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EOG Resources Announces Second Quarter 2008 Results and Increases Dividend
- United States Crude Oil and Condensate Production Increased By 51 Percent Year-Over-Year
- On Track to Deliver 15 Percent Total Company Organic Production Growth for 2008
- Common Stock Dividend Increased by 12.5 Percent
- James C. Day Appointed to Board of Directors
PRNewswire-FirstCall
HOUSTON

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FOR IMMEDIATE RELEASE: Tuesday, July 29, 2008

HOUSTON - EOG Resources, Inc. (EOG) today reported second quarter 2008 net income available to common stockholders of $178.2 million, or $0.71 per share. This compares to second quarter 2007 net income available to common stockholders of $306.1 million, or $1.24 per share.

The results for the second quarter 2008 included a previously disclosed $842.8 million ($542.4 million after tax, or $2.16 per share) loss on the mark-to-market of financial commodity transactions. During the quarter, the cash outflow related to financial commodity contracts was $138.1 million ($88.9 million after tax, or $0.35 per share). Consistent with some analysts' practice of matching realizations to settlement months, adjusted non-GAAP net income available to common stockholders for the quarter was $631.7 million, or $2.52 per share. Adjusted non-GAAP net income available to common stockholders for the second quarter 2007 was $289.7 million, or $1.17 per share. (Please refer to the attached tables for the reconciliation of adjusted non-GAAP net income available to common stockholders to GAAP net income available to common stockholders.)

Operational Highlights

Driven by strong well results from the North Dakota Bakken and Mid Continent operating areas, EOG's United States crude oil and condensate production increased 51 percent versus the second quarter 2007. Total company crude oil and condensate production increased 38 percent over the same period. In the North Dakota Bakken, where EOG is operating an eight rig program, among its most prolific wells drilled during the quarter in the Parshall Field were the Austin #5-14H, #24-33H and #9-11H. The wells started production in June, posting peak rates of 3,744, 1,880 and 3,225 barrels of oil per day, gross respectively. EOG holds a 91 percent, 75 percent and 57 percent working interest, respectively, in the wells.

In the Fort Worth Barnett Shale Play, which continues to be one of the key drivers of EOG's United States natural gas production growth, the company recorded strong drilling results from northeastern Johnson County. Further reflecting EOG's application of completion technology and improved recovery rates, the Martin #1H, #2H, #3H, #4H and #5H started production in June at rates ranging from 6.1 to 9.2 million cubic feet per day of natural gas, gross. EOG has a 48 percent working interest in the wells.

Recently, EOG commenced sales from its first two natural gas shale wells in British Columbia's Horn River Basin. EOG plans to monitor the production profile of these and an additional five wells that are scheduled to be completed by year-end before assessing per well reserves.

"EOG's consistent strategy of organic production growth has again positioned our company as an industry leader in ROCE, low unit costs, debt adjusted production per share growth and low net debt," said Mark G. Papa, Chairman and Chief Executive Officer. "With the robust growth from our core areas, EOG remains on track to achieve 15 percent total company organic production growth in 2008."

Dividend Increased

Following a 33 percent increase in the common stock dividend in February, EOG's Board of Directors increased the cash dividend on the common stock for the second time in 2008. Effective with the dividend payable on October 31, 2008 to holders of record as of October 17, 2008, the quarterly dividend on the common stock will be $0.135 per share. The indicated annual rate of $0.54 reflects a 12.5 percent increase from the previously stated rate, the ninth increase in nine years.

Capital Structure

At June 30, 2008, EOG's total debt outstanding was $1,147 million for a debt-to-total capitalization ratio of 13 percent. Taking into account cash on the balance sheet of $108 million, at the end of the second quarter EOG's net debt was $1,039 million. At the end of the second quarter, the net debt-to-total capitalization ratio was 12 percent, down from 14 percent at year-end 2007. (Please refer to the attached tables for the reconciliation of net debt (non-GAAP) to long-term debt (GAAP) and the reconciliation of net debt-to-total capitalization ratio (non-GAAP) to debt-to-total capitalization ratio (GAAP).)

"EOG's strong results for the first six months of the year have provided us with the opportunity to further strengthen our balance sheet and increase the common stock dividend. Based on current NYMEX price projections, we expect to further reduce our net debt by year-end," said Papa.

