Fueled by acquisitions, EXCO Resources (NYSE:XCO) said on Monday it expects production to grow by at least 40% next year.
Reflecting the optimistic outlook, the oil and natural gas explorer, which has received a $4.36 billion buyout bid from the chief executive, approved a capital budget of $976.2 million, nearly double its current year’s $496.8 million budget.
A majority of the allocated funds will go toward development and completion activities, including activity in its recently acquired Shelby Trough and expansion of its activities in Appalachia.
About $757 million will be spent within EXCO’s East Texas/North Louisiana joint venture with BG Group, $683 million of which will be used for drilling and completion costs, the rest for lease acquisitions, operations projects and seismic data acquisition.
The Dallas-based company is focusing on Haynesville shale targets, the goal being to have 22 operated drilling rigs throughout the year. The rigs would enable the company to drill and complete 163 gross operated wells targeting the shale.
Some $82.7 million of the funds will go toward its Appalachia venture, just under half of which will help drill and complete 52 gross operated horizontal Marcellus shale wells and drill 12 gross appraisal wells. Other funds will be used for lease acquisitions, operations projects and seismic data acquisition.
Another $53.4 million will be allocated to EXCO’s Permian Division.