Feb 27, 2020 SOURCE: PR NewsWire
EOG Resources Reports Excellent Fourth Quarter and Full-Year 2019 Results; Announces 2020 Capital Program; Raises Dividend by 30 Percent
HOUSTON, Feb. 27, 2020 /PRNewswire/ --
-- Increased Common Stock Dividend by 30 Percent to $1.50 Indicated Annual
Rate
-- Earned $2.7 Billion Net Income in 2019, or $4.71 per Share
-- Generated $8.2 Billion Net Cash from Operating Activities and
Significant Free Cash Flow
-- Exceeded Fourth Quarter and Full-Year 2019 Crude Oil Production Target
with Capital Expenditures Below Target
-- Lease and Well and DD&A Expense Rates Below Target in Fourth Quarter and
Full-Year 2019
-- Increased Proved Reserves by 14% and Replaced 253% of 2019 Production at
$8.21 per Boe Finding Cost
-- $6.3 to $6.7 Billion Capital Program Targets 10-14% Crude Oil Volume
Growth in 2020
-- 2020 Capital Program and Dividend Funded with Net Cash from Operating
Activities at Oil Prices Below $50
EOG Resources, Inc. (EOG) today reported fourth quarter 2019 net income of $637 million, or $1.10 per share, compared with fourth quarter 2018 net income of $893 million, or $1.54 per share. Net cash from operating activities for the fourth quarter 2019 was $1.8 billion. For the full year 2019, EOG reported net income of $2.7 billion, or $4.71 per share, compared with net income of $3.4 billion, or $5.89 per share, for the full year 2018. Net cash from operating activities for the full year 2019 was $8.2 billion.
Adjusted non-GAAP net income for the fourth quarter 2019 was $787 million, or $1.35 per share, compared with adjusted non-GAAP net income of $718 million, or $1.24 per share, for the same prior year period. Adjusted non-GAAP net income for the full year 2019 was $2.9 billion, or $4.98 per share, compared with adjusted non-GAAP net income of $3.2 billion, or $5.54 per share, for the full year 2018.
Increased crude oil production from high-return operating areas and reductions in per-unit operating costs contributed to EOG's strong fourth quarter 2019 financial results. Adjusted earnings per share, discretionary cash flow and adjusted EBITDAX increased in the fourth quarter 2019 compared with the same prior year period, demonstrating EOG's resiliency and ability to overcome declines in commodity prices. Please refer to the attached tables for definitions and the reconciliation of non-GAAP measures to GAAP measures.
Fourth Quarter and Full Year 2019 Operating Review
Capital efficiency improvements from increased well productivity and cost reductions across EOG's premium plays supported strong operating and financial performance in 2019. United States crude oil volumes grew 15 percent to 455,500 barrels of oil per day (Bopd). Total company natural gas liquids production increased 16 percent, while total company natural gas volumes grew 12 percent.
Total crude oil volumes in the fourth quarter 2019 were 468,900 Bopd, which was above the midpoint of the target range and represents an eight percent increase compared with the same prior year period. Natural gas liquids and natural gas volumes increased by 17 percent and 15 percent, respectively, during this same period. EOG incurred total expenditures of $1.5 billion in the fourth quarter. Total cash capital expenditures before acquisitions of $1.4 billion were below the low end of the target range. Please refer to the attached tables for definitions and the reconciliation of non-GAAP measures to GAAP measures.
EOG continued to lower operating costs during the fourth quarter 2019. Lease and well costs declined 13 percent, transportation costs fell five percent and depreciation, depletion and amortization (DD&A) expenses fell six percent, all on a per-unit basis compared with the same prior-year period. The company also continued to implement sustainable efficiency improvements to reduce well costs. The fourth quarter improvements brought full-year 2019 well cost reductions to seven percent, two percentage points ahead of the target.
EOG generated $2.1 billion of discretionary cash flow in the fourth quarter 2019. After considering total cash capital expenditures before acquisitions of $1.4 billion, EOG generated free cash flow during the fourth quarter 2019 of $723 million. For the full year 2019, EOG generated $8.1 billion of discretionary cash flow and incurred total cash capital expenditures before acquisitions of $6.2 billion, resulting in free cash flow of $1.9 billion. Please refer to the attached tables for definitions and the reconciliation of non-GAAP measures to GAAP measures. As is further explained in the attached reconciliation tables, EOG now defines its free cash flow for a period as its discretionary cash flow for such period less its total cash capital expenditures (before acquisitions) for such period (without regards to the dividends paid in such period). EOG believes this definition of free cash flow is more consistent with that utilized by other companies in the industry.
"Year after year, EOG keeps getting better, delivering record operating performance in 2019. Significant capital efficiency improvements from strong well productivity and sustainable cost reductions allowed us to deliver higher production with less capital investment than we planned at the beginning of the year," said William R. "Bill" Thomas, Chairman and Chief Executive Officer. "We did this while generating substantial free cash flow, strengthening our financial position and increasing the dividend. This was the third consecutive year since our transition to premium drilling that EOG delivered double-digit returns and production growth along with strong free cash flow."
2020 Capital Plan
The purpose of EOG's annual capital program is to generate high returns on investment and increase the company's business value. Exploration and development expenditures for 2020 are expected to range from $6.3 billion to $6.7 billion, including facilities and gathering, processing and other expenditures, and excluding acquisitions and non-cash exchanges. The disciplined capital program supports growth in crude oil production of 10 to 14 percent in 2020 and funds dividend payments with net cash from operating activities at less than $50 oil.
Due to the decline in crude oil prices, the 2020 capital plan allocates slightly less capital to growing oil production than in 2019. To continue to improve the company, the 2020 plan allocates more capital than in 2019 to fund new high-quality drilling potential and high-return infrastructure to further lower EOG's cost structure and environmental footprint. With the benefit of sustainable cost reductions and operational efficiencies, EOG expects to complete approximately 800 net wells in 2020 compared with 750 net wells in 2019. Activity will remain focused in EOG's highest rate-of-return oil assets in the Delaware Basin, Eagle Ford and Rocky Mountain Area.
"EOG's 2020 capital plan reflects continued improvement in capital efficiency, highlights the resiliency of our business model, and ensures the capital program and dividend payments can be funded at a conservative oil price. Looking to the future, our 2020 plan also invests in new high-return drilling potential and infrastructure development to lower costs and further improve the company," Thomas said. "EOG's sustainable competitive advantages already position us as one of the lowest cost oil producers in the global market and we are poised to extend our cost advantage well into the future."
Dividend Increase
The board of directors declared a dividend of $0.375 per share on EOG's Common Stock, an increase of 30 percent. The dividend will be payable April 30, 2020, to stockholders of record as of April 16, 2020. The indicated annual rate is $1.50 per share.
"EOG's high-return premium drilling program and our low cost structure allow us to continue upholding the commitment we have made to return more cash to shareholders. This latest dividend increase demonstrates the confidence we have in our ability to grow cash flow, generate high returns through our premium well strategy and improve our future inventory with high quality new drilling potential," Thomas said.
Reserves
At year-end 2019, total company net proved reserves were 3,329 million barrels of oil equivalent (MMBoe), a 14 percent increase compared with year-end 2018. Net proved reserve additions from all sources, excluding revisions due to price, replaced 253 percent of EOG's 2019 production at a finding and development cost of $8.21 per barrel of oil equivalent. Revisions due to price decreased net proved reserves by 60 MMBoe and asset divestitures decreased net proved reserves by five MMBoe. For more reserves detail and a reconciliation of non-GAAP measures to GAAP measures please refer to the attached tables.
For the 32nd consecutive year, internal reserves estimates were within five percent of estimates independently prepared by DeGolyer and MacNaughton.
Financial Review
EOG further strengthened its financial position during the fourth quarter 2019. At December 31, 2019, EOG's total debt outstanding was $5.2 billion for a debt-to-total capitalization ratio of 19 percent. Considering cash on the balance sheet at the end of the fourth quarter, EOG's net debt was $3.1 billion for a net debt-to-total capitalization ratio of 13 percent. For definitions and the reconciliation of non-GAAP measures to GAAP measures, please refer to the attached tables.
Fourth Quarter 2019 Results Webcast
Friday, February 28, 2020, 9:00 a.m. Central time (10:00 a.m. Eastern time)
Webcast will be available on EOG's website for one year.
http://investors.eogresources.com/Investors
About EOG
EOG Resources, Inc. (NYSE: EOG) is one of the largest crude oil and natural gas exploration and production companies in the United States with proved reserves in the United States, Trinidad, and China. To learn more visit www.eogresources.com.
Investor Contacts
David Streit 713-571-4902
Neel Panchal 713-571-4884
Media and Investor Contact
Kimberly Ehmer 713-571-4676
This press release may include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, including, among others, statements and projections regarding EOG's future financial position, operations, performance, business strategy, returns, budgets, reserves, levels of production, capital expenditures, costs and asset sales, statements regarding future commodity prices and statements regarding the plans and objectives of EOG's management for future operations, are forward-looking statements. EOG typically uses words such as "expect," "anticipate," "estimate," "project," "strategy," "intend," "plan," "target," "aims," "goal," "may," "will," "should" and "believe" or the negative of those terms or other variations or comparable terminology to identify its forward-looking statements. In particular, statements, express or implied, concerning EOG's future operating results and returns or EOG's ability to replace or increase reserves, increase production, generate returns, replace or increase drilling locations, reduce or otherwise control operating costs and capital expenditures, generate cash flows, pay down or refinance indebtedness or pay and/or increase dividends are forward-looking statements. Forward-looking statements are not guarantees of performance. Although EOG believes the expectations reflected in its forward-looking statements are reasonable and are based on reasonable assumptions, no assurance can be given that these assumptions are accurate or that any of these expectations will be achieved (in full or at all) or will prove to have been correct. Moreover, EOG's forward-looking statements may be affected by known, unknown or currently unforeseen risks, events or circumstances that may be outside EOG's control. Furthermore, this press release and any accompanying disclosures may include or reference certain forward-looking, non-GAAP financial measures, such as free cash flow or discretionary cash flow, and certain related estimates regarding future performance, results and financial position. Because we provide these measures on a forward-looking basis, we cannot reliably or reasonably predict certain of the necessary components of the most directly comparable forward-looking GAAP measures, such as future impairments and future changes in working capital. Accordingly, we are unable to present a quantitative reconciliation of such forward-looking, non-GAAP financial measures to the respective most directly comparable forward-looking GAAP financial measures. Management believes these forward-looking, non-GAAP measures may be a useful tool for the investment community in comparing EOG's forecasted financial performance to the forecasted financial performance of other companies in the industry. Any such forward-looking measures and estimates are intended to be illustrative only and are not intended to reflect the results that EOG will necessarily achieve for the period(s) presented; EOG's actual results may differ materially from such measures and estimates. Important factors that could cause EOG's actual results to differ materially from the expectations reflected in EOG's forward-looking statements include, among others:
-- the timing, extent and duration of changes in prices for, supplies of,
and demand for, crude oil and condensate, natural gas liquids, natural
gas and related commodities;
-- the extent to which EOG is successful in its efforts to acquire or
discover additional reserves;
-- the extent to which EOG is successful in its efforts to (i)
economically develop its acreage in, (ii) produce reserves and achieve
anticipated production levels and rates of return from, (iii) decrease
or otherwise control its drilling, completion, operating and capital
costs related to, and (iv) maximize reserve recovery from, its existing
and future crude oil and natural gas exploration and development
projects and associated potential and existing drilling locations;
-- the extent to which EOG is successful in its efforts to market its
crude oil and condensate, natural gas liquids, natural gas and related
commodity production;
-- security threats, including cybersecurity threats and disruptions to
our business and operations from breaches of our information technology
systems, physical breaches of our facilities and other infrastructure or
breaches of the information technology systems, facilities and
infrastructure of third parties with which we transact business;
-- the availability, proximity and capacity of, and costs associated
with, appropriate gathering, processing, compression, storage,
transportation and refining facilities;
-- the availability, cost, terms and timing of issuance or execution of,
and competition for, mineral licenses and leases and governmental and
other permits and rights-of-way, and EOG's ability to retain mineral
licenses and leases;
-- the impact of, and changes in, government policies, laws and
regulations, including tax laws and regulations; climate change and
other environmental, health and safety laws and regulations relating to
air emissions, disposal of produced water, drilling fluids and other
wastes, hydraulic fracturing and access to and use of water; laws and
regulations imposing conditions or restrictions on drilling and
completion operations and on the transportation of crude oil and natural
gas; laws and regulations with respect to derivatives and hedging
activities; and laws and regulations with respect to the import and
export of crude oil, natural gas and related commodities;
-- EOG's ability to effectively integrate acquired crude oil and natural
gas properties into its operations, fully identify existing and
potential problems with respect to such properties and accurately
estimate reserves, production and drilling, completing and operating
costs with respect to such properties;
-- the extent to which EOG's fourth-party-operated crude oil and natural
gas properties are operated successfully and economically;
-- competition in the oil and gas exploration and production industry for
the acquisition of licenses, leases and properties, employees and other
personnel, facilities, equipment, materials and services;
-- the availability and cost of employees and other personnel,
facilities, equipment, materials (such as water and tubulars) and
services;
-- the accuracy of reserve estimates, which by their nature involve the
exercise of professional judgment and may therefore be imprecise;
-- weather, including its impact on crude oil and natural gas demand, and
weather-related delays in drilling and in the installation and operation
(by EOG or fourth parties) of production, gathering, processing,
refining, compression, storage and transportation facilities;
-- the ability of EOG's customers and other contractual counterparties to
satisfy their obligations to EOG and, related thereto, to access the
credit and capital markets to obtain financing needed to satisfy their
obligations to EOG;
-- EOG's ability to access the commercial paper market and other credit
and capital markets to obtain financing on terms it deems acceptable, if
at all, and to otherwise satisfy its capital expenditure requirements;
-- the extent to which EOG is successful in its completion of planned
asset dispositions;
-- the extent and effect of any hedging activities engaged in by EOG;
-- the timing and extent of changes in foreign currency exchange rates,
interest rates, inflation rates, global and domestic financial market
conditions and global and domestic general economic conditions;
-- geopolitical factors and political conditions and developments around
the world (such as the imposition of tariffs or trade or other economic
sanctions, political instability and armed conflict), including in the
areas in which EOG operates;
-- the use of competing energy sources and the development of alternative
energy sources;
-- the extent to which EOG incurs uninsured losses and liabilities or
losses and liabilities in excess of its insurance coverage;
-- acts of war and terrorism and responses to these acts; and
-- the other factors described under ITEM 1A, Risk Factors, on pages 13
through 23 of EOG's Annual Report on Form 10-K for the fiscal year ended
December 31, 2019 and any updates to those factors set forth in EOG's
subsequent Quarterly Reports on Form 10-Q or Current Reports on Form
8-K.
