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4Q 2018 and 2019 Development Plan – EOG Resources, Inc.

EOG Resources, Inc. · Feb 26, 2019 · 43 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. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 1
    4Q 2018 David Streit, Vice President IR/PR Kimberly Ehmer, Director IR/PR Neel Panchal, Director IR John Wagner, Engineer IR (713) 5714902, dstreiteogresources.com (713) 5714676, kehmereogresources.com (713) 5714884,…
  2. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 2
    4Q 2018 3
  3. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 3
    EOG Resources High Return Organic Growth Company Leader in ROCE Leader in LowCost Producer Commitment to Through Disciplined Competitive in Sustainability Commodity Growth Global Energy Price Cycles Market 4Q 2018 4
  4. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 4
    2018 Performance Among the Best Across all Sectors Delivered A Premium Combination: High Return Organic Growth ROCE Competitive with All Sectors Organic Growth Through Premium Drilling Realized 15%1 ROCE in 2018 Grew Oil Production…
  5. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 5
    2019 Game Plan Continue Delivering LongTerm Shareholder Value ROCE Competitive with All Sectors Disciplined Growth + Opportunistic Investment Target DoubleDigit ROCE in 2019 Target 12% 16% U.S. Oil Growth Continue Lowering Oil Price…
  6. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 6
    2018 Return on Capital Employed1 Highest Since Shift to Oil LongTerm Track Record of Value Creation Business Environment Gas Focused Shift to Oil High Oil Price & Growth Oil Downturn Avg. ROCE 20% 4% 10% 4% 30% 27% 26% Reset to…
  7. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 7
    Strategy for Sustainable DoubleDigit ROCE Premium Drilling + Disciplined Growth Premium Drilling Oil Price Required to Earn DoubleDigit ROCE3 Minimum 30% Direct ATROR1 with Flat 40 Oil and 2.50 Natural Gas Ensures Strong Returns…
  8. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 8
    Improvement in Finding & Development Costs1 Drives Down DD&A Premium Drilling Locks in Lower Costs Finding & Development Costs1 Depreciation, Depletion & Amortization per Boe per Boe 17.87 18.43 17.34 15.86 15.34 14.58 12.51…
  9. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 9
    EOG Earns PeerLeading1 Returns Strong Reinvestment Returns Drives ROCE2 2017 US Lower 48 Allin Rate of Return3 2018 Return on Capital Employed2 41% 15%4 15% 14% 9% 19% 19% 7% 6% 6% 5% 10% 10% 4% 8% 7% 5% 1% 1% 0% EOG A…
  10. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 10
    Premium Inventory1 Additions Sustain HighReturn Growth Inventory Growing in Quality and Size 9,500 13 Years of Premium Inventory 8,000 at Current Drilling Pace 6,000 Replacing Premium Locations 2x Faster than Drilling 3,200…
  11. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 11
    Disciplined Investment in 2019 Capital Budget Allocation 82% Premium Areas1 77% New Domestic Drilling Potential2 International 2018 2019 Facilities 6.2 Bn 6.3 Bn4 Gathering, 5% Processing & Other3 3% 3% 10% 10% 5% 4% 1%…
  12. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 12
    Improved Capital Efficiency Drives 2019 Plan Disciplined Growth + Opportunistic Investment Improvement in Capital Efficiency1 in Premium Areas2 Opportunistic Investment for High Return, New Drilling Potential4 Assumes 31% Base Decline3…
  13. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 13
    Substantial 2019 Free Cash Flow1 with Higher Oil Prices Free Cash Flow1 Dividend3 CAPEX2 CAPEX2 + Dividend3 6.8 Bn 50 55 60 65 WTI Oil Price (1) Discretionary Cash Flow less CAPEX and dividend. See reconciliation schedules for…
  14. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 14
    Premium Capital Allocation Creates Value Through Price Cycles Cash Flow Priorities Disciplined, HighReturn Organic Growth Diverse & Deep Premium Drilling Inventory Exploration & LowCost Leasing for New HighReturn Plays Generate…
