This document contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control, which may include statements about:

• the amount of oil and natural gas we produce;

• the level of capital expenditures;

• the price at which we are able to sell our oil and natural gas production;

• our ability to acquire additional oil and natural gas properties at economically attractive prices;

• our drilling locations and our ability to continue our development activities at economically attractive costs;

• the level of our lease operating expenses, general and administrative costs and finding and development costs, including payments to our general partner:

• our future operating results; and

• our business strategy, plans, objectives, expectations and intentions.

All of these types of statements, other than statements of historical fact included in this document, are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as "may," "could," "should," "expect," "plan," "project," "intend," "anticipate," "believe," "estimate," "predict," "potential," "pursue," "target," "continue," the negative of such terms or other comparable terminology.

The forward-looking statements contained in this document are largely based on our expectations, which reflect estimates and assumptions made by our management. These estimates and assumptions reflect our best judgment based on currently known market conditions and other factors. Although we believe such estimates and assumptions to be reasonable, they are inherently uncertain and involve a number of risks and uncertainties that are beyond our control. In addition, management's assumptions about future events may prove to be inaccurate. All readers are cautioned that the forward-looking statements contained in this document are not guarantees of future performance, and our expectations may not be realized or the forward-looking events and circumstances may not occur. Actual results may differ materially from those anticipated or implied in the forward-looking statements due to factors described in Legacy's Annual Report on Form 10-K for the year ended December 31, 2008 and this Quarterly Report on Form 10-Q in Item 1A under "Risk Factors." The forward-looking statements in this document speak only as of the date of this document; we disclaim any obligation to update these statements unless required by securities law, and we caution you not to rely on them unduly.

We were formed in October 2005. Upon completion of our private equity offering and as a result of the formation of Legacy on March 15, 2006, we acquired oil and natural gas properties and business operations from our Founding Investors and three charitable foundations.

Because of our rapid growth through acquisitions and development of properties, historical results of operations and period-to-period comparisons of these results and certain financial data may not be meaningful or indicative of future results. The operating results from the COP III Acquisition have been included from April 30, 2008 and the operating results from the Pantwist Acquisition have been included from October 1, 2008.

Acquisitions have been financed with a combination of proceeds from bank borrowings, issuances of units and cash flow from operations. Post-acquisition activities are focused on evaluating and developing the acquired properties and evaluating potential add-on acquisitions.

Our revenues, cash flow from operations and future growth depend substantially on factors beyond our control, such as economic, political and regulatory developments and competition from other sources of energy. Oil and natural gas prices historically have been volatile and may fluctuate widely in the future.

Sustained periods of low prices for oil or natural gas could materially and adversely affect our financial position, our results of operations, the quantities of oil and natural gas reserves that we can economically produce, our access to capital and the amount of our cash distributions.

Outlook: The current global economic environment has reduced the demand for oil and natural gas and resulted in a significant decrease of commodity prices. In addition, financial and credit markets have deteriorated, virtually shutting down access to public financial markets and significantly reducing the availability of credit. We cannot predict future commodity prices nor when or whether credit conditions will ease and financial markets will become available again. Based on the sustained decrease in commodity prices which began in the third and fourth quarters of 2008, we are experiencing a challenging 2009. A sustained period of reduced commodity prices will have an adverse effect on our operating income and cash flow in future periods resulting in decreased revenues and higher depletion rates, and as a result, will adversely impact our ability to pay cash distributions at current levels.

We face the challenge of natural production declines. As initial reservoir pressures are depleted, oil and natural gas production from a given well or formation decreases. We attempt to overcome this natural decline by utilizing multiple types of recovery techniques such as secondary (waterflood) and tertiary (CO2) recovery methods to repressure the reservoir and recover additional oil, drilling to find additional reserves, re-stimulating existing wells and acquiring more reserves than we produce. Our future growth will depend on our ability to continue to add reserves in excess of production. We will maintain our focus on adding reserves through acquisitions and exploitation projects. Our ability to add reserves through acquisitions and exploitation projects is dependent upon many factors including our ability to raise capital and obtain regulatory approvals.

