Wednesday, February 26, 2014

Data Points From EOG 4Q13 Conference Call

Random data points from EOG's 4Q13 and full year 2013 earnings. As usual, numbers may be rounded.

Finances
  • 4Q13: net income of $2.12/share
  • full year: net income of $8.04/share
  • 4Q13 discretionary cash flow: $2 billion
  • For full year, EOG's net cash provided by operating activities exceeded financing investing cash outflows.
  • debt/total cap: 28%; debt reduced by almost $1 billion during 2013
Operations
  • best year on record
  • increased crude oil production growth targets three times 
  • ended year with total company production up 40% over 2012
  • a 44% average increase over the last three years
  • key assets: Eagle Ford, Bakken, and Leonard
  • biggest driver: Eagle Ford
Eagle Ford
  • biggest driver for EOG
  • for third time since EOG discovered oil in the Eagle Ford in 2010, EOG has increased the net reserve potential
  • EOG's estimated net reserve potential: 3.2 billion bbls equivalent; 45% increase over the previous 2.2 billion bbls
  • 7,200 net drilling locations (includes the 1,200 net wells drilled to-date)
  • 6,000 net wells remaining = 12-year drilling inventory
  • increased by 12% net recoverable reserve per well; up from previous 400,000 boe to 450,000 boe
The Bakken
  • in 2014, expect to again grow crude oil production
  • localized in two areas: Bakken Core and Antelope Extension; majority in the Core
  • downspace in each area
  • operate a 6-rig program
  • plan to drill 80 net wells this year, up from 54 last year
The Permian (Leonard)
  • the Leonard is EOG's third best play in terms of rate of return; drilling in two zones, A and B
  • CAPEX to remain flat
  • shift from Midland Basin to higher return plays in the Delaware Basin, the Leonard, and Wolfcamp
  • biggest increase in activity will be the Leonard where recent wells have been excellent
  • will develop A zone with 8 to 10 wells/section
Pricing
  • for March 2014, 181,000 bbls hedged at $96.55
  • for April 1 through June 30, 2014, 168,000 bbls hedged at $96.48
  • for second half of 2014, 64,000 bbls hedged at $95.18
  • natural gas hedged at $4.55 through end of 2014
  • for the sixth year in a row, EOG is not growing it North American natural gas production
Q&A
  • downspacing to 160 acres in the Bakken
  • new wells coming in extremely good
  • not ready to comment on how much new wells interfering with existing wells

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