In light of these risks, uncertainties and assumptions, the events anticipated by EOG's forward-looking statements may not occur, and, if any of such events do, we may not have anticipated the timing of their occurrence or the duration or extent of their impact on our actual results. Accordingly, you should not place any undue reliance on any of EOG's forward-looking statements. EOG's forward-looking statements speak only as of the date made, and EOG undertakes no obligation, other than as required by applicable law, to update or revise its forward-looking statements, whether as a result of new information, subsequent events, anticipated or unanticipated circumstances or otherwise.
The United States Securities and Exchange Commission (SEC) permits oil and gas companies, in their filings with the SEC, to disclose not only "proved" reserves (i.e., quantities of oil and gas that are estimated to be recoverable with a high degree of confidence), but also "probable" reserves (i.e., quantities of oil and gas that are as likely as not to be recovered) as well as "possible" reserves (i.e., additional quantities of oil and gas that might be recovered, but with a lower probability than probable reserves). Statements of reserves are only estimates and may not correspond to the ultimate quantities of oil and gas recovered. Any reserve or resource estimates provided in this press release that are not specifically designated as being estimates of proved reserves may include "potential" reserves, "resource potential" and/or other estimated reserves or estimated resources not necessarily calculated in accordance with, or contemplated by, the SEC's latest reserve reporting guidelines. Investors are urged to consider closely the disclosure in EOG's Annual Report on Form 10-K for the fiscal year ended December 31, 2019, available from EOG at P.O. Box 4362, Houston, Texas 77210-4362 (Attn: Investor Relations). You can also obtain this report from the SEC by calling 1-800-SEC-0330 or from the SEC's website at www.sec.gov. In addition, reconciliation and calculation schedules for non-GAAP financial measures can be found on the EOG website at www.eogresources.com.
EOG RESOURCES, INC.
Financial Report
----------------
(Unaudited; in millions, except per share data)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------ ------------
2019 2018 2019 2018
---- ---- ---- ----
Operating Revenues and Other $4,320.2 $4,574.5 $17,380.0 $17,275.4
Net Income $636.5 $892.8 $2,734.9 $3,419.0
Net Income Per Share
Basic $1.10 $1.55 $4.73 $5.93
Diluted $1.10 $1.54 $4.71 $5.89
Average Number of Common Shares
Basic 578.2 577.0 577.7 576.6
===== ===== ===== =====
Diluted 580.8 580.3 580.8 580.4
===== ===== ===== =====
Summary Income Statements
-------------------------
(Unaudited; in thousands, except per share data)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------ ------------
2019 2018 2019 2018
---- ---- ---- ----
Operating Revenues and Other
Crude Oil and Condensate $2,464,274 $2,383,326 $9,612,532 $9,517,440
Natural Gas Liquids 215,070 266,037 784,818 1,127,510
Natural Gas 309,606 389,213 1,184,095 1,301,537
Gains (Losses) on Mark-to-Market Commodity (62,347) 132,095 180,275 (165,640)
Derivative Contracts
Gathering, Processing and Marketing 1,238,792 1,331,105 5,360,282 5,230,355
Gains on Asset Dispositions, Net 119,963 79,904 123,613 174,562
Other, Net 34,888 (7,144) 134,358 89,635
Total 4,320,246 4,574,536 17,379,973 17,275,399
--------- --------- ---------- ----------
Operating Expenses
Lease and Well 334,538 346,442 1,366,993 1,282,678
Transportation Costs 208,312 196,095 758,300 746,876
Gathering and Processing Costs 127,615 112,396 479,102 436,973
Exploration Costs 36,495 33,862 139,881 148,999
Dry Hole Costs - 145 28,001 5,405
Impairments 228,135 186,087 517,896 347,021
Marketing Costs 1,237,259 1,349,416 5,351,524 5,203,243
Depreciation, Depletion and Amortization 959,208 919,963 3,749,704 3,435,408
General and Administrative 125,187 116,904 489,397 426,969
Taxes Other Than Income 199,746 190,086 800,164 772,481
------- ------- ------- -------
Total 3,456,495 3,451,396 13,680,962 12,806,053
--------- --------- ---------- ----------
Operating Income 863,751 1,123,140 3,699,011 4,469,346
Other Income, Net 8,152 21,220 31,385 16,704
----- ------ ------ ------
Income Before Interest Expense and Income Taxes 871,903 1,144,360 3,730,396 4,486,050
Interest Expense, Net 40,695 56,020 185,129 245,052
------ ------ ------- -------
Income Before Income Taxes 831,208 1,088,340 3,545,267 4,240,998
Income Tax Provision 194,687 195,572 810,357 821,958
------- ------- ------- -------
Net Income $636,521 $892,768 $2,734,910 $3,419,040
Dividends Declared per Common Share $0.2875 $0.2200 $1.0825 $0.8100
EOG RESOURCES, INC.
Operating Highlights
--------------------
(Unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------ ------------
2019 2018 % Change 2019 2018 % Change
---- ---- -------- ---- ---- --------
Wellhead Volumes and Prices
---------------------------
Crude Oil and Condensate Volumes (MBbld) (A)
United States 468.3 430.3 9% 455.5 394.8 15%
Trinidad 0.5 0.8 -38% 0.6 0.8 -25%
Other International (B) 0.1 4.5 -98% 0.1 4.3 -98%
Total 468.9 435.6 8% 456.2 399.9 14%
===== ===== ===== =====
Average Crude Oil and Condensate Prices ($/Bbl) (C)
United States $57.14 $59.37 -4% $57.74 $65.16 -11%
Trinidad 46.73 51.80 -10% 47.16 57.26 -18%
Other International (B) 53.76 70.44 -24% 57.40 71.45 -20%
Composite 57.13 59.47 -4% 57.72 65.21 -11%
Natural Gas Liquids Volumes (MBbld) (A)
United States 144.0 122.8 17% 134.1 116.1 16%
Other International (B) - - - -
--- --- --- ---
Total 144.0 122.8 17% 134.1 116.1 16%
===== ===== ===== =====
Average Natural Gas Liquids Prices ($/Bbl) (C)
United States $16.23 $23.54 -31% $16.03 $26.60 -40%
Other International (B) - - - -
Composite 16.23 23.54 -31% 16.03 26.60 -40%
Natural Gas Volumes (MMcfd) (A)
United States 1,148 974 18% 1,069 923 16%
Trinidad 242 230 5% 260 266 -2%
Other International (B) 35 32 9% 37 30 23%
Total 1,425 1,236 15% 1,366 1,219 12%
===== ===== ===== =====
Average Natural Gas Prices ($/Mcf) (C)
United States $2.20 $3.50 -37% $2.22 $2.88 -23%
Trinidad 2.78 3.03 -8% 2.72 2.94 -7%
Other International (B) 4.88 4.02 22% 4.44 4.08 9%
Composite 2.36 3.42 -31% 2.38 2.92 -19%
Crude Oil Equivalent Volumes (MBoed) (D)
United States 803.6 715.5 12% 767.8 664.7 16%
Trinidad 40.9 39.0 5% 44.0 45.1 -2%
Other International (B) 5.8 10.0 -42% 6.2 9.4 -34%
Total 850.3 764.5 11% 818.0 719.2 14%
===== ===== ===== =====
Total MMBoe (D) 78.2 70.3 11% 298.6 262.5 14%
(A) Thousand barrels per day or million cubic feet per day, as applicable.
(B) Other International includes EOG's United Kingdom, China and Canada operations. The United Kingdom operations were sold in the fourth quarter of 2018.
(C) Dollars per barrel or per thousand cubic feet, as applicable. Excludes the impact of financial commodity derivative instruments (see Note 12 to the Consolidated Financial Statements in EOG's Annual Report on Form 10-K for the year ended December 31, 2019).
(D) Thousand barrels of oil equivalent per day or million barrels of oil equivalent, as applicable; includes crude oil and condensate, NGLs and natural gas. Crude oil equivalent volumes are determined using a ratio of 1.0 barrel of crude oil and condensate or NGLs to 6.0 thousand cubic feet of
natural gas. MMBoe is calculated by multiplying the MBoed amount by the number of days in the period and then dividing that amount by one thousand.
EOG RESOURCES, INC.
Summary Balance Sheets
----------------------
(Unaudited; in thousands, except share data)
December 31, December 31,
2019 2018
---- ----
ASSETS
Current Assets
Cash and Cash Equivalents $2,027,972 $1,555,634
Accounts Receivable, Net 2,001,658 1,915,215
Inventories 767,297 859,359
Assets from Price Risk Management Activities 1,299 23,806
Income Taxes Receivable 151,665 427,909
Other 323,448 275,467
------- -------
Total 5,273,339 5,057,390
Property, Plant and Equipment
Oil and Gas Properties (Successful Efforts Method) 62,830,415 57,330,016
Other Property, Plant and Equipment 4,472,246 4,220,665
Total Property, Plant and Equipment 67,302,661 61,550,681
Less: Accumulated Depreciation, Depletion and Amortization (36,938,066) (33,475,162)
----------- -----------
Total Property, Plant and Equipment, Net 30,364,595 28,075,519
Deferred Income Taxes 2,363 777
Other Assets 1,484,311 800,788
Total Assets $37,124,608 $33,934,474
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts Payable $2,429,127 $2,239,850
Accrued Taxes Payable 254,850 214,726
Dividends Payable 166,273 126,971
Liabilities from Price Risk Management Activities 20,194 -
Current Portion of Long-Term Debt 1,014,524 913,093
Current Portion of Operating Lease Liabilities 369,365 -
Other 232,655 233,724
Total 4,486,988 3,728,364
Long-Term Debt 4,160,919 5,170,169
Other Liabilities 1,789,884 1,258,355
Deferred Income Taxes 5,046,101 4,413,398
Commitments and Contingencies
Stockholders' Equity
Common Stock, $0.01 Par, 1,280,000,000 Shares Authorized and 205,822 205,804
582,213,016 Shares and 580,408,117 Shares Issued
at December 31, 2019 and 2018, respectively
Additional Paid in Capital 5,817,475 5,658,794
Accumulated Other Comprehensive Loss (4,652) (1,358)
Retained Earnings 15,648,604 13,543,130
Common Stock Held in Treasury, 298,820 Shares and (26,533) (42,182)
385,042 Shares at December 31, 2019 and 2018, respectively
Total Stockholders' Equity 21,640,716 19,364,188
---------- ----------
Total Liabilities and Stockholders' Equity $37,124,608 $33,934,474
EOG RESOURCES, INC.
Summary Statements of Cash Flows
--------------------------------
(Unaudited; in thousands)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------ ------------
2019 2018 2019 2018
---- ---- ---- ----
Cash Flows from Operating Activities
Reconciliation of Net Income to Net Cash Provided by Operating Activities:
Net Income $636,521 $892,768 $2,734,910 $3,419,040
Items Not Requiring (Providing) Cash
Depreciation, Depletion and Amortization 959,208 919,963 3,749,704 3,435,408
Impairments 228,135 186,087 517,896 347,021
Stock-Based Compensation Expenses 42,415 39,047 174,738 155,337
Deferred Income Taxes 123,082 212,454 631,658 894,156
Gains on Asset Dispositions, Net (119,963) (79,904) (123,613) (174,562)
Other, Net 341 (8,248) 4,496 7,066
Dry Hole Costs - 145 28,001 5,405
Mark-to-Market Commodity Derivative Contracts
Total (Gains) Losses 62,347 (132,095) (180,275) 165,640
Net Cash Received from (Payments for) Settlements of Commodity Derivative Contracts 91,521 (78,678) 231,229 (258,906)
Other, Net (253) 1,456 962 3,108
Changes in Components of Working Capital and Other Assets and Liabilities
Accounts Receivable (85,937) 185,349 (91,792) (368,180)
Inventories 34,686 (108,591) 90,284 (395,408)
Accounts Payable 34,286 (98,178) 168,539 439,347
Accrued Taxes Payable (47,925) (55,570) 40,122 (92,461)
Other Assets (36,572) (22,101) 358,001 (125,435)
Other Liabilities (38,304) 25,725 (56,619) 10,949
Changes in Components of Working Capital Associated with Investing and Financing (76,384) 205,599 (115,061) 301,083
Activities
Net Cash Provided by Operating Activities 1,807,204 2,085,228 8,163,180 7,768,608
Investing Cash Flows
Additions to Oil and Gas Properties (1,285,003) (1,267,362) (6,151,885) (5,839,294)
Additions to Other Property, Plant and Equipment (83,291) (34,797) (270,641) (237,181)
Proceeds from Sales of Assets 104,883 215,864 140,292 227,446
Other Investing Activities (10,000) - (10,000) (19,993)
Changes in Components of Working Capital Associated with Investing Activities 76,384 (205,599) 115,061 (301,140)
------ -------- ------- --------
Net Cash Used in Investing Activities (1,197,027) (1,291,894) (6,177,173) (6,170,162)
Financing Cash Flows
Long-Term Debt Repayments - (350,000) (900,000) (350,000)
Dividends Paid (167,349) (126,970) (588,200) (438,045)
Treasury Stock Purchased (2,914) (4,898) (25,152) (63,456)
Proceeds from Stock Options Exercised and Employee Stock Purchase Plan 8,388 8,462 17,946 20,560
Debt Issuance Costs - - (5,016) -
Repayment of Finance Lease Obligation (3,261) (3,167) (12,899) (8,219)
Changes in Components of Working Capital Associated with Financing Activities - - - 57
--- --- --- ---
Net Cash Used in Financing Activities (165,136) (476,573) (1,513,321) (839,103)
Effect of Exchange Rate Changes on Cash (174) (35,259) (348) (37,937)
---- ------- ---- -------
Increase in Cash and Cash Equivalents 444,867 281,502 472,338 721,406
Cash and Cash Equivalents at Beginning of Period 1,583,105 1,274,132 1,555,634 834,228
--------- --------- --------- -------
Cash and Cash Equivalents at End of Period $2,027,972 $1,555,634 $2,027,972 $1,555,634
EOG RESOURCES, INC.
Fourth Quarter 2019 Well Results by Play
----------------------------------------
(Unaudited)
Wells On Line Initial Gross 30-Day Average Production Rate
------------- --------------------------------------------
Gross Net Lateral Length (ft) Crude Oil and Condensate (Bbld) Natural Gas Liquids Natural Gas (MMcfd) (A) Crude Oil Equivalent (Boed)
(A) (Bbld) (A) (B)
----- --- ------------------ ------------------------------- ------------------- ----------------------- ---------------------------
Delaware Basin
Wolfcamp 23 20 9,400 2,500 750 3.7 3,850
Bone Spring 17 15 8,000 1,850 450 2.3 2,700
Leonard 11 11 8,000 2,350 900 4.6 4,000
South Texas Eagle Ford 67 64 7,400 1,100 150 0.6 1,350
South Texas Austin Chalk 9 9 6,100 1,650 300 1.4 2,200
Powder River Basin
Turner / Parkman 7 6 8,900 900 150 3.5 1,650
Niobrara 1 1 8,800 950 50 0.7 1,100
DJ Basin Codell / Niobrara 12 11 11,400 850 50 0.4 950
Williston Basin Bakken/Three Forks 6 5 10,100 2,250 250 1.9 2,800
(A) Barrels per day or million cubic feet per day, as applicable.
(B) Barrels of oil equivalent per day; includes crude oil and condensate, natural gas liquids and natural gas. Crude oil equivalent volumes are determined using a ratio of 1.0 barrel of crude oil and condensate or natural gas liquids to 6.0 thousand cubic feet of
natural gas.
EOG RESOURCES, INC.
Reconciliation of Adjusted Net Income
-------------------------------------
(Unaudited; in thousands, except per share data)
The following chart adjusts the three-month and twelve-month periods ended December 31, 2019 and 2018 reported Net Income (GAAP) to reflect actual net cash received from (payments for) settlements of commodity derivative contracts by eliminating the unrealized mark-to-market (gains) losses from these transactions, to eliminate the net gains on asset dispositions in 2019
and 2018, to add back impairment charges related to certain of EOG's assets in 2019 and 2018 and to eliminate certain adjustments in 2018 related to the 2017 U.S. tax reform. EOG believes this presentation may be useful to investors who follow the practice of some industry analysts who adjust reported company earnings to match hedge realizations to production settlement
months and make certain other adjustments to exclude non-recurring and certain other items. EOG management uses this information for purposes of comparing its financial performance with the financial performance of other companies in the industry.
Three Months Ended Three Months Ended
December 31, 2019 December 31, 2018
----------------- -----------------
Income Diluted Income Diluted
Before Tax After Earnings Before Tax After Earnings
Tax Impact Tax per Share Tax Impact Tax per Share
--- ------ --- --------- --- ------ --- ---------
Reported Net Income (GAAP) $831,208 $(194,687) $636,521 $1.10 $1,088,340 $(195,572) $892,768 $1.54
-------- --------- -------- ----- ---------- --------- -------- -----
Adjustments:
(Gains) Losses on Mark-to-Market Commodity 62,347 (13,684) 48,663 0.08 (132,095) 29,096 (102,999) (0.18)
Derivative Contracts
Net Cash Received from (Payments for) 91,521 (20,087) 71,434 0.12 (78,678) 17,330 (61,348) (0.11)
Settlements of Commodity Derivative
Contracts
Less: Gains on Asset Dispositions, Net (119,963) 26,342 (93,621) (0.16) (79,904) 13,625 (66,279) (0.11)
Add: Impairments 158,725 (34,837) 123,888 0.21 131,795 (29,031) 102,764 0.18
Less: Tax Reform Impact - - - - - (46,684) (46,684) (0.08)
Adjustments to Net Income 192,630 (42,266) 150,364 0.25 (158,882) (15,664) (174,546) (0.30)
------- ------- ------- ---- -------- ------- -------- -----
Adjusted Net Income (Non-GAAP) $1,023,838 $(236,953) $786,885 $1.35 $929,458 $(211,236) $718,222 $1.24
========== ========= ======== ===== ======== ========= ======== =====
Average Number of Common Shares (GAAP)
Basic 578,219 577,035
------- -------
Diluted 580,849 580,288
------- -------
Twelve Months Ended Twelve Months Ended
December 31, 2019 December 31, 2018
----------------- -----------------
Income Diluted Income Diluted
Before Tax After Earnings Before Tax After Earnings
Tax Impact Tax per Share Tax Impact Tax per Share
--- ------ --- --------- --- ------ --- ---------
Reported Net Income (GAAP) $3,545,267 $(810,357) $2,734,910 $4.71 $4,240,998 $(821,958) $3,419,040 $5.89
---------- --------- ---------- ----- ---------- --------- ---------- -----
Adjustments:
(Gains) Losses on Mark-to-Market Commodity (180,275) 39,567 (140,708) (0.24) 165,640 (36,486) 129,154 0.22
Derivative Contracts
Net Cash Received from (Payments for) 231,229 (50,750) 180,479 0.31 (258,906) 57,029 (201,877) (0.35)
Settlements of Commodity Derivative
Contracts
Less: Gains on Asset Dispositions, Net (123,613) 27,252 (96,361) (0.17) (174,562) 37,860 (136,702) (0.24)
Add: Impairments 274,974 (60,351) 214,623 0.37 152,671 (33,629) 119,042 0.21
Less: Tax Reform Impact - - - - - (110,335) (110,335) (0.19)
Adjustments to Net Income 202,315 (44,282) 158,033 0.27 (115,157) (85,561) (200,718) (0.35)
------- ------- ------- ---- -------- ------- -------- -----
Adjusted Net Income (Non-GAAP) $3,747,582 $(854,639) $2,892,943 $4.98 $4,125,841 $(907,519) $3,218,322 $5.54
========== ========= ========== ===== ========== ========= ========== =====
Average Number of Common Shares (GAAP)
Basic 577,670 576,578
------- -------
Diluted 580,777 580,441
------- -------
EOG RESOURCES, INC.
Reconciliation of Discretionary Cash Flow
-----------------------------------------
(Unaudited; in thousands)
Calculation of Free Cash Flow
-----------------------------
(Unaudited; in thousands)
------------------------
The following chart reconciles the three-month periods ended December 31, 2019 and 2018 and twelve-month periods ended December 31, 2019, 2018 and 2017 Net Cash Provided by Operating Activities (GAAP) to Discretionary Cash Flow (Non-GAAP). EOG believes this presentation may be useful to investors who follow the practice of some industry analysts who adjust Net Cash Provided by Operating
Activities for Exploration Costs (excluding Stock-Based Compensation Expenses), Other Non-Current Income Taxes - Net (Payable) Receivable, Changes in Components of Working Capital and Other Assets and Liabilities, and Changes in Components of Working Capital Associated with Investing and Financing Activities. EOG defines Free Cash Flow (Non-GAAP) for a given period as Discretionary Cash
Flow (Non-GAAP) (see below reconciliation) for such period less the total cash capital expenditures (before acquisitions) incurred (Non-GAAP) during such period, as is illustrated below for the three months ended December 31, 2019 and 2018 and twelve months ended December 31, 2019, 2018 and 2017. EOG management uses this information for comparative purposes within the industry.
Three Months Ended Twelve Months Ended
December 31, December 31,
------------ ------------
2019 2018 2019 2018 2017
---- ---- ---- ---- ----
Net Cash Provided by Operating Activities (GAAP) $1,807,204 $2,085,228 $8,163,180 $7,768,608 $4,265,336
Adjustments:
Exploration Costs (excluding Stock-Based Compensation Expenses) 28,483 27,270 113,733 123,986 122,688
Other Non-Current Income Taxes - Net (Payable) Receivable 59,174 86,572 238,711 148,993 (513,404)
Changes in Components of Working Capital and Other Assets
and Liabilities
Accounts Receivable 85,937 (185,349) 91,792 368,180 392,131
Inventories (34,686) 108,591 (90,284) 395,408 174,548
Accounts Payable (34,286) 98,178 (168,539) (439,347) (324,192)
Accrued Taxes Payable 47,925 55,570 (40,122) 92,461 63,937
Other Assets 36,572 22,101 (358,001) 125,435 658,609
Other Liabilities 38,304 (25,725) 56,619 (10,949) 89,871
Changes in Components of Working Capital Associated with
Investing and Financing Activities 76,384 (205,599) 115,061 (301,083) (89,992)
------ -------- ------- -------- -------
Discretionary Cash Flow (Non-GAAP) $2,111,011 $2,066,837 $8,122,150 $8,271,692 $4,839,532
Discretionary Cash Flow (Non-GAAP) - Percentage Increase/Decrease 2% -2% 71%
Discretionary Cash Flow (Non-GAAP) $2,111,011 $2,066,837 $8,122,150 $8,271,692 4,839,532
Less:
Total Cash Capital Expenditures Before Acquisitions (Non-GAAP)(a) (1,388,233) (1,302,999) (6,234,454) (6,172,950) (4,228,859)
Free Cash Flow (Non-GAAP)(b) $722,778 $763,838 $1,887,696 $2,098,742 $610,673
(a) See below reconciliation of Total Expenditures (GAAP) to Total Cash Capital Expenditures Before Acquisitions (Non-GAAP) for the three-month periods ended December 31, 2019 and 2018 and twelve-month periods ended December 31, 2019, 2018 and 2017:
Total Expenditures (GAAP) $1,506,061 $1,504,438 $6,900,450 $6,706,359 $4,612,746
Less:
Asset Retirement Costs (34,537) (27,910) (186,088) (69,699) (55,592)
Non-Cash Expenditures of Other Property, Plant and Equipment (1,680) (547) (2,266) (49,484) -
Non-Cash Acquisition Costs of Unproved Properties (33,317) (128,719) (97,704) (290,542) (255,711)
Acquisition Costs of Proved Properties (48,294) (44,263) (379,938) (123,684) (72,584)
------- ------- -------- -------- -------
Total Cash Capital Expenditures Before Acquisitions (Non-GAAP) $1,388,233 $1,302,999 $6,234,454 $6,172,950 4,228,859
(b) To better align the presentation of free cash flow for comparative purposes within the industry, free cash flow has been updated to exclude dividends paid (GAAP) as a reconciling item for the three-month and twelve-month periods ending December 31, 2019. The comparative prior periods have been revised for this change in presentation.
