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EOG Resources Q4, Full Year 2022 Results; IDs $6.0B Budget for 2023

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   |    Friday,February 24,2023

EOG Resources, Inc. reported fourth quarter and full-year 2022 results.

Fourth Quarter Highlights:

  • Earned adjusted net income of $1.9 billion, or $3.30 per share
  • Generated $1.7 billion of free cash flow
  • Declared regular quarterly dividend of $0.825 per share and special dividend of $1.00 per share
  • Oil production above guidance midpoint with capital expenditures within 1% of guidance midpoint

Full Year 2022 Highlights and 2023 Capital Plan:

  • Generated $7.6 billion free cash flow and returned $5.1 billion to shareholders
  • Offset most inflation to deliver total production above original plan for capex 2% above original plan
  • Replaced 244% of 2022 production at finding and development cost of $5.13 per Boe
  • Reduced GHG intensity and methane percentage to achieve 2025 targets
  • Announced $6.0 billion capital plan to grow oil production 3% and total production 9%

From Ezra Yacob, Chairman and Chief Executive Officer: "EOG's 2022 results benefited from our growing portfolio of high-return plays. In a challenging inflationary environment, we leveraged the flexibility provided by our multi-basin plays and decentralized structure to deliver exceptional performance that was within two percent of our original plan for volumes and capital expenditures. Credit goes to the innovative and entrepreneurial teams working collaboratively across our multi-basin portfolio.

"Our commitment to decentralized exploration resulted in the addition of a new premium play - the Ohio Utica Combo - and advancements in our other emerging plays, South Texas Dorado and Southern Powder River Basin. We also progressed several exploration prospects.

"We reduced our GHG intensity and methane emissions percentage, achieving our 2025 targets. We also deployed a new continuous leak detection system called iSenseSM and recently began operations at our first carbon capture and storage site.

"EOG's financial performance was equally strong, highlighted by record net income and returns on capital. We returned $5.1 billion to shareholders, representing 67% of free cash flow, well above our minimum 60% commitment. The strong price environment in 2022 also allowed us to improve our financial position, reducing net debt by $794 million.

"EOG is in a better position than ever to play a significant role in the long-term future of energy and deliver value for our shareholders. And we continue to get better - our 2023 plan positions us to continue to lower our cost structure. We remain committed to returning cash through a sustainable, growing regular dividend, which is supported by our low cost structure and an impeccable balance sheet."

2023 Capital Program

Total expenditures for 2023 are expected to range from $5.8 to $6.2 billion, including exploration and development drilling, facilities, leasehold acquisitions, capitalized interest, other property, plant and equipment, and excluding property acquisitions, asset retirement costs and non-cash exchanges. The capital program also excludes certain exploration costs incurred as operating expenses.

The disciplined capital program is allocated across EOG's high-return, multi-basin drilling portfolio. It is anchored by steady development in the Delaware Basin, with increased activity focused on the Eagle Ford and on EOG's emerging premium plays - the Powder River Basin, South Texas Dorado and Ohio Utica Shale.

About $4.4 billion of the capital program is allocated to EOG's existing and emerging premium areas. The capital program also funds investment in international plays, high-potential exploration and environmental and infrastructure projects.

Fourth Quarter 2022 Financial Performance

Earnings per Share 4Q 2022 vs 3Q 2022


  • Crude oil, NGL and natural gas prices declined in 4Q compared with 3Q


  • Total 4Q oil production of 465,600 Bopd was above the midpoint of the guidance range and up 500 Bopd from 3Q
  • NGL production decreased 10% from 3Q and increased 20% from the prior year period, primarily driven by changes in the amount of ethane extraction
  • Natural gas production increased 4% from 3Q
  • Total company equivalent production declined 1% from 3Q

Per-Unit Costs

  • DD&A, transportation and gathering and processing costs decreased in 4Q compared with 3Q, partially offset by higher lease and well expenses (LOE)


  • Lower commodity prices in 4Q were partially offset by increased earnings related to hedging
Change in Cash 4Q 2022 vs 3Q 2022

Free Cash Flow

  • Cash flow from operations before changes in working capital was $3.1 billion in 4Q
  • EOG incurred $1.4 billion of capital expenditures
  • This resulted in $1.7 billion of free cash flow

Working Capital and Dividends

  • Changes in working capital accounted for $0.3 billion of the increase in cash during 4Q
  • EOG paid $1.3 billion in dividends in 4Q, including $876 million of special dividends

Full-Year 2022 Financial Performance

Earnings per Share 2022 vs 2021


  • Crude oil prices increased 42%
  • Natural gas prices increased 49%
  • Prices for NGLs increased 7%


  • Crude oil volumes increased 4% to 461,300 Bopd
  • NGL volumes increased 37%, supported by increased extraction of ethane
  • Natural gas production increased 4%
  • Total company equivalent production increased 10%

Per-Unit Costs

  • DD&A costs decreased in 2022, partially offset by higher lease and well expenses (LOE)


  • Higher commodity prices in 2022 were partially offset by lower earnings related to hedging
Change in Cash 2022 vs 2021

Free Cash Flow

  • Cash flow from operations before changes in working capital was $12.2 billion in 2022
  • EOG incurred $4.6 billion of capital expenditures
  • This resulted in $7.6 billion of free cash flow


  • EOG paid $3.00 per share in regular dividends and $5.80 per share in special dividends during 2022
  • EOG returned a total of $5.1 billion in 2022, representing 67% of free cash flow

Fourth Quarter 2022 Operating Performance

Lease and Well

Per-unit LOE costs increased $0.27 in 4Q compared with 3Q and were within the guidance range. Higher well maintenance and water handling costs were the primary drivers of the increase.

Transportation, Gathering and Processing

Per-unit transportation and G&P costs declined in 4Q and were below the guidance midpoints, primarily due to lower fuel prices.

General and Administrative

Per-unit G&A costs in 4Q were above the guidance range and prior quarter because of higher employee-related expenses.

Depreciation, Depletion and Amortization

Per-unit DD&A costs in 4Q decreased $0.21 compared with 3Q and were below the guidance range. The addition of lower-cost reserves in the Delaware Basin drove most of the decrease.

2022 Reserves; Regular and Special Dividend

Finding and Development Cost

Finding and development cost, excluding price revisions, decreased 8% in 2022 to $5.13 per Boe. Proved developed finding cost, excluding price revisions, was $6.62 per Boe in 2022. For the 35th consecutive year, internal reserves estimates were within five percent of estimates independently prepared by DeGolyer and McNaughton.

Reserve Replacement

Total proved reserves increased 13% in 2022. Extensions and discoveries added 560 MMBoe of proved reserves in 2022. Revisions other than price increased proved reserves by 325 MMBoe. Net proved reserve additions from all sources, excluding price revisions, replaced 244% of 2022 total production and 279% of liquids production.

Regular Dividend and Special Dividend

The Board of Directors today declared a dividend of $0.825 per share on EOG's common stock. The dividend will be payable April 28, 2023, to stockholders of record as of April 14, 2023. The indicated annual rate is $3.30 per share. The Board of Directors today also declared a special dividend of $1.00 per share on EOG's Common Stock. The special dividend will be payable March 30, 2023, to stockholders of record as of March 16, 2023.

2022 ESG Performance3 - Approximate Preliminary Results

EOG reduced its Scope 1 GHG intensity rate by 4% and its methane emissions percentage by 17% during 2022 to meet the company's 2025 targets. Wellhead gas capture increased to 99.9% from 99.8% in 2021. Water sourced from reuse increased to 58% from 55% in 2021.

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