Our revenues are highly sensitive to changes in oil and natural gas prices and to levels of production. As set forth under "Cash Flow from Operations" below, we have entered into derivative transactions covering a significant portion of our expected production, which allows us to mitigate, but not eliminate, oil and natural gas price risk. We continuously conduct financial sensitivity analyses to assess the effect of changes in pricing and production. These analyses allow us to determine how changes in oil and natural gas prices will affect our ability to execute our capital investment programs and to meet future financial obligations. Further, the financial analyses allow us to monitor any impact such changes in oil and natural gas prices may have on the value of our proved reserves and their impact, if any, on any redetermination of our borrowing base under our revolving credit facility.

Legacy does not specifically designate derivative instruments as cash flow hedges; therefore, the mark-to-market adjustment reflecting the unrealized gain or loss associated with these instruments is recorded in current earnings.

We strive to increase our production levels to maximize our revenue and cash available for distribution. Additionally, we continuously monitor our operations to ensure that we are incurring operating costs at the optimal level. Accordingly, we continuously monitor our production and operating costs per well to determine if any wells or properties should be shut in, recompleted or sold.

Such costs include, but are not limited to, the cost of electricity to lift produced fluids, chemicals to treat wells, field personnel to monitor the wells, well repair expenses to restore production, well workover expenses intended to increase production, and ad valorem taxes. We incur and separately report severance taxes paid to the states in which our properties are located. These taxes are reported as production taxes and are a percentage of oil and natural gas revenue. Ad valorem taxes are a percentage of property valuation and are reported with production costs. Gathering and transportation costs are generally borne by the purchasers of our oil and natural gas as the price paid for our products reflects these costs.

                                 Operating Data

The following table sets forth selected unaudited financial and operating data
of Legacy for the periods indicated.

                                                                  Three Months Ended March 31,
                                                                  2009                  2008
                                                                 (In thousands, except per unit
                                                                             data)
Revenues:
Oil sales                                                      $    16,465         $       36,049
Natural gas liquid sales                                             2,069                  3,502
Natural gas sales                                                    4,525                  9,236
Total revenue                                                  $    23,059         $       48,787

Expenses:
Oil and natural gas production                                 $    10,537         $        8,996
Ad valorem taxes                                               $     1,465         $          532
Total oil and natural gas production                           $    12,002         $        9,528
Production and other taxes                                     $     1,353         $        2,469
General and administrative                                     $     3,368         $        3,018
Depletion, depreciation, amortization and accretion            $    16,621         $        9,617

Realized swap settlements
Realized gain (loss) on oil swaps                              $    14,912         $       (6,578 )
Realized gain (loss) on natural gas liquid swaps               $       470         $         (721 )
Realized gain on natural gas swaps                             $     3,597         $          532

Production:
Oil - barrels                                                          460                    379
Natural gas liquids - gallons                                        3,388                  2,721
Natural gas - Mcf                                                    1,249                  1,058
Total (MBoe)                                                           749                    620
Average daily production (Boe/d)                                     8,322                  6,813

Average sales price per unit (excluding swaps):
Oil price per barrel                                           $     35.79         $        95.12
Natural gas liquid price per gallon                            $      0.61         $         1.29
Natural gas price per Mcf                                      $      3.62         $         8.73
Combined (per Boe)                                             $     30.79         $        78.69

Average sales price per unit (including realized swap
gains/losses):
Oil price per barrel                                           $     68.21         $        77.76
Natural gas liquid price per gallon                            $      0.75         $         1.02
Natural gas price per Mcf                                      $      6.50         $         9.23
Combined (per Boe)                                             $     56.13         $        67.77

NYMEX oil index prices per barrel:
Beginning of Period                                            $     44.60         $        95.98
End of Period                                                  $     49.66         $       101.58

NYMEX gas index prices per Mcf:
Beginning of Period                                            $      5.62         $         7.48
End of Period                                                  $      3.78         $        10.10

Average unit costs per Boe:
Oil and natural gas production                                 $     14.07         $        14.51
Ad valorem taxes                                               $      1.96         $         0.86
Production and other taxes                                     $      1.81         $         3.98
General and administrative                                     $      4.50         $         4.87
Depletion, depreciation, amortization and accretion            $     22.19         $        15.51