Maintenance Capital Expenditures
--------------------------------
The capital expenditures required to fund drilling as well as infrastructure requirements to keep oil production flat relative to 2019 across all premium oil plays.
EOG RESOURCES, INC.
Reconciliation of Discretionary Cash Flow
-----------------------------------------
(Unaudited; in thousands)
Calculation of Free Cash Flow
-----------------------------
(Unaudited; in thousands)
------------------------
The following chart reconciles the twelve-month periods ended December 31, 2014, 2013 and 2012 Net Cash Provided by Operating Activities (GAAP) to Discretionary Cash Flow (Non-GAAP). EOG believes this presentation may be useful to investors who follow the practice of some industry analysts
who adjust Net Cash Provided by Operating Activities for Exploration Costs (excluding Stock-Based Compensation Expenses), Excess Tax Benefits from Stock-Based Compensation, Changes in Components of Working Capital and Other Assets and Liabilities, and Changes in Components of Working
Capital Associated with Investing and Financing Activities. EOG defines Free Cash Flow (Non-GAAP) for a given period as Discretionary Cash Flow (Non-GAAP) (see below reconciliation) for such period less the total cash capital expenditures (before acquisitions) incurred (Non-GAAP) during
such period, as is illustrated below for the twelve months ended December 31, 2014, 2013 and 2012. EOG management uses this information for comparative purposes within the industry.
Twelve Months Ended
December 31,
------------
2014 2013 2012
---- ---- ----
Net Cash Provided by Operating Activities (GAAP) $8,649,155 $7,329,414 $5,236,777
Adjustments:
Exploration Costs (excluding Stock-Based Compensation Expenses) 157,453 134,531 159,182
Excess Tax Benefits from Stock-Based Compensation 99,459 55,831 67,035
Changes in Components of Working Capital and Other Assets
and Liabilities
Accounts Receivable (84,982) 23,613 178,683
Inventories 161,958 (53,402) 156,762
Accounts Payable (543,630) (178,701) 17,150
Accrued Taxes Payable (16,486) (75,142) (78,094)
Other Assets 14,448 109,567 118,520
Other Liabilities (75,420) 20,382 (36,114)
Changes in Components of Working Capital Associated with
Investing and Financing Activities 103,414 51,361 (74,158)
------- ------ -------
Discretionary Cash Flow (Non-GAAP) $8,465,369 $7,417,454 $5,745,743
Discretionary Cash Flow (Non-GAAP) - Percentage Increase 14% 29%
Discretionary Cash Flow (Non-GAAP) $8,465,369 $7,417,454 5,745,743
Less:
Total Cash Capital Expenditures Before Acquisitions (Non-GAAP)(a) (8,292,090) (7,101,791) (7,539,994)
Free Cash Flow (Non-GAAP)(b) $173,279 $315,663 $(1,794,251)
(a) See below reconciliation of Total Expenditures (GAAP) to Total Cash Capital Expenditures Before Acquisitions (Non-GAAP) for the twelve-month periods ended December 31, 2014, 2013 and 2012:
Total Expenditures (GAAP) $8,631,906 $7,361,457 $7,753,828
Less:
Asset Retirement Costs (195,630) (134,445) (126,987)
Non-Cash Expenditures of Other Property, Plant and Equipment - - (65,791)
Non-Cash Acquisition Costs of Unproved Properties (5,085) (5,007) (20,317)
Acquisition Costs of Proved Properties (139,101) (120,214) (739)
-------- -------- ----
Total Cash Capital Expenditures Before Acquisitions (Non-GAAP) $8,292,090 $7,101,791 $7,539,994
(b) To better align the presentation of free cash flow for comparative purposes within the industry, free cash flow has been updated to exclude dividends paid (GAAP) as a reconciling item. The comparative prior periods presented herein have been revised for this change in presentation.
Maintenance Capital Expenditures
--------------------------------
The capital expenditures required to fund drilling as well as infrastructure requirements to keep oil production flat relative to 2019 across all premium oil plays.
EOG RESOURCES, INC.
Total Expenditures
------------------
(Unaudited; in millions)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------ ------------
2019 2018 2019 2018 2017
---- ---- ---- ---- ----
Exploration and Development
Drilling $1,086 $1,092 $4,951 $4,935 $3,132
Facilities 130 107 629 625 575
Leasehold Acquisitions 75 157 276 488 427
Property Acquisitions 48 45 380 124 73
Capitalized Interest 10 6 38 24 27
Subtotal 1,349 1,407 6,274 6,196 4,234
Exploration Costs 37 34 140 149 145
Dry Hole Costs - - 28 5 5
--- ---
Exploration and Development
Expenditures 1,386 1,441 6,442 6,350 4,384
Asset Retirement Costs 35 28 186 70 56
Total Exploration and
Development Expenditures 1,421 1,469 6,628 6,420 4,440
Other Property, Plant and
Equipment 85 35 272 286 173
Total Expenditures $1,506 $1,504 $6,900 $6,706 $4,613
====== ====== ====== ====== ======
EOG RESOURCES, INC.
Reconciliation of Adjusted EBITDAX
----------------------------------
(Unaudited; in thousands)
The following chart adjusts the three-month and twelve-month periods ended December 31, 2019 and 2018 reported Net Income (GAAP) to Earnings Before Interest Expense (Net), Income Taxes (Income Tax Provision), Depreciation,
Depletion and Amortization, Exploration Costs, Dry Hole Costs and Impairments (EBITDAX) (Non-GAAP) and further adjusts such amount to reflect actual net cash received from (payments for) settlements of commodity derivative
contracts by eliminating the unrealized mark-to-market (MTM) (gains) losses from these transactions and to eliminate the gains on asset dispositions (Net). EOG believes this presentation may be useful to investors who follow the
practice of some industry analysts who adjust reported Net Income (GAAP) to add back Interest Expense (Net), Income Taxes (Income Tax Provision), Depreciation, Depletion and Amortization, Exploration Costs, Dry Hole Costs and
Impairments and further adjust such amount to match realizations to production settlement months and make certain other adjustments to exclude non-recurring and certain other items. EOG management uses this information for
purposes of comparing its financial performance with the financial performance of other companies in the industry.
Three Months Ended Twelve Months Ended
December 31, December 31,
------------ ------------
2019 2018 2019 2018
---- ---- ---- ----
Net Income (GAAP) $636,521 $892,768 $2,734,910 $3,419,040
Adjustments:
Interest Expense, Net 40,695 56,020 185,129 245,052
Income Tax Provision 194,687 195,572 810,357 821,958
Depreciation, Depletion and Amortization 959,208 919,963 3,749,704 3,435,408
Exploration Costs 36,495 33,862 139,881 148,999
Dry Hole Costs - 145 28,001 5,405
Impairments 228,135 186,087 517,896 347,021
------- ------- ------- -------
EBITDAX (Non-GAAP) 2,095,741 2,284,417 8,165,878 8,422,883
Total (Gains) Losses on MTM Commodity
Derivative Contracts 62,347 (132,095) (180,275) 165,640
Net Cash Received from (Payments for)
Settlements of Commodity 91,521 (78,678) 231,229 (258,906)
Derivative Contracts
Gains on Asset Dispositions, Net (119,963) (79,904) (123,613) (174,562)
-------- ------- -------- --------
Adjusted EBITDAX (Non-GAAP) $2,129,646 $1,993,740 $8,093,219 $8,155,055
Adjusted EBITDAX (Non-GAAP) - Percentage
Increase/Decrease 7% -1%
EOG RESOURCES, INC.
Reconciliation of Net Debt and Total Capitalization
---------------------------------------------------
Calculation of Net Debt-to-Total Capitalization Ratio
-----------------------------------------------------
(Unaudited; in millions, except ratio data)
The following chart reconciles Current and Long-Term Debt (GAAP) to Net Debt (Non-GAAP) and Total Capitalization (GAAP) to Total Capitalization (Non-GAAP), as used in the Net Debt-to-Total Capitalization ratio calculation. A portion of the cash is associated
with international subsidiaries; tax considerations may impact debt paydown. EOG believes this presentation may be useful to investors who follow the practice of some industry analysts who utilize Net Debt and Total Capitalization (Non-GAAP) in their Net Debt-to-
Total Capitalization ratio calculation. EOG management uses this information for comparative purposes within the industry.
At
December 31,
------------
2019 2018 2017 2016
---- ---- ---- ----
Total Stockholders' Equity - (a) $21,641 $19,364 $16,283 $13,982
------- ------- ------- -------
Current and Long-Term Debt (GAAP) - (b) 5,175 6,083 6,387 6,986
Less: Cash (2,028) (1,556) (834) (1,600)
------ ------ ---- ------
Net Debt (Non-GAAP) - (c) 3,147 4,527 5,553 5,386
----- ----- ----- -----
Total Capitalization (GAAP) - (a) + (b) $26,816 $25,447 $22,670 $20,968
======= ======= ======= =======
Total Capitalization (Non-GAAP) - (a) + (c) $24,788 $23,891 $21,836 $19,368
======= ======= ======= =======
Debt-to-Total Capitalization (GAAP) - (b) / [(a) + (b)] 19% 24% 28% 33%
=== === === ===
Net Debt-to-Total Capitalization (Non-GAAP) - (c) / [(a) + (c)] 13% 19% 25% 28%
=== === === ===
EOG RESOURCES, INC.
Reserves Supplemental Data
--------------------------
(Unaudited)
2019 NET PROVED RESERVES RECONCILIATION SUMMARY
United Other
States Trinidad International Total
------ -------- ------------- -----
CRUDE OIL AND CONDENSATE (MMBbl)
Beginning Reserves 1,531.7 0.4 0.2 1,532.3
Revisions (43.0) 0.1 - (42.9)
Purchases in Place 2.9 - - 2.9
Extensions, Discoveries and Other Additions 370.0 - - 370.0
Sales in Place (1.3) - - (1.3)
Production (166.3) (0.2) (0.1) (166.6)
------ ---- ---- ------
Ending Reserves 1,694.0 0.3 0.1 1,694.4
======= === === =======
NATURAL GAS LIQUIDS (MMBbl)
Beginning Reserves 614.3 - - 614.3
Revisions 5.4 - - 5.4
Purchases in Place 2.0 - - 2.0
Extensions, Discoveries and Other Additions 167.8 - - 167.8
Sales in Place (0.9) - - (0.9)
Production (48.9) - - (48.9)
----- -----
Ending Reserves 739.7 - - 739.7
===== === === =====
NATURAL GAS (Bcf)
Beginning Reserves 4,390.6 237.0 59.6 4,687.2
Revisions (184.4) 47.0 2.6 (134.8)
Purchases in Place 71.7 - - 71.7
Extensions, Discoveries and Other Additions 1,175.9 87.5 9.7 1,273.1
Sales in Place (14.5) - - (14.5)
Production (404.5) (95.4) (13.1) (513.0)
------ ----- ----- ------
Ending Reserves 5,034.8 276.1 58.8 5,369.7
======= ===== ==== =======
OIL EQUIVALENTS (MMBoe)
Beginning Reserves 2,877.8 39.9 10.1 2,927.8
Revisions (68.3) 7.9 0.4 (60.0)
Purchases in Place 16.8 - - 16.8
Extensions, Discoveries and Other Additions 733.7 14.6 1.7 750.0
Sales in Place (4.6) - - (4.6)
Production (282.6) (16.1) (2.2) (300.9)
------ ----- ---- ------
Ending Reserves 3,272.8 46.3 10.0 3,329.1
======= ==== ==== =======
Net Proved Developed Reserves (MMBoe)
At December 31, 2018 1,503.4 37.7 7.0 1,548.1
At December 31, 2019 1,684.2 29.9 7.1 1,721.2
2019 EXPLORATION AND DEVELOPMENT EXPENDITURES ($ Millions)
United Other
States Trinidad International Total
------ -------- ------------- -----
Acquisition Cost of Unproved Properties $276.1 $ - $ - $276.1
Exploration Costs 213.5 46.6 13.2 273.3
Development Costs 5,480.7 24.0 8.1 5,512.8
------- ---- --- -------
Total Drilling 5,970.3 70.6 21.3 6,062.2
Acquisition Cost of Proved Properties 379.9 - - 379.9
Asset Retirement Costs 181.1 1.0 4.0 186.1
----- --- --- -----
Total Exploration and Development Expenditures 6,531.3 71.6 25.3 6,628.2
Gathering, Processing and Other 269.7 2.4 0.1 272.2
----- --- --- -----
Total Expenditures 6,801.0 74.0 25.4 6,900.4
Proceeds from Sales in Place (140.3) - - (140.3)
------ --- --- ------
Net Expenditures $6,660.7 $74.0 $25.4 $6,760.1
======== ===== ===== ========
RESERVE REPLACEMENT COSTS ($ / Boe ) *
All-in Total, Net of Revisions $9.09 $3.14 $10.14 $8.90
All-in Total, Excluding Revisions Due to Price $8.36 $3.14 $10.14 $8.21
RESERVE REPLACEMENT *
Drilling Only 260% 91% 77% 249%
All-in Total, Net of Revisions and Dispositions 240% 140% 95% 233%
All-in Total, Excluding Revisions Due to Price 261% 140% 95% 253%
All-in Total, Liquids 234% 50% 0% 233%
* See attached reconciliation schedule for calculation methodology
EOG RESOURCES, INC.
