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EOG Resources Reports Excellent Third Quarter 2021 Results; Raises Regular Dividend 82% and Declares $2.00 per Share Special Dividend

11/04/2021

HOUSTON, Nov. 4, 2021 /PRNewswire/ -- EOG Resources, Inc. (EOG) today reported third quarter 2021 results. The attached supplemental financial tables and schedules for the reconciliation of non-GAAP measures to GAAP measures and related definitions, along with a related presentation, are also available on EOG's website at http://investors.eogresources.com/investors.

Key Financial Results

In millions of USD, except per-share and ratio data



3Q 2021


2Q 2021


3Q 2020



GAAP

Total Revenue

4,765


4,139


2,246



Net Income (Loss)

1,095


907


(42)



Net Income (Loss) Per Share

1.88


1.55


(0.07)



Net Cash Provided by Operating Activities

2,196


1,559


1,214



Total Expenditures

962


1,089


646



Current and Long-Term Debt

5,117


5,125


5,721



Cash and Cash Equivalents

4,293


3,880


3,066



Debt-to-Total Capitalization

19.0

%

19.7

%

22.1

%




Non-GAAP

Adjusted Net Income

1,264


1,012


252



Adjusted Net Income Per Share

2.16


1.73


0.43



Discretionary Cash Flow

2,296


2,030


1,261



Cash Capital Expenditures before Acquisitions

935


972


499



Free Cash Flow

1,361


1,058


762



Net Debt

824


1,245


2,655



Net Debt-to-Total Capitalization

3.6

%

5.6

%

11.6

%


Third Quarter 2021 Highlights

  • Increased regular dividend 82% to an indicated annual rate of $3.00 per share
  • Declared special dividend of $2.00 per share
  • Updated share repurchase authorization
  • Earned adjusted net income of $1.3 billion, or $2.16 per share
  • Generated $1.4 billion of free cash flow
  • Capital expenditures near low end of guidance range driven by sustainable cost reductions
  • Oil and NGL production above high end of guidance ranges
  • Total per-unit cash operating costs below guidance midpoint

Volumes and Capital Expenditures

Wellhead Volumes

3Q 2021

3Q 2021
Guidance
Midpoint

2Q 2021

3Q 2020

Crude Oil and Condensate (MBod)

449.5

444.5

448.6

377.6

Natural Gas Liquids (MBbld)

157.9

140.0

138.5

140.1

Natural Gas (MMcfd)

1,422

1,410

1,445

1,190

Total Crude Oil Equivalent (MBoed)

844.4

819.5

828.0

716.0


Cash Capital Expenditures before Acquisitions ($MM)

935

1,000

972

499

From Ezra Yacob, Chief Executive Officer
"EOG delivered exceptionally strong earnings and free cash flow in the third quarter driven by our double premium investment program. We extended our track record of reliable execution with better than expected production, capital expenditures, operating costs and product prices.

"For the second time this year, we've increased our dividend rate. This quarter's 82 percent raise brings our indicated annual rate to $3.00 per share, doubling the dividend compared to last year. Our high-return investment program, first spurred by our shift to a premium investment standard in 2016 and followed by the double premium standard instituted last year, has positioned the company to step up our cash return to shareholders. The sizable increase in the regular dividend closes the gap between the prior dividend level and the significant improvement in EOG's profitability since 2016. It should also be taken as a signal of our confidence that we can continue improving in the future.

"We also continue to deliver on our other cash return priorities, with a second special dividend to be paid this year and an update to our share repurchase authorization. Share repurchases provide the opportunity to create additional value for stockholders when executed prudently and at the right time. We remain firmly committed to our long-term free cash flow priorities.

"EOG has never been in better shape. Our high-return business model is sustainable for the long term, underpinned by a deep inventory of double premium drilling locations. We also remain optimistic about the potential of new exploration plays to improve the overall quality of our inventory. Our financial and operational results, our world-class assets as well as our continued progress on exploration are a testament to the strength of EOG's underlying business, all driven by our talented employees and unique culture. We are well positioned to be one of the lowest cost and lowest emissions producers and generate superior cash returns, free cash flow growth and long-term shareholder value."

Third Quarter 2021 Financial Performance

Adjusted Earnings per Share 3Q 2021 vs 2Q 2021

Prices and Hedges
Natural gas, crude oil and NGL prices increased significantly in 3Q compared with 2Q, partially offset by an increase in cash paid for hedge settlements in 3Q of $100 million compared with 2Q.

Volumes
Total company crude oil production of 449,500 Bopd was above the high end of the guidance range due to better well productivity. Increased extraction of ethane boosted NGL production 14% higher than 2Q while contributing to slightly lower natural gas production, along with declines related to plant downtime in Trinidad. Total company equivalent volumes increased 2% compared with 2Q.

Per-Unit Costs
Per-unit cash operating costs in 3Q were 5% below the midpoint of the guidance range, primarily due to lower than forecasted lease and well and transportation costs. Compared with 2Q, per-unit cash operating costs increased 3% due to higher gathering and processing and general and administrative costs. In addition, per-unit taxes other than income increased compared with 2Q due to higher product prices.

Change in Cash 3Q 2021 vs 2Q 2021

Free Cash Flow
EOG generated discretionary cash flow (net cash provided by operating activities before exploration costs and changes in working capital) of $2.3 billion in 3Q. The company incurred $935 million of cash capital expenditures before acquisitions, resulting in $1.4 billion of free cash flow.

Capital Expenditures
Cash capital expenditures before acquisitions of $935 million were near the low end of the guidance range due to lower well costs from sustainable efficiency improvements. EOG was able to offset inflationary pressures with efficiency improvements in many areas. In particular, the application of "super-zipper" completion techniques, faster drilling times, lower-cost sand sourcing and the addition of infrastructure to procure lower-cost water all contributed to the overall cost reductions.

Third Quarter 2021 Operating Performance

Lease and Well
Per-unit LOE costs were $0.32 below the guidance mid-point due to lower water handling and compression costs. Per-unit LOE costs were $0.10 below 2Q due to overall efficiency improvements. Per- unit costs were in-line with 3Q 2020.

Transportation, Gathering and Processing
Per-unit transportation costs were below the guidance mid- point due to lower than expected NGL and oil transportation fees. Per-unit G&P costs increased from 2Q due to higher fuel prices while transportation costs were in-line with 2Q. Per-unit transportation and G&P costs increased 3% and 7%, respectively, compared with 3Q 2020 due to increased fuel prices and higher storage and terminal fees.

General and Administrative
Per-unit G&A costs were in line with the guidance midpoint. Per-unit G&A costs were above 2Q due to seasonally higher employee related costs. Per-unit G&A costs decreased from 3Q 2020 as increased production volumes more than offset increased employee related costs.

Depreciation, Depletion and Amortization
Per-unit DD&A costs were slightly below the guidance midpoint and declined 2% and 4% compared with 2Q 2021 and 3Q 2020, respectively, due to the addition of reserves from new wells at lower finding costs.

Free Cash Flow Allocation Actions

Declared $0.75 per Share Regular Dividend – 82% Increase to $3.00 per Share Indicated Annual Rate


The Board of Directors today declared a regular dividend of $0.75 per share on EOG's Common Stock. The dividend is payable January 28, 2022 to stockholders of record as of January 14, 2022. The new dividend represents a $3.00 per share indicated annual rate, an 82% increase from the previous level. The annual cash commitment towards the dividend is $785 million higher and reflects EOG's low cost of supply, robust cash flow generation and strong balance sheet. A growing, sustainable dividend is the company's primary mode of returning cash to shareholders. EOG has a long track record of delivering against this objective as the company has never suspended or reduced its regular dividend.

