EOG
$93.68
Eog Resources
($3.19)
(3.29%)
Earnings Details
4th Quarter December 2018
Tuesday, February 26, 2019 4:16:00 PM
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Summary

Eog Resources Misses

Eog Resources (EOG) reported 4th Quarter December 2018 earnings of $1.24 per share on revenue of $4.6 billion. The consensus earnings estimate was $1.34 per share on revenue of $4.5 billion. The Earnings Whisper number was $1.36 per share. Revenue grew 36.9% on a year-over-year basis.

EOG Resources Inc explores for, develops, produces and markets crude oil and natural gas in the USA, Trinidad, United Kingdom, China, Argentina and, from time to time, select other international areas.

Results
Reported Earnings
$1.24
Earnings Whisper
$1.36
Consensus Estimate
$1.34
Reported Revenue
$4.57 Bil
Revenue Estimate
$4.49 Bil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

EOG Resources Reports Fourth Quarter and Full Year 2018 Results and Announces 2019 Capital Program

HOUSTON, Feb. 26, 2019 /PRNewswire/ --

  • Earns Record Net Income in 2018 and Generates Significant Net Cash from Operating Activities and Free Cash Flow
  • Exceeds Fourth Quarter Crude Oil and NGL Production Target Midpoints
  • Increases Proved Reserves by 16% and Replaces 238% of 2018 Production at Sub-$10 Finding Cost
  • Targets Improved Capital Efficiency, Significant Investment in High-Quality New Drilling Potential and 12-16% U.S. Crude Oil Volume Growth in 2019, Funded with Net Cash from Operating Activities at $50 Oil

EOG Resources, Inc. (EOG) today reported fourth quarter 2018 net income of $893 million, or $1.54 per share. This compares to fourth quarter 2017 net income of $2.4 billion, or $4.20 per share. For the full year 2018, EOG reported a company record net income of $3.4 billion, or $5.89 per share, compared to $2.6 billion, or $4.46 per share, for the full year 2017. Net cash from operating activities for the fourth quarter and full year 2018 was $2.1 billion and $7.8 billion, respectively.

Adjusted non-GAAP net income for the fourth quarter 2018 was $718 million, or $1.24 per share, compared to adjusted non-GAAP net income of $401 million, or $0.69 per share, for the same prior year period. Adjusted non-GAAP net income for the full year 2018 was $3.2 billion, or $5.54 per share, compared to adjusted non-GAAP net income of $648 million, or $1.12 per share, for the full year 2017. Please refer to the attached tables for the reconciliation of non-GAAP measures to GAAP measures.

Fourth Quarter and Full Year 2018 Review
EOG delivered exceptional financial and operating performance in 2018. The company generated record net income and free cash flow, while ending the year with strong improvements in well productivity and additional cost reductions. Total company crude oil volumes grew 19 percent to 399,900 barrels of oil per day (Bopd). Natural gas liquids production increased 31 percent, while natural gas volumes grew 11 percent, contributing to total company production growth of 18 percent.

In the fourth quarter 2018, EOG exceeded the high end of its target range for U.S. crude oil volumes by producing 430,300 Bopd, an increase of 17 percent compared to the same prior year period. Per-unit operating expenses declined during the fourth quarter 2018 compared to the same prior year period. Lower general and administrative expenses, transportation costs and depreciation, depletion and amortization expenses each contributed to the overall cost reduction.

EOG generated $2.1 billion of discretionary cash flow and incurred total expenditures of $1.5 billion in the fourth quarter 2018. After considering cash exploration and development expenditures, excluding acquisitions, of $1.3 billion and dividend payments of $127 million, the company generated free cash flow during the fourth quarter of $637 million. For the full year 2018 EOG generated a company record $1.7 billion of free cash flow. Please refer to the attached tables for the reconciliation of non-GAAP measures to GAAP measures.

"Our goal at EOG is to be one of the best companies in the S&P 500. Our stellar 2018 performance delivered a premium combination of high returns and double-digit production growth while generating record free cash flow," said William R. "Bill" Thomas, Chairman and Chief Executive Officer. "Our 2018 results show that we can be competitive with the best companies across all sectors, and we remain relentlessly focused on further improving our cost structure and operating performance."

2019 Capital Plan
EOG's capital plan is custom-designed each year to increase returns and capital efficiencies. In 2019, EOG is allocating more capital to opportunistic, high quality new drilling potential and somewhat less capital to drilling in established areas. The company's disciplined growth strategy emphasizes generating free cash flow while lowering well costs and per-unit operating expenses and driving improvement in well productivity. Retaining high-quality equipment and crews during the fourth quarter of 2018 positioned the company to further improve efficiencies and returns in 2019.

EOG expects to grow U.S. crude oil production by 12 to 16 percent, fund capital investment and pay the dividend with net cash from operating activities in 2019 at $50 oil. Exploration and development expenditures for 2019 are expected to range from $6.1 to $6.5 billion, including facilities and gathering, processing and other expenditures, excluding acquisitions and non-cash exchanges.

EOG expects to complete approximately 740 net wells in 2019 compared to 763 net wells in 2018. Activity will remain focused in EOG's highest rate-of-return oil assets in the Delaware Basin, Eagle Ford, Rockies, Woodford and Bakken. The company's investment in new potential areas in the United States includes spending for leasing and related infrastructure to drill wells in a number of new prospects in 2019.

"EOG's disciplined 2019 capital plan delivers improved capital efficiency and strong high-return growth while making investments in new organic high-quality drilling potential to improve the future performance of the company," Thomas said. "Our focus on innovation and operational execution, as well as our investment in new drilling potential, will continue to increase the quality of EOG's premium portfolio. EOG is poised to further improve its position as one of the lowest cost oil producers in the global market, able to create shareholder value through commodity price cycles."

Operating Highlights
EOG completed 262 net wells in the Delaware Basin and increased crude oil production 47% to 126,800 Bopd in 2018. The company made significant progress during 2018 in improving well productivity and reducing well costs. EOG refined spacing and development patterns, reduced drilling days and applied new completion technology designed to lower costs and improve well productivity.

EOG continues to drive growth and operating efficiencies in its premier South Texas Eagle Ford asset. In 2018, the company grew crude oil production 9% to 171,000 Bopd. Of the 304 net wells completed in 2018, EOG drilled a total of 65 wells with lateral lengths greater than 10,000 feet. These wells included the Slytherin C#3H, which, at 13,500 feet, was a company record in the Eagle Ford.

EOG's Powder River Basin and Wyoming DJ Basin activity both contributed to the company's 2018 crude oil production growth. In the Powder River Basin, the company brought eight wells on line during the fourth quarter targeting the Turner, Mowry and Parkman formations. The company plans to add infrastructure and further delineate the field and test additional targets in 2019 to be positioned to execute a more robust development program in the Niobrara and Mowry in 2020 and beyond. In the Wyoming DJ Basin, EOG generated further cost reductions during 2018 through efficiency improvements in drilling, completion and production operations. The company brought 20 wells to sales in the fourth quarter, all targeting the Codell formation. EOG expects further crude oil production growth from its high rate of return drilling in the DJ Basin in 2019.

EOG continued development of its premium play in the Eastern Anadarko Basin Woodford Oil Window, where it brought five wells on line in the fourth quarter. The company made significant progress in reducing well costs during 2018, and, as a result, has lowered its 2019 well cost target to $7.6 million.

In the Williston Basin, EOG realized significant operational improvements in 2018. The company drilled 20 net wells with an average treated lateral length of 9,500 feet per well. Efficient drilling performance delivered, on average, an additional 1,000 feet of lateral length per well in 2018 for the same cost as 2017. EOG's Austin 45-1113H well set a company record in the basin with a spud-to-total depth time of 8.4 days.