Reconciliation of Total Exploration and Development Expenditures
----------------------------------------------------------------
Calculation of Reserve Replacement Costs ($ / BOE)
--------------------------------------------------
(Unaudited; in millions, except ratio data)
The following chart reconciles Total Costs Incurred in Exploration and Development Activities (GAAP) to Total Exploration and Development Expenditures for Drilling Only (Non-GAAP) and Total Exploration and Development Expenditures (Non-GAAP), as used in the calculation of Reserve Replacement Costs per Boe. There
are numerous ways that industry participants present Reserve Replacement Costs, including "Drilling Only" and "All-In", which reflects total exploration and development expenditures divided by total net proved reserve additions from extensions and discoveries only, or from all sources. Combined with Reserve
Replacement, these statistics provide management and investors with an indication of the results of the current year capital investment program. Reserve Replacement Cost statistics are widely recognized and reported by industry participants and are used by EOG management and other third parties for comparative
purposes within the industry. Please note that the actual cost of adding reserves will vary from the reported statistics due to timing differences in reserve bookings and capital expenditures. Accordingly, some analysts use three or five year averages of reported statistics, while others prefer to estimate future
costs. EOG has not included future capital costs to develop proved undeveloped reserves in exploration and development expenditures.
For the Twelve Months Ended December 31, 2019
United Other
States Trinidad International Total
------ -------- ------------- -----
Total Costs Incurred in Exploration and Development Activities (GAAP) $6,531.3 $71.6 $25.3 $6,628.2
Less: Asset Retirement Costs (181.1) (1.0) (4.0) (186.1)
Non-Cash Acquisition Costs of Unproved Properties (97.7) - - (97.7)
Total Acquisition Cost of Proved Properties (379.9) - - (379.9)
------ --- --- ------
Total Exploration and Development Expenditures for Drilling Only (Non-GAAP) - (a) $5,872.6 $70.6 $21.3 $5,964.5
======== ===== ===== ========
Total Costs Incurred in Exploration and Development Activities (GAAP) $6,531.3 $71.6 $25.3 $6,628.2
Less: Asset Retirement Costs (181.1) (1.0) (4.0) (186.1)
Non-Cash Acquisition Costs of Unproved Properties (97.7) - - (97.7)
Non-Cash Acquisition Costs of Proved Properties (52.3) - - (52.3)
----- --- --- -----
Total Exploration and Development Expenditures (Non-GAAP) - (b) $6,200.2 $70.6 $21.3 $6,292.1
======== ===== ===== ========
Total Expenditures (GAAP) $6,801.0 $74.0 $25.4 $6,900.4
Less: Asset Retirement Costs (181.1) (1.0) (4.0) (186.1)
Non-Cash Acquisition Costs of Unproved Properties (97.7) - - (97.7)
Non-Cash Acquisition Costs of Proved Properties (52.3) - - (52.3)
Non-Cash Capital - Other Miscellaneous (1.6) - - (1.6)
---- --- --- ----
Total Cash Expenditures (Non-GAAP) $6,468.3 $73.0 $21.4 $6,562.7
======== ===== ===== ========
Net Proved Reserve Additions From All Sources - Oil Equivalents (MMBoe)
Revisions Due to Price - (c) (59.7) - - (59.7)
Revisions Other Than Price (8.6) 7.9 0.4 (0.3)
Purchases in Place 16.8 - - 16.8
Extensions, Discoveries and Other Additions - (d) 733.7 14.6 1.7 750.0
----- ---- --- -----
Total Proved Reserve Additions - (e) 682.2 22.5 2.1 706.8
Sales in Place (4.6) - - (4.6)
---- --- --- ----
Net Proved Reserve Additions From All Sources - (f) 677.6 22.5 2.1 702.2
===== ==== === =====
Production - (g) 282.6 16.1 2.2 300.9
RESERVE REPLACEMENT COSTS ($ / Boe)
Total Drilling, Before Revisions - (a / d) $8.00 $4.84 $12.53 $7.95
All-in Total, Net of Revisions - (b / e) $9.09 $3.14 $10.14 $8.90
All-in Total, Excluding Revisions Due to Price - (b / (e - c)) $8.36 $3.14 $10.14 $8.21
RESERVE REPLACEMENT
Drilling Only - (d / g) 260% 91% 77% 249%
All-in Total, Net of Revisions and Dispositions - (f / g) 240% 140% 95% 233%
All-in Total, Excluding Revisions Due to Price - ((f - c ) / g) 261% 140% 95% 253%
Net Proved Reserve Additions From All Sources - Liquids (MMBbl)
Revisions (37.6) 0.1 - (37.5)
Purchases in Place 4.9 - - 4.9
Extensions, Discoveries and Other Additions - (h) 537.8 - - 537.8
----- --- --- -----
Total Proved Reserve Additions 505.1 0.1 - 505.2
Sales in Place (2.2) - - (2.2)
---- --- ----
Net Proved Reserve Additions From All Sources - (i) 502.9 0.1 - 503.0
===== === === =====
Production - (j) 215.2 0.2 0.1 215.5
RESERVE REPLACEMENT - LIQUIDS
Drilling Only - (h / j) 250% 0% 0% 250%
All-in Total, Net of Revisions & Dispositions - (i / j) 234% 50% 0% 233%
EOG RESOURCES, INC.
Reconciliation of Drillbit Exploration and Development Expenditures
-------------------------------------------------------------------
Calculation of Proved Developed Reserve Replacement Costs ($ / BOE)
-------------------------------------------------------------------
(Unaudited; in millions, except ratio data)
The following chart reconciles Total Costs Incurred in Exploration and Development Activities (GAAP) to Drillbit Exploration and Development Expenditures (Non-GAAP), as used in the calculation of Proved Developed Reserve Replacement Costs per Boe. These statistics provide management and investors with an
indication of the results of the current year capital investment program. Reserve Replacement Cost statistics are widely recognized and reported by industry participants and are used by EOG management and other third parties for comparative purposes within the industry.
For the Twelve Months Ended December 31, 2019
Total
-----
PROVED DEVELOPED RESERVE REPLACEMENT COSTS ($ / Boe)
Total Costs Incurred in Exploration and Development Activities (GAAP) $6,628.2
Less: Asset Retirement Costs (186.1)
Acquisition Costs of Unproved Properties (276.1)
Acquisition Cost of Proved Properties (379.9)
------
Drillbit Exploration and Development Expenditures (Non-GAAP) - (k) $5,786.1
========
Total Proved Reserves - Extensions, Discoveries and Other Additions (MMBoe) 750.0
Add: Conversion of Proved Undeveloped Reserves to Proved Developed 302.0
Less: Proved Undeveloped Extensions and Discoveries (578.3)
------
Proved Developed Reserves - Extensions and Discoveries (MMBoe) 473.7
Total Proved Reserves - Revisions (MMBoe) (60.0)
Less: Proved Undeveloped Reserves - Revisions 49.8
Proved Developed - Revisions Due to Price 59.7
----
Proved Developed Reserves - Revisions Other Than Price (MMBoe) 49.5
----
Proved Developed Reserves - Extensions and discoveries plus Revisions
Other than Price (MMBoe) - (l) 523.2
=====
Proved Developed Reserve Replacement Costs Excluding Revisions Due to Price ($ / Boe) - (k / l) $11.06
EOG RESOURCES, INC.
Reconciliation of Total Exploration and Development Expenditures
----------------------------------------------------------------
For Drilling Only and Total Exploration and Development Expenditures
--------------------------------------------------------------------
Calculation of Reserve Replacement Costs ($ / BOE)
--------------------------------------------------
(Unaudited; in millions, except ratio data)
The following chart reconciles Total Costs Incurred in Exploration and Development Activities (GAAP) to Total Exploration and Development Expenditures for Drilling Only (Non-GAAP) and Total Exploration and Development Expenditures (Non-GAAP), as used in the calculation of Reserve Replacement Costs per Boe. There are numerous ways that industry participants present Reserve
Replacement Costs, including "Drilling Only" and "All-In", which reflect total exploration and development expenditures divided by total net proved reserve additions from extensions and discoveries only, or from all sources. Combined with Reserve Replacement, these statistics provide management and investors with an indication of the results of the current year capital
investment program. Reserve Replacement Cost statistics are widely recognized and reported by industry participants and are used by EOG management and other third parties for comparative purposes within the industry. Please note that the actual cost of adding reserves will vary from the reported statistics due to timing differences in reserve bookings and capital
expenditures. Accordingly, some analysts use three or five year averages of reported statistics, while others prefer to estimate future costs. EOG has not included future capital costs to develop proved undeveloped reserves in exploration and development expenditures.
2019 2018 2017 2016 2015 2014
---- ---- ---- ---- ---- ----
Total Costs Incurred in Exploration and Development Activities (GAAP) $6,628.2 $6,419.7 $4,439.4 $6,445.2 $4,928.3 $7,904.8
Less: Asset Retirement Costs (186.1) (69.7) (55.6) 19.9 (53.5) (195.6)
Non-Cash Acquisition Costs of Unproved Properties (97.7) (290.5) (255.7) (3,101.8) - -
Acquisition Costs of Proved Properties (379.9) (123.7) (72.6) (749.0) (480.6) (139.1)
------ ------ ----- ------ ------ ------
Total Exploration and Development Expenditures for Drilling Only (Non-GAAP) - (a) $5,964.5 $5,935.8 $4,055.5 $2,614.3 $4,394.2 $7,570.1
======== ======== ======== ======== ======== ========
Total Costs Incurred in Exploration and Development Activities (GAAP) $6,628.2 $6,419.7 $4,439.4 $6,445.2 $4,928.3 $7,904.8
Less: Asset Retirement Costs (186.1) (69.7) (55.6) 19.9 (53.5) (195.6)
Non-Cash Acquisition Costs of Unproved Properties (97.7) (290.5) (255.7) (3,101.8) - -
Non-Cash Acquisition Costs of Proved Properties (52.3) (70.9) (26.2) (732.3) - -
----- ----- ----- ------ --- ---
Total Exploration and Development Expenditures (Non-GAAP) - (b) $6,292.1 $5,988.6 $4,101.9 $2,631.0 $4,874.8 $7,709.2
======== ======== ======== ======== ======== ========
Net Proved Reserve Additions From All Sources - Oil Equivalents (MMBoe)
Revisions Due to Price - (c) (59.7) 34.8 154.0 (100.7) (573.8) 52.2
Revisions Other Than Price (0.3) (39.5) 48.0 252.9 107.2 48.4
Purchases in Place 16.8 11.6 2.3 42.3 56.2 14.4
Extensions, Discoveries and Other Additions - (d) 750.0 669.7 420.8 209.0 245.9 519.2
----- ----- ----- ----- ----- -----
Total Proved Reserve Additions - (e) 706.8 676.6 625.1 403.5 (164.5) 634.2
Sales in Place (4.6) (10.8) (20.7) (167.6) (3.5) (36.3)
---- ----- ----- ------ ---- -----
Net Proved Reserve Additions From All Sources - (f) 702.2 665.8 604.4 235.9 (168.0) 597.9
===== ===== ===== ===== ====== =====
Production - (g) 300.9 265.0 224.4 207.1 211.2 219.1
RESERVE REPLACEMENT COSTS ($ / Boe)
Total Drilling, Before Revisions - (a / d) $7.95 $8.86 $9.64 $12.51 $17.87 $14.58
All-in Total, Net of Revisions - (b / e) $8.90 $8.85 $6.56 $6.52 $(29.63) $12.16
All-in Total, Excluding Revisions Due to Price - (b / (e - c)) $8.21 $9.33 $8.71 $5.22 $11.91 $13.25
EOG RESOURCES, INC.
Crude Oil, NGLs and Natural Gas Financial Commodity
---------------------------------------------------
Derivative Contracts
--------------------
EOG accounts for financial commodity derivative contracts using the mark-to-market accounting method.
Prices received by EOG for its crude oil production generally vary from NYMEX West Texas Intermediate prices due to adjustments for delivery location (basis) and other factors. EOG has entered into crude oil basis swap contracts in order to
fix the differential between pricing in Midland, Texas, and Cushing, Oklahoma (Midland Differential). Presented below is a comprehensive summary of EOG's Midland Differential basis swap contracts through February 19, 2020. The weighted
average price differential expressed in $/Bbl represents the amount of reduction to Cushing, Oklahoma, prices for the notional volumes expressed in Bbld covered by the basis swap contracts.