$2.00 per Share Special Dividend
The Board of Directors today also declared a special dividend of $2.00 per share on EOG's Common Stock. The dividend is payable December 30, 2021 to stockholders of record as of December 15, 2021. EOG has now committed to return $2.7 billion of cash to stockholders in 2021, representing approximately 30 percent of expected 2021 discretionary cash flow.

Share Repurchase Authorization
In addition, the Board of Directors today updated EOG's share repurchase authorization to $5 billion. The updated authorization is consistent with EOG's long-standing cash flow priorities and complements existing avenues to return cash to shareholders through regular and special dividends. The repurchase authorization enables EOG to opportunistically increase per-share value for stockholders.


Third Quarter 2021 Results vs Guidance


 

(Unaudited)


Crude Oil and Condensate Volumes (MBod)

3Q 2021

3Q 2021
Guidance
Midpoint

Variance

2Q 2021

1Q 2021

4Q 2020

3Q 2020


United States

448.3

443.5

4.8

446.9

428.7

442.4

376.6


Trinidad

1.2

1.0

0.2

1.7

2.2

2.3

1.0


Other International

0.0

0.0

0.0

0.0

0.1

0.1

0.0


Total

449.5

444.5

5.0

448.6

431.0

444.8

377.6


Natural Gas Liquids Volumes (MBbld)


Total

157.9

140.0

17.9

138.5

124.3

141.4

140.1


Natural Gas Volumes (MMcfd)


United States

1,210

1,200

10

1,199

1,100

1,075

1,008


Trinidad

212

210

2

233

217

192

151


Other International

0

0

0

13

25

25

31


Total

1,422

1,410

12

1,445

1,342

1,292

1,190




Total Crude Oil Equivalent Volumes (MBoed)

844.4

819.5

24.9

828.0

778.9

801.5

716.0


Total MMBoe

77.7

75.4

2.3

75.3

70.1

73.7

65.9




Benchmark Price


Oil (WTI) ($/Bbl)

70.55



66.06

57.80

42.67

40.94


Natural Gas (HH) ($/Mcf)

4.01



2.83

2.69

2.65

1.94




Crude Oil and Condensate - above (below) WTI ($/Bbl)


United States

0.33

0.30

0.03

0.10

0.27

(0.81)

(0.75)


Trinidad

(10.36)

(7.50)

(2.86)

(9.80)

(8.03)

(9.76)

(15.53)




Natural Gas Liquids - Realizations as % of WTI

53.5%

50.0%

3.5%

44.1%

48.5%

41.1%

35.0%




Natural Gas - above (below) NYMEX Henry Hub ($/Mcf)


United States

0.49

0.30

0.19

0.16

2.83

(0.36)

(0.45)


Natural Gas Realizations ($/Mcf)


Trinidad

3.39

3.35

0.04

3.37

3.38

3.57

2.35




Total Expenditures (GAAP) ($MM)

962



1,089

1,067

1,107

646


Capital Expenditures (non-GAAP) ($MM)

935

1,000

(65)

972

945

828

499




Operating Unit Costs ($/Boe)


Lease and Well

3.48

3.80

(0.32)

3.58

3.85

3.54

3.45


Transportation Costs

2.82

3.00

(0.18)

2.84

2.88

2.64

2.74


Gathering and Processing

1.87

1.90

(0.03)

1.70

1.98

1.62

1.74


General and Administrative

1.83

1.80

0.03

1.59

1.57

1.54

1.89


Cash Operating Costs

10.00

10.50

(0.50)

9.71

10.28

9.34

9.82


Depreciation, Depletion and Amortization

11.93

12.00

(0.07)

12.13

12.84

11.81

12.49




Expenses ($MM)


Exploration and Dry Hole

48

40

8

49

44

40

51


Impairment (GAAP)

82



44

44

143

79


Impairment (excluding certain impairments (non-GAAP))

69

85

(16)

43

43

57

52


Capitalized Interest

8

8

0

8

8

7

7


Net Interest

48

45

3

45

47

53

53




Taxes Other Than Income (% of Wellhead Revenue)

6.8%

7.0%

(0.2%)

6.9%

6.7%

5.1%

7.2%


Income Taxes


Effective Rate

23.4%

23.5%

(0.1%)

19.3%

23.2%

21.1%

19.2%


Deferred Ratio

(33%)

33%

(66%)

(45%)

(18%)

60%

330%


 


Fourth Quarter and Full-Year 2021 Guidance 2


 

(Unaudited)


See "Endnotes" below for related discussion and definitions.

4Q 2021
Guidance Range

FY 2021
Guidance Range

2020
Actual

2019
Actual


Crude Oil and Condensate Volumes (MBod)










United States

442.0

-

450.0

441.5

-

443.5

408.1

455.5


Trinidad

0.5

-

1.5

1.4

-

1.6

1.0

0.6


Other International

0.0

-

0.0

0.0

-

0.0

0.1

0.1


Total

442.5

-

451.5

442.9

-

445.1

409.2

456.2


Natural Gas Liquids Volumes (MBbld)










Total

148.0

-

158.0

142.3

-

144.8

136.0

134.1


Natural Gas Volumes (MMcfd)










United States

1,285

-

1,385

1,199

-

1,225

1,040

1,069


Trinidad

185

-

215

212

-

219

180

260


Other International

0

-

0

9

-

10

32

37


Total

1,470

-

1,600

1,420

-

1,454

1,252

1,366


Crude Oil Equivalent Volumes (MBoed)










United States

804.2

-

838.8

783.6

-

792.5

717.5

767.8


Trinidad

31.3

-

37.3

36.7

-

38.1

30.9

44.0


Other International

0.0

-

0.0

1.5

-

1.7

5.4

6.2


Total

835.5

-

876.1

821.8

-

832.3

753.8

818.0












Benchmark Price










Oil (WTI) ($/Bbl)







39.40

57.04


Natural Gas (HH) ($/Mcf)







2.08

2.62












Crude Oil and Condensate Differentials - above (below) WTI 3 ($/Bbl)


United States

0.20

-

1.20

0.30

-

0.60

(0.75)

0.70


Trinidad

(12.00)

-

(10.00)

(12.79)

-

(10.64)

(9.20)

(9.88)


Natural Gas Liquids - Realizations as % of WTI










Total

50%

-

60%

50%

-

53%

34.0%

28.1%


Natural Gas Differentials - above (below) NYMEX Henry Hub 4 ($/Mcf)


United States

0.60

-

1.60

0.95

-

1.30

(0.47)

(0.40)


Natural Gas Realizations ($/Mcf)










Trinidad

3.20

-

3.70

3.34

-

3.46

2.57

2.72












Total Expenditures (GAAP) ($MM)







4,113

6,900


Capital Expenditures 5 (non-GAAP) ($MM)

950

-

1,150

3,800

-

4,000

3,490

6,234












Operating Unit Costs ($/Boe)










Lease and Well

3.40

-

4.10

3.57

-

3.76

3.85

4.58


Transportation Costs

2.75

-

3.15

2.82

-

2.93

2.66

2.54


Gathering and Processing

1.80

-

2.00

1.83

-

1.89

1.66

1.60


General and Administrative

1.50

-

1.60

1.62

-

1.65

1.75

1.64


Cash Operating Costs

9.45

-

10.85

9.84

-

10.23

9.92

10.36


Depreciation, Depletion and Amortization

11.40

-

12.00

12.06

-

12.21

12.32

12.56












Expenses ($MM)