Appointment of New Board Member

EOG announced the appointment of James C. Day to its Board of Directors. Mr. Day is the retired Chairman of the Board and Chief Executive Officer of Noble Corporation, one of the world's largest offshore drilling companies. Mr. Day also serves on the Board of Directors of Tidewater Inc. and ONEOK, Inc. and as a Trustee of The Samuel Roberts Noble Foundation. He has held numerous leadership positions with various industry and civic associations throughout his career.

"We are pleased to have an industry leader such as Jim join our board. His experience in the industry will certainly be an asset to EOG," said Papa.

Conference Call Scheduled for July 30, 2008

EOG's second quarter 2008 results conference call will be available via live audio webcast at 8 a.m. Central Daylight Time (9 a.m. Eastern Daylight Time) on Wednesday, July 30, 2008. To listen, log on to http://www.eogresources.com/. The webcast will be archived on EOG's website through Wednesday, August 13, 2008.

EOG Resources, Inc. is one of the largest independent (non-integrated) oil and natural gas companies in the United States with proved reserves in the United States, Canada, Trinidad, the United Kingdom North Sea and China. 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, 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 regarding EOG's future financial position, business strategy, budgets, reserve information, projected levels of production, projected costs and plans and objectives of management for future operations, are forward-looking statements. EOG typically uses words such as "expect," "anticipate," "estimate," "strategy," "intend," "plan," "target" 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 future operating results, the ability to replace or increase reserves or to increase production, or the ability to generate income or cash flows are forward-looking statements. Forward-looking statements are not guarantees of performance. Although EOG believes the expectations reflected in its 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 EOG's forward-looking statements include, among others:

  -- the timing and extent of changes in commodity prices for crude oil,
     natural gas and related products, foreign currency exchange rates,
     interest rates and financial market conditions;
  -- the extent and effect of any hedging activities engaged in by EOG;
  -- the timing and impact of liquefied natural gas imports;
  -- changes in demand or prices for ammonia or methanol;
  -- 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;
  -- the ability to achieve production levels from existing and future oil
     and gas development projects due to operating hazards, drilling risks
     and the inherent uncertainties in predicting oil and gas reservoir
     performance;
  -- the availability and cost of drilling rigs, experienced drilling crews,
     tubular steel and other materials, equipment and services used in
     drilling and well completions;
  -- the availability, terms and timing of mineral licenses and leases and
     governmental and other permits and rights of way;
  -- access to surface locations for drilling and production facilities;
  -- the availability and capacity of gathering, processing and pipeline
     transportation facilities;
  -- the availability of compression uplift capacity;
  -- the extent to which EOG can economically develop its Barnett Shale
     acreage outside of Johnson County, Texas;
  -- whether EOG is successful in its efforts to more densely develop its
     acreage in the Barnett Shale and other production areas;
  -- political developments around the world and the enactment of new
     government policies, legislation and regulations, including
     environmental regulations;
  -- acts of war and terrorism and responses to these acts; and
  -- weather, including weather-related delays in the installation of
     gathering and production facilities.


In light of these risks, uncertainties and assumptions, the events anticipated by EOG's forward-looking statements may not occur. EOG's forward-looking statements speak only as of the date made and EOG undertakes no obligation to update or revise its forward-looking statements, whether as a result of new information, future events or otherwise.

The United States Securities and Exchange Commission (SEC) permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. As noted above, statements of proved reserves are only estimates and may be imprecise. Any reserve estimates provided in this press release that are not specifically designated as being estimates of proved reserves may include not only proved reserves, but also other categories of reserves that the SEC's guidelines strictly prohibit EOG from including in filings with the SEC. Investors are urged to consider closely the disclosure in EOG's Annual Report on Form 10-K for fiscal year ended December 31, 2007, 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 http://www.sec.gov/.