Reserves
At year-end 2018, total company net proved reserves were 2,928 million barrels of oil equivalent (MMBoe), an increase of 16 percent compared to year-end 2017. Net proved reserve additions from all sources, excluding revisions due to price, replaced 238 percent of EOG's 2018 production at a finding and development cost of $9.33 per barrel of oil equivalent. Revisions due to price increased net proved reserves by 35 MMBoe and asset divestitures decreased net proved reserves by 11 MMBoe. For more reserves detail and a reconciliation of non-GAAP measures to GAAP measures, please refer to the attached tables.

For the 31st consecutive year, internal reserves estimates were within five percent of estimates independently prepared by DeGolyer and MacNaughton.

Financial Review
At December 31, 2018, EOG's total debt outstanding was $6.1 billion for a debt-to-total capitalization ratio of 24 percent. Considering cash on the balance sheet at the end of the fourth quarter, EOG's net debt was $4.5 billion for a net debt-to-total capitalization ratio of 19 percent. For a reconciliation of non-GAAP measures to GAAP measures, please refer to the attached tables.

EOG completed its previously announced agreement to divest all of its U.K. operations in the fourth quarter 2018. Proceeds from the U.K. divestment and other asset sales in 2018 totaled $227 million.

Fourth Quarter 2018 Results Webcast
Wednesday, February 27, 2019, 9:00 a.m. Central time (10:00 a.m. Eastern time)
Webcast will be available on EOG 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
John Wagner  713-571-4404

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.  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 economically develop its acreage in, produce reserves and achieve anticipated production levels from, and maximize reserve recovery from, its existing and future crude oil and natural gas exploration and development projects;
  • ­ 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;
  • ­ 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 costs with respect to such properties;
  • ­ the extent to which EOG's third-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 third 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;
  • ­ physical, electronic and cybersecurity breaches; and
  • ­ the other factors described under ITEM 1A, Risk Factors, on pages 13 through 22 of EOG's Annual Report on Form 10-K for the fiscal year ended December 31, 2018 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, 2018, 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,


2018


2017


2018


2017













Operating Revenues and Other

$

4,574.5


$

3,340.4


$

17,275.4


$

11,208.3

Net Income 

$

892.8


$

2,430.5


$

3,419.0


$

2,582.6

Net Income Per Share 












        Basic

$

1.55


$

4.22


$

5.93


$

4.49

        Diluted

$

1.54


$

4.20


$

5.89


$

4.46

Average Number of Common Shares












        Basic


577.0



575.4



576.6



574.6

        Diluted


580.3



579.2



580.4



578.7

























Summary Income Statements

(Unaudited; in thousands, except per share data)














Three Months Ended


Twelve Months Ended


December 31,


December 31,


2018


2017


2018


2017

Operating Revenues and Other








        Crude Oil and Condensate

$

2,383,326


$

1,929,471


$

9,517,440


$

6,256,396

        Natural Gas Liquids


266,037



249,172



1,127,510



729,561

        Natural Gas


389,213



246,922



1,301,537



921,934

        Gains (Losses) on Mark-to-Market Commodity
           Derivative Contracts


132,095



(45,032)



(165,640)



19,828

        Gathering, Processing and Marketing


1,331,105



1,008,385



5,230,355



3,298,087

        Gains (Losses) on Asset Dispositions, Net


79,904



(65,220)



174,562



(99,096)

        Other, Net


(7,144)



16,741



89,635



81,610

               Total


4,574,536



3,340,439



17,275,399



11,208,320

Operating Expenses












        Lease and Well


346,442



281,941



1,282,678



1,044,847

        Transportation Costs


196,095



191,717



746,876



740,352

        Gathering and Processing Costs


112,396



43,295



436,973



148,775

        Exploration Costs


33,862



22,941



148,999



145,342

        Dry Hole Costs


145



4,532



5,405



4,609

        Impairments 


186,087



153,442



347,021



479,240

        Marketing Costs


1,349,416



1,009,566



5,203,243



3,330,237

        Depreciation, Depletion and Amortization


919,963



881,745



3,435,408



3,409,387

        General and Administrative


116,904



117,005



426,969



434,467

        Taxes Other Than Income


190,086



158,343



772,481



544,662

               Total


3,451,396



2,864,527



12,806,053



10,281,918













Operating Income 


1,123,140



475,912



4,469,346



926,402













Other Income, Net


21,220



803



16,704



9,152













Income Before Interest Expense and Income Taxes


1,144,360



476,715



4,486,050



935,554













Interest Expense, Net


56,020



63,362



245,052



274,372













Income Before Income Taxes


1,088,340



413,353



4,240,998



661,182













Income Tax Provision (Benefit)


195,572



(2,017,115)



821,958



(1,921,397)













Net Income 

$

892,768


$

2,430,468


$

3,419,040


$

2,582,579













Dividends Declared per Common Share

$

0.2200


$

0.1675


$

0.8100


$

0.6700



EOG RESOURCES, INC.

Operating Highlights

(Unaudited)














Three Months Ended


Twelve Months Ended


December 31,


December 31,


2018


2017


2018


2017

Wellhead Volumes and Prices




Crude Oil and Condensate Volumes (MBbld) (A)




      United States


430.3



366.9



394.8



335.0

      Trinidad


0.8



1.1



0.8



0.9

      Other International (B)


4.5



0.1



4.3



0.8

            Total


435.6



368.1



399.9



336.7













Average Crude Oil and Condensate Prices ($/Bbl) (C)












      United States

$

59.37


$

56.95


$

65.16


$

50.91

      Trinidad


51.80



46.56



57.26



42.30

      Other International (B)


70.44



45.72



71.45



57.20

            Composite


59.47



56.97



65.21



50.91













Natural Gas Liquids Volumes (MBbld) (A)












      United States


122.8



100.6



116.1



88.4

      Other International (B)


-



-



-



-

            Total


122.8



100.6



116.1



88.4













Average Natural Gas Liquids Prices ($/Bbl) (C)












      United States

$

23.54


$

26.92


$

26.60


$

22.61

      Other International (B)


-



-



-



-

            Composite


23.54



26.92



26.60



22.61













Natural Gas Volumes (MMcfd) (A)












      United States


974



829



923



765

      Trinidad


230



299



266



313

      Other International (B)


32



32



30



25

            Total


1,236



1,160



1,219



1,103













Average Natural Gas Prices ($/Mcf) (C)












      United States

$

3.50


$

2.17


$

2.88


$

2.20

      Trinidad


3.03



2.52



2.94



2.38

      Other International (B)


4.02



4.23



4.08



3.89

            Composite


3.42

(D)


2.31



2.92

(D)


2.29













Crude Oil Equivalent Volumes (MBoed) (E)












      United States 


715.5



605.6



664.7



551.0

      Trinidad


39.0



51.0



45.1



53.0

      Other International (B)


10.0



5.4



9.4



4.9

            Total


764.5



662.0



719.2



608.9













Total MMBoe (E)


70.3



60.9



262.5



222.3


(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, 2018).

(D) Includes positive revenue adjustments of $0.49 per Mcf and $0.44 per Mcf for the three and twelve months ended December 31, 2018, respectively, related to the adoption of ASU 2014-09, "Revenue From Contracts with Customers" (ASU 2014-09).  (see Note 1 to the Consolidated Financial Statements in EOG's Annual Report on Form 10-K for the year ended December 31, 2018).  In connection with the adoption of ASU 2014-09, EOG presents natural gas processing fees for certain processing and marketing agreements as Gathering and Processing Costs, instead of as a deduction to Natural Gas Revenues.

