	—		$	—		$	8