  15. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 15
    EOG Culture Drives Sustainable Competitive Advantage RateofReturn MultiDisciplinary Every Employee is a Driven Teamwork Business Person First Decentralized / Innovative / Safety, Environment, NonBureaucratic Entrepreneurial &…
  16. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 16
    4Q 2018 17
  17. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 17
    Strong Second Half 2018 Momentum Wolfcamp Well Productivity and Operating Efficiencies Cumulative Crude Oil Production (MBo) Days to Drill1 Normalized to 7,000 Lateral 100 +13% 19.4 18.4 17.5 16.0 80 1Q18 2Q18 3Q18 4Q18 60…
  18. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 18
    Strong Track Record of Cost Reduction in All Price Environments Eagle Ford Well Costs1 (MM) 7.2 6.2 6.1 5.7 4.7 4.5 4.6 4.5 4.3 2012 2013 2014 2015 2016 2017 1H 2018 2H 2018 2019 2019 Target Target (1) Well Costs =…
  19. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 19
    Line of Sight to 2019 Permian Well Cost1 Reductions Wolfcamp Oil 7.5 Well Costs1 (MM) 7.2 YearEnd 2018 Drilling Drilling Tools Completion Sand Water Price YearEnd 2019 Efficiencies Efficiencies Increases Target 4Q 2018 20…
  20. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 20
    Secured 65% of Anticipated 2019 Well Costs1 at Competitive Pricing Completion Services SelfSource 25% 33% of Well Costs1 SelfSource Water, Chemicals & Completion Design Completion Spreads 13% Sand 65% 9% SelfSource of…
  21. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 21
    EOG Continues Reducing Cash Operating Costs ( Per Boe) G&A Transportation 12.861 LOE 11.391 9.951 9.911 9.36 9.342 2014 2015 2016 2017 2018 2019E (1) Excludes onetime expenses. See reconciliation schedules for reconciliations…
  22. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 22
    EOG Continues Leading the Thousand Club in 2018 Number of Wells with 30Day Peak Rate 1,000 Boed 600 Oil Focused Gas Focused 500 400 300 200 100 0 EOG A B C D E F G H I J K L M N O P Q R S Source: Sanford C.…
  23. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 23
    EOG Realizes Higher Oil Prices than Peers 6.00 EOG Average 3.17 per Bbl Advantage U.S. Crude Oil and Condensate Price 4.98 5.00 Realization vs. Peers1 4.41 ( per Bbl) 4.00 3.71 3.01 2.86 3.00 2.21 2.17 2.00 2.00 1.00…
  24. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 24
    EOGs Diversified Marketing Options Provide Pricing Advantage & Flow Assurance 2019 Estimated Sales Market U.S. Crude Oil U.S. Natural Gas Gulf Coast Gulf Coast Permian Permian MidCush Hedges Midwest & West Coast East Coast…
  25. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 25
    Owning Data from Creation to DeliverySM via 100+ Apps EOGs Supply Chain of Data: INFRASTRUCTURE Data Sensors Networks Servers Data Storage Processing Nodes User Support Enabling EOGs Culture of RealTime, ReturnsFocused…
  26. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 26
    Lower Costs Drive Higher Margins 2018 2014 2015 2016 2017 1Q 2Q 3Q 4Q FY Composite Average Wellhead Revenue per Boe 58.01 30.66 26.82 35.58 44.15 46.40 48.20 43.20 45.51 Operating Costs per Boe Lease & Well 6.53 5.66 4.53 4.70 5.05…
  27. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 27
    Strong Balance Sheet & Sustainable Dividend Through Commodity Price Cycles Retire Maturing Bonds From 2018 2021 31% Dividend Increase in 20182 Bn per Share 6.4 0.90 0.35 0.80 0.90 0.70 1.00 0.60 0.75 3.4 0.50 0.40 0.30…
  28. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 28
    Premium Drilling in All Major U.S. Oil Basins Rocky Mountain Mid-Continent Area 6 MBopd in 2018 62 MBopd in 2018 Woodford Oil Window Powder River Basin 30 Net Completions in 2019 40 Net Completions in 2019 Wyoming DJ Basin 35 Net…
  29. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 29
    Deep Inventory of Crude Oil Assets Net Undrilled 2019 Average 2019 Average 2019 Play Premium Locations1 Drilling Rigs Completion Spreads Net Planned Completions Eagle Ford 2,300 10 7.5 300 Delaware Basin 4,815 20 6 270 Wolfcamp…