Exploration and Dry Hole

40

-

45

180

-

185

159

168


Impairment (GAAP)







2,100

518


Impairment (excluding certain impairments (non-GAAP))

100

-

140

257

-

297

232

243


Capitalized Interest

5

-

10

29

-

34

31

38


Net Interest

42

-

48

182

-

188

205

185












Taxes Other Than Income (% of Wellhead Revenue)

6.0%

-

8.0%

6.5%

-

7.5%

6.6%

6.9%


Income Taxes










Effective Rate

21%

-

26%

20%

-

25%

18.2%

22.9%


Deferred Ratio

5%

-

20%

(20%)

-

(5%)

54.8%

107.4%


 


Third Quarter 2021 Results Webcast
Friday, November 5, 2021, 9:00 a.m. Central time (10:00 a.m. Eastern time) Webcast will be available on EOG's website for one year.http://investors.eogresources.com/Investors

About EOG
EOG Resources, Inc. (NYSE: EOG) is one of the largest crude oil and natural gas exploration and production companies in the United States with proved reserves in the United States and Trinidad. To learn more visit www.eogresources.com.

Investor Contacts
David Streit 713‐571‐4902
Neel Panchal 713‐571‐4884

Media and Investor Contact
Kimberly Ehmer 713‐571‐4676

Endnotes



1)

The 2022 dividend amount reflects the indicated annual rate of the quarterly dividend declared on November 4, 2021.



2)

The forecast items for the fourth quarter and full year 2021 set forth above 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.



3)

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.



4)

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.



5)

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 Transactions.

 

Glossary


Acq

Acquisitions

ATROR

After-tax rate of return

Bbl

Barrel

Bn

Billion

Boe

Barrels of oil equivalent

Bopd
CAGR

Barrels of oil per day
Compound annual growth rate

Capex

Capital expenditures

CO2e

Carbon dioxide equivalent

DCF

Discretionary cash flow

DD&A

Depreciation, Depletion and Amortization

Disc

Discoveries

Divest

Divestitures

EPS

Earnings per share

Ext

Extensions

G&A

General and administrative expense

G&P

Gathering and processing expense

GHG

Greenhouse gas

HH

Henry Hub

LOE

Lease operating expense, or lease and well expense

MBbld

Thousand barrels of liquids per day

MBod

Thousand barrels of oil per day

MBoe

Thousand barrels of oil equivalent

MBoed

Thousand barrels of oil equivalent per day

Mcf

Thousand cubic feet of natural gas

MMBoe

Million barrels of oil equivalent

MMcfd

Million cubic feet of natural gas per day

NGLs

Natural gas liquids

OTP

Other than price

NYMEX

U.S. New York Mercantile Exchange

QoQ

Quarter over quarter

Trans

Transportation expense

USD

United States dollar

WTI

West Texas Intermediate

YoY

Year over year

$MM

Million United States dollars

$/Bbl

U.S. Dollars per barrel

$/Boe

U.S. Dollars per barrel of oil equivalent

$/Mcf

U.S. Dollars per thousand cubic feet

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, goals, returns and rates of return, 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," "focused on," "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 and rates of return, replace or increase drilling locations, reduce or otherwise control operating costs and capital expenditures, generate cash flows, pay down or refinance indebtedness, achieve, reach or otherwise meet goals or ambitions with respect to emissions, other environmental matters, safety matters or other ESG (environmental/social/governance) matters, or pay and/or increase dividends are forward‐looking statements. Forward‐looking statements are not guarantees of performance. Although EOG believes the expectations reflected in its forward‐looking statements are reasonable and are based on reasonable assumptions, no assurance can be given that these assumptions are accurate or that any of these expectations will be achieved (in full or at all) or will prove to have been correct. Moreover, EOG's forward‐looking statements may be affected by known, unknown or currently unforeseen risks, events or circumstances that may be outside EOG's control. Furthermore, this press release and any accompanying disclosures may include or reference certain forward‐looking, non‐GAAP financial measures, such as free cash flow or discretionary cash flow, and certain related estimates regarding future performance, results and financial position. Because we provide these measures on a forward‐looking basis, we cannot reliably or reasonably predict certain of the necessary components of the most directly comparable forward‐looking GAAP measures, such as future impairments and future changes in working capital. Accordingly, we are unable to present a quantitative reconciliation of such forward‐looking, non‐GAAP financial measures to the respective most directly comparable forward‐looking GAAP financial measures. Management believes these forward‐looking, non‐GAAP measures may be a useful tool for the investment community in comparing EOG's forecasted financial performance to the forecasted financial performance of other companies in the industry. Any such forward‐looking measures and estimates are intended to be illustrative only and are not intended to reflect the results that EOG will necessarily achieve for the period(s) presented; EOG's actual results may differ materially from such measures and estimates. Important factors that could cause EOG's actual results to differ materially from the expectations reflected in EOG's forward‐looking statements include, among others:

  • the timing, extent and duration of changes in prices for, supplies of, and demand for, crude oil and condensate, natural gas liquids, natural gas and related commodities;
  • the extent to which EOG is successful in its efforts to acquire or discover additional reserves;
  • the extent to which EOG is successful in its efforts to (i) economically develop its acreage in, (ii) produce reserves and achieve anticipated production levels and rates of return from, (iii) decrease or otherwise control its drilling, completion, operating and capital costs related to, and (iv) maximize reserve recovery from, its existing and future crude oil and natural gas exploration and development projects and associated potential and existing drilling locations;
  • the extent to which EOG is successful in its efforts to market its production of crude oil and condensate, natural gas liquids, and natural gas;
  • security threats, including cybersecurity threats and disruptions to our business and operations from breaches of our information technology systems, physical breaches of our facilities and other infrastructure or breaches of the information technology systems, facilities and infrastructure of third parties with which we transact business;
  • the availability, proximity and capacity of, and costs associated with, appropriate gathering, processing, compression, storage, transportation, refining, and export 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 any changes or other actions which may result from the recent U.S. elections and change in U.S. administration and 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 affecting the leasing of acreage and permitting for oil and gas drilling and the calculation of royalty payments in respect of oil and  gas production; laws and regulations imposing additional permitting and disclosure requirements, additional operating restrictions and conditions or restrictions on drilling and completion operations and on the transportation of crude oil and natural gas; laws and regulations with respect to derivatives and hedging activities; and laws and regulations with respect to the import and export of crude oil, natural gas and related commodities;
  • EOG's ability to effectively integrate acquired crude oil and natural gas properties into its operations, fully identify existing and potential problems with respect to such properties and accurately estimate reserves, production and drilling, completing and operating costs with respect to such properties;
  • the extent to which EOG's 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, transportation, and export 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;
  • the duration and economic and financial impact of epidemics, pandemics or other public health issues, including the COVID-19 pandemic;
  • geopolitical factors and political conditions and developments around the world (such as the imposition of tariffs or trade or other economic sanctions, political instability and armed conflict), including in the areas in which EOG operates;
  • the use of competing energy sources and the development of alternative energy sources;
  • the extent to which EOG incurs uninsured losses and liabilities or losses and liabilities in excess of its insurance coverage;
  • acts of war and terrorism and responses to these acts; and
  • the other factors described under ITEM 1A, Risk Factors, of EOG's Annual Report on Form 10‐K for the fiscal year ended December 31, 2020 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, 2020, 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.