(E) 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,


2018


2017

ASSETS

Current Assets






     Cash and Cash Equivalents

$

1,555,634


$

834,228

     Accounts Receivable, Net


1,915,215



1,597,494

     Inventories


859,359



483,865

     Assets from Price Risk Management Activities


23,806



7,699

     Income Taxes Receivable


427,909



113,357

     Other


275,467



242,465

            Total


5,057,390



3,279,108







Property, Plant and Equipment






     Oil and Gas Properties (Successful Efforts Method)


57,330,016



52,555,741

     Other Property, Plant and Equipment


4,220,665



3,960,759

            Total Property, Plant and Equipment


61,550,681



56,516,500

     Less:  Accumulated Depreciation, Depletion and Amortization


(33,475,162)



(30,851,463)

            Total Property, Plant and Equipment, Net


28,075,519



25,665,037

Deferred Income Taxes


777



17,506

Other Assets


800,788



871,427

Total Assets

$

33,934,474


$

29,833,078







LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities






     Accounts Payable

$

2,239,850


$

1,847,131

     Accrued Taxes Payable


214,726



148,874

     Dividends Payable


126,971



96,410

     Liabilities from Price Risk Management Activities


-



50,429

     Current Portion of Long-Term Debt


913,093



356,235

     Other


233,724



226,463

            Total


3,728,364



2,725,542













Long-Term Debt


5,170,169



6,030,836

Other Liabilities


1,258,355



1,275,213

Deferred Income Taxes


4,413,398



3,518,214

Commitments and Contingencies












Stockholders' Equity






     Common Stock, $0.01 Par, 1,280,000,000 Shares Authorized and 
        580,408,117 Shares and 578,827,768 Shares Issued at December 31, 2018
        and 2017, respectively.


205,804



205,788

     Additional Paid in Capital


5,658,794



5,536,547

     Accumulated Other Comprehensive Loss


(1,358)



(19,297)

     Retained Earnings


13,543,130



10,593,533

     Common Stock Held in Treasury, 385,042 Shares and 350,961 Shares at
        December 31, 2018 and 2017, respectively.


(42,182)



(33,298)

            Total Stockholders' Equity


19,364,188



16,283,273

Total Liabilities and Stockholders' Equity

$

33,934,474


$

29,833,078

 

EOG RESOURCES, INC.

Summary Statements of Cash Flows

(Unaudited; in thousands)








Twelve Months Ended


December 31,


2018


2017

Cash Flows from Operating Activities






Reconciliation of Net Income to Net Cash Provided by Operating Activities:






     Net Income

$

3,419,040


$

2,582,579

     Items Not Requiring (Providing) Cash






            Depreciation, Depletion and Amortization


3,435,408



3,409,387

            Impairments 


347,021



479,240

            Stock-Based Compensation Expenses


155,337



133,849

            Deferred Income Taxes


894,156



(1,473,872)

            (Gains) Losses on Asset Dispositions, Net


(174,562)



99,096

            Other, Net


7,066



6,546

     Dry Hole Costs


5,405



4,609

     Mark-to-Market Commodity Derivative Contracts






            Total (Gains) Losses


165,640



(19,828)

            Net Cash Received from (Payments for) Settlements of Commodity Derivative Contracts 


(258,906)



7,438

     Other, Net


3,108



1,204

     Changes in Components of Working Capital and Other Assets and Liabilities






            Accounts Receivable


(368,180)



(392,131)

            Inventories


(395,408)



(174,548)

            Accounts Payable


439,347



324,192

            Accrued Taxes Payable


(92,461)



(63,937)

            Other Assets


(125,435)



(658,609)

            Other Liabilities


10,949



(89,871)

     Changes in Components of Working Capital Associated with Investing and Financing
        Activities


301,083



89,992

Net Cash Provided by Operating Activities


7,768,608



4,265,336







Investing Cash Flows






     Additions to Oil and Gas Properties


(5,839,294)



(3,950,918)

     Additions to Other Property, Plant and Equipment


(237,181)



(173,324)

     Proceeds from Sales of Assets


227,446



226,768

     Other Investing Activities


(19,993)



-

     Changes in Components of Working Capital Associated with Investing Activities


(301,140)



(89,935)

Net Cash Used in Investing Activities


(6,170,162)



(3,987,409)







Financing Cash Flows






     Long-Term Debt Repayments


(350,000)



(600,000)

     Dividends Paid


(438,045)



(386,531)

     Treasury Stock Purchased


(63,456)



(63,408)

     Proceeds from Stock Options Exercised and Employee Stock Purchase Plan 


20,560



20,840

     Repayment of Capital Lease Obligation


(8,219)



(6,555)

     Changes in Components of Working Capital Associated with Financing Activities


57



(57)

Net Cash Used in Financing Activities


(839,103)



(1,035,711)







Effect of Exchange Rate Changes on Cash


(37,937)



(7,883)







Increase (Decrease) in Cash and Cash Equivalents


721,406



(765,667)

Cash and Cash Equivalents at Beginning of Period


834,228



1,599,895

Cash and Cash Equivalents at End of Period

$

1,555,634


$

834,228

 

EOG RESOURCES, INC.

Fourth Quarter 2018 Well Results by Play

(Unaudited)
















Wells Online




Initial Gross 30-Day Average Production Rate


Gross


Net


Lateral
Length
(ft)


Crude Oil and
Condensate
(Bbld) (A)


Natural Gas
Liquids
(Bbld) (A)


 Natural Gas
(MMcfd) (A)


Crude Oil
Equivalent
(Boed) (B)

Delaware Basin














Wolfcamp

42


37


7,000


1,950


600


3.7


3,150

Bone Spring

13


11


5,300


1,550


300


1.9


2,150

Leonard

2


1


4,600


1,200


550


3.7


2,350















South Texas Eagle Ford

82


78


7,300


1,300


150


0.8


1,600















South Texas Austin Chalk

6


5


5,500


2,650


550


2.6


3,650















Powder River Basin














Turner

4


3


9,700


800


200


2.4


1,400

Mowry

2


2


9,200


700


450


5.5


2,050















DJ Basin Codell

20


10


9,600


700


50


0.3


800















Williston Basin Bakken/Three Forks

7


5


10,100


550


25


0.1


600















Anadarko Basin Woodford Oil Window

5


4


9,200


600


75


0.4


750


(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.

Quantitative Reconciliation of Adjusted Net Income (Non-GAAP)

To Net Income (GAAP)

(Unaudited; in thousands, except per share data)

































The following chart adjusts the three-month and twelve-month periods ended December 31, 2018 and 2017 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) losses on asset dispositions in 2018 and 2017, to add back impairment charges related to certain of EOG's assets in 2018 and 2017, to add back an early lease termination payment as the result of a legal settlement in 2017, to add back the transaction costs for the formation of a joint venture in 2017, to add back certain joint interest billings deemed uncollectible in 2017 and to eliminate certain adjustments in 2018 and 2017 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, 2018


December 31, 2017




















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)

$          1,088,340


$        (195,572)


$            892,768


$          1.54


$          413,353


$       2,017,115


$          2,430,468


$          4.20

Adjustments:
















(Gains) Losses on Mark-to-Market Commodity
     Derivative Contracts

(132,095)


29,096


(102,999)


(0.18)


45,032


(16,142)


28,890


0.05

Net Cash Received from (Payments for)
     Settlements of Commodity Derivative
     Contracts

(78,678)


17,330


(61,348)


(0.11)


2,708


(971)


1,737


-

Add:  Net (Gains) Losses on Asset Dispositions

(79,904)


13,625


(66,279)


(0.11)


65,220


(23,315)


41,905


0.07

Add:  Impairments

131,795


(29,031)


102,764


0.18


100,304


(35,954)


64,350


0.11

Add:  Joint Interest Billings Deemed Uncollectible

-


-


-


-


4,528


(1,623)


2,905


0.01

Less:  Tax Reform Impact

-


(46,684)


(46,684)


(0.08)


-


(2,169,376)


(2,169,376)


(3.75)

Adjustments to Net Income 

(158,882)


(15,664)


(174,546)


(0.30)


217,792


(2,247,381)


(2,029,589)


(3.51)

















Adjusted Net Income (Non-GAAP)

$             929,458


$        (211,236)


$            718,222


$          1.24


$          631,145


$         (230,266)