Midland Differential Basis Swap Contracts
-----------------------------------------
Weighted
Average Price
Volume Differential
(Bbld) ($/Bbl)
----- -------
2019
----
January 1, 2019 through December 31, 2019 (closed) 20,000 $1.075
EOG has also entered into crude oil basis swap contracts in order to fix the differential between pricing in the U.S. Gulf Coast and Cushing, Oklahoma (Gulf Coast Differential). Presented below is a comprehensive summary of EOG's Gulf Coast
Differential basis swap contracts through February 19, 2020. The weighted average price differential expressed in $/Bbl represents the amount of addition to Cushing, Oklahoma, prices for the notional volumes expressed in Bbld covered by
the basis swap contracts.
Gulf Coast Differential Basis Swap Contracts
--------------------------------------------
Weighted
Average Price
Volume Differential
(Bbld) ($/Bbl)
----- -------
2019
----
January 1, 2019 through December 31, 2019 (closed) 13,000 $5.572
EOG has also entered into crude oil swaps to fix the differential in pricing between the NYMEX calendar month average and the physical crude oil delivery month (Roll Differential). Presented below is a comprehensive summary of EOG's Roll
Differential swap contracts through February 19, 2020. The weighted average price differential expressed in $/Bbl represents the amount of addition to delivery month prices for the notional volumes expressed in Bbld covered by the swap
contracts.
Roll Differential Swap Contracts
--------------------------------
Weighted
Average Price
Volume Differential
(Bbld) ($/Bbl)
----- -------
2020
----
February 2020 (closed) 10,000 $0.70
March 1, 2020 through December 31, 2020 10,000 0.70
Presented below is a comprehensive summary of EOG's crude oil price swap contracts through February 19, 2020, with notional volumes expressed in Bbld and prices expressed in $/Bbl.
Crude Oil Price Swap Contracts
------------------------------
Weighted
Volume Average Price
(Bbld) ($/Bbl)
----- -------
2019
----
April 2019 (closed) 25,000 $60.00
May 1, 2019 through December 31, 2019 (closed) 150,000 62.50
2020
----
January 2020 (closed) 200,000 $59.33
February 1, 2020 through March 31, 2020 200,000 59.33
April 1, 2020 through June 30, 2020 200,000 59.59
July 1, 2020 through September 30, 2020 107,000 58.94
Presented below is a comprehensive summary of EOG's Mont Belvieu propane (non-TET) price swap contracts through February 19, 2020, with notional volumes expressed in Bbld and prices expressed in $/Bbl.
Mont Belvieu Propane Price Swap Contracts
-----------------------------------------
Weighted
Volume Average Price
(Bbld) ($/Bbl)
----- -------
2020
----
January 2020 (closed) 4,000 $21.34
February 2020 4,000 21.34
March 1, 2020 through December 31, 2020 25,000 17.92
Presented below is a comprehensive summary of EOG's natural gas price swap contracts through February 19, 2020, with notional volumes expressed in MMBtud and prices expressed in $/MMBtu.
Natural Gas Price Swap Contracts
--------------------------------
Weighted
Volume Average Price
(MMBtud) ($/MMBtu)
------- ---------
2019
----
April 1, 2019 through October 31, 2019 (closed) 250,000 $2.90
EOG has also entered into natural gas collar contracts, which establish ceiling and floor prices for the sale of notional volumes of natural gas as specified in the collar contracts. The collars require that EOG pay the difference between
the ceiling price and the NYMEX Henry Hub natural gas price for the contract month (Henry Hub Index Price) in the event the Henry Hub Index Price is above the ceiling price. The collars grant EOG the right to receive the difference between
the floor price and the Henry Hub Index Price in the event the Henry Hub Index Price is below the floor price. Presented below is a comprehensive summary of EOG's natural gas collar contracts through February 19, 2020, with notional volumes
expressed in MMBtud and prices expressed in $/MMBtu.
Natural Gas Collar Contracts
----------------------------
Weighted Average Price
($/MMBtu)
-----------------------
Volume (MMBtud) Ceiling Price Floor Price
-------------- ------------- -----------
2020
----
April 1, 2020 through October 31, 2020 250,000 $2.50 $2.00
Prices received by EOG for its natural gas production generally vary from NYMEX Henry Hub prices due to adjustments for delivery location (basis) and other factors. EOG has entered into natural gas basis swap contracts in order to fix the
differential between pricing in the Rocky Mountain area and NYMEX Henry Hub prices (Rockies Differential). Presented below is a comprehensive summary of EOG's Rockies Differential basis swap contracts through February 19, 2020. The
weighted average price differential expressed in $/MMBtu represents the amount of reduction to NYMEX Henry Hub prices for the notional volumes expressed in MMBtud covered by the basis swap contracts.
Rockies Differential Basis Swap Contracts
-----------------------------------------
Weighted
Average Price
Volume Differential
(MMBtud) ($/MMBtu)
------- ---------
2020
----
January 1, 2020 through February 29, 2020 (closed) 30,000 $0.55
March 1, 2020 through December 31, 2020 30,000 0.55
EOG has also entered into natural gas basis swap contracts in order to fix the differential between pricing at the Houston Ship Channel (HSC) and NYMEX Henry Hub prices (HSC Differential). Presented below is a comprehensive summary of EOG's
HSC Differential basis swap contracts through February 19, 2020. The weighted average price differential expressed in $/MMBtu represents the amount of reduction to NYMEX Henry Hub prices for the notional volumes expressed in MMBtud covered
by the basis swap contracts.
HSC Differential Basis Swap Contracts
-------------------------------------
Weighted
Average Price
Volume Differential
(MMBtud) ($/MMBtu)
------- ---------
2020
----
January 1, 2020 through February 29, 2020 (closed) 60,000 $0.05
March 1, 2020 through December 31, 2020 60,000 0.05
EOG has also entered into natural gas basis swap contracts in order to fix the differential between pricing at the Waha Hub in West Texas and NYMEX Henry Hub prices (Waha Differential). Presented below is a comprehensive summary of EOG's
Waha Differential basis swap contracts through February 19, 2020. The weighted average price differential expressed in $/MMBtu represents the amount of reduction to NYMEX Henry Hub prices for the notional volumes expressed in MMBtud covered
by the basis swap contracts.
Waha Differential Basis Swap Contracts
--------------------------------------
Weighted
Average Price
Volume Differential
(MMBtud) ($/MMBtu)
------- ---------
2020
----
January 1, 2020 through February 29, 2020 (closed) 50,000 $1.40
March 1, 2020 through December 31, 2020 50,000 1.40
Definitions
-----------
Bbld Barrels per day
$/Bbl Dollars per barrel
MMBtud Million British thermal units per day
$/MMBtu Dollars per million British thermal units
NYMEX U.S. New York Mercantile Exchange
EOG RESOURCES, INC.
Direct After-Tax Rate of Return
(ATROR)
-------------------------------
The calculation of our direct after-
tax rate of return (ATROR) with
respect to our capital expenditure
program for a particular play or
well is based on the estimated
recoverable reserves ("net" to EOG's
interest) for all wells in such play
or such well (as the case may be),
the estimated net present value
(NPV) of the future net cash flows
from such reserves (for which we
utilize certain assumptions
regarding future commodity prices
and operating costs) and our direct
net costs incurred in drilling or
acquiring (as the case may be) such
wells or well (as the case may be).
As such, our direct ATROR with
respect to our capital expenditures
for a particular play or well cannot
be calculated from our consolidated
financial statements.
Direct ATROR
------------
Based on Cash Flow and Time Value of
Money
-Estimated future commodity prices
and operating costs
-Costs incurred to drill, complete
and equip a well, including
facilities
Excludes Indirect Capital
-Gathering and Processing and other
Midstream
-Land, Seismic, Geological and
Geophysical
Payback ~12 Months on 100% Direct
ATROR Wells
First Five Years ~1/2 Estimated
Ultimate Recovery Produced but ~3/4
of NPV Captured
Return on Equity /Return on Capital
Employed
-----------------------------------
Based on GAAP Accrual Accounting
Includes All Indirect Capital and
Growth Capital for Infrastructure
-Eagle Ford, Bakken, Permian
Facilities
- Gathering and Processing
Includes Legacy Gas Capital and
Capital from Mature Wells
EOG RESOURCES, INC.
Reconciliation of After-Tax Net Interest Expense, Adjusted Net Income,
----------------------------------------------------------------------
Net Debt and Total Capitalization
---------------------------------
Calculations of Return on Capital Employed and Return on Equity
---------------------------------------------------------------
(Unaudited; in millions, except ratio data)
The following chart reconciles Net Interest Expense (GAAP), Net Income (GAAP), Current and Long-Term Debt (GAAP) and Total Capitalization (GAAP) to After-Tax Net Interest Expense (Non-GAAP), Adjusted Net Income (Non-GAAP), Net Debt (Non-GAAP) and Total
Capitalization (Non-GAAP), respectively, as used in the Return on Capital Employed (ROCE) and Return on Equity (ROE) calculations. EOG believes this presentation may be useful to investors who follow the practice of some industry analysts who utilize After-
Tax Net Interest Expense, Adjusted Net Income, Net Debt and Total Capitalization (Non-GAAP) in their ROCE and ROE calculations. EOG management uses this information for purposes of comparing its financial performance with the financial performance of other
companies in the industry.
2019 2018 2017
---- ---- ----
Return on Capital Employed (ROCE) (Non-GAAP)
-------------------------------------------
Net Interest Expense (GAAP) $185 $245
Tax Benefit Imputed (based on 21%) (39) (51)
After-Tax Net Interest Expense (Non-GAAP) - (a) $146 $194
Net Income (GAAP) - (b) $2,735 $3,419
Adjustments to Net Income, Net of Tax (See Accompanying Schedule) 158 (1) (201) (2)
--- ----
Adjusted Net Income (Non-GAAP) - (c) $2,893 $3,218
Total Stockholders' Equity - (d) $21,641 $19,364 $16,283
Average Total Stockholders' Equity * - (e) $20,503 $17,824
Current and Long-Term Debt (GAAP) - (f) $5,175 $6,083 $6,387
Less: Cash (2,028) (1,556) (834)
Net Debt (Non-GAAP) - (g) $3,147 $4,527 $5,553
Total Capitalization (GAAP) - (d) + (f) $26,816 $25,447 $22,670
Total Capitalization (Non-GAAP) - (d) + (g) $24,788 $23,891 $21,836
Average Total Capitalization (Non-GAAP) * - (h) $24,340 $22,864
ROCE (GAAP Net Income) - [(a) + (b)] / (h) 11.8% 15.8%
==== ====
ROCE (Non-GAAP Adjusted Net Income) - [(a) + (c)] / (h) 12.5% 14.9%
==== ====
Return on Equity (ROE)
---------------------
ROE (GAAP Net Income) - (b) / (e) 13.3% 19.2%
==== ====
ROE (Non-GAAP Adjusted Net Income) - (c) / (e) 14.1% 18.1%
==== ====
* Average for the current and immediately preceding year
Adjustments to Net Income (GAAP)
-------------------------------
(1) See below schedule for detail of adjustments to Net Income (GAAP) in 2019:
Year Ended December 31, 2019
----------------------------
Before Income Tax After
Tax Impact Tax
--- ------ ---
Adjustments:
Add: Mark-to-Market Commodity Derivative Contracts Impact $51 $(11) $40
Add: Impairments of Certain Assets 275 (60) 215
Less: Net Gains on Asset Dispositions (124) 27 (97)
Total $202 $(44) $158
(2) See below schedule for detail of adjustments to Net Income (GAAP) in 2018:
Year Ended December 31, 2018
----------------------------
Before Income Tax After
Tax Impact Tax
--- ------ ---
Adjustments:
Add: Mark-to-Market Commodity Derivative Contracts Impact $(93) $20 $(73)
Add: Impairments of Certain Assets 153 (34) 119
Less: Net Gains on Asset Dispositions (175) 38 (137)
Less: Tax Reform Impact - (110) (110)
Total $(115) $(86) $(201)
EOG RESOURCES, INC.
Reconciliation of After-Tax Net Interest Expense,
-------------------------------------------------
Net Debt and Total Capitalization
---------------------------------
Calculation of Return on Capital Employed
-----------------------------------------
(Unaudited; in millions, except ratio data)
The following chart reconciles Net Interest Expense (GAAP), Current and Long-Term Debt (GAAP) and Total Capitalization (GAAP) to After-Tax Net Interest Expense (Non-GAAP), Net Debt (Non-GAAP) and Total Capitalization (Non-GAAP), respectively, as used in the Return on Capital Employed (ROCE) (Non-
GAAP) calculation. EOG believes this presentation may be useful to investors who follow the practice of some industry analysts who utilize After-Tax Net Interest Expense, Net Debt and Total Capitalization (Non-GAAP) in their ROCE calculation. EOG management uses this information for purposes of
comparing its financial performance with the financial performance of other companies in the industry.
