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Q2 2016 Earnings Presentation – EOG Resources, Inc.

EOG Resources, Inc. · Aug 4, 2016 · 39 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 1
    2Q 2016 NYSE Stock Symbol: EOG Investor Relations Contacts Common Dividend: 0.67 Cedric W. Burgher, SVP Investor and Public Relations Basic Shares Outstanding: 551 Million (713) 571-4658, cburghereogresources.com David J. Streit,…
  2. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 2
    2Q 2016 Increased Premium Inventory by 1,100 Locations to 4,300 Net Wells - Premium Resource Potential Increased 75% to 3.5 BnBoe* Introduced 2017-2020 Oil Growth Outlook of 10%-20% CAGR Beat High End of All U.S. Production Guidance…
  3. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 3
    Robust Growth for Far Less Capital Premium Well Definition - Generates at Least 30% Direct ATROR* at 40 Oil - Does Not Change with Oil Prices; Benchmark Remains 40 Oil Significant Capital Productivity Increase - Higher Direct…
  4. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 4
    Shifting to Premium Locations Premium Drilling Direct ATROR* (% Completed Premium Wells*) (Minimum Return for Premium) 98% 100%+ 81% 60% 60% 30% 23% 14% 10% 2014 2015 2016 2017 2018+ Oil: 30 40 50 60 Est Est Est *…
  5. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 5
    Feb 2016 Aug 2016 Change Eagle Ford 1,535 1,925 +390 Bakken/Three Forks Core 330 330 - Delaware Basin - Wolfcamp 695 775 +80 - 2nd Bone Spring 255 540 +285 - Leonard 280 435 +155 DJ Basin - 200 +200 Powder River Basin 80 80 -…
  6. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 6
    Delaware Basin Wolfcamp Oil Wells Delaware Basin Bone Spring Sand Wells Average Cumulative Production* Average Cumulative Production* (MBoe) (MBoe) 250 125 2016 2016 200 2015 100 2015 150 750 MBoe 75 EUR 500 MBoe EUR 100…
  7. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 7
    Bpd Delaware Basin Oil Midland Basin Oil 1,000 800 Solid Colors: Barrels of Oil per Day Gray Bar: BOE per Day Natural Gas 600 400 200 0 EOG A B C D E F G H I J K Well Count 31 25 41 32 50 21 19 164 30 30 27 12…
  8. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 8
    Short Laterals Long Laterals Combined Naylor Jones Naylor Jones Units 5W and 8W Units 5W and 8W 640 Acres 1,280 Acres 640 Acres Per Well Total Per Well Total Lateral, Feet 4,850 19,400 10,420 20,840 CWC* 4.0 MM 16.0 MM…
  9. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 9
    Delaware Basin South Texas Eagle Ford Bakken Wolfcamp Oil Play 11.5 8.8 7.5 7.2 6.7 6.5 6.3 6.1 5.7 6.1 5.1 4.8 2014 2015 1H16 Target 2014 2015 1H16 Target 2014 2015 1H16 Target * Normalized to 4,500 lateral. *…
  10. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 10
    4,185 1,925 1,535 Potential Growth February 2016 August 2016 10% Cost 10% EUR -OR- Savings Increase EOG _0816-11
  11. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 11
    17.02 14.11* 11.95* G&P G&A Taxes Other Than Income Transportation LOE 2014 2015 1H 2016 * Excludes one-time expenses of 19.4 million in 2015 related to early leasehold termination and 42.1 million in 1H 2016 related…
  12. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 12
    Reset Company to Be Successful At Low Prices Improve Well Productivity with Technology and Innovation - Precision Lateral Targeting - High-Density Completions - Enhanced Oil Recovery Lower Costs - Identify Further Efficiency…
  13. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 13
    MBopd 700 600 60 500 400 50 300 200 100 0 2016 2017 2018 2019 2020 * Discretionary Cash Flow Capex + Current Dividend EOG _0816-14
  14. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 14