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

                                      Quarter               Six Months
                                   Ended June 30,          Ended June 30,
                                  2008        2007        2008        2007
  Net Operating Revenues       $1,032.5    $1,068.5    $2,133.5    $1,939.7
  Net Income Available to
   Common Stockholders           $178.2      $306.1      $418.7      $522.9
  Net Income Per Share
   Available to Common
   Stockholders
    Basic                         $0.72       $1.26       $1.70       $2.15
    Diluted                       $0.71       $1.24       $1.67       $2.12
  Average Number of Shares
   Outstanding
    Basic                         246.5       243.2       246.0       243.0
    Diluted                       251.1       247.3       250.6       247.0



                        SUMMARY INCOME STATEMENTS
                        (Unaudited; in thousands)

                                Quarter                   Six Months
                             Ended June 30,              Ended June 30,
                           2008         2007          2008          2007
  Net Operating Revenues
    Natural Gas         $1,340,557     $785,837    $2,378,195    $1,516,298
    Crude Oil,
     Condensate and
     Natural Gas Liquids   524,793      218,696       919,641       393,560
    (Losses) Gains on
     Mark-to-Market
     Commodity Derivative
     Contracts            (842,822)      44,103    (1,312,666)        4,302
    Other, Net               9,998       19,851       148,329        25,564
      Total              1,032,526    1,068,487     2,133,499     1,939,724
  Operating Expenses
    Lease and Well         138,871      123,188       271,337       227,513
    Transportation Costs    63,102       36,971       125,069        69,538
    Exploration Costs       59,511       41,216       107,454        67,600
    Dry Hole Costs           6,785       11,816        15,213        28,626
    Impairments             48,875       20,804        81,449        44,846
    Depreciation,
     Depletion and
     Amortization          315,294      259,780       612,493       504,122
    General and
     Administrative         61,640       47,183       114,566        91,062
    Taxes Other Than
     Income                 95,345       62,047       182,095       102,695
      Total                789,423      603,005     1,509,676     1,136,002

  Operating Income         243,103      465,482       623,823       803,722

  Other Income, Net         13,309       11,205        14,892        15,924

  Income Before
   Interest Expense
   and Income Taxes        256,412      476,687       638,715       819,646

  Interest Expense, Net      9,029       10,818        21,220        18,456

  Income Before
   Income Taxes            247,383      465,869       617,495       801,190

  Income Tax
   Provision                69,177      158,816       198,333       276,470

  Net Income               178,206      307,053       419,162       524,720

  Preferred Stock
   Dividends                     -          990           443         1,865

  Net Income
   Available to
   Common Stockholders    $178,206     $306,063      $418,719      $522,855



                           EOG RESOURCES, INC.
                           OPERATING HIGHLIGHTS
                               (Unaudited)

                                            Quarter            Six Months
                                         Ended June 30,      Ended June 30,
                                        2008       2007      2008      2007
  Wellhead Volumes and Prices

  Natural Gas Volumes (MMcfd) (A)
     United States                      1,139       960      1,112      938
     Canada                               215       232        215      227
     Trinidad                             217       250        224      251
     United Kingdom                        12        22         15       26
       Total                            1,583     1,464      1,566    1,442

  Average Natural Gas Prices
   ($/Mcf) (B)
     United States                     $10.36     $6.74      $9.23    $6.55
     Canada                              9.42      6.70       8.42     6.57
     Trinidad                            3.64      2.04       3.76     2.42
     United Kingdom                      9.95      4.35       9.89     5.04
       Composite                         9.31      5.90       8.34     5.81

  Crude Oil and Condensate Volumes
   (MBbld) (A)
     United States                       35.4      23.4       33.0     22.6
     Canada                               2.6       2.4        2.5      2.5
     Trinidad                             3.2       4.0        3.4      4.2
     United Kingdom                         -       0.1          -      0.1
       Total                             41.2      29.9       38.9     29.4

  Average Crude Oil and Condensate
   Prices ($/Bbl) (B)
     United States                    $117.60    $61.38    $105.78   $57.75
     Canada                            112.55     60.08     101.41    55.88
     Trinidad                          113.29     75.16      99.92    67.32
     United Kingdom                    114.40     68.82      96.84    59.61
       Composite                       116.94     63.15     104.97    58.96

  Natural Gas Liquids Volumes
   (MBbld) (A)
     United States                       14.2      10.4       15.5     10.0
     Canada                               0.9       1.1        0.9      1.1
       Total                             15.1      11.5       16.4     11.1

  Average Natural Gas Liquids
   Prices ($/Bbl) (B)
     United States                     $63.62    $45.35     $60.19   $41.40
     Canada                             66.39     42.30      61.52    39.39
       Composite                        63.78     45.04      60.26    41.20

  Natural Gas Equivalent Volumes
   (MMcfed) ©
     United States                      1,437     1,163      1,403    1,134
     Canada                               236       253        236      248
     Trinidad                             236       274        244      276
     United Kingdom                        12        23         15       27
       Total                            1,921     1,713      1,898    1,685

  Total Bcfe ©                        174.8     155.8      345.4    305.0

   (A) Million cubic feet per day or thousand barrels per day, as
       applicable.
   (B) Dollars per thousand cubic feet or per barrel, as applicable.
   © Million cubic feet equivalent per day or billion cubic feet
       equivalent, as applicable; includes natural gas, crude oil,
       condensate and natural gas liquids.  Natural gas equivalents are
       determined using the ratio of 6.0 thousand cubic feet of natural gas
       to 1.0 barrel of crude oil, condensate or natural gas liquids.



                           EOG RESOURCES, INC.
                          SUMMARY BALANCE SHEETS
               (Unaudited; in thousands, except share data)

                                                June 30,        December 31,
                                                  2008              2007
                                     ASSETS
  Current Assets
    Cash and Cash Equivalents                    $108,101           $54,231
    Accounts Receivable, Net                    1,228,560           835,670
    Inventories                                   109,971           102,322
    Assets from Price Risk Management
     Activities                                         -           100,912
    Income Taxes Receivable                       239,442           110,370
    Deferred Income Taxes                         347,928            33,533
    Other                                          54,095            55,001
         Total                                  2,088,097         1,292,039

  Property, Plant and Equipment
    Oil and Gas Properties (Successful
     Efforts Method)                           18,929,852        16,981,836
    Other Property, Plant and Equipment           776,864           581,402
                                               19,706,716        17,563,238
    Less:  Accumulated Depreciation,
     Depletion and Amortization                (7,717,996)       (7,133,984)
         Total Property, Plant and
          Equipment, Net                       11,988,720        10,429,254
  Long-Term Assets Held for Sale                        -           254,376
  Other Assets                                    147,950           113,238
  Total Assets                                $14,224,767       $12,088,907

                   LIABILITIES AND STOCKHOLDERS' EQUITY
  Current Liabilities
    Accounts Payable                           $1,379,602        $1,152,140
    Accrued Taxes Payable                         137,589           104,647
    Dividends Payable                              29,607            22,045
    Liabilities from Price Risk
     Management Activities                        762,560             3,404
    Deferred Income Taxes                          61,048           108,980
    Other                                          74,634            82,954
         Total                                  2,445,040         1,474,170


  Long-Term Debt                                1,147,000         1,185,000
  Other Liabilities                               661,417           368,336
  Deferred Income Taxes                         2,545,139         2,071,307

  Stockholders' Equity
    Preferred Stock, $0.01 Par,
     10,000,000 Shares Authorized:
      Series B, Cumulative, $1,000
      Liquidation Preference per Share,
      5,000 Shares Outstanding at
      December 31, 2007                                 -             4,977
    Common Stock, $0.01 Par, 640,000,000
     Shares Authorized:
      249,470,617 Shares Issued at
      June 30, 2008 and 249,460,000
      Shares Issued at December 31, 2007          202,495           202,495
    Additional Paid In Capital                    321,026           221,102
    Accumulated Other Comprehensive Income        403,195           466,702
    Retained Earnings                           6,515,795         6,156,721
    Common Stock Held in Treasury,
     678,033 Shares at June 30, 2008
     and 2,935,313 Shares at
     December 31, 2007                            (16,340)          (61,903)
            Total Stockholders' Equity          7,426,171         6,990,094
  Total Liabilities and Stockholders'
   Equity                                     $14,224,767       $12,088,907



                           EOG RESOURCES, INC.
                     SUMMARY STATEMENTS OF CASH FLOWS
                        (Unaudited; in thousands)

                                                         Six Months
                                                       Ended June 30,
                                                  2008               2007
  Cash Flows from Operating Activities
  Reconciliation of Net Income to Net
   Cash Provided by Operating Activities:
    Net Income                                   $419,162          $524,720
    Items Not Requiring (Providing) Cash
      Depreciation, Depletion and Amortization    612,493           504,122
      Impairments                                  81,449            44,846
      Stock-Based Compensation Expenses            44,566            29,542
      Deferred Income Taxes                       123,330           223,591
      Other, Net                                 (127,693)          (24,091)
    Dry Hole Costs                                 15,213            28,626
    Mark-to-Market Commodity Derivative
     Contracts
      Total Losses (Gains)                      1,312,666            (4,302)
      Realized (Losses) Gains                    (114,859)           65,880
    Other, Net                                      9,077            15,228
    Changes in Components of Working Capital
     and Other Assets and Liabilities
      Accounts Receivable                        (395,526)           20,734
      Inventories                                  (9,176)           (2,476)
      Accounts Payable                            255,495            14,651
      Accrued Taxes Payable                       (92,738)           26,191
      Other Assets                                (61,623)           (4,683)
      Other Liabilities                            (8,440)          (15,492)
    Changes in Components of Working Capital
     Associated with Investing and Financing
     Activities                                      (775)          (20,471)
  Net Cash Provided by Operating Activities     2,062,621         1,426,616

  Investing Cash Flows
    Additions to Oil and Gas Properties        (2,144,769)       (1,621,542)
    Additions to Other Property, Plant
     and Equipment                               (196,353)         (157,515)
    Proceeds from Sales of Assets                 354,413            37,988
    Changes in Components of Working Capital
     Associated with Investing Activities             648            20,412
    Other, Net                                    (20,429)           (1,540)
  Net Cash Used in Investing Activities        (2,006,490)       (1,722,197)

  Financing Cash Flows
    Net Commercial Paper Borrowings                     -           170,400
    Long-Term Debt Borrowings                           -            10,000
    Long-Term Debt Repayments                     (38,000)          (30,000)
    Dividends Paid                                (51,647)          (38,370)
    Redemption of Preferred Stock                  (5,395)                -
    Excess Tax Benefits from Stock-Based
     Compensation                                  55,552            11,122
    Treasury Stock Purchased                       (6,865)           (4,928)
    Proceeds from Stock Options Exercised
     and Employee Stock Purchase Plan              48,509            14,089
    Other, Net                                        127              (194)
  Net Cash Provided by Financing Activities         2,281           132,119

  Effect of Exchange Rate Changes on Cash          (4,542)            3,741

  Increase (Decrease) in Cash and Cash
   Equivalents                                     53,870          (159,721)
  Cash and Cash Equivalents at
   Beginning of Period                             54,231           218,255
  Cash and Cash Equivalents at
   End of Period                                 $108,101           $58,534



                           EOG RESOURCES, INC.
  QUANTITATIVE RECONCILIATION OF ADJUSTED NET INCOME AVAILABLE TO COMMON
                         STOCKHOLDERS (Non-GAAP)
          TO NET INCOME AVAILABLE TO COMMON STOCKHOLDERS (GAAP)
             (Unaudited; in thousands, except per share data)

The following chart adjusts three-month and six-month periods ended June 30 reported Net Income Available to Common Stockholders (GAAP) to reflect actual cash realized from financial commodity price transactions by eliminating the unrealized mark-to-market losses (gains) from these transactions and for the gain on the sale of Appalachian assets. EOG believes this presentation may be useful to investors who follow the practice of some industry analysts who adjust reported company earnings to match realizations to production settlement months and make certain other adjustments to exclude one-time items. EOG management uses this information for comparative purposes within the industry.

                                      Quarter               Six Months
                                   Ended June 30,         Ended June 30,
                                  2008       2007        2008        2007
  Reported Net Income
   Available to Common
   Stockholders (GAAP)          $178,206   $306,063     $418,719   $522,855

  Mark-to-Market (MTM)
   Commodity Derivative
   Contracts Impact
    Total Losses (Gains)         842,822    (44,103)   1,312,666     (4,302)
    Realized (Losses) Gains     (138,069)    18,613     (114,859)    65,880
       Subtotal                  704,753    (25,490)   1,197,807     61,578

    After Tax MTM Impact         453,509    (16,403)     770,789     39,625

  Less: Gain on Sale of
   Appalachian Assets, Net of
   Tax                                 -          -      (84,748)         -

  Adjusted Net Income
   Available to Common
   Stockholders (Non-GAAP)      $631,715   $289,660   $1,104,760   $562,480

  Net Income Per Share
   Available to Common
   Stockholders (GAAP)
    Basic                          $0.72      $1.26        $1.70      $2.15
    Diluted                        $0.71      $1.24        $1.67      $2.12

  Adjusted Net Income Per
   Share Available to Common
   Stockholders (Non-GAAP)
    Basic                          $2.56      $1.19        $4.49      $2.31
    Diluted                        $2.52      $1.17        $4.41      $2.28

  Average Number of Shares
   Outstanding
    Basic                        246,536    243,227      245,950    242,976
    Diluted                      251,135    247,261      250,553    247,009



                           EOG RESOURCES, INC.
QUANTITATIVE RECONCILIATION OF DISCRETIONARY CASH FLOW AVAILABLE TO COMMON
                         STOCKHOLDERS (Non-GAAP)
           TO NET CASH PROVIDED BY OPERATING ACTIVITIES (GAAP)
                        (Unaudited; in thousands)

The following chart reconciles three-month and six-month periods ended June 30 Net Cash Provided by Operating Activities (GAAP) to Discretionary Cash Flow Available to Common Stockholders (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), Changes in Components of Working Capital and Other Assets and Liabilities, Changes in Components of Working Capital Associated with Investing and Financing Activities and Preferred Stock Dividends. EOG management uses this information for comparative purposes within the industry.

                                Quarter                   Six Months
                             Ended June 30,             Ended June 30,
                            2008         2007         2008          2007
  Net Cash Provided by
   Operating
   Activities (GAAP)     $1,141,044    $728,136    $2,062,621    $1,426,616

  Adjustments
    Exploration Costs
     (excluding Stock-
     Based Compensation
     Expenses)               55,168      38,230        99,091        61,574
    Changes in
     Components of
     Working Capital
     and Other Assets
     and Liabilities
      Accounts Receivable   217,842       2,201       395,526       (20,734)
      Inventories            12,461      (6,368)        9,176         2,476
      Accounts Payable     (162,043)      8,780      (255,495)      (14,651)
      Accrued Taxes Payable  63,473     (24,224)       92,738       (26,191)
      Other Assets           59,878       1,060        61,623         4,683
      Other Liabilities     (19,233)      1,136         8,440        15,492
    Changes in
     Components of
     Working Capital
     Associated with
     Investing
     and Financing
     Activities               5,967     (12,223)          775        20,471
    Preferred Stock
     Dividends                    -        (990)         (443)       (1,865)

  Discretionary Cash
   Flow Available to
   Common Stockholders
   (Non-GAAP)            $1,374,557    $735,738    $2,474,052    $1,467,871



                           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
         TO LONG-TERM DEBT (GAAP) AND TOTAL CAPITALIZATION (GAAP)
            (Unaudited; in millions, except ratio information)

The following chart reconciles 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 in their Net Debt-to-Total Capitalization ratio calculation. EOG management uses this information for comparative purposes within the industry.

                                               06/30/2008        12/31/2007

     Total Stockholders' Equity (GAAP) - (a)      $7,426            $6,990

     Long-Term Debt (GAAP) - (b)                   1,147             1,185
     Less: Cash (GAAP)                              (108)              (54)
     Net Debt (Non-GAAP) - (c)                     1,039             1,131

     Total Capitalization (Non-GAAP) - (a) + (c)  $8,465            $8,121

     Total Capitalization (GAAP) - (a) + (b)      $8,573            $8,175

     Net Debt-to-Total Capitalization
      (Non-GAAP) - (c) / [(a) + (c)]                 12%               14%

     Debt-to-Total Capitalization
      (GAAP) - (b) / [(a) + (b)]                     13%               14%

Investors
Maire A. Baldwin
(713) 651-6EOG (651-6364)

Media and Investors 
Elizabeth M. Ivers
(713) 651-7132

 

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