  30. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 30
    Delaware Basin Northwest Shelf 163,000 Brushy Canyon Chaves Net Acres Lea Leonard Delaware Basin 1st Bone Spring 4,800 of Stacked Pay 416,000 Net Acres 2nd Bone Spring Eddy 3rd Bone Spring Loving Winkler Upper…
  31. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 31
    South Texas Eagle Ford Oil FAYETTE Bellwether Asset for EOG EOG Largest Oil Producer & Acreage Holder San Antonio GUADALUPE GONZALES Organically Leased Position for 450 per Acre KINNEY UVALDE MEDINA BEXAR LAVACA Capable of…
  32. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 32
    Powder River Basin Parkman Shannon Powder River Basin Core Area 4,800 of Stacked Pay Niobrara Turner Mowry Muddy Dakota Source Rock Reservoir Rock 4Q 2018 33
  33. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 33
    Bakken/Three Forks Wyoming DJ Basin Laramie Stanley, ND State Line Bakken Lite Elm Coulee Bakken Core Antelope Extension Wyoming Colorado Weld 20 Miles Core EOG Acreage Bakken/Three Forks EOG 88,000 Net Acres NonCore…
  34. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 34
    Eastern Anadarko Basin Woodford Oil Window HighReturn, LowDecline Premium Play in Crude Oil Window CANADIAN OKLAHOMA Lowered Well Cost1 Target to 7.6 MM Oklahoma City Anticipate Sourcing 50% of Water CLEVELAND Needs with…
  35. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 35
    Trinidad Oil Fields Return to Drilling Gas Fields 5 Well Drilling Program in 2019 EOG Blocks Entered Into New Gas Supply Contract TOBAGO Enables Additional Drilling Sold into Trinidad Domestic Gas Market Caribbean Sea Free…
  36. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 36
    EOG Premium Play Details Delaware Basin Wolfcamp Oil Wolfcamp Combo First Bone Spring Second Bone Spring Leonard Net Prospective Acres 226,000 120,000 100,000 289,000 160,000 Estimated Resource Potential1 2.9 BnBoe 540 MMBoe 1.4 BnBoe…
  37. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 37
    EOG Premium Play Details Powder River Basin Bakken / Wyoming Woodford Oil Eagle Ford Mowry Shale Niobrara Shale Turner Sand Three Forks DJ Basin Window Net Prospective Acres 516,000 141,000 89,000 154,000 220,000 88,000 47,000…
  38. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 38
    Initial 30Day Average Production Rates Gross Net Gross Gross Net Gross Lateral Lateral Wells Wells Bopd Boed Wells Wells Bopd Boed 4Q 2018 42 37 1,950 3,150 7,000 4Q 2018 82 78 1,300 1,600 7,300 3Q 2018 61 58 1,655 2,640 7,100 3Q…
  39. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 39
    1Q & FY 2019 Guidance Estimated Ranges Estimated Ranges (Unaudited) (Unaudited) 1Q 2019 Full Year 2019 1Q 2019 Full Year 2019 Daily Sales Volumes Expenses (MM) Crude Oil and Condensate Volumes (MBbld) Exploration and Dry Hole 35 45…
  40. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 40
    Premium Drilling Adds LowCost Reserves 2018 Net Proved Reserves Allin Reserve Replacement Cost1 per BOE Strong Reserve Growth 13.25 Increased YE 2018 Net Proved Reserves 16% to 2,928 MMBoe Replaced 238%1 of 2018 Production 11.91…
  41. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 41
    Focusing Our Energy on the Future Environmental Social Leak Detection and Repair Program (LDAR) Commitment to Safety Reduces Emissions Support the Communities Where We Work Pipeline Infrastructure Reduces Road Congestion Inclusive and…
  42. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 42
    Committed to Minimizing Emissions 60 Greenhouse Gas Intensity1 (Metric Tons CO2e per MBoe) Gassy Oily EOG Peers2 Peers3 Peers3 30 EOG EOG 0 0 100 200 300 400 500 600 700 800 Gross U.S. Production (MBoed) (1) Metric tons…
  43. 4Q 2018 and 2019 Development Plan – EOG Resources, Inc. – slide 43
    EOG Industry Leader in Capturing Produced Gas 100% Texas Permian Basin Flared / Vented Wellhead Gas (% of Wellhead Production) EOG Peers 10% EOG 1% 0 100 200 300 400 500 600 Wellhead Gas Production (MMcfd) 4Q 2018 44…

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