Three-Month Period Ended March 31, 2009 Compared to Three-Month Period Ended March 31, 2008

Legacy's revenues from the sale of oil were $16.5 million and $36.0 million for the three-month periods ended March 31, 2009 and 2008, respectively. Legacy's revenues from the sale of NGLs were $2.1 million and $3.5 for the three-month periods ended March 31, 2009 and 2008, respectively. Legacy's revenues from the sale of natural gas were $4.5 million and $9.2 million for the three-month periods ended March 31, 2009 and 2008, respectively. The $19.5 million decrease in oil revenues reflects the decrease in average realized price of $59.33 per Bbl (62%). In addition to the decrease in NYMEX WTI oil prices, our realized oil revenues were impacted by widening price differentials to NYMEX WTI. Our realized differentials during the three-month period ended March 31, 2009 were $7.42 per barrel less than NYMEX WTI compared to $2.87 less than NYMEX WTI during the three-month period ended March 31, 2008. These price declines were partially offset by an increase in oil production of 81 MBbls (21%) due primarily to Legacy's purchase of the oil and natural gas properties in the COP III and Pantwist Acquisitions. The $1.4 million decrease in proceeds from NGL sales reflects the decrease in realized NGL price of $0.68 per gallon (53%) partially offset by an increase in NGL production of approximately 667,000 gallons (25%) due primarily to Legacy's purchase of oil and natural gas properties in the COP III and Pantwist Acquisitions. The $4.7 million decrease in natural gas revenues reflects the decrease in average realized price per Mcf of $5.11 per Mcf (59%) partially offset by an increase in natural gas production of approximately 191 MMcf (18%) due primarily to Legacy's purchase of oil and natural gas properties acquired in the COP III and Pantwist Acquisitions.

For the three-month period ended March 31, 2009, Legacy recorded $19.5 million of net gains on oil, NGL and natural gas swaps comprised of realized gains of $19.0 million from net cash settlements of oil, NGL and natural gas swap contracts and net unrealized gains of $0.5 million. Legacy had unrealized net losses from oil swaps because the price of oil increased during the three-month period ended March 31, 2009. As a point of reference, the NYMEX price for light sweet crude oil for the near-month close increased from $44.60 per Bbl at December 31, 2008 to $49.66 per Bbl at March 31, 2009, a price which is less than the average contract prices of Legacy's outstanding oil swap contracts, but greater than the price at December 31, 2008, resulting in a reduction of unrealized net gain attributable to Legacy's outstanding oil swap contracts. Due to the increase in oil prices during the quarter, the differential between Legacy's fixed price oil swaps and NYMEX decreased, resulting in losses for the quarter. Legacy had unrealized net losses from NGL swaps because NGL prices increased during the three-month period ended March 31, 2009. Legacy had unrealized net gains from natural gas swaps because the NYMEX natural gas prices declined during the three-month period ended March 31, 2009. As a point of reference, the NYMEX price for natural gas for the near-month close decreased from $5.62 per MMBtu at December 31, 2008 to $3.78 per MMBtu at March 31, 2009, a price which is less than the average contract prices of Legacy's outstanding natural gas swap contracts, but less than the price at December 31, 2008, resulting in an increase of unrealized net gain attributable to Legacy's outstanding natural gas swap contracts. For the three-month period ended March 31, 2008, Legacy recorded $40.8 million of net losses on oil, NGL and natural gas swaps comprised of realized losses of $6.8 million from net cash settlements of oil, NGL and natural gas swap contracts and a net unrealized loss of $25.3 million on oil swap contracts, due to the increase in oil prices during the quarter which increased the differential between the NYMEX oil index price and our fixed price oil swaps, a net unrealized loss of $0.01 million on NGL swap contracts and a net unrealized loss of $8.7 million on natural gas swap contracts, due to the increase in natural gas prices during the period. Unrealized gains and losses represent a current period mark-to-market adjustment for commodity derivatives which will be settled in future periods.

