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Section 1: 8-K (8-K)

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false0000821189 0000821189 2019-11-06 2019-11-06


 
 
 
 
 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 6, 2019

_______________

EOG RESOURCES, INC.
(Exact name of registrant as specified in its charter)

Delaware
1-9743
47-0684736
(State or other jurisdiction
 of incorporation)
(Commission File
 Number)
(I.R.S. Employer
Identification No.)

1111 Bagby, Sky Lobby 2
Houston, Texas  77002
(Address of principal executive offices) (Zip Code)

713-651-7000
(Registrant's telephone number, including area code)


Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

     Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

     Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

     Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

     Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading symbol(s)
Name of each exchange on which registered
Common Stock, par value $0.01 per share
EOG
New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.


 
 
 
 
 




EOG RESOURCES, INC.

Item 2.02     Results of Operations and Financial Condition.

On November 6, 2019, EOG Resources, Inc. issued a press release announcing third quarter 2019 financial and operational results and fourth quarter and full year 2019 forecast and benchmark commodity pricing information (see Item 7.01 below).  A copy of this release is attached as Exhibit 99.1 to this filing and is incorporated herein by reference.  This information shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, and is not incorporated by reference into any filing under the Securities Act of 1933, as amended, or Securities Exchange Act of 1934, as amended.

Item 7.01     Regulation FD Disclosure.

Accompanying the press release announcing third quarter 2019 financial and operational results attached hereto as Exhibit 99.1 is fourth quarter and full year 2019 forecast and benchmark commodity pricing information for EOG Resources, Inc., which information is incorporated herein by reference.  This information shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, and is not incorporated by reference into any filing under the Securities Act of 1933, as amended, or Securities Exchange Act of 1934, as amended.

Item 9.01     Financial Statements and Exhibits.

(d)    Exhibits

  99.1    Press Release of EOG Resources, Inc. dated November 6, 2019 (including the accompanying fourth quarter and full year 2019 forecast and benchmark commodity pricing information).

104    Cover Page Interactive Data File (formatted as Inline XBRL).



2



SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
 
EOG RESOURCES, INC.
(Registrant)
 
 
 
 
 
 
 
 
 
Date: November 6, 2019
By:
/s/ TIMOTHY K. DRIGGERS
Timothy K. Driggers
Executive Vice President and Chief Financial Officer
(Principal Financial Officer and Duly Authorized Officer)


3
(Back To Top)

Section 2: EX-99.1 (PRESS RELEASE OF EOG RESOURCES, INC.)

Exhibit
EXHIBIT 99.1


400863030_eoglogoa28.jpg

November 6, 2019

EOG Resources Reports Outstanding Third Quarter 2019 Results; Announces Two New Delaware Basin Plays and Adds 1,700 Net Premium Locations
Exceeded Crude Oil Production Target Range and Raised Full-Year 2019 U.S. Crude Oil Growth Target from 14 to 15 Percent
Capital Expenditures Near Low End of Target Range
Generated Significant Net Cash From Operating Activities and Free Cash Flow
Reduced YTD Well Costs 5 Percent
Per-Unit Lease and Well and DD&A Expense Rates Below Low End of Target Ranges
Added 1,700 Net Premium Locations to Inventory Now Totaling 10,500 Locations and Representing Over 14 Years of Drilling Inventory
New Delaware Basin Wolfcamp M and Third Bone Spring Plays Add 1.6 BnBoe Net Resource Potential
 
HOUSTON - EOG Resources, Inc. (EOG) today reported third quarter 2019 net income of $615 million, or $1.06 per share, compared with third quarter 2018 net income of $1.2 billion, or $2.05 per share. Net cash provided by operating activities for the third quarter 2019 was $2.1 billion.

Adjusted non-GAAP net income for the third quarter 2019 was $654 million, or $1.13 per share, compared with adjusted non-GAAP net income of $1.0 billion, or $1.75 per share, for the same prior year period. Please refer to the attached tables for the reconciliation of non-GAAP measures to GAAP measures.
 
Third Quarter 2019 Operating Review
Total crude oil volumes of 464,100 barrels of oil per day (Bopd) in the third quarter 2019 increased 12 percent compared to the same prior year period and were above the high end of the target range. Natural gas liquids (NGLs) and natural gas volumes each grew 11 percent. EOG incurred total expenditures of $1.6 billion in the third quarter. Cash capital expenditures before acquisitions of $1.5 billion were near the low end of the target range. Please refer to the attached tables for the reconciliation of non-GAