EXCO Resources still has 145,000 net acres in the Marcellus with 124 horizontal Marcellus wells drilled and in production. However, they have pretty much abandoned the Marcellus at this point. EXCO was officially warned by the New York Stock Exchange last week that their stock is in danger of becoming delisted on the NYSE. Sound familiar? It should. The NYSE warned EXCO of the same thing in March 2016 (see EXCO: No Marcellus Drilling in 2015/2016, NYSE Threatens Delisting). Bad timing for EXCO as they have a Feb. 1 deadline looming for their borrowing base “redetermination” (see EXCO’s Day of Reckoning with Bankers: Feb 1). A company’s borrowing base is the value of its assets–in this case the value of the leases and oil/gas wells EXCO owns. Those assets are used as collateral to back up loans and IOUs. If the bankers extending credit determine a company’s assets are no longer sufficient to cover their loans, the bankers may force that company into bankruptcy as a way to protect the bank’s investment. EXCO pushed off the asset checkup to November. Then in December, the company got a reprieve, pushing the overdue checkup from Nov. 1, 2016 to Feb. 1, 2017. Time is now up and the redetermination will happen on Feb. 1. Will the NYSE warning play a role in that redetermination? EXCO says they have a plan to stay listed…