Income Statements

In millions of USD, except share data (in millions) and per share data (Unaudited)



3Q 2021


2Q 2021


3Q 2020


YTD 2021


YTD 2020

Operating Revenues and Other









Crude Oil and Condensate

2,929



2,699



1,395



7,879



4,075


Natural Gas Liquids

548



367



185



1,229



439


Natural Gas

568



404



184



1,597



535


Gains (Losses) on Mark-to-Market

     Commodity Derivative Contracts

(494)



(427)



(4)



(1,288)



1,075


Gathering, Processing and Marketing

1,186



1,022



539



3,056



1,940


Gains (Losses) on Asset Dispositions, Net

1



51



(71)



46



(41)


Other, Net

27



23



18



79



44


Total

4,765



4,139



2,246



12,598



8,067












Operating Expenses










Lease and Well

270



270



227



810



802


Transportation Costs

219



214



180



635



540


Gathering and Processing Costs

145



128



115



412



340


Exploration Costs

44



35



38



112



105


Dry Hole Costs

4



13



13



28



13


Impairments

82



44



79



170



1,957


Marketing Costs

1,184



991



523



3,013



2,077


Depreciation, Depletion and Amortization

927



914



823



2,741



2,530


General and Administrative

142



120



125



372



371


Taxes Other Than Income

277



239



126



731



364


Total

3,294



2,968



2,249



9,024



9,099












Operating Income (Loss)

1,471



1,171



(3)



3,574



(1,032)


Other Income (Expense), Net

6



(2)



3





17


Income (Loss) Before Interest Expense

     and Income Taxes

1,477



1,169





3,574



(1,015)


Interest Expense, Net

48



45



53



140



152


Income (Loss) Before Income Taxes

1,429



1,124



(53)



3,434



(1,167)


Income Tax Provision (Benefit)

334



217



(11)



755



(225)


Net Income (Loss)

1,095



907



(42)



2,679



(942)












Dividends Declared per Common Share

0.4125



1.4125



0.3750



2.2375



1.1250


Net Income (Loss) Per Share










Basic

1.88



1.56



(0.07)



4.62



(1.63)


Diluted

1.88



1.55



(0.07)



4.59



(1.63)


Average Number of Common Shares










Basic

581



580



579



580



579


Diluted

584



584



579



584



579


 

Wellhead Volumes and Prices

(Unaudited)



3Q 2021


3Q2020


% Change


2Q 2021


YTD 2021


YTD 2020


% Change















Crude Oil and Condensate Volumes

     (MBbld) (A)












United States

448.3



376.6



19

%


446.9



441.3



396.6



11

%

Trinidad

1.2



1.0



20

%


1.7



1.7



0.5



240

%

Other International (B)









0.1



0.2



-50

%

Total

449.5



377.6



19

%


448.6



443.1



397.3



12

%















Average Crude Oil and Condensate Prices

     ($/Bbl) (C)














United States

70.88



40.19



76

%


66.16



65.18



37.45



74

%

Trinidad

60.19



25.41



137

%


56.26



54.33



26.35



106

%

Other International (B)



25.29



-100

%


55.56



42.36



45.09



-6

%

Composite

70.85



40.15



76

%


66.12



65.14



37.44



74

%















Natural Gas Liquids Volumes (MBbld) (A)














United States

157.9



140.1



13

%


138.5



140.4



134.2



5

%

Total

157.9



140.1



13

%


138.5



140.4



134.2



5

%















Average Natural Gas Liquids Prices

      ($/Bbl) (C)














United States

37.72



14.34



163

%


29.15



32.07



11.95



168

%

Composite

37.72



14.34



163

%


29.15



32.07



11.95



168

%















Natural Gas Volumes (MMcfd) (A)














United States

1,210



1,008



20

%


1,199



1,170



1,029



14

%

Trinidad

212



151



40

%


233



221



175



26

%

Other International (B)



31



-100

%


13



12



34



-65

%

Total

1,422



1,190



19

%


1,445



1,403



1,238



13

%















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














United States

4.50



1.49



203

%


2.99



4.30



1.38



213

%

Trinidad

3.39



2.35



44

%


3.37



3.38



2.20



53

%

Other International (B)



4.73



-100

%


5.69



5.67



4.45



27

%

Composite

4.34



1.68



158

%


3.07



4.17



1.58



164

%















Crude Oil Equivalent Volumes (MBoed) (D)














United States

807.9



684.7



18

%


785.2



776.8



702.3



11

%

Trinidad

36.5



26.2



39

%


40.6



38.5



29.8



29

%

Other International (B)



5.1



-100

%


2.2



2.0



5.7



-65

%

Total

844.4



716.0



18

%


828.0



817.3



737.8



11

%















Total MMBoe (D)

77.7



65.9



18

%


75.3



223.1



202.2



10

%
















(A)

Thousand barrels per day or million cubic feet per day, as applicable.



(B)

Other International includes EOG's China and Canada operations.  The China operations were sold in the second quarter of 2021.



(C)

Dollars per barrel or per thousand cubic feet, as applicable.  Excludes the impact of financial commodity derivative instruments (see Note 12 to the Condensed Consolidated Financial Statements in EOG's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2021).



(D)

Thousand barrels of oil equivalent per day or million barrels of oil equivalent, as applicable; includes crude oil and condensate, NGLs and natural gas.  Crude oil equivalent volumes are determined using a ratio of 1.0 barrel of crude oil and condensate or NGLs to 6.0 thousand cubic feet of natural gas.  MMBoe is calculated by multiplying the MBoed amount by the number of days in the period and then dividing that amount by one thousand.

 

Balance Sheets

In millions of USD, except share data (Unaudited)


September 30,


December 31,


2021


2020

Current Assets




Cash and Cash Equivalents

4,293



3,329


Accounts Receivable, Net

2,154



1,522


Inventories

521



629


Assets from Price Risk Management Activities

18



65


Income Taxes Receivable



23


Other

363



294


Total

7,349



5,862



Property, Plant and Equipment




Oil and Gas Properties (Successful Efforts Method)

67,024



64,793


Other Property, Plant and Equipment

4,694



4,479


Total Property, Plant and Equipment

71,718



69,272


Less:  Accumulated Depreciation, Depletion and Amortization

(43,173)



(40,673)


Total Property, Plant and Equipment, Net

28,545



28,599


Deferred Income Taxes

14



2


Other Assets

1,264



1,342


Total Assets

37,172



35,805



Current Liabilities




Accounts Payable

1,972



1,681


Accrued Taxes Payable

492



206


Dividends Payable

240



217


Liabilities from Price Risk Management Activities

238




Current Portion of Long-Term Debt

38



781


Current Portion of Operating Lease Liabilities

250



295


Other

254



280


Total

3,484



3,460






Long-Term Debt

5,079



5,035


Other Liabilities

2,214



2,149


Deferred Income Taxes

4,630



4,859


Commitments and Contingencies








Stockholders' Equity




Common Stock, $0.01 Par, 1,280,000,000 Shares Authorized and 585,361,866
     Shares Issued at September 30, 2021 and 583,694,850 Shares Issued at 
     December 31, 2020

206



206


Additional Paid in Capital

6,058



5,945


Accumulated Other Comprehensive Loss

(13)



(12)


Retained Earnings

15,542



14,170


Common Stock Held in Treasury, 371,249 Shares at September 30, 2021 and 
     124,265 Shares at December 31, 2020