$             400,879


$          0.69

















Average Number of Common Shares (GAAP)
















       Basic







577,035








575,394

       Diluted







580,288








579,203


















































Twelve Months Ended 


Twelve Months Ended 


December 31, 2018


December 31, 2017




















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)

$          4,240,998


$        (821,958)


$         3,419,040


$          5.89


$          661,182


$       1,921,397


$          2,582,579


$          4.46

Adjustments:
















(Gains) Losses on Mark-to-Market Commodity
     Derivative Contracts

165,640


(36,486)


129,154


0.22


(19,828)


7,107


(12,721)


(0.02)

Net Cash Received from (Payments for)
     Settlements of Commodity Derivative
     Contracts

(258,906)


57,029


(201,877)


(0.35)


7,438


(2,666)


4,772


0.01

Add:  Net (Gains) Losses on Asset Dispositions

(174,562)


37,860


(136,702)


(0.24)


99,096


(35,270)


63,826


0.11

Add:  Impairments

152,671


(33,629)


119,042


0.21


261,452


(93,718)


167,734


0.29

Add:  Legal Settlement - Early Lease Termination

-


-


-


-


10,202


(3,657)


6,545


0.01

Add:  Joint Venture Transaction Costs

-


-


-


-


3,056


(1,095)


1,961


-

Add:  Joint Interest Billings Deemed Uncollectible

-


-


-


-


4,528


(1,623)


2,905


0.01

Less:  Tax Reform Impact

-


(110,335)


(110,335)


(0.19)


-


(2,169,376)


(2,169,376)


(3.75)

Adjustments to Net Income

(115,157)


(85,561)


(200,718)


(0.35)


365,944


(2,300,298)


(1,934,354)


(3.34)

















Adjusted Net Income (Non-GAAP)

$          4,125,841


$        (907,519)


$         3,218,322


$          5.54


$       1,027,126


$         (378,901)


$             648,225


$          1.12

















Average Number of Common Shares (GAAP)
















       Basic







576,578








574,620

       Diluted







580,441








578,693

 

EOG RESOURCES, INC.

Quantitative Reconciliation of Discretionary Cash Flow (Non-GAAP)

To Net Cash Provided by Operating Activities (GAAP)

(Unaudited; in thousands)













Calculation of Free Cash Flow (Non-GAAP)

(Unaudited; in thousands)








The following chart reconciles the three-month and twelve-month periods ended December 31, 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 Receivable (Payable), 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 excluding acquisitions incurred (Non-GAAP) during such period and dividends paid (GAAP) during such period, as is illustrated below for the three months and twelve months ended December 31, 2018.  EOG management uses this information for comparative purposes within the industry.














Three Months Ended


Twelve Months Ended


December 31,


December 31,


2018


2017


2018


2017













Net Cash Provided by Operating Activities (GAAP)

$

2,085,228


$

1,327,548


$

7,768,608


$

4,265,336













Adjustments:












Exploration Costs (excluding Stock-Based Compensation Expenses) 


27,270



16,420



123,986



122,688

Other Non-Current Income Taxes - Net Receivable (Payable)


86,572



(513,404)



148,993



(513,404)

Changes in Components of Working Capital and Other Assets












and Liabilities












Accounts Receivable


(185,349)



366,686



368,180



392,131

Inventories


108,591



156,874



395,408



174,548

Accounts Payable


98,178



(211,298)



(439,347)



(324,192)

Accrued Taxes Payable


55,570



13,970



92,461



63,937

Other Assets


22,101



574,669



125,435



658,609

Other Liabilities


(25,725)



20,647



(10,949)



89,871

Changes in Components of Working Capital Associated with 












Investing and Financing Activities


(205,599)



(210,365)



(301,083)



(89,992)








Discretionary Cash Flow (Non-GAAP)

$

2,066,837


$

1,541,747


$

8,271,692


$

4,839,532













Discretionary Cash Flow (Non-GAAP) - Percentage Increase


34%






71%




























Discretionary Cash Flow (Non-GAAP)

$

2,066,837





$

8,271,692




Less:  












Total Cash Expenditures Excluding Acquisitions (Non-GAAP)(a)


(1,302,999)






(6,172,950)




Dividends Paid (GAAP) 


(126,970)






(438,045)




Free Cash Flow (Non-GAAP)

$

636,868





$

1,660,697




























(a) See below reconciliation of Total Expenditures (GAAP) to Total Cash Expenditures Excluding Acquisitions (Non-GAAP) for the three months and twelve months ended December 31, 2018:













Total Expenditures (GAAP)

$

1,504,438





$

6,706,359




Less:  












          Asset Retirement Costs


(27,910)






(69,699)




          Non-Cash Expenditures of Other Property, Plant and Equipment


(547)






(49,484)




          Non-Cash Acquisition Costs of Unproved Properties


(128,719)






(290,542)




          Acquisition Costs of Proved Properties


(44,263)






(123,684)




Total Cash Expenditures Excluding Acquisitions (Non-GAAP) 

$

1,302,999





$

6,172,950




 

EOG RESOURCES, INC.

Quantitative Reconciliation of Adjusted Earnings Before Interest Expense, Net,

Income Taxes, Depreciation, Depletion and Amortization, Exploration Costs, 

Dry Hole Costs, Impairments and Additional Items (Adjusted EBITDAX)

 (Non-GAAP) to Net Income (GAAP)

(Unaudited; in thousands)













The following chart adjusts the three-month and twelve-month periods ended December 31, 2018 and 2017 reported Net Income (GAAP) to Earnings Before Interest Expense (Net), Income Taxes (Income Tax Provision (Benefit)), 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) losses 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 (Benefit)), 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,


2018


2017


2018


2017













Net Income (GAAP)

$

892,768


$

2,430,468


$

3,419,040


$

2,582,579













Adjustments:












     Interest Expense, Net


56,020



63,362



245,052



274,372

     Income Tax Provision (Benefit)


195,572



(2,017,115)



821,958



(1,921,397)

     Depreciation, Depletion and Amortization


919,963



881,745



3,435,408



3,409,387

     Exploration Costs


33,862



22,941



148,999



145,342

     Dry Hole Costs


145



4,532



5,405



4,609

     Impairments 


186,087



153,442



347,021



479,240

             EBITDAX (Non-GAAP)


2,284,417



1,539,375



8,422,883



4,974,132

     Total (Gains) Losses on MTM Commodity Derivative Contracts  


(132,095)



45,032



165,640



(19,828)

     Net Cash Received from (Payments for) Settlements of Commodity
         Derivative Contracts


(78,678)



2,708



(258,906)



7,438

     (Gains) Losses on Asset Dispositions, Net


(79,904)



65,220



(174,562)



99,096













Adjusted EBITDAX (Non-GAAP)

$

1,993,740


$

1,652,335


$

8,155,055


$

5,060,838













Adjusted EBITDAX (Non-GAAP) - Percentage Increase


21%






61%




 

EOG RESOURCES, INC.

Quantitative Reconciliation of Net Debt (Non-GAAP) and Total

Capitalization (Non-GAAP) as Used in the Calculation of

The Net Debt-to-Total Capitalization Ratio (Non-GAAP) to

Current and Long-Term Debt (GAAP) and Total Capitalization (GAAP)

(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


At


December 31,


December 31,


2018


2017







Total Stockholders' Equity - (a)

$

19,364


$

16,283







Current and Long-Term Debt (GAAP) - (b)


6,083



6,387

Less: Cash 


(1,556)



(834)

Net Debt (Non-GAAP) - (c)


4,527



5,553







Total Capitalization (GAAP) - (a) + (b)

$

25,447


$

22,670







Total Capitalization (Non-GAAP) - (a) + (c)

$

23,891


$

21,836







Debt-to-Total Capitalization (GAAP) - (b) / [(a) + (b)]


24%



28%







Net Debt-to-Total Capitalization (Non-GAAP) - (c) / [(a) + (c)]


19%



25%

 

EOG RESOURCES, INC.