    High-Quality Assets with Scale - Large Eagle Ford, Bakken and Delaware Basin Footprints - Scale Drives Cost Savings and Leverages Technology Gains Innovation and Technology Focus - In-House Completion Design - Merging Data Science and…
  15. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 15
    Resource Net Total Potential** Premium Play Acres Locations* (MMBoe) Locations Eagle Ford 549,000 7,200 3,200 1,925 Bakken/Three Forks - Core 120,000 975 620 330 - Non-Core 110,000 1,125 400 - Delaware Basin - Wolfcamp 168,000…
  16. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 16
    Oil Production (MBod) versus Capex* (Bn) Gathering, Processing and Other 10 289 284 300 273 Exploration and 0.1 9 Development Facilities 250 0.4 8 - 44% 8.3 7 200 6 2.0 5 - 47% 150 Exploration and Development 4 4.7 100 3 2…
  17. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 17
    120-Day Cumulative Oil Production* (Bbl Per Foot of Treated Lateral) Focus on Premium Locations 20.9 Precision Targeting Advanced Completions 13.6 10.7 Lower Costs 2014 2015 2016 Est * Domestic completions, gross oil…
  18. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 18
    Delaware Basin South Texas Eagle Ford Bakken Wolfcamp Oil Play 32.8 20.8 18.7 17.7 14.7 14.2 12.4 10.9 8.9 8.5 8.8 7.8 6.2 5.4 3.7 2014 2015 1H16 Record 2012 2013 2014 2015 1H16 Record 2012 2013 2014 2015 Record *…
  19. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 19
    3/4 Savings From Efficiencies Sustainable Efficiency Improvements +0.4MM -1.6MM 8.3MM Flowback & Water Facilities Handling -0.6MM Efficiency Savings 1.6M Per Well 6.5MM Drilling Faster Completion Operations Supervsion…
  20. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 20
    Largest Oil Producer and Acreage Holder in the Eagle Ford - Average 5 Rigs Operating in 2016 FAYETTE San Antonio - Complete 190 Net Wells in 2016; 105 YTD GUADALUPE BEXAR GONZALES LAVACA Estimated Resource Potential 3.2…
  21. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 21
    Eagle Ford West Wells Eagle Ford East Wells Average Cumulative Oil Production* Average Cumulative Oil Production* (Mbo) (Mbo) 100 100 2016 80 80 2015 2016 2014 2015 2013 2014 60 2013 60 2012 40 2012 40 20 20 0 0 0 30…
  22. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 22
    2010 Completions 540 Events /1,000 ft 2015 Completions 4,030 Events /1,000 ft Enhance Complexity to Contain Events Closer Contact More Surface Area to Wellbore Note: Microseismic dots represent well stimulation events…
  23. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 23
    3. Drill 2. Overall 1. Grade Rock Characteristics High to Low Quality Grade * Sample 1-foot core extracted from Lower Eagle Ford. Enlarged to show detail of the rock. Lower Eagle Ford * Sample 1-foot core extracted from…
  24. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 24
    Four Gas Injection Pilot Projects with 15 Producing Wells - One Additional Project Planned for 2016 with 32 Wells - Geologically and Geographically Diverse - EOR Incremental Production in 2016 1,000 Net Bopd Attractive Economics -…
  25. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 25
    (Net Mbo) 600 Enhanced Oil Recovery Production 1.3x 1.7x 500 Response 3 Months After Injection 400 1.0x 300 Primary Recovery 200 100 Produce 2 - 5 Years Before EOR Injection 0 EOG _0816-27
  26. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 26
    New Geologic Concept in an Existing Play Precision Targeting Key Responds Well to EOG-Style Completions Overlays Existing Eagle Ford Acreage Exhibiting Premium-Level Well Performance Plan 9 Wells in 2016 EOG _0816-28
  27. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 27