2017 2016 2015 2014 2013
---- ---- ---- ---- ----
Return on Capital Employed (ROCE) (Non-GAAP)
-------------------------------------------
(Calculated Using GAAP Net Income)
---------------------------------
Net Interest Expense (GAAP) $274 $282 $237 $201 $235
Tax Benefit Imputed (based on 35%) (96) (99) (83) (70) (82)
After-Tax Net Interest Expense (Non-GAAP) - (a) $178 $183 $154 $131 $153
Net Income (Loss) (GAAP) - (b) $2,583 $(1,097) $(4,525) $2,915 $2,197
Total Stockholders' Equity - (d) $16,283 $13,982 $12,943 $17,713 $15,418
Average Total Stockholders' Equity * - (e) $15,133 $13,463 $15,328 $16,566 $14,352
Current and Long-Term Debt (GAAP) - (f) $6,387 $6,986 $6,655 $5,906 $5,909
Less: Cash (834) (1,600) (719) (2,087) (1,318)
Net Debt (Non-GAAP) - (g) $5,553 $5,386 $5,936 $3,819 $4,591
Total Capitalization (GAAP) - (d) + (f) $22,670 $20,968 $19,598 $23,619 $21,327
Total Capitalization (Non-GAAP) - (d) + (g) $21,836 $19,368 $18,879 $21,532 $20,009
Average Total Capitalization (Non-GAAP) * - (h) $20,602 $19,124 $20,206 $20,771 $19,365
ROCE (GAAP Net Income) - [(a) + (b)] / (h) 13.4% -4.8% -21.6% 14.7% 12.1%
==== ==== ===== ==== ====
Return on Equity (ROE) (GAAP)
----------------------------
ROE (GAAP Net Income) - (b) / (e) 17.1% -8.1% -29.5% 17.6% 15.3%
==== ==== ===== ==== ====
* Average for the current and immediately preceding year
EOG RESOURCES, INC.
Reconciliation of After-Tax Net Interest Expense,
-------------------------------------------------
Net Debt and Total Capitalization
---------------------------------
Calculation of Return on Capital Employed
-----------------------------------------
(Unaudited; in millions, except ratio data)
The following chart reconciles Net Interest Expense (GAAP), Current and Long-Term Debt (GAAP) and Total Capitalization (GAAP) to After-Tax Net Interest Expense (Non-GAAP), Net Debt (Non-GAAP) and Total Capitalization (Non-GAAP), respectively, as used in the Return on Capital Employed (ROCE) (Non-
GAAP) calculation. EOG believes this presentation may be useful to investors who follow the practice of some industry analysts who utilize After-Tax Net Interest Expense, Net Debt and Total Capitalization (Non-GAAP) in their ROCE calculation. EOG management uses this information for purposes of
comparing its financial performance with the financial performance of other companies in the industry.
2012 2011 2010 2009 2008
---- ---- ---- ---- ----
Return on Capital Employed (ROCE) (Non-GAAP)
-------------------------------------------
(Calculated Using GAAP Net Income)
---------------------------------
Net Interest Expense (GAAP) $214 $210 $130 $101 $52
Tax Benefit Imputed (based on 35%) (75) (74) (46) (35) (18)
After-Tax Net Interest Expense (Non-GAAP) - (a) $139 $136 $84 $66 $34
Net Income (Loss) (GAAP) - (b) $570 $1,091 $161 $547 $2,437
Total Stockholders' Equity - (d) $13,285 $12,641 $10,232 $9,998 $9,015
Average Total Stockholders' Equity * - (e) $12,963 $11,437 $10,115 $9,507 $8,003
Current and Long-Term Debt (GAAP) - (f) $6,312 $5,009 $5,223 $2,797 $1,897
Less: Cash (876) (616) (789) (686) (331)
Net Debt (Non-GAAP) - (g) $5,436 $4,393 $4,434 $2,111 $1,566
Total Capitalization (GAAP) - (d) + (f) $19,597 $17,650 $15,455 $12,795 $10,912
Total Capitalization (Non-GAAP) - (d) + (g) $18,721 $17,034 $14,666 $12,109 $10,581
Average Total Capitalization (Non-GAAP) * - (h) $17,878 $15,850 $13,388 $11,345 $9,351
ROCE (GAAP Net Income) - [(a) + (b)] / (h) 4.0% 7.7% 1.8% 5.4% 26.4%
=== === === === ====
Return on Equity (ROE) (GAAP)
----------------------------
ROE (GAAP Net Income) - (b) / (e) 4.4% 9.5% 1.6% 5.8% 30.5%
=== === === === ====
* Average for the current and immediately preceding year
EOG RESOURCES, INC.
Reconciliation of After-Tax Net Interest Expense,
-------------------------------------------------
Net Debt and Total Capitalization
---------------------------------
Calculation of Return on Capital Employed
-----------------------------------------
(Unaudited; in millions, except ratio data)
The following chart reconciles Net Interest Expense (GAAP), Current and Long-Term Debt (GAAP) and Total Capitalization (GAAP) to After-Tax Net Interest Expense (Non-GAAP), Net Debt (Non-GAAP) and Total Capitalization (Non-GAAP), respectively, as used in the Return on Capital Employed (ROCE) (Non-
GAAP) calculation. EOG believes this presentation may be useful to investors who follow the practice of some industry analysts who utilize After-Tax Net Interest Expense, Net Debt and Total Capitalization (Non-GAAP) in their ROCE calculation. EOG management uses this information for purposes of
comparing its financial performance with the financial performance of other companies in the industry.
2007 2006 2005 2004 2003
---- ---- ---- ---- ----
Return on Capital Employed (ROCE) (Non-GAAP)
-------------------------------------------
(Calculated Using GAAP Net Income)
---------------------------------
Net Interest Expense (GAAP) $47 $43 $63 $63 $59
Tax Benefit Imputed (based on 35%) (16) (15) (22) (22) (21)
After-Tax Net Interest Expense (Non-GAAP) - (a) $31 $28 $41 $41 $38
Net Income (Loss) (GAAP) - (b) $1,090 $1,300 $1,260 $625 $430
Total Stockholders' Equity - (d) $6,990 $5,600 $4,316 $2,945 $2,223
Average Total Stockholders' Equity * - (e) $6,295 $4,958 $3,631 $2,584 $1,948
Current and Long-Term Debt (GAAP) - (f) $1,185 $733 $985 $1,078 $1,109
Less: Cash (54) (218) (644) (21) (4)
Net Debt (Non-GAAP) - (g) $1,131 $515 $341 $1,057 $1,105
Total Capitalization (GAAP) - (d) + (f) $8,175 $6,333 $5,301 $4,023 $3,332
Total Capitalization (Non-GAAP) - (d) + (g) $8,121 $6,115 $4,657 $4,002 $3,328
Average Total Capitalization (Non-GAAP) * - (h) $7,118 $5,386 $4,330 $3,665 $3,068
ROCE (GAAP Net Income) - [(a) + (b)] / (h) 15.7% 24.7% 30.0% 18.2% 15.3%
==== ==== ==== ==== ====
Return on Equity (ROE) (GAAP)
----------------------------
ROE (GAAP Net Income) - (b) / (e) 17.3% 26.2% 34.7% 24.2% 22.1%
==== ==== ==== ==== ====
* Average for the current and immediately preceding year
EOG RESOURCES, INC.
Reconciliation of After-Tax Net Interest Expense,
-------------------------------------------------
Net Debt and Total Capitalization
---------------------------------
Calculation of Return on Capital Employed
-----------------------------------------
(Unaudited; in millions, except ratio data)
The following chart reconciles Net Interest Expense (GAAP), Current and Long-Term Debt (GAAP) and Total Capitalization (GAAP) to After-Tax Net Interest Expense (Non-GAAP), Net Debt (Non-GAAP) and Total Capitalization (Non-GAAP), respectively, as used in the Return on Capital Employed (ROCE) (Non-
GAAP) calculation. EOG believes this presentation may be useful to investors who follow the practice of some industry analysts who utilize After-Tax Net Interest Expense, Net Debt and Total Capitalization (Non-GAAP) in their ROCE calculation. EOG management uses this information for purposes of
comparing its financial performance with the financial performance of other companies in the industry.
2002 2001 2000 1999 1998
---- ---- ---- ---- ----
Return on Capital Employed (ROCE) (Non-GAAP)
-------------------------------------------
(Calculated Using GAAP Net Income)
---------------------------------
Net Interest Expense (GAAP) $60 $45 $61 $62
Tax Benefit Imputed (based on 35%) (21) (16) (21) (22)
After-Tax Net Interest Expense (Non-GAAP) - (a) $39 $29 $40 $40
Net Income (Loss) (GAAP) - (b) $87 $399 $397 $569
Total Stockholders' Equity - (d) $1,672 $1,643 $1,381 $1,130 $1,280
Average Total Stockholders' Equity * - (e) $1,658 $1,512 $1,256 $1,205
Current and Long-Term Debt (GAAP) - (f) $1,145 $856 $859 $990 $1,143
Less: Cash (10) (3) (20) (25) (6)
Net Debt (Non-GAAP) - (g) $1,135 $853 $839 $965 $1,137
Total Capitalization (GAAP) - (d) + (f) $2,817 $2,499 $2,240 $2,120 $2,423
Total Capitalization (Non-GAAP) - (d) + (g) $2,807 $2,496 $2,220 $2,095 $2,417
Average Total Capitalization (Non-GAAP) * - (h) $2,652 $2,358 $2,158 $2,256
ROCE (GAAP Net Income) - [(a) + (b)] / (h) 4.8% 18.2% 20.2% 27.0%
=== ==== ==== ====
Return on Equity (ROE) (GAAP)
----------------------------
ROE (GAAP Net Income) - (b) / (e) 5.2% 26.4% 31.6% 47.2%
=== ==== ==== ====
* Average for the current and immediately preceding year
EOG RESOURCES, INC.
Cash Operating Expenses per Barrel of Oil Equivalent (Boe)
---------------------------------------------------------
(Unaudited; in thousands, except per Boe amounts)
Year Ended
December 31,
------------
2019 2018 2017 2016 2015 2014
---- ---- ---- ---- ---- ----
Cash Operating Expenses (GAAP)*
------------------------------
Lease and Well $1,366,993 $1,282,678 $1,044,847 $927,452 $1,182,282 $1,416,413
Transportation Costs 758,300 746,876 740,352 764,106 849,319 972,176
General and Administrative 489,397 426,969 434,467 394,815 366,594 402,010
Cash Operating Expenses 2,614,690 2,456,523 2,219,666 2,086,373 2,398,195 2,790,599
Less: Legal Settlement - Early Leasehold Termination - - (10,202) - (19,355) -
Less: Voluntary Retirement Expense - - - (42,054) - -
Less: Acquisition Costs - Yates Transaction - - - (5,100) - -
Less: Joint Venture Transaction Costs - - (3,056) - - -
Less: Joint Interest Billings Deemed Uncollectible - - (4,528) - - -
Adjusted Cash Operating Expenses (Non-GAAP) - (a) $2,614,690 $2,456,523 $2,201,880 $2,039,219 $2,378,840 $2,790,599
========== ========== ========== ========== ========== ==========
Volume - Thousand Barrels of Oil Equivalent - (b) 298,565 262,516 222,251 204,929 208,862 217,073
Adjusted Cash Operating Expenses Per Boe (Non-GAAP) - (a) / (b) $8.76 (c) $9.36 (d) $9.91 (e) $9.95 (f) $11.39 (g) $12.86 (h)
===== ===== ===== ===== ====== ======
Adjusted Cash Operating Expenses Per Boe (Non-GAAP) -
Percentage Decrease
-------------------
2019 compared to 2018 - [(c) - (d)] / (d) -6%
2019 compared to 2017 - [(c) - (e)] / (e) -12%
2019 compared to 2016 - [(c) - (f)] / (f) -12%
2019 compared to 2015 - [(c) - (g)] / (g) -23%
2019 compared to 2014 - [(c) - (h)] / (h) -32%
* Includes stock compensation expense and other non-cash items.
EOG RESOURCES, INC.