Reserves Supplemental Data

(Unaudited)









2018 NET PROVED RESERVES RECONCILIATION SUMMARY  


 United 




 Other 




 States 


Trinidad


 International 


 Total 

CRUDE OIL AND CONDENSATE (MMBbl)








Beginning Reserves

1,304.1


0.9


8.0


1,313.0

Revisions 

(13.2)


(0.2)


-


(13.4)

Purchases in Place

2.7


-


-


2.7

Extensions, Discoveries and Other Additions

383.0


-


-


383.0

Sales in Place

(0.8)


-


(6.3)


(7.1)

Production 

(144.1)


(0.3)


(1.5)


(145.9)

Ending Reserves

1,531.7


0.4


0.2


1,532.3


NATURAL GAS LIQUIDS (MMBbl)








Beginning Reserves

503.5


-


-


503.5

Revisions 

23.9


-


-


23.9

Purchases in Place

2.0


-


-


2.0

Extensions, Discoveries and Other Additions

127.4


-


-


127.4

Sales in Place

-


-


-


-

Production 

(42.5)


-


-


(42.5)

Ending Reserves

614.3


-


-


614.3


NATURAL GAS (Bcf) 








Beginning Reserves 

3,898.5


313.4


51.2


4,263.1

Revisions 

(127.2)


20.7


15.0


(91.5)

Purchases in Place

41.3


-


-


41.3

Extensions, Discoveries and Other Additions

951.4


-


4.6


956.0

Sales in Place

(22.2)


-


-


(22.2)

Production 

(351.2)


(97.1)


(11.2)


(459.5)

Ending Reserves

4,390.6


237.0


59.6


4,687.2


OIL EQUIVALENTS (MMBoe) 








Beginning Reserves 

2,457.3


53.1


16.6


2,527.0

Revisions 

(10.5)


3.3


2.5


(4.7)

Purchases in Place

11.6


-


-


11.6

Extensions, Discoveries and Other Additions

669.0


-


0.7


669.7

Sales in Place

(4.5)


-


(6.3)


(10.8)

Production 

(245.1)


(16.5)


(3.4)


(265.0)

Ending Reserves

2,877.8


39.9


10.1


2,927.8


Net Proved Developed Reserves (MMBoe) 








At December 31, 2017

1,300.7


50.8


12.8


1,364.3

At December 31, 2018

1,503.4


37.7


7.0


1,548.1


2018 EXPLORATION AND DEVELOPMENT EXPENDITURES ($ Millions) 


 United 




 Other 




 States 


Trinidad


 International 


 Total 


Acquisition Cost of Unproved Properties

$          486.0


$          1.3


$                       -


$          487.3

Exploration Costs

157.2


22.5


13.9


193.6

Development Costs

5,515.4


(0.8)


30.8


5,545.4

Total Drilling

6,158.6


23.0


44.7


6,226.3

Acquisition Cost of Proved Properties

123.7


-


-


123.7

Asset Retirement Costs 

90.0


(12.1)


(8.2)


69.7

Total Exploration and Development Expenditures 

6,372.3


10.9


36.5


6,419.7

Gathering, Processing and Other

286.0


0.4


0.3


286.7

Total Expenditures

6,658.3


11.3


36.8


6,706.4

Proceeds from Sales in Place

(53.3)


-


(174.1)


(227.4)

Net Expenditures

$       6,605.0


$        11.3


$                 (137.3)


$       6,479.0


RESERVE REPLACEMENT COSTS ($ / Boe ) * 








All-in Total, Net of Revisions 

$            8.84


$        6.97


$                  13.97


$            8.85

All-in Total, Excluding Revisions Due to Price

$            9.32


$        6.97


$                  13.97


$            9.33


RESERVE REPLACEMENT *








Drilling Only

273%


0%


21%


253%

All-in Total, Net of Revisions and Dispositions  

272%


20%


-91%


251%

All-in Total, Excluding Revisions Due to Price

257%


20%


-91%


238%

All-in Total, Liquids

281%


-67%


-420%


275%


*   See attached reconciliation schedule for calculation methodology



EOG RESOURCES, INC.

Quantitative Reconciliation of Total Exploration and Development Expenditures (Non-GAAP)

As Used in the Calculation of Reserve Replacement Costs ($ / BOE)

To Total Costs Incurred in Exploration and Development Activities (GAAP)

(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.









For the Twelve Months Ended December 31, 2018









 United 




 Other 




 States 


 Trinidad 


 International 


 Total 


Total Costs Incurred in Exploration and Development Activities (GAAP)

$       6,372.3


$           10.9


$                   36.5


$       6,419.7

Less:  Asset Retirement Costs

(90.0)


12.1


8.2


(69.7)

          Non-Cash Acquisition Costs of Unproved Properties

(290.5)


-


-


(290.5)

           Total Acquisition Costs of Proved Properties

(123.7)


-


-


(123.7)


Total Exploration and Development Expenditures (Non-GAAP) (a) 

$       5,868.1


$           23.0


$                   44.7


$       5,935.8


Total Costs Incurred in Exploration and Development Activities (GAAP)

$       6,372.3


$           10.9


$                   36.5


$       6,419.7

Less:  Asset Retirement Costs

(90.0)


12.1


8.2


(69.7)

          Non-Cash Acquisition Costs of Unproved Properties

(290.5)


-


-


(290.5)

          Non-Cash Acquisition Costs of Proved Properties

(70.9)


-


-


(70.9)


Total Exploration and Development Expenditures (Non-GAAP) (b) 

$       5,920.9


$           23.0


$                   44.7


$       5,988.6









Total Expenditures (GAAP)

$       6,658.3


$           11.3


$                   36.8


$       6,706.4

Less:  Asset Retirement Costs

(90.0)


12.1


8.2


(69.7)

          Non-Cash Acquisition Costs of Unproved Properties

(290.5)


-


-


(290.5)

          Non-Cash Acquisition Costs of Proved Properties

(70.9)


-


-


(70.9)

          Non-Cash Capital - Other Miscellaneous

(49.5)


-


-


(49.5)

Total Cash Expenditures (Non-GAAP) 

$       6,157.4


$           23.4


$                   45.0


$       6,225.8


Net Proved Reserve Additions From All Sources - Oil Equivalents (MMBoe) 








Revisions Due to Price (c)

34.8


-


-


34.8

Revisions Other Than Price

(45.3)


3.3


2.5


(39.5)

Purchases in Place

11.6


-


-


11.6

Extensions, Discoveries and Other Additions (d)

669.0


-


0.7


669.7

Total Proved Reserve Additions (e) 

670.1


3.3


3.2


676.6

Sales in Place

(4.5)


-


(6.3)


(10.8)

Net Proved Reserve Additions From All Sources (f) 

665.6


3.3


(3.1)


665.8


Production (g) 

245.1


16.5


3.4


265.0


RESERVE REPLACEMENT COSTS ($ / Boe)








Total Drilling, Before Revisions (a / d) 

$            8.77


$              -


$                  63.86


$            8.86

All-in Total, Net of Revisions (b / e)  

$            8.84


$           6.97


$                  13.97


$            8.85

All-in Total, Excluding Revisions Due to Price (b / (e - c)) 

$            9.32


$           6.97


$                  13.97


$            9.33


RESERVE REPLACEMENT








Drilling Only (d / g) 

273%


0%


21%


253%

All-in Total, Net of Revisions and Dispositions (f / g) 

272%


20%


-91%


251%

All-in Total, Excluding Revisions Due to Price ((f - c ) / g) 

257%


20%


-91%


238%


Net Proved Reserve Additions From All Sources - Liquids (MMBbl) 








Revisions

10.7


(0.2)


-


10.5

Purchases in Place

4.7


-


-


4.7

Extensions, Discoveries and Other Additions (h)

510.4


-


-


510.4

Total Proved Reserve Additions 

525.8


(0.2)


-


525.6

Sales in Place

(0.8)


-


(6.3)


(7.1)

Net Proved Reserve Additions From All Sources (i) 

525.0


(0.2)


(6.3)


518.5


Production (j)   

186.6


0.3


1.5


188.4


RESERVE REPLACEMENT - LIQUIDS








Drilling Only (h / j) 

274%


0%


0%


271%

All-in Total, Net of Revisions and Dispositions (i / j) 

281%


-67%


-420%


275%


EOG RESOURCES, INC.