    Brushy Canyon City Hall Leonard A Average 5 Rigs in 2016 Leonard B 1st Bone Spring 4,800 2nd Bone Spring Wall Street 3rd Bone Spring Upper Wolfcamp Battery Park Middle Wolfcamp Lower Wolfcamp 150 40 Battery Park…
  28. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 28
    168,000 Net Acres Prospective with Multiple Target Zones - 2,130 Net Drilling Locations - 4,500 Average Lateral; 700 Spacing NGLs - Complete 70 Net Wells in 2016; 31 YTD 24% Oil Estimated Resource Potential 1.3 BnBoe,* Net to EOG…
  29. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 29
    Second Bone Spring 111,000 Net Acres Prospective in Northern Delaware Basin - 1,250 Net Drilling Locations; 850 Spacing - Complete 20 Net Wells in 2016; 13 YTD Estimated Resource Potential 500 MMBoe,* Net to EOG Typical Well NGLs…
  30. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 30
    Canada Focus on Premium Locations State Line Stanley, ND Complete 25 Net Wells in Williston in 2016 Bakken Lite Estimated Resource Potential 1.0 BnBoe* Elm Coulee Bakken Core - 8,400 Lateral - 7.2 MM CWC** in 2015; Target…
  31. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 31
    Trinidad Trinidad and Tobago Sercan Joint Development Project ATLANTIC OCEAN - 5-Well Program - Complete One Well Late 2016 TRINIDAD 4(a) U(a) U(b) Limited Capital Spending in 2016 SECC Active Exploration Program…
  32. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 32
    EOG Competitive Globally Brent (/BBL) 100 90 80 New Marginal Cost of Oil Oil Sands 70 ( 65 - 75) US L48 Conv Russia North Sea 60 GOM Angola Far East U.S. Tight Oil Brazil 50 Mexico Nigeria 40 Venezuela 30 Russia…
  33. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 33
    2014 2015 2016 2017 +1,269 +723 -819 -410 9,694 9,423 9,407 9,329 9,129 9,451 9,168 9,315 8,835 9,192 8,568 8,947 8,630 8,678 8,350 8,244 8,223 8,234 8,206 8,262 8,247 8,170 7,728 8,099 8,064 7,998 7,400 7,296 7,575…
  34. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 34
    Percent of Wells with ATROR* Net Present Value* 10% at 50 Oil Per Well at 50 Oil 95% 79% 3.3MM 1.7MM 39% Industry Industry EOG EOG EOG EOG -0.3MM 2015 2016 2015 2016 Industry production data from IHS for U.S.…
  35. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 35
    9.0% 8.1% 7.3% 6.5% 5.2% 5.1% 4.9% 4.4% 2.9% 2.7% EOG A B C Peer D E F G H Avg Source: FactSet, adjusted earnings. See Reconciliation Schedules. Peer companies: APC, APA, CHK, DVN, HES, MRO, NBL and PXD. EOG _0816-37
  36. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 36
    EOG Employees Are Incentivized to Deliver Returns Production and Returns Reserve Growth EOG 25% 8% A 10% 30% B 45% C 40% D 30% E 10% 30% F 58% G 10% H 30% Source: Company Reports. Percentages represent weightings…
  37. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 37
    0.70 Committed to the Dividend 0.67 0.67 16 Dividend Increases in 17 Years 0.60 0.59 0.50 0.40 0.38 0.34 0.31 0.32 0.29 0.30 0.26 0.20 0.18 0.12 0.10 0.08 0.05 0.06 0.03 0.04 0.04 0.04 0.00 1999 2000 2001…
  38. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 38
    Maintain Strong Balance Sheet - Investment Grade Credit Ratings Successful Efforts Accounting Zero Goodwill 2.8 Billion in Available Liquidity - 0.8 Billion Cash at June 30, 2016 - 2.0 Billion Credit Facility Undrawn at June 30, 2016…
  39. Q2 2016 Earnings Presentation – EOG Resources, Inc. – slide 39
    70% 60% 50% Issued Equity Since June 2014 40% 30% 20% 10% 0% A B C D E F G H Peer EOG I J K L M N O Avg * Source: FactSet. As of 3/31/16. See reconciliation schedule. Peer Group: APA, APC, CLR, COG, COP,…

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