Cost per Barrel of Oil Equivalent (Boe)
--------------------------------------
(Unaudited; in thousands, except per Boe amounts)
Three Months Ended
------------------
March 31, June 30, September 30, December 31,
2019 2019 2019 2019
---- ---- ---- ----
Volume - Thousand Barrels of Oil Equivalent - (a) 69,623 73,964 76,748 78,231
Crude Oil and Condensate $2,200,403 $2,528,866 $2,418,989 $2,464,274
Natural Gas Liquids 218,638 186,374 164,736 215,070
Natural Gas 334,972 269,892 269,625 309,606
Total Wellhead Revenues - (b) $2,754,013 $2,985,132 $2,853,350 $2,988,950
Operating Costs
Lease and Well $336,291 $347,281 $348,883 $334,538
Transportation Costs 176,522 174,101 199,365 208,312
Gathering and Processing Costs 111,295 112,643 127,549 127,615
General and Administrative 106,672 121,780 135,758 125,187
Taxes Other Than Income 192,906 204,414 203,098 199,746
Interest Expense, Net 54,906 49,908 39,620 40,695
Total Cash Operating Cost (excluding DD&A and Total $978,592 $1,010,127 $1,054,273 $1,036,093
Exploration Costs) - (c)
Depreciation, Depletion and Amortization (DD&A) 879,595 957,304 953,597 959,208
Total Operating Cost (excluding Total Exploration Costs) - (d) $1,858,187 $1,967,431 $2,007,870 $1,995,301
Exploration Costs $36,324 $32,522 $34,540 $36,495
Dry Hole Costs 94 3,769 24,138 -
Impairments 72,356 112,130 105,275 228,135
------ ------- ------- -------
Total Exploration Costs 108,774 148,421 163,953 264,630
Less: Impairments (Non-GAAP) (23,745) (65,289) (27,215) (158,725)
Total Exploration Costs (Non-GAAP) $85,029 $83,132 $136,738 $105,905
Total Operating Cost (Non-GAAP) (including Total $1,943,216 $2,050,563 $2,144,608 $2,101,206
Exploration Costs) - (e)
Composite Average Wellhead Revenue per Boe - (b) / (a) $39.56 $40.36 $37.18 $38.21
====== ====== ====== ======
Total Cash Operating Cost per Boe (excluding DD&A $14.06 $13.65 $13.75 $13.24
and Total Exploration Costs) - (c) / (a)
Composite Average Margin per Boe (excluding DD&A $25.50 $26.71 $23.43 $24.97
and Total Exploration Costs) - [(b) / (a) - (c) / (a)]
Total Operating Cost per Boe (excluding Total $26.69 $26.59 $26.18 $25.50
Exploration Costs) - (d) / (a)
Composite Average Margin per Boe (excluding Total $12.87 $13.77 $11.00 $12.71
Exploration Costs) - [(b) / (a) - (d) / (a)]
Total Operating Cost per Boe (Non-GAAP) (including $27.91 $27.72 $27.97 $26.85
Total Exploration Costs) - (e) / (a)
Composite Average Margin per Boe (Non-GAAP) $11.65 $12.64 $9.21 $11.36
(including Total Exploration Costs) - [(b) / (a) - (e) / (a)]
EOG RESOURCES, INC.
Cost per Barrel of Oil Equivalent (Boe)
--------------------------------------
(Unaudited; in thousands, except per Boe amounts)
Year Ended
December 31,
------------
2019 2018 2017
---- ---- ----
Volume - Thousand Barrels of Oil Equivalent - (a) 298,565 262,516 222,251
Crude Oil and Condensate $9,612,532 $9,517,440 $6,256,396
Natural Gas Liquids 784,818 1,127,510 729,561
Natural Gas 1,184,095 1,301,537 921,934
Total Wellhead Revenues - (b) $11,581,445 $11,946,487 $7,907,891
Operating Costs
Lease and Well $1,366,993 $1,282,678 $1,044,847
Transportation Costs 758,300 746,876 740,352
Gathering and Processing Costs 479,102 436,973 148,775
General and Administrative 489,397 426,969 434,467
Less: Legal Settlement - Early Leasehold Termination - - (10,202)
Less: Joint Venture Transaction Costs - - (3,056)
Less: Joint Interest Billings Deemed Uncollectible - - (4,528)
General and Administrative (Non-GAAP) 489,397 426,969 416,681
Taxes Other Than Income 800,164 772,481 544,662
Interest Expense, Net 185,129 245,052 274,372
Total Cash Operating Cost (Non-GAAP) (excluding DD&A $4,079,085 $3,911,029 $3,169,689
and Total Exploration Costs) - (c)
Depreciation, Depletion and Amortization (DD&A) 3,749,704 3,435,408 3,409,387
Total Operating Cost (Non-GAAP) (excluding Total $7,828,789 $7,346,437 $6,579,076
Exploration Costs) - (d)
Exploration Costs $139,881 $148,999 $145,342
Dry Hole Costs 28,001 5,405 4,609
Impairments 517,896 347,021 479,240
------- ------- -------
Total Exploration Costs 685,778 501,425 629,191
Less: Impairments (Non-GAAP) (274,974) (152,671) (261,452)
Total Exploration Costs (Non-GAAP) $410,804 $348,754 $367,739
--------
Total Operating Cost (Non-GAAP) (including Total $8,239,593 $7,695,191 $6,946,815
Exploration Costs) - (e)
Composite Average Wellhead Revenue per Boe - (b) / (a) $38.79 $45.51 $35.58
====== ====== ======
Total Cash Operating Cost per Boe (Non-GAAP) $13.66 $14.90 $14.25
(excluding DD&A and Total Exploration Costs) - (c) / (a)
Composite Average Margin per Boe (Non-GAAP) (excluding $25.13 $30.61 $21.33
DD&A and Total Exploration Costs) - [(b) / (a) - (c) / (a)]
Total Operating Cost per Boe (Non-GAAP) (excluding $26.22 $27.99 $29.59
Total Exploration Costs) - (d) / (a)
Composite Average Margin per Boe (Non-GAAP) $12.57 $17.52 $5.99
(excluding Total Exploration Costs) - [(b) / (a) - (d) / (a)]
Total Operating Cost per Boe (Non-GAAP) (including $27.60 $29.32 $31.24
Total Exploration Costs) - (e) / (a)
Composite Average Margin per Boe (Non-GAAP) $11.19 $16.19 $4.34
(including Total Exploration Costs) - [(b) / (a) - (e) / (a)]
EOG RESOURCES, INC.
Cost per Barrel of Oil Equivalent (Boe)
--------------------------------------
(Unaudited; in thousands, except per Boe amounts)
Year Ended
December 31,
------------
2016 2015 2014
---- ---- ----
Volume - Thousand Barrels of Oil Equivalent - (a) 204,929 208,862 217,073
Crude Oil and Condensate $4,317,341 $4,934,562 $9,742,480
Natural Gas Liquids 437,250 407,658 934,051
Natural Gas 742,152 1,061,038 1,916,386
Total Wellhead Revenues - (b) $5,496,743 $6,403,258 $12,592,917
Operating Costs
Lease and Well $927,452 $1,182,282 $1,416,413
Transportation Costs 764,106 849,319 972,176
Gathering and Processing Costs 122,901 146,156 145,800
General and Administrative 394,815 366,594 402,010
Less: Voluntary Retirement Expense (42,054) - -
Less: Acquisition Costs (5,100) - -
Less: Legal Settlement - Early Leasehold Termination - (19,355) -
General and Administrative (Non-GAAP) 347,661 347,239 402,010
Taxes Other Than Income 349,710 421,744 757,564
Interest Expense, Net 281,681 237,393 201,458
Total Cash Operating Cost (Non-GAAP) (excluding DD&A $2,793,511 $3,184,133 $3,895,421
and Total Exploration Costs) - (c)
Depreciation, Depletion and Amortization (DD&A) 3,553,417 3,313,644 3,997,041
Total Operating Cost (Non-GAAP) (excluding Total $6,346,928 $6,497,777 $7,892,462
Exploration Costs) - (d)
Exploration Costs $124,953 $149,494 $184,388
Dry Hole Costs 10,657 14,746 48,490
Impairments 620,267 6,613,546 743,575
------- --------- -------
Total Exploration Costs 755,877 6,777,786 976,453
Less: Impairments (Non-GAAP) (320,617) (6,307,593) (824,312)
Total Exploration Costs (Non-GAAP) $435,260 $470,193 $152,141
Total Operating Cost (Non-GAAP) (including Total $6,782,188 $6,967,970 $8,044,603
Exploration Costs) - (e)
Composite Average Wellhead Revenue per Boe - (b) / (a) $26.82 $30.66 $58.01
====== ====== ======
Total Cash Operating Cost per Boe (Non-GAAP) $13.64 $15.25 $17.95
(excluding DD&A and Total Exploration Costs) - (c) / (a)
Composite Average Margin per Boe (Non-GAAP) (excluding $13.18 $15.41 $40.06
DD&A and Total Exploration Costs) - [(b) / (a) - (c) / (a)]
Total Operating Cost per Boe (Non-GAAP) (excluding $30.98 $31.11 $36.38
Total Exploration Costs) - (d) / (a)
Composite Average Margin per Boe (Non-GAAP) $(4.16) $(0.45) $21.63
(excluding Total Exploration Costs) - [(b) / (a) - (d) / (a)]
Total Operating Cost per Boe (Non-GAAP) (including $33.10 $33.36 $37.08
Total Exploration Costs) - (e) / (a)
Composite Average Margin per Boe (Non-GAAP) $(6.28) $(2.70) $20.93
(including Total Exploration Costs) - [(b) / (a) - (e) / (a)]
EOG RESOURCES, INC.
First Quarter and Full Year 2020 Forecast and Benchmark Commodity Pricing
-------------------------------------------------------------------------
(a) First Quarter and Full Year 2020 Forecast
The forecast items for the first quarter and full year 2020 set forth below for EOG Resources, Inc. (EOG) are based on current available information and expectations as of the date of the accompanying press release. EOG undertakes no obligation, other than as required by
applicable law, to update or revise this forecast, whether as a result of new information, subsequent events, anticipated or unanticipated circumstances or otherwise. This forecast, which should be read in conjunction with the accompanying press release and EOG's related
Current Report on Form 8-K filing, replaces and supersedes any previously issued guidance or forecast.
(b) Capital Expenditures
The forecast includes expenditures for Exploration and Development Drilling, Facilities, Leasehold Acquisitions, Capitalized Interest, Exploration Costs, Dry Hole Costs and Other Property, Plant and Equipment. The forecast excludes Property Acquisitions, Asset Retirement Costs
and any Non-Cash Exchanges.
(c) Benchmark Commodity Pricing
EOG bases United States and Trinidad crude oil and condensate price differentials upon the West Texas Intermediate crude oil price at Cushing, Oklahoma, using the simple average of the NYMEX settlement prices for each trading day within the applicable calendar month.
EOG bases United States natural gas price differentials upon the natural gas price at Henry Hub, Louisiana, using the simple average of the NYMEX settlement prices for the last three trading days of the applicable month.
Estimated Ranges
----------------
(Unaudited)
1Q 2020 Full Year 2020
------- --------------
Daily Sales Volumes
Crude Oil and Condensate Volumes (MBbld)
United States 479.0 - 487.0 499.0 - 517.6
Trinidad 0.5 - 0.7 1.0 - 1.2
Other International 0.0 - 0.2 0.0 - 0.2
Total 479.5 - 487.9 500.0 - 519.0
Natural Gas Liquids Volumes (MBbld)
Total 150.0 - 160.0 157.0 - 177.0
Natural Gas Volumes (MMcfd)
United States 1,090 - 1,150 1,135 - 1,235
Trinidad 185 - 215 215 - 255
Other International 25 - 35 25 - 35
Total 1,300 - 1,400 1,375 - 1,525
Crude Oil Equivalent Volumes (MBoed)
United States 810.7 - 838.7 845.2 - 900.4
Trinidad 31.3 - 36.5 36.8 - 43.7
Other International 4.2 - 6.0 4.2 - 6.0
Total 846.2 - 881.2 886.2 - 950.1
Capital Expenditures ($MM) $1,850 - $2,050 $6,300 - $6,700
Estimated Ranges
----------------
(Unaudited)
1Q 2020 Full Year 2020
------- --------------
Operating Costs
Unit Costs ($/Boe)
Lease and Well $4.30 - $4.80 $4.20 - $4.80
Transportation Costs $2.40 - $2.80 $2.30 - $2.70
General and Administrative $1.55 - $1.65 $1.55 - $1.65
Gathering and Processing $1.70 - $1.80 $1.60 - $1.80
Depreciation, Depletion and Amortization $13.00 - $13.50 $12.15 - $13.15
Expenses ($MM)
Exploration and Dry Hole $40 - $50 $145 - $185
Impairment $80 - $90 $325 - $365
Capitalized Interest $9 - $11 $37 - $43
Net Interest $39 - $41 $136 - $140
Taxes Other Than Income (% of Wellhead Revenue) 7.0% - 8.0% 7.0% - 8.0%
Income Taxes
Effective Rate 21% - 26% 21% - 26%
Current Tax (Benefit) / Expense ($MM) $(15) - $30 $5 - $50
Pricing - (Refer to Benchmark Commodity Pricing in text)
Crude Oil and Condensate ($/Bbl)
Differentials
United States - above (below) WTI $(0.10) - $0.90 $(0.50) - $1.50
Trinidad - above (below) WTI $(11.00) - $(9.00) $(11.50) - $(9.50)
Other International - above (below) WTI $0.75 - $4.75 $(0.65) - $1.35
Natural Gas Liquids
Realizations as % of WTI 21% - 27% 21% - 27%
Natural Gas ($/Mcf)
Differentials
United States - above (below) NYMEX Henry Hub $(0.70) - $(0.30) $(0.90) - $(0.30)
Realizations
Trinidad $2.40 - $2.80 $2.50 - $3.20
Other International $4.00 - $4.50 $3.85 - $4.85
Definitions
-----------
$/Bbl U.S. Dollars per barrel
$/Boe U.S. Dollars per barrel of oil equivalent
$/Mcf U.S. Dollars per thousand cubic feet
$MM U.S. Dollars in millions
MBbld Thousand barrels per day
MBoed Thousand barrels of oil equivalent per day
MMcfd Million cubic feet per day
NYMEX U.S. New York Mercantile Exchange
WTI West Texas Intermediate
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SOURCE EOG Resources, Inc.