Quantitative Reconciliation of Drillbit Exploration and Development Expenditures (Non-GAAP)

As Used in the Calculation of Proved Developed Reserve Replacement Costs ($ / BOE)

To Total Costs Incurred in Exploration and Development Activities (GAAP)

(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, 2018



 Total 

PROVED DEVELOPED RESERVE REPLACEMENT COSTS ($ / Boe)


Total Costs Incurred in Exploration and Development Activities (GAAP)

$       6,419.7

Less:  Asset Retirement Costs

(69.7)

           Acquisition Costs of Unproved Properties

(487.3)

           Acquisition Costs of Proved Properties

(123.7)

Drillbit Exploration and Development Expenditures (Non-GAAP) (j)

$       5,739.0



Total Proved Reserves - Extensions, Discoveries and Other Additions (MMBoe)

669.7

Add:   Conversion of Proved Undeveloped Reserves to Proved Developed

265.7

Less:  Proved Undeveloped Extensions and Discoveries

(490.7)

Proved Developed Reserves - Extensions and Discoveries (MMBoe)

444.7



Total Proved Reserves - Revisions (MMBoe)

(4.7)

Less:  Proved Undeveloped Reserves - Revisions

8.2

          Proved Developed - Revisions Due to Price

(31.8)

Proved Developed Reserves - Revisions Other Than Price (MMBoe)

(28.3)



Proved Developed Reserves - Extensions and Discoveries plus Revisions Other than Price (MMBoe) (k)

416.4



Proved Developed Reserve Replacement Cost Excluding Revisions Due to Price ($ / Boe) (j / k)

$          13.78

 

EOG RESOURCES, INC.

Quantitative Reconciliation of 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 ($ / BOE)

To Total Costs Incurred in Exploration and Development Activities (GAAP)

(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.












2018


2017


2016


2015


2014






Total Costs Incurred in Exploration and Development Activities (GAAP)

$       6,419.7


$       4,439.4


$       6,445.2


$        4,928.3


$       7,904.8

Less:  Asset Retirement Costs

(69.7)


(55.6)


19.9


(53.5)


(195.6)

          Non-Cash Acquisition Costs of Unproved Properties

(290.5)


(255.7)


(3,101.8)


-


-

          Acquisition Costs of Proved Properties

(123.7)


(72.6)


(749.0)


(480.6)


(139.1)

Total Exploration and Development Expenditures for Drilling Only (Non-GAAP) (a) 

$       5,935.8


$       4,055.5


$       2,614.3


$        4,394.2


$       7,570.1











Total Costs Incurred in Exploration and Development Activities (GAAP)

$       6,419.7


$       4,439.4


$       6,445.2


$        4,928.3


$       7,904.8

Less:  Asset Retirement Costs

(69.7)


(55.6)


19.9


(53.5)


(195.6)

          Non-Cash Acquisition Costs of Unproved Properties

(290.5)


(255.7)


(3,101.8)


-


-

          Non-Cash Acquisition Costs of Proved Properties

(70.9)


(26.2)


(732.3)


-


-

Total Exploration and Development Expenditures (Non-GAAP) (b) 

$       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)

34.8


154.0


(100.7)


(573.8)


52.2

Revisions Other Than Price

(39.5)


48.0


252.9


107.2


48.4

Purchases in Place

11.6


2.3


42.3


56.2


14.4

Extensions, Discoveries and Other Additions (d)

669.7


420.8


209.0


245.9


519.2

Total Proved Reserve Additions (e) 

676.6


625.1


403.5


(164.5)


634.2

Sales in Place

(10.8)


(20.7)


(167.6)


(3.5)


(36.3)

Net Proved Reserve Additions From All Sources (f) 

665.8


604.4


235.9


(168.0)


597.9











Production (g) 

265.0


224.4


207.1


211.2


219.1











RESERVE REPLACEMENT COSTS ($ / Boe)










Total Drilling, Before Revisions (a / d) 

$           8.86


$          9.64


$         12.51


$         17.87


$         14.58

All-in Total, Net of Revisions (b / e)  

$           8.85


$          6.56


$           6.52


$        (29.63)


$         12.16

All-in Total, Excluding Revisions Due to Price (b / (e - c)) 

$           9.33


$          8.71


$           5.22


$         11.91


$         13.25

 

EOG RESOURCES, INC.

Crude Oil 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, 2019.  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) 

2018









January 1, 2018 through December 31, 2018 (closed)





15,000


$                 1.063










2019









January 1, 2019 through February 28, 2019 (closed)





20,000


$                 1.075

March 1, 2019 through December 31, 2019 





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, 2019.  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) 

2018









January 1, 2018 through September 30, 2018 (closed)





37,000


$                 3.818

October 1, 2018 through December 31, 2018 (closed)





52,000


3.911










2019









January 1, 2019 through February 28, 2019 (closed) 





13,000


$                 5.572

March 1, 2019 through December 31, 2019 





13,000


5.572



















Presented below is a comprehensive summary of EOG's crude oil price swap contracts through February 19, 2019, with notional volumes expressed in Bbld and prices expressed in $/Bbl.  



















Crude Oil Price Swap Contracts







Weighted







Volume


Average Price







(Bbld) 


($/Bbl) 

2018









January 1, 2018 through November 30, 2018 (closed)





134,000


$                 60.04



















On November 20, 2018, EOG entered into crude oil price swap contracts for the period December 1, 2018 through December 31, 2018, with notional volumes of 134,000 Bbld at an average price of $53.75 per Bbl.  These contracts offset the crude oil price swap contracts for the same time period with notional volumes of 134,000 Bbld at an average price of $60.04 per Bbl.  The net cash EOG received for settling these contracts was $26.1 million.  The offsetting contracts are excluded from the above table.



















Presented below is a comprehensive summary of EOG's natural gas price swap contracts through February 19, 2019, with notional volumes expressed in MMBtud and prices expressed in $/MMBtu.



















Natural Gas Price Swap Contracts









Weighted







Volume


Average Price







(MMBtud)


($/MMBtu)

2018









March 1, 2018 through November 30, 2018 (closed)





35,000


$                   3.00



















EOG has sold call options which establish a ceiling price for the sale of notional volumes of natural gas as specified in the call option contracts.  The call options require that EOG pay the difference between the call option strike price and either the average or last business day 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 call option strike price. 










In addition, EOG has purchased put options which establish a floor price for the sale of notional volumes of natural gas as specified in the put option contracts.  The put options grant EOG the right to receive the difference between the put option strike price and the Henry Hub Index Price in the event the Henry Hub Index Price is below the put option strike price.  Presented below is a comprehensive summary of EOG's natural gas call and put option contracts through February 19, 2019, with notional volumes expressed in MMBtud and prices expressed in $/MMBtu.



















Natural Gas Option Contracts



Call Options Sold


Put Options Purchased





Weighted




Weighted



Volume


Average Price


Volume


Average Price



(MMBtud) 


($/MMBtu) 


(MMBtud)


($/MMBtu)

2018









March 1, 2018 through November 30, 2018 (closed)

120,000


$                   3.38


96,000


$                   2.94



















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.

Quantitative Reconciliation of After-Tax Net Interest Expense (Non-GAAP), Adjusted Net Income (Non-GAAP),

Net Debt (Non-GAAP) and Total Capitalization (Non-GAAP) as used in the Calculations of Return on Capital

Employed (Non-GAAP) and Return on Equity (Non-GAAP) to Net Interest Expense (GAAP), Net Income

(GAAP), Current and Long-Term Debt (GAAP) and Total Capitalization (GAAP), Respectively

(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.