Legacy's oil and natural gas production expenses, excluding ad valorem taxes, increased to $10.5 million ($14.07 per Boe) for the three-month period ended March 31, 2009, from $9.0 million ($14.51 per Boe) for the three-month period ended March 31, 2008. Production expenses increased primarily because of $1.7 million of production expenses related to the COP III and Pantwist Acquisitions. Legacy's ad valorem taxes increased to $1.5 million ($1.96 per Boe) for the three-month period ended March 31, 2009, from $0.5 million ($0.86 per Boe) for the three-month period ended March 31, 2008 primarily because of increased well counts and periods of ownership from 2008 acquisition activity.

Legacy's production and other taxes were $1.4 million and $2.5 million for the three-month periods ended March 31, 2009 and 2008, respectively. Production and other taxes decreased primarily because of the decrease in realized prices. As production and other taxes are a function of price and volume, the decrease is consistent with the decrease in realized prices.

Legacy's general and administrative expenses were $3.4 million and $3.0 million for the three-month periods ended March 31, 2009 and 2008, respectively. General and administrative expenses increased approximately $0.4 million between the three-month periods ended March 31, 2009 and 2008 primarily due to increases in payroll related to an increased headcount due to growth in our asset base.

Legacy's depletion, depreciation, amortization and accretion expense, or DD&A, was $16.6 million and $9.6 million for the three-month periods ended March 31, 2009 and 2008, respectively. DD&A increased partially because of $2.1 million of DD&A related to the COP III and Pantwist Acquisitions. In addition, the increase in DD&A expense per Boe, from $15.51 to $22.19 for the three-month periods ended March 31, 2008 and 2009, respectively, reflects the decreased commodity prices combined with the higher cost basis of the producing oil and natural gas properties acquired in recent acquisitions.

Impairment expense was $1.1 million and $0.1 million for the three-month periods ended March 31, 2009 and 2008, respectively. In the period ended March 31, 2009, Legacy recognized impairment expense in five separate producing fields, due primarily to lower natural gas prices, rising production costs and, in the case of one field, performance. The impairment expense for the period ended March 31, 2008, involved one producing field due primarily to costs incurred in the period during which the estimated production revenues did not exceed the costs.

Legacy recorded interest expense of $4.3 million and $4.2 million for the three-month periods ended March 31, 2009 and 2008, respectively, reflecting higher average borrowings in the period ended March 31, 2009 partially offset by lower average interest rates.

Legacy's primary sources of capital and liquidity have been bank borrowings, cash flow from operations, its private offering in March 2006, the IPO in January 2007 and its private offering in November 2007. To date, Legacy's primary use of capital has been for acquisitions, repayment of bank borrowings and development of oil and natural gas properties.

We continually monitor the capital resources available to us to meet our future financial obligations and planned capital expenditures. Our future success in maintaining and growing reserves and production will be highly dependent on capital resources available to us and our success in acquiring and developing additional reserves. If we were to make significant additional acquisitions for cash, we would need to borrow additional amounts under our credit facility, if available, or obtain additional debt or equity financing. While we actively review acquisition opportunities on an ongoing basis, current overall economic conditions and the lack of debt and equity financing at economically attractive terms severely limit our ability to execute any significant acquisition transactions. Further, our credit facility imposes certain restrictions on our ability to obtain additional debt financing. Based upon current oil and natural gas price expectations for the year ending December 31, 2009, we anticipate that our cash on hand, cash flow from operations and available borrowing capacity under our credit facility will provide us sufficient working capital to meet our currently planned capital expenditures and future cash distributions at levels to be determined based on cash available for distribution, any remaining borrowing capacity for cash distributions under our credit facility, requirements to repay debt, and any other factors the board of directors of our general partner may consider.

To reduce debt, the board of directors of our general partner on April 23, 2009 approved a reduction in our 2009 capital expenditure budget to $10.7 million from the $20 million budget approved in February 2009. Also on April 23, 2009, the board of directors approved a cash distribution of $0.52 per unit with respect to the first quarter of 2009, or $16.16 million in the aggregate. With respect to any future distributions, we continue to review our distribution policy to maintain liquidity given the volatile commodity price and capital markets environment. In each of the last three quarters, we distributed more cash than we generated. This is not a sustainable scenario; thus, a reduction in distribution levels will likely be necessary in the coming quarters unless a significant improvement in oil and natural gas prices occurs.

