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EOG Resources Reports First Quarter 2002 Results
PRNewswire-FirstCall
HOUSTON

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FOR IMMEDIATE RELEASE: Monday, April 29, 2002

EOG Resources, Inc. (EOG) today reported a first quarter 2002 net loss available to common of $27.0 million, or $0.23 per share. This compares to first quarter 2001 net income available to common of $212.5 million, or $1.79 per share.

The results for first quarter 2002 include, as previously disclosed, a $34.3 million ($22.0 million after tax, or $0.19 per share) loss on mark-to-market commodity price transactions primarily relating to second quarter settlement months. During the first quarter, cash realized from commodity price swaps was $11.0 million ($7.1 million after tax, or $0.06 per share). Adjusting for these items to be consistent with some analysts' practice of matching realizations to settlement months, net income available to common for the first quarter 2002 was $2.1 million, or $0.02 per share. EOG has financial price swaps in place for 100,000 million British thermal units a day (MMBtud) of natural gas at an average price of $3.26 per MMBtu and 2,000 barrels of oil per day at $21.50 per barrel for the second half of 2002 and is unhedged for 2003 and beyond.

"EOG's first quarter results are in line with our expectations and our consistent strategy. Our game plan for 2002 was to protect against lower natural gas prices in the first part of the year and increase our natural gas production later in the year in conformance with our expectation of strengthening of gas prices," said Mark Papa, Chairman and Chief Executive Officer. "The turnaround came faster than we had originally anticipated with gas prices firming late in the first quarter. EOG's strategy continues to be concentrating on the successful execution and rate of return of our drilling program while maintaining a strong financial position. This strategy should enable us to deliver an increased production profile as we enter 2003 at the very time that we expect total industry U.S. natural gas production to be in continuing decline."

During the quarter, EOG recorded solid drilling results that should position the company favorably for the latter part of the year and 2003 with an increased sequential quarterly production profile in 2002. In South Texas, natural gas production from EOG's successful Dinn Ranch exploration discovery in the deep Wilcox trend will continue to escalate through year-end as new wells are added and production facility constraints are alleviated. In western Canada, natural gas production is expected to continue to increase through year-end from the shallow gas drilling program, where EOG plans to drill approximately 1,000 wells in 2002. In the West Texas horizontal Devonian play, first quarter drilling focused on the optimization of drilling mechanics to facilitate the addition of drilling rigs and ultimately increase gas production.

EOG has had several successful developments in its Trinidad division this year. In the first quarter, EOG made a significant exploration discovery in the Parula prospect on the SECC block. Drilled to 17,960 feet, new reserves from the Parula prospect will position EOG to seek new gas markets. Additionally, EOG signed its second ammonia plant in Trinidad, Nitro 2000, that should begin to take gas from EOG's U(a) block early in 2005. EOG also added a new exploration block off the southeast coast of Trinidad with the signing of the Lower Reverse "L" contract.

EOG's first quarter conference call will be available via live audio webcast at 9:00 a.m. Central Time (10:00 a.m. Eastern Time) on Tuesday, April 30, 2002. To listen to this webcast, log on to http://www.eogresources.com/ . The webcast will be archived on EOG's website, http://www.eogresources.com/ , until May 14, 2002.

EOG Resources, Inc. is one of the largest independent (non-integrated) oil and gas companies in the United States and is the operator of substantial proved reserves in the U.S., Canada and offshore Trinidad. EOG Resources, Inc. is listed on the New York Stock Exchange and is traded under the ticker symbol "EOG".

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are not guarantees of performance. Although EOG believes its expectations reflected in forward- looking statements are based on reasonable assumptions, no assurance can be given that these expectations will be achieved. Important factors that could cause actual results to differ materially from the expectations reflected in the forward-looking statements include, among others: the timing and extent of changes in commodity prices for crude oil, natural gas and related products and interest rates; the extent and effect of any hedging activities engaged in by EOG; the extent of EOG's success in discovering, developing, marketing and producing reserves and in acquiring oil and gas properties; the accuracy of reserve estimates, which by their nature involve the exercise of professional judgment and may therefore be imprecise; political developments around the world, including terrorist activities and responses to terrorist activities; and financial market conditions. In light of these risks, uncertainties and assumptions, the events anticipated by EOG's forward-looking statements might not occur. EOG undertakes no obligations to update or revise its forward- looking statements, whether as a result of new information, future events or otherwise.

                           EOG RESOURCES, INC.
                             FINANCIAL REPORT
                (Unaudited; in millions except per share)

                                                          Quarter
                                                       Ended March 31
                                                   2002              2001
  Net Operating Revenues                          $186.5            $597.3
  Net Income (Loss) Available to Common           $(27.0)           $212.5
  Net Income (Loss) Per Share Available to Common
    Basic                                         $(0.23)           $ 1.83
    Diluted                                       $(0.23)           $ 1.79
  Average Number of Shares Outstanding
    Basic                                          115.5             116.4
    Diluted                                        115.5             119.0


                         SUMMARY INCOME STATEMENT
                        (Unaudited; in thousands)

                                                          Quarter
                                                       Ended March 31
                                                   2002              2001