2018


2017




Return on Capital Employed (ROCE) (Non-GAAP)


















Net Interest Expense (GAAP)

$

245







Tax Benefit Imputed (based on 21%) 


(51)







After-Tax Net Interest Expense (Non-GAAP) - (a) 

$

194
















Net Income (GAAP) - (b)                                                   

$

3,419







Adjustments to Net Income, Net of Tax (See Accompanying Schedule)


(201)

(1)






Adjusted Net Income (Non-GAAP) - (c)   

$

3,218
















Total Stockholders' Equity - (d)   

$

19,364


$

16,283













Average Total Stockholders' Equity * - (e)   

$

17,824
















Current and Long-Term Debt (GAAP) - (f) 

$

6,083


$

6,387




Less: Cash                                                       


(1,556)



(834)




Net Debt (Non-GAAP) - (g) 

$

4,527


$

5,553













Total Capitalization (GAAP) - (d) + (f)  

$

25,447


$

22,670













Total Capitalization (Non-GAAP) - (d) + (g) 

$

23,891


$

21,836













Average Total Capitalization (Non-GAAP) * - (h)   

$

22,864
















ROCE (GAAP Net Income) - [(a) + (b)] / (h)       


15.8%
















ROCE (Non-GAAP Adjusted Net Income) - [(a) + (c)] / (h)       


14.9%
















Return on Equity (ROE)


















ROE (GAAP Net Income) - (b) / (e)


19.2%
















ROE (Non-GAAP Adjusted Net Income) - (c) / (e)


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 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.

Quantitative Reconciliation of After-Tax Net Interest Expense (Non-GAAP), Net Debt (Non-GAAP) and Total

Capitalization (Non-GAAP) as used in the Calculation of Return on Capital Employed (Non-GAAP) to Net Interest

Expense (GAAP), Current and Long-Term Debt (GAAP) and Total Capitalization (GAAP), Respectively

(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.

Quantitative Reconciliation of After-Tax Net Interest Expense (Non-GAAP), Net Debt (Non-GAAP) and Total

Capitalization (Non-GAAP) as used in the Calculation of Return on Capital Employed (Non-GAAP) to Net Interest

Expense (GAAP), Current and Long-Term Debt (GAAP) and Total Capitalization (GAAP), Respectively

(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.

Quantitative Reconciliation of After-Tax Net Interest Expense (Non-GAAP), Net Debt (Non-GAAP) and Total

Capitalization (Non-GAAP) as used in the Calculation of Return on Capital Employed (Non-GAAP) to Net Interest

Expense (GAAP), Current and Long-Term Debt (GAAP) and Total Capitalization (GAAP), Respectively

(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.

Quantitative Reconciliation of After-Tax Net Interest Expense (Non-GAAP), Net Debt (Non-GAAP) and Total

Capitalization (Non-GAAP) as used in the Calculation of Return on Capital Employed (Non-GAAP) to Net Interest

Expense (GAAP), Current and Long-Term Debt (GAAP) and Total Capitalization (GAAP), Respectively

(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,



2018


2017


2016


2015


2014













Cash Operating Expenses (GAAP)*












Lease and Well

$         1,282,678


$         1,044,847


$            927,452


$         1,182,282


$         1,416,413


Transportation Costs

746,876


740,352


764,106


849,319


972,176


General and Administrative

426,969


434,467


394,815


366,594


402,010


     Cash Operating Expenses

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)

$         2,456,523


$         2,201,880


$         2,039,219


$         2,378,840


$         2,790,599













Volume - Thousand Barrels of Oil Equivalent - (b)

262,516


222,251


204,929


208,862


217,073













Adjusted Cash Operating Expenses Per Boe (Non-GAAP) - (a) / (b)


$                 9.36

(c)

$                 9.91

(d)

$                 9.95

(e)

$                11.39

(f)

$               12.86

(g)












Adjusted Cash Operating Expenses Per Boe (Non-GAAP) -
   Percentage Decrease












2018 compared to 2017 - [(c) - (d)] / (d)       

-6%










2018 compared to 2016 - [(c) - (e)] / (e)       

-6%










2018 compared to 2015 - [(c) - (f)] / (f)       

-18%










2018 compared to 2014 - [(c) - (g)] / (g)       

-27%





















* 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,




2018


2018


2018


2018













Volume - Thousand Barrels of Oil Equivalent - (a)

59,394


63,898


68,890


70,334













     Crude Oil and Condensate

$    2,101,308


$   2,377,528


$            2,655,278


$         2,383,326



     Natural Gas Liquids

221,415


286,354


353,704


266,037



     Natural Gas

299,766


300,845


311,713


389,213



Total Wellhead Revenues - (b)

$    2,622,489


$   2,964,727


$            3,320,695


$         3,038,576













Operating Costs










     Lease and Well

$      300,064


$      314,604


$               321,568


$            346,442



     Transportation Costs

176,957


177,797


196,027


196,095



     Gathering and Processing Costs

101,345


109,169


114,063


112,396



     General and Administrative

94,698


104,083


111,284


116,904



     Taxes Other Than Income

179,084


194,268


209,043


190,086



     Interest Expense, Net

61,956


63,444


63,632


56,020



Total Cash Operating Cost (excluding
  DD&A and Exploration Costs) - (c)

$      914,104


$      963,365


$            1,015,617


$         1,017,943













     Depreciation, Depletion and Amortization (DD&A)

748,591


848,674


918,180


919,963



Total Operating Cost (excluding Exploration
  Costs) - (d)

$    1,662,695


$   1,812,039


$            1,933,797


$         1,937,906













     Exploration Costs

$        34,836


$        47,478


$                32,823


$              33,862



     Dry Hole Costs

-


4,902


358


145



     Impairments

64,609


51,708


44,617


186,087



     Total Exploration Costs 

99,445


104,088


77,798


220,094



          Less:  Impairments (Non-GAAP)

(20,876)


-


-


(131,795)



     Total Exploration Costs (Non-GAAP)

$        78,569


$      104,088


$                77,798


$              88,299













Total Operating Cost (Non-GAAP) (including Exploration
  Costs) - (e)

$    1,741,264


$   1,916,127


$            2,011,595


$         2,026,205













Composite Average Wellhead Revenue per Boe - (b) / (a)

$          44.15


$         46.40


$                  48.20


$                43.20













Total Cash Operating Cost per Boe 
  (excluding DD&A and Exploration Costs) - (c) / (a)

$          15.39


$         15.07


$                  14.75


$                14.48













Composite Average Margin per Boe (excluding
   DD&A and Exploration Costs) - [(b) / (a) - (c) / (a)]

$          28.76


$         31.33


$                  33.45


$                28.72













Total Operating Cost per Boe (excluding
  Exploration Costs) - (d) / (a)

$          27.99


$         28.35


$                  28.08


$                27.56













Composite Average  Margin per Boe (excluding
   Exploration Costs) - [(b) / (a) - (d) / (a)]

$          16.16


$         18.05


$                  20.12


$                15.64













Total Operating Cost per Boe (Non-GAAP) (including
  Exploration Costs) (e) / (a)

$          29.31


$         29.98


$                  29.21


$                28.82













Composite Average Margin per Boe (Non-GAAP)
  (including Exploration Costs) - [(b) / (a) - (e) / (a)]

$          14.84


$         16.42


$                  18.99


$                14.38























EOG RESOURCES, INC.