(28)



(7)


Total Stockholders' Equity

21,765



20,302


Total Liabilities and Stockholders' Equity

37,172



35,805


 

Cash Flows Statements

In millions of USD (Unaudited)


3Q 2021


3Q 2020


2Q 2021


YTD 2021


YTD 2020

Cash Flows from Operating Activities










Reconciliation of Net Income (Loss) to Net Cash Provided

     by Operating Activities:










Net Income (Loss)

1,095



(42)



907



2,679



(942)


Items Not Requiring (Providing) Cash










Depreciation, Depletion and Amortization

927



823



914



2,741



2,530


Impairments

82



79



44



170



1,957


Stock-Based Compensation Expenses

51



33



31



117



113


Deferred Income Taxes

(111)



(33)



(97)



(244)



(241)


(Gains) Losses on Asset Dispositions, Net

(1)



71



(51)



(46)



41


Other, Net

2



2



6



15



2


Dry Hole Costs

4



13



13



28



13


Mark-to-Market Commodity Derivative Contracts










Total (Gains) Losses

494



4



427



1,288



(1,075)


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

(293)



275



(193)



(516)



999


Other, Net

7



(1)





8



(1)


Changes in Components of Working Capital and Other
     Assets and Liabilities










Accounts Receivable

(145)



(260)



(186)



(639)



931


Inventories

(6)



7



37



95



92


Accounts Payable

(68)



(37)



11



115



(1,222)


Accrued Taxes Payable

206



73



(163)



286



12


Other Assets

167



162



(119)



(55)



415


Other Liabilities

(260)



51



32



(317)



(13)


Changes in Components of Working Capital Associated
     with Investing Activities

45



(6)



(54)



(100)



276


Net Cash Provided by Operating Activities

2,196



1,214



1,559



5,625



3,887


Investing Cash Flows










Additions to Oil and Gas Properties

(846)



(469)



(968)



(2,689)



(2,459)


Additions to Other Property, Plant and Equipment

(50)



(18)



(55)



(147)



(165)


Proceeds from Sales of Assets

8



146



141



154



189


Changes in Components of Working Capital Associated 
     with Investing Activities

(45)



6



54



100



(276)


Net Cash Used in Investing Activities

(933)



(335)



(828)



(2,582)



(2,711)


Financing Cash Flows










Long-Term Debt Borrowings









1,484


Long-Term Debt Repayments







(750)



(1,000)


Dividends Paid

(820)



(217)



(239)



(1,278)



(601)


Treasury Stock Purchased

(21)



(10)



(2)



(33)



(15)


Proceeds from Stock Options Exercised and Employee 
     Stock Purchase Plan





9



9



8


Debt Issuance Costs









(3)


Repayment of Finance Lease Liabilities

(9)



(5)



(9)



(27)



(13)


Net Cash Used in Financing Activities

(850)



(232)



(241)



(2,079)



(140)


Effect of Exchange Rate Changes on Cash



2



2





2


Increase in Cash and Cash Equivalents

413



649



492



964



1,038


Cash and Cash Equivalents at Beginning of Period

3,880



2,417



3,388



3,329



2,028


Cash and Cash Equivalents at End of Period

4,293



3,066



3,880



4,293



3,066


 

Non-GAAP Financial Measures


To supplement the presentation of its financial results prepared in accordance with generally accepted accounting principles in the United States of America (GAAP), EOG's quarterly earnings releases and related conference calls, accompanying investor presentation slides and presentation slides for investor conferences contain certain financial measures that are not prepared or presented in accordance with GAAP.   These non-GAAP financial measures may include, but are not limited to, Adjusted Net Income (Loss), Discretionary Cash Flow, Free Cash Flow, Adjusted EBITDAX, Net Debt and related statistics.


A reconciliation of each of these measures to their most directly comparable GAAP financial measure and related discussion is included in the tables on the following pages and can also be found in the "Reconciliations & Guidance" section of the "Investors" page of the EOG website at www.eogresources.com.


As further discussed in the tables on the following pages, EOG believes these measures may be useful to investors who follow the practice of some industry analysts who make certain adjustments to GAAP measures (for example, to exclude non-recurring items) to facilitate comparisons to others in EOG's industry, and who utilize non-GAAP measures in their calculations of certain statistics (for example, return on capital employed and return on equity) used to evaluate EOG's performance.


EOG believes that the non-GAAP measures presented, when viewed in combination with its financial and operating results prepared in accordance with GAAP, provide a more complete understanding of the factors and trends affecting the company's performance. As is discussed in the tables on the following pages, EOG uses these non-GAAP measures for purposes of (i) comparing EOG's financial and operating performance with the financial and operating performance of other companies in the industry and (ii) analyzing EOG's financial and operating performance across periods.


The non-GAAP measures presented should not be considered in isolation, and should not be considered as a substitute for, or as an alternative to, EOG's reported Net Income (Loss), Long-Term Debt (including Current Portion of Long-Term Debt), Net Cash Provided by Operating Activities and other financial results calculated in accordance with GAAP. The non-GAAP measures presented should be read in conjunction with EOG's consolidated financial statements prepared in accordance with GAAP.


In addition, because not all companies use identical calculations, EOG's presentation of non-GAAP measures may not be comparable to, and may be calculated differently from, similarly titled measures disclosed by other companies, including its peer companies. EOG may also change the calculation of one or more of its non-GAAP measures from time to time – for example, to account for changes in its business and operations or to more closely conform to peer company or industry analysts' practices.

 

Adjusted Net Income (Loss)

In millions of USD, except share data (in millions) and per share data (Unaudited)









The following tables adjust the reported Net Income (Loss) (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, to add back impairment charges related to certain of EOG's assets (which are generally (i) attributable to declines in commodity prices, (ii) related to sales of certain oil and gas properties or (iii) the result of certain other events or decisions (e.g., a periodic review of EOG's oil and gas properties or other assets) - see "Revenues, Costs and Margins Per Barrel of Oil Equivalent" below for additional related discussion) and to make certain other adjustments to exclude non-recurring and certain other items as further described below.  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.










3Q 2021


Before

Tax


Income Tax

Impact


After

Tax


Diluted

Earnings

per Share









Reported Net Income (GAAP)

1,429



(334)



1,095



1.88


Adjustments:








Losses on Mark-to-Market Commodity Derivative Contracts

494



(108)



386



0.65


Net Cash Payments for Settlements of Commodity Derivative Contracts

(293)



64



(229)



(0.39)


Less: Gains on Asset Dispositions, Net

(1)





(1)




Add: Certain Impairments

13





13



0.02


Adjustments to Net Income

213



(44)



169



0.28










Adjusted Net Income (Non-GAAP)

1,642



(378)



1,264



2.16










Average Number of Common Shares (GAAP)








Basic







581


Diluted







584










Average Number of Common Shares (Non-GAAP)








Basic







581


Diluted







584




















Adjusted Net Income (Loss)

(Continued)

In millions of USD, except share data (in millions) and per share data (Unaudited)


3Q 2020


Before

Tax


Income Tax

Impact


After

Tax


Diluted

Earnings

per Share









Reported Net Loss (GAAP)

(53)



11



(42)



(0.07)


Adjustments:








Losses on Mark-to-Market Commodity Derivative Contracts

4





4



0.01


Net Cash Received from Settlements of Commodity Derivative Contracts

275



(60)



215



0.37


Add: Losses on Asset Dispositions, Net

71



(16)



55



0.09


Add: Certain Impairments

27



(7)