  Net Operating Revenues
    Natural Gas                                 $176,584          $521,477
    Crude Oil, Condensate and Natural
     Gas Liquids                                  46,775            75,194
    Losses on Mark-to-market Commodity
     Derivative Contracts                        (34,295)             (565)
    Gains (Losses) on Sales of Reserves
     and Related Assets and Other, Net            (2,561)            1,147
         Total                                   186,503           597,253
  Operating Expenses
    Lease and Well                                40,591            42,574
    Exploration Costs                             12,936            20,265
    Dry Hole Costs                                10,406            15,684
    Impairments                                   12,063            15,764
    Depreciation, Depletion and
     Amortization                                 94,460            93,961
    General and Administrative                    20,713            17,949
    Taxes Other Than Income                       16,040            37,032
         Total                                   207,209           243,229
  Operating Income (Loss)                        (20,706)          354,024

  Other Expense, Net                              (3,103)             (639)

  Income (Loss) Before Interest Expense
   and Income Taxes                              (23,809)          353,385

  Interest Expense, Net                           12,051            13,289

  Income (Loss) Before Income Taxes              (35,860)          340,096

  Income Tax Provision (Benefit)                 (11,619)          124,849

  Net Income (Loss)                              (24,241)          215,247

  Preferred Stock Dividends                        2,758             2,721

  Net Income (Loss) Available to Common         $(26,999)         $212,526


                           EOG RESOURCES, INC.
                           OPERATING HIGHLIGHTS
                               (Unaudited)

                                                            Quarter
                                                         Ended March 31
                                                    2002               2001
  Wellhead Volumes and Prices
  Natural Gas Volumes (MMcf/d)
     United States                                   635                704
     Canada                                          145                117
       North America                                 780                821
     Trinidad                                        108                120
       Total                                         888                941

  Average Natural Gas Prices ($/Mcf)
     United States                               $  2.25            $  6.97
     Canada                                         2.29               6.60
       North America Composite                      2.26               6.91
     Trinidad                                       1.27               1.22
       Composite                                    2.14               6.19

  Crude Oil/Condensate Volumes (MBD)
     United States                                  20.0               23.0
     Canada                                          1.8                1.7
       North America                                21.8               24.7
     Trinidad                                        1.9                2.2
       Total                                        23.7               26.9

  Average Crude Oil/Condensate Prices ($/Bbl)
     United States                               $ 20.07            $ 28.09
     Canada                                        19.10              25.25
       North America Composite                     19.99              27.89
     Trinidad                                      17.68              28.84
       Composite                                   19.80              27.97

  Natural Gas Liquids Volumes (MBD)
     United States                                   3.9                3.0
     Canada                                          0.7                0.5
       Total                                         4.6                3.5

  Average Natural Gas Liquids Prices ($/Bbl)
     United States                               $ 11.30            $ 23.95
     Canada                                         8.48              23.46
       Composite                                   10.84              23.88

  Natural Gas Equivalent Volumes (MMcfe/d)
     United States                                   778                860
     Canada                                          161                131
       North America                                 939                991
     Trinidad                                        119                132
       Total                                       1,058              1,123

  Total Bcfe Deliveries                             95.2              101.1


                           EOG RESOURCES, INC.
                    SUPPLEMENTAL FINANCIAL INFORMATION
               DISCRETIONARY CASH FLOW AVAILABLE TO COMMON
                        (Unaudited; in thousands)

                                                          Quarter
                                                       Ended March 31
                                                   2002              2001
  Net Income (Loss) Available to Common         $(26,999)         $212,526
  Items Not Requiring Cash
     Depreciation, Depletion, and
      Amortization                                94,460            93,961
     Impairments                                  12,063            15,764
     Deferred Income Taxes                        (9,844)           34,452
     Other, Net                                    4,129             5,497
  Exploration Expenses                            12,936            20,265
  Dry Hole Expense                                10,406            15,684
  Mark-to-market Commodity Derivative
   Contracts
     Total Losses                                 34,295               565
     Realized Gains (Losses)                      11,014              (243)
  Other, Net                                       1,754             2,007
     Total Discretionary Cash Flow
      Available to Common                       $144,214          $400,478


                           EOG RESOURCES, INC.
                          Summary Balance Sheets
                        (Unaudited; in thousands)

                                                 March 31,      December 31,
                                                   2002             2001
                            ASSETS

   Current Assets
     Cash and Cash Equivalents                $    5,403        $    2,512
     Accounts Receivable                         185,518           194,624
     Inventories                                  18,302            18,871
     Assets from Price Risk Management
      Activities                                     ---            19,161
     Other                                        56,995            37,253
           Total                                 266,218           272,421

   Oil and Gas Properties
    (Successful Efforts Method)                6,223,989         6,065,603
     Less: Accumulated Depreciation,
      Depletion, and Amortization             (3,098,899)       (3,009,693)
           Net Oil and Gas Properties          3,125,090         3,055,910

   Other Assets                                   88,215            85,713

   Total Assets                               $3,479,523        $3,414,044


       LIABILITIES AND SHAREHOLDERS' EQUITY

   Current Liabilities
     Accounts Payable                         $  166,958        $  219,561
     Accrued Taxes Payable                        28,983            40,219
     Dividends Payable                             5,058             5,045
     Liabilities from Price Risk
      Management Activities                       25,933               ---
     Other                                        34,708            46,022
            Total                                261,640           310,847

   Long-Term Debt                                975,662           855,969

   Other Liabilities                              53,760            53,522

   Deferred Income Taxes                         563,347           551,020

   Shareholders' Equity
     Preferred Stock                             147,686           147,582
     Common Stock                                201,247           201,247
     Retained Earnings                         1,636,121         1,668,708
     Common Stock Held in Treasury              (287,398)         (304,780)
     Other                                       (72,542)          (70,071)
            Total                              1,625,114         1,642,686
   Total Liabilities and Shareholders'
    Equity                                    $3,479,523        $3,414,044

 

 
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