Cost per Barrel of Oil Equivalent (Boe)

(Unaudited; in thousands, except per Boe amounts)






















Year Ended


December 31,


2018


2017


2016


2015


2014











Volume - Thousand Barrels of Oil Equivalent - (a)

262,516


222,251


204,929


208,862


217,073











     Crude Oil and Condensate

$    9,517,440


$   6,256,396


$            4,317,341


$         4,934,562


$    9,742,480

     Natural Gas Liquids

1,127,510


729,561


437,250


407,658


934,051

     Natural Gas

1,301,537


921,934


742,152


1,061,038


1,916,386

Total Wellhead Revenues - (b)

$  11,946,487


$   7,907,891


$            5,496,743


$         6,403,258


$  12,592,917











Operating Costs










     Lease and Well

$    1,282,678


$   1,044,847


$               927,452


$         1,182,282


$    1,416,413

     Transportation Costs

746,876


740,352


764,106


849,319


972,176

     Gathering and Processing Costs

436,973


148,775


122,901


146,156


145,800











     General and Administrative

426,969


434,467


394,815


366,594


402,010

          Less:  Voluntary Retirement Expense

-


-


(42,054)


-


-

          Less:  Acquisition Costs

-


-


(5,100)


-


-

          Less:  Legal Settlement - Early Leasehold Termination

-


(10,202)


-


(19,355)


-

          Less:  Joint Venture Transaction Costs

-


(3,056)


-


-


-

          Less:  Joint Interest Billings Deemed Uncollectible

-


(4,528)


-


-


-

     General and Administrative (Non-GAAP)

426,969


416,681


347,661


347,239


402,010











     Taxes Other Than Income

772,481


544,662


349,710


421,744


757,564

     Interest Expense, Net

245,052


274,372


281,681


237,393


201,458

Total Cash Operating Cost (Non-GAAP) (excluding
  DD&A and Exploration Costs) - (c)

$    3,911,029


$   3,169,689


$            2,793,511


$         3,184,133


$    3,895,421











     Depreciation, Depletion and Amortization (DD&A)

3,435,408


3,409,387


3,553,417


3,313,644


3,997,041

Total Operating Cost (Non-GAAP) (excluding Exploration
  Costs) - (d)

$    7,346,437


$   6,579,076


$            6,346,928


$         6,497,777


$    7,892,462











     Exploration Costs

$      148,999


$      145,342


$               124,953


$            149,494


$      184,388

     Dry Hole Costs

5,405


4,609


10,657


14,746


48,490

     Impairments

347,021


479,240


620,267


6,613,546


743,575

     Total Exploration Costs 

501,425


629,191


755,877


6,777,786


976,453

          Less:  Impairments (Non-GAAP)

(152,671)


(261,452)


(320,617)


(6,307,593)


(824,312)

     Total Exploration Costs (Non-GAAP)

$      348,754


$      367,739


$               435,260


$            470,193


$      152,141











Total Operating Cost (Non-GAAP) (including Exploration
  Costs) - (e)

$    7,695,191


$   6,946,815


$            6,782,188


$         6,967,970


$    8,044,603











Composite Average Wellhead Revenue per Boe - (b) / (a)

$          45.51


$         35.58


$                  26.82


$                30.66


$          58.01











Total Cash Operating Cost per Boe (Non-GAAP)
  (excluding DD&A and Exploration Costs) - (c) / (a)

$          14.90


$         14.25


$                  13.64


$                15.25


$          17.95











Composite Average Margin per Boe (Non-GAAP)
   (excluding DD&A and Exploration Costs) - [(b) / (a) - (c) / (a)]

$          30.61


$         21.33


$                  13.18


$                15.41


$          40.06











Total Operating Cost per Boe (Non-GAAP) (excluding
  Exploration Costs) - (d) / (a)

$          27.99


$         29.59


$                  30.98


$                31.11


$          36.38











Composite Average Margin per Boe (Non-GAAP)
   (excluding Exploration Costs) - [(b) / (a) - (d) / (a)]

$          17.52


$           5.99


$                   (4.16)


$                (0.45)


$          21.63











Total Operating Cost per Boe (Non-GAAP) (including
  Exploration Costs) - (e) / (a)

$          29.32


$         31.24


$                  33.10


$                33.36


$          37.08











Composite Average Margin per Boe (Non-GAAP)
  (including Exploration Costs) - [(b) / (a) - (e) / (a)]

$          16.19


$           4.34


$                   (6.28)


$                (2.70)


$          20.93

 

EOG RESOURCES, INC.

First Quarter and Full Year 2019 Forecast and Benchmark Commodity Pricing













     (a)  First Quarter and Full Year 2019 Forecast


The forecast items for the first quarter and full year 2019 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 2019



Full Year 2019

Daily Sales Volumes












     Crude Oil and Condensate Volumes (MBbld)












          United States


426.6

-


434.2



442.6

-


458.2

          Trinidad


0.4

-


0.6



0.4

-


0.6

          Other International


0.0

-


0.2



0.0

-


0.2

               Total


427.0

-


435.0



443.0

-


459.0













     Natural Gas Liquids Volumes (MBbld)












               Total


115.0

-


125.0



120.0

-


140.0













     Natural Gas Volumes (MMcfd)












          United States


950

-


1,000



1,030

-


1,130

          Trinidad


245

-


275



250

-


290

          Other International


30

-


40



30

-


40

               Total


1,225

-


1,315



1,310

-


1,460













     Crude Oil Equivalent Volumes (MBoed)  












          United States


699.9

-


725.9



734.3

-


786.5

          Trinidad


41.2

-


46.4



42.1

-


48.9

          Other International


5.0

-


6.9



5.0

-


6.9

               Total


746.1

-


779.2



781.4

-


842.3

























Capital Expenditures ($MM)

$

1,750

-

$

1,950


$

6,100

-

$

6,500















Estimated Ranges



(Unaudited)


1Q 2019



Full Year 2019

Operating Costs












     Unit Costs ($/Boe)












          Lease and Well

$

4.90

-

$

5.30


$

4.50

-

$

5.30

          Transportation Costs

$

2.50

-

$

3.00


$

2.60

-

$

3.10

          Depreciation, Depletion and Amortization

$

12.50

-

$

13.00


$

12.25

-

$

13.25













Expenses ($MM)












     Exploration and Dry Hole

$

35

-

$

45


$

155

-

$

195

     Impairment

$

55

-

$

65


$

190

-

$

230

     General and Administrative

$

110

-

$

120


$

450

-

$

490

     Gathering and Processing 

$

100

-

$

110


$

440

-

$

480

     Capitalized Interest

$

6

-

$

8


$

25

-

$

30

     Net Interest

$

54

-

$

56


$

190

-

$

200













Taxes Other Than Income (% of Wellhead Revenue)


7.2%

-


7.6%



7.2%

-


7.6%













Income Taxes












     Effective Rate 


20%

-


25%



20%

-


25%

     Current Tax (Benefit) / Expense ($MM)

$

(55)

-

$

(15)


$

(190)

-

$

(110)













Pricing - (Refer toBenchmark Commodity Pricingin text)












     Crude Oil and Condensate ($/Bbl)












          Differentials












               United States - above (below) WTI

$

0.25

-

$

1.25


$

(1.00)

-

$

1.00

               Trinidad - above (below) WTI

$

(11.00)

-

$

(9.00)


$

(11.00)

-

$

(9.00)

               Other International - above (below) WTI

$

5.00

-

$

9.00


$

(1.00)

-

$

1.00













     Natural Gas Liquids












          Realizations as % of WTI


37%

-


43%



37%

-


43%













     Natural Gas ($/Mcf)












          Differentials












               United States - above (below) NYMEX Henry Hub

$

(0.40)

-

$

0.00


$

(0.50)

-

$

0.10













          Realizations












               Trinidad

$

2.50

-

$

2.90


$

2.50

-

$

3.20

               Other International

$

4.30

-

$

4.80


$

4.00

-

$

5.00













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












 

Cision View original content:http://www.prnewswire.com/news-releases/eog-resources-reports-fourth-quarter-and-full-year-2018-results-and-announces-2019-capital-program-300802665.html

SOURCE EOG Resources, Inc.