20



0.03


Adjustments to Net Loss

377



(83)



294



0.50










Adjusted Net Income (Non-GAAP)

324



(72)



252



0.43










Average Number of Common Shares (GAAP)








Basic







579


Diluted







579










Average Number of Common Shares (Non-GAAP)








Basic







579


Diluted







581




















Adjusted Net Income (Loss)

(Continued)

In millions of USD, except share data (in millions) and per share data (Unaudited)


2Q 2021


Before

Tax


Income Tax

Impact


After

Tax


Diluted

Earnings

per Share









Reported Net Income (GAAP)

1,124



(217)



907



1.55


Adjustments:








Losses on Mark-to-Market Commodity Derivative Contracts

427



(93)



334



0.58


Net Cash Payments for Settlements of Commodity Derivative Contracts

(193)



42



(151)



(0.26)


Less: Gains on Asset Dispositions, Net

(51)



17



(34)



(0.06)


Add: Certain Impairments

1





1




Less: Tax Benefits Related to Exiting Canada Operations



(45)



(45)



(0.08)


Adjustments to Net Income

184



(79)



105



0.18










Adjusted Net Income (Non-GAAP)

1,308



(296)



1,012



1.73










Average Number of Common Shares (GAAP)








Basic







580


Diluted







584










Average Number of Common Shares (Non-GAAP)








Basic







580


Diluted







584




















Adjusted Net Income (Loss)

(Continued)

In millions of USD, except share data (in millions) and per share data (Unaudited)


YTD 2021


Before

Tax


Income Tax

Impact


After

Tax


Diluted

Earnings

per Share









Reported Net Income (GAAP)

3,434



(755)



2,679



4.59


Adjustments:








Losses on Mark-to-Market Commodity Derivative Contracts

1,288



(282)



1,006



1.72


Net Cash Payments for Settlements of Commodity Derivative Contracts

(516)



113



(403)



(0.69)


Less: Gains on Asset Dispositions, Net

(46)



16



(30)



(0.05)


Add: Certain Impairments

15





15



0.03


Less: Tax Benefits Related to Exiting Canada Operations



(45)



(45)



(0.08)


Adjustments to Net Income

741



(198)



543



0.93










Adjusted Net Income (Non-GAAP)

4,175



(953)



3,222



5.52










Average Number of Common Shares (GAAP)








Basic







580


Diluted







584










Average Number of Common Shares (Non-GAAP)








Basic







580


Diluted







584




















Adjusted Net Income (Loss)

(Continued)

In millions of USD, except share data (in millions) and per share data (Unaudited)


YTD 2020


Before

Tax


Income Tax

Impact


After

Tax


Diluted

Earnings

per Share









Reported Net Loss (GAAP)

(1,167)



225



(942)



(1.63)


Adjustments:








Gains on Mark-to-Market Commodity Derivative Contracts

(1,075)



236



(839)



(1.45)


Net Cash Received from Settlements of Commodity Derivative Contracts

999



(219)



780



1.35


Add: Losses on Asset Dispositions, Net

41



(9)



32



0.06


Add: Certain Impairments

1,782



(374)



1,408



2.43


Adjustments to Net Loss

1,747



(366)



1,381



2.39










Adjusted Net Income (Non-GAAP)

580



(141)



439



0.76










Average Number of Common Shares (GAAP)








Basic







579


Diluted







579










Average Number of Common Shares (Non-GAAP)








Basic







579


Diluted







580




















Adjusted Net Income (Loss)

(Continued)

In millions of USD, except share data (in millions) and per share data (Unaudited)









FY 2020


Before

Tax


Income Tax

Impact


After

Tax


Diluted

Earnings

per Share









Reported Net Loss (GAAP)

(739)



134



(605)



(1.04)


Adjustments:








Gains on Mark-to-Market Commodity Derivative Contracts

(1,145)



251



(894)



(1.55)


Net Cash Received from Settlements of Commodity Derivative Contracts

1,071



(235)



836



1.44


Add: Losses on Asset Dispositions, Net

47



(10)



37



0.06


Add: Certain Impairments

1,868



(392)



1,476



2.55


Adjustments to Net Loss

1,841



(386)



1,455



2.50










Adjusted Net Income (Non-GAAP)

1,102



(252)



850



1.46










Average Number of Common Shares (GAAP)








Basic







579


Diluted







579










Average Number of Common Shares (Non-GAAP)








Basic







579


Diluted







581


 

Adjusted Net Income Per Share

In millions of USD, except share data (in millions), per share data, production volume data and per Boe data (Unaudited)

2Q 2021 Adjusted Net Income per Share (Non-GAAP)



1.73






Realized Price




3Q 2021 Composite Average Wellhead Revenue per Boe

52.07




Less:  2Q 2021 Composite Average Welhead Revenue per Boe

(46.07)




Subtotal

6.00




Multiplied by: 3Q 2021 Crude Oil Equivalent Volumes (MMBoe)

77.7




Total Change in Revenue

466




Less: Income Tax Benefit (Cost) Imputed (based on 23%)

(107)




Change in Net Income

359




Change in Diluted Earnings per Share



0.61






Net Cash Received (Paid) from Settlements of Commodity Derivative Contracts




3Q 2021 Net Cash Received (Paid) from Settlement of Commodity Derivative 
     Contracts

(293)




Less:  Income Tax Benefit (Cost)

64




After Tax - (a)

(229)




2Q 2021 Net Cash Received (Paid) from Settlement of Commodity Derivative 
      Contracts

(193)




Less:  Income Tax Benefit (Cost)

42




After Tax - (b)

(151)




Change in Net Income - (a) - (b)

(78)




Change in Diluted Earnings per Share



(0.13)






Wellhead Volumes




3Q 2021 Crude Oil Equivalent Volumes (MMBoe)

77.7




Less:  2Q 2021 Crude Oil Equivalent Volumes (MMBoe)

(75.3)




Subtotal

2.3




Multiplied by:  3Q 2021 Composite Average Margin per Boe (Including Total
     Exploration Costs) (Non-GAAP) (refer to "Revenues, Costs and Margins Per Barrel of 
     Oil Equivalent" schedule)

24.45




Change in Revenue

57




Less:  Income Tax Benefit (Cost) Imputed (based on 23%)

(13)




Change in Net Income

44




Change in Diluted Earnings per Share



0.08






Operating Cost per Boe




2Q 2021 Total Operating Cost per Boe (including Total Exploration Costs) (Non-GAAP)
     (refer to "Revenues, Costs and Margins Per Barrel of Oil Equivalent" schedule)

26.82




Less:  3Q 2021 Total Operating Cost per Boe (including Total Exploration Costs) (Non-
     GAAP) (refer to "Revenues, Costs and Margins Per Barrel of Oil Equivalent" 
     schedule)

(27.62)




Subtotal

(0.8)




Multiplied by:  3Q 2021 Crude Oil Equivalent Volumes (MMBoe)

77.7




Change in Before-Tax Net Income

(62)




Less:  Income Tax Benefit (Cost) Imputed (based on 23%)

14




Change in Net Income

(48)




Change in Diluted Earnings per Share



(0.08)






Other Items



(0.05)






3Q 2021 Adjusted Net Income per Share (Non-GAAP)



2.16


3Q 2021 Average Number of Common Shares (Non-GAAP) - Diluted

584




 

Discretionary Cash Flow and Free Cash Flow

In millions of USD (Unaudited)











The following tables reconcile 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), Changes in Components of Working Capital and Other Assets and Liabilities, Changes in Components of Working Capital Associated with Investing and Financing Activities and certain other adjustments to exclude non-recurring and certain other items as further described below.  EOG defines Free Cash Flow (Non-GAAP) for a given period as Discretionary Cash Flow (Non-GAAP) (see below reconciliation) for such period less the total cash capital expenditures (before acquisitions) incurred (Non-GAAP) during such period, as is illustrated below.  EOG management uses this information for comparative purposes within the industry.