Further, given the semi-annual borrowing base redeterminations and potentially lower bank price forecasts, which are determined by our lenders based on their commodity price expectations, a reduction in our borrowing base may occur at the time of the scheduled redetermination in October 2009 or earlier, at the request of the lenders. Should our borrowing base be decreased below the amount of debt then outstanding, which as of May 7, 2009 was $300 million, we would be required to pay down our debt to a level below the newly reduced borrowing base. As noted above, we have already reduced our capital expenditure budget for fiscal year 2009 to $10.7 million and thus would need to reduce our future distributions to prospectively lower our debt balance. Please read "- Financing Activities - Our Revolving Credit Facility."

Legacy's net cash provided by (used in) operating activities was $(10.7) million and $29.3 million for the three-month periods ended March 31, 2009 and 2008, respectively, with the 2009 period being unfavorably impacted by lower commodity prices.

Our cash flow from operations is subject to many variables, the most significant of which is the volatility of oil and natural gas prices. Oil and natural gas prices are determined primarily by prevailing market conditions, which are dependent on regional and worldwide economic activity, weather and other factors beyond our control. Our future cash flow from operations will depend on our ability to maintain and increase production through acquisitions and development projects, as well as the prices of oil and natural gas.

Legacy's cash capital expenditures were $5.1 million for the three-month period ended March 31, 2009. The total includes $4.8 million of development projects and $0.3 million in purchase price adjustments on previous acquisitions. Legacy's cash capital expenditures were $32.6 million for the three-month period ended March 31, 2008. The total includes $29.6 million for the acquisition of oil and natural gas properties in small acquisitions and $3.0 million of development projects.

We currently anticipate that our capital expenditure budget, which predominantly consists of drilling, recompletion and re-fracture stimulation projects will be $10.7 million for the year ending December 31, 2009. Our remaining borrowing capacity under our revolving credit facility is $40.0 million as of May 7, 2009. The amount and timing of our capital expenditures is largely discretionary and within our control, with the exception of certain projects managed by other operators. We may defer a portion of our planned capital expenditures until later periods. Accordingly, we routinely monitor and adjust our capital expenditures in response to changes in oil and natural gas prices, drilling and acquisition costs, industry conditions and internally generated cash flow. Matters outside our control that could affect the timing of our capital expenditures include obtaining required permits and approvals in a timely manner. Based upon current oil and natural gas price expectations for the year ending December 31, 2009, we anticipate that we will have sufficient sources of working capital, including our cash flow from operations and available borrowing capacity under our credit facility, to meet our cash obligations including our planned capital expenditures of $10.7 million. Future cash distributions will be at levels to be determined based on cash available for distribution, any remaining borrowing capacity for cash distributions under our credit facility, requirements to repay debt and any other factors the board of directors of our general partner may consider. However, future cash flows are subject to a number of variables, including the level of oil and natural gas production and prices. There can be no assurance that operations and other capital resources will provide cash in sufficient amounts to maintain planned levels of capital expenditures.

We enter into oil, NGL and natural gas derivatives to reduce the impact of oil, NGL and natural gas price volatility on our operations. Currently, we use swaps and collars to offset price volatility on NYMEX oil, NGL and natural gas prices, which do not include the additional net discount that we typically experience in the Permian Basin. At March 31, 2009, we had in place oil, NGL and natural gas swaps covering significant portions of our estimated 2008 through 2013 oil, NGL and natural gas production. As of May 7, 2009, we have swap contracts covering approximately 74.9% of our remaining expected oil, natural gas liquid and natural gas production for 2009. As of May 7, 2009, we also have swap and collar contracts covering approximately 54.0% of our currently expected oil and natural gas production for 2010 through 2013 from existing estimated total proved reserves.

By reducing the cash flow effects of price volatility from a significant portion of our oil and natural gas production, we have mitigated, but not eliminated, the potential effects of changing prices on our cash flow from operations for . . .