3Q 2021


2Q 2021


3Q 2020


YTD 2021


YTD 2020











Net Cash Provided by Operating Activities (GAAP)

2,196



1,559



1,214



5,625



3,887












Adjustments:










Exploration Costs (excluding Stock-Based
     Compensation Expenses)

39



29



37



96



90


Changes in Components of Working Capital and
     Other Assets and Liabilities










Accounts Receivable

145



186



260



639



(931)


Inventories

6



(37)



(7)



(95)



(92)


Accounts Payable

68



(11)



37



(115)



1,222


Accrued Taxes Payable

(206)



163



(73)



(286)



(12)


Other Assets

(167)



119



(162)



55



(415)


Other Liabilities

260



(32)



(51)



317



13


Changes in Components of Working Capital
     Associated with Investing Activities

(45)



54



6



100



(276)


Other Non-Current Income Taxes - Net Receivable









113


Discretionary Cash Flow (Non-GAAP)

2,296



2,030



1,261



6,336



3,599












Discretionary Cash Flow (Non-GAAP) – Percentage

     Increase

82

%






76

%













Discretionary Cash Flow (Non-GAAP)

2,296



2,030



1,261



6,336



3,599


Less:










Total Cash Capital Expenditures Before Acquisitions 
     (Non-GAAP) (a)

(935)



(972)



(499)



(2,852)



(2,662)


Free Cash Flow (Non-GAAP)

1,361



1,058



762



3,484



937






















(a) See below reconciliation of Total Expenditures (GAAP) to Total Cash Capital Expenditures Before Acquisitions (Non-GAAP):












3Q 2021


2Q 2021


3Q 2020


YTD 2021


YTD 2020











Total Expenditures (GAAP)

962



1,089



646



3,118



3,006


Less:










Asset Retirement Costs

(8)



(31)



(44)



(56)



(69)


Non-Cash Expenditures of Other Property, Plant and
     Equipment










Non-Cash Acquisition Costs of Unproved Properties

(15)





(80)



(37)



(128)


Non-Cash Finance Leases







(74)



(73)


Acquisition Costs of Proved Properties

(4)



(86)



(23)



(99)



(74)


Total Cash Capital Expenditures Before Acquisitions

     (Non-GAAP)

935



972



499



2,852



2,662


 

Discretionary Cash Flow and Free Cash Flow

(Continued)

In millions of USD (Unaudited)

















FY 2020


FY 2019


FY 2018


FY 2017









Net Cash Provided by Operating Activities (GAAP)

5,008



8,163



7,769



4,265










Adjustments:








Exploration Costs (excluding Stock-Based Compensation Expenses)

126



113



125



122


Changes in Components of Working Capital and Other Assets and
      Liabilities








Accounts Receivable

(467)



92



368



392


Inventories

(123)



(90)



395



175


Accounts Payable

795



(169)



(439)



(324)


Accrued Taxes Payable

49



(40)



92



64


Other Assets

(325)



(358)



125



659


Other Liabilities

(8)



57



(11)



90


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

(75)



115



(301)



(90)


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

113



239



149



(513)


Discretionary Cash Flow (Non-GAAP)

5,093



8,122



8,272



4,840










Discretionary Cash Flow (Non-GAAP) - Percentage Increase (Decrease)

-37

%


-2

%


71

%


76

%









Discretionary Cash Flow (Non-GAAP)

5,093



8,122



8,272



4,840


Less:








Total Cash Capital Expenditures Before Acquisitions (Non-GAAP) (a)

(3,490)



(6,234)



(6,172)



(4,228)


Free Cash Flow (Non-GAAP)

1,603



1,888



2,100



612










(a) See below reconciliation of Total Expenditures (GAAP) to Total Cash Capital Expenditures Before Acquisitions (Non-GAAP):









Total Expenditures (GAAP)

4,113



6,900



6,706



4,613


Less:








Asset Retirement Costs

(117)



(186)



(70)



(56)


Non-Cash Expenditures of Other Property, Plant and Equipment



(2)



(1)




Non-Cash Acquisition Costs of Unproved Properties

(197)



(98)



(291)



(256)


Non-Cash Finance Leases

(174)





(48)




Acquisition Costs of Proved Properties

(135)



(380)



(124)



(73)


Total Cash Capital Expenditures Before Acquisitions (Non-GAAP)

3,490



6,234



6,172



4,228










 

Discretionary Cash Flow and Free Cash Flow

(Continued)

In millions of USD (Unaudited)





















FY 2016


FY 2015


FY 2014


FY 2013


FY 2012











Net Cash Provided by Operating Activities (GAAP)

2,359



3,595



8,649



7,329



5,237












Adjustments:










Exploration Costs (excluding Stock-Based Compensation
     Expenses)

104



124



158



134



158


Changes in Components of Working Capital and Other 
     Assets and Liabilities










Accounts Receivable

233



(641)



(85)



24



179


Inventories

(171)



(58)



162



(53)



157


Accounts Payable

74



1,409



(544)



(179)



17


Accrued Taxes Payable

(93)



(12)



(16)



(75)



(78)


Other Assets

41



(118)



14



110



119


Other Liabilities

16



66



(75)



20



(36)


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

156



(500)



103



51



(74)


Excess Tax Benefits from Stock-Based Compensation

30



26



99



56



67


Discretionary Cash Flow (Non-GAAP)

2,749



3,891



8,465



7,417



5,746












Discretionary Cash Flow (Non-GAAP) - Percentage Increase

     (Decrease)

-29

%


-54

%


14

%


29

%













Discretionary Cash Flow (Non-GAAP)

2,749



3,891



8,465



7,417



5,746


Less:










Total Cash Capital Expenditures Before Acquisitions 
     (Non-GAAP) (a)

(2,706)



(4,682)



(8,292)



(7,102)



(7,540)


Free Cash Flow (Non-GAAP)

43



(791)



173



315



(1,794)












(a) See below reconciliation of Total Expenditures (GAAP) to Total Cash Capital Expenditures Before Acquisitions (Non-GAAP):











Total Expenditures (GAAP)

6,554



5,216



8,632



7,361



7,754


Less:










Asset Retirement Costs

20



(53)



(196)



(134)



(127)


Non-Cash Expenditures of Other Property, Plant and 
     Equipment

(17)









(66)


Non-Cash Acquisition Costs of Unproved Properties

(3,102)





(5)



(5)



(20)


Acquisition Costs of Proved Properties

(749)



(481)



(139)



(120)



(1)


Total Cash Capital Expenditures Before Acquisitions (Non-

     GAAP)

2,706



4,682



8,292



7,102



7,540












 

Total Expenditures

In millions of USD (Unaudited)














3Q 2021


3Q 2020


FY 2020


FY 2019


FY 2018


FY 2017













Exploration and Development Drilling

653



378



2,664



4,951



4,935



3,132


Facilities

100



38



347



629



625



575


Leasehold Acquisitions

90



88



265



276



488



427


Property Acquisitions

4



23



135



380



124



73


Capitalized Interest

9



7



31



38



24



27


Subtotal

856



534



3,442



6,274



6,196



4,234


Exploration Costs

44



38



146



140



149



145


Dry Hole Costs

4



13



13



28



5



5


Exploration and Development Expenditures

904



585



3,601



6,442



6,350



4,384


Asset Retirement Costs

8



44



117



186



70



56


Total Exploration and Development Expenditures

912



629



3,718



6,628



6,420



4,440


Other Property, Plant and Equipment

50



17



395



272



286



173


Total Expenditures

962



646



4,113



6,900



6,706



4,613


 

EBITDAX and Adjusted EBITDAX

In millions of USD (Unaudited)








The following table adjusts the reported Net Income (Loss) (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 (Loss) (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.









3Q 2021

3Q 2020


YTD 2021


YTD 2020








Net Income (Loss) (GAAP)

1,095


(42)



2,679



(942)









Adjustments:







Interest Expense, Net

48


53



140



152


Income Tax Provision (Benefit)

334


(11)



755



(225)


Depreciation, Depletion and Amortization

927


823



2,741



2,530


Exploration Costs

44


38



112



105


Dry Hole Costs

4


13



28



13


Impairments

82


79



170



1,957


EBITDAX (Non-GAAP)

2,534


953



6,625



3,590


(Gains) Losses on MTM Commodity Derivative Contracts

494


4



1,288



(1,075)


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

(293)


275



(516)



999


(Gains) Losses on Asset Dispositions, Net

(1)


71



(46)



41









Adjusted EBITDAX (Non-GAAP)

2,734


1,303



7,351



3,555









Adjusted EBITDAX (Non-GAAP) - Percentage Increase

110

%



107

%










Definitions







EBITDAX - Earnings Before Interest Expense, Net; Income Tax Provision (Benefit); Depreciation, Depletion and Amortization; Exploration Costs; Dry Hole Costs; and Impairments

 

Net Debt-to-Total Capitalization Ratio

In millions of USD, except ratio data (Unaudited)







The following tables reconcile 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.








September 30,

2021


June 30,

2021


March 31,

2021







Total Stockholders' Equity - (a)

21,765



20,881



20,762








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

5,117



5,125



5,133


Less: Cash

(4,293)



(3,880)



(3,388)


Net Debt (Non-GAAP) - (c)

824



1,245



1,745








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

26,882



26,006



25,895








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

22,589



22,126



22,507








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

19.0

%


19.7

%


19.8

%







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

3.6

%


5.6

%


7.8

%

 

Net Debt-to-Total Capitalization Ratio

(Continued)

In millions of USD, except ratio data (Unaudited)

















December 31,

2020


September 30,

2020


June 30,

2020


March 31,

2020









Total Stockholders' Equity - (a)

20,302



20,148



20,388



21,471










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

5,816



5,721



5,724



5,222


Less: Cash

(3,329)



(3,066)



(2,417)



(2,907)


Net Debt (Non-GAAP) - (c)

2,487



2,655



3,307



2,315










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

26,118



25,869



26,112



26,693










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

22,789



22,803



23,695



23,786










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

22.3

%


22.1

%


21.9

%


19.6

%









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

10.9

%


11.6

%


14.0

%


9.7

%

























Net Debt-to-Total Capitalization Ratio

(Continued)

In millions of USD, except ratio data (Unaudited)









December 31,

2019


September 30,

2019


June 30,

2019


March 31,

2019









Total Stockholders' Equity - (a)

21,641



21,124



20,630



19,904










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

5,175



5,177



5,179



6,081


Less: Cash

(2,028)



(1,583)



(1,160)



(1,136)


Net Debt (Non-GAAP) - (c)

3,147



3,594



4,019



4,945










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

26,816



26,301



25,809



25,985










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

24,788



24,718



24,649



24,849










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

19.3

%


19.7

%


20.1

%


23.4

%









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

12.7

%


14.5

%


16.3

%


19.9

%

























Net Debt-to-Total Capitalization Ratio

(Continued)

In millions of USD, except ratio data (Unaudited)








December 31,

2018


September 30,

2018


June 30,

2018


March 31,

2018








Total Stockholders' Equity - (a)

19,364



18,538



17,452



16,841










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

6,083



6,435



6,435



6,435


Less: Cash

(1,556)



(1,274)



(1,008)



(816)


Net Debt (Non-GAAP) - (c)

4,527



5,161



5,427



5,619










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

25,447



24,973



23,887



23,276










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

23,891



23,699



22,879



22,460










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

23.9

%


25.8

%


26.9

%


27.6

%









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

18.9

%


21.8

%


23.7

%


25.0

%

























Net Debt-to-Total Capitalization Ratio

(Continued)

In millions of USD, except ratio data (Unaudited)








December 31,

2017


September 30,

2017


June 30,

2017


March 31,

2017








Total Stockholders' Equity - (a)

16,283



13,922



13,902



13,928










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

6,387



6,387



6,987



6,987


Less: Cash

(834)



(846)



(1,649)



(1,547)


Net Debt (Non-GAAP) - (c)

5,553



5,541



5,338



5,440










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

22,670



20,309



20,889



20,915










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

21,836



19,463



19,240



19,368










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

28.2

%


31.4

%


33.4

%


33.4

%









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

25.4

%


28.5

%


27.7

%


28.1

%


 

Net Debt-to-Total Capitalization Ratio

(Continued)

In millions of USD, except ratio data (Unaudited)










December 31,

2016


September 30,

2016


June 30,

2016


March 31,

2016


December 31,

2015










Total Stockholders' Equity - (a)

13,982



11,798



12,057



12,405



12,943












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

6,986



6,986



6,986



6,986



6,660


Less: Cash

(1,600)



(1,049)



(780)



(668)



(719)


Net Debt (Non-GAAP) - (c)

5,386



5,937



6,206



6,318



5,941












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

20,968



18,784



19,043



19,391



19,603












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

19,368



17,735



18,263



18,723



18,884












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

33.3

%


37.2

%


36.7

%


36.0

%


34.0

%











Net Debt-to-Total Capitalization (Non-GAAP) - (c) /

     [(a) + (c)]

27.8

%


33.5

%


34.0

%


33.7

%


31.5

%

 

Reserve Replacement Cost Data

In millions of USD, except reserves and ratio data (Unaudited)















The following table 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 (and the non-GAAP measures used in calculating such statistics) provide management and investors with an indication of the results of the current year capital investment program.  Reserve Replacement Cost statistics (and the non-GAAP measures used in calculating such 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.
















2020


2019


2018


2017


2016


2015


2014















Total Costs Incurred in Exploration and
     Development Activities (GAAP)

3,718



6,628



6,420



4,440



6,445



4,928



7,905


Less:  Asset Retirement Costs

(117)



(186)



(70)



(56)



20



(53)



(196)


Non-Cash Acquisition Costs of
     Unproved Properties

(197)



(98)



(291)



(256)



(3,102)






Acquisition Costs of Proved
Properties

(135)



(380)



(124)



(73)



(749)



(481)



(139)


Total Exploration and Development

    Expenditures for Drilling Only (Non-

    GAAP) - (a)

3,269



5,964



5,935



4,055



2,614



4,394



7,570
















Total Costs Incurred in Exploration and
     Development Activities (GAAP)

3,718



6,628



6,420



4,440



6,445



4,928



7,905


Less:  Asset Retirement Costs

(117)



(186)



(70)



(56)



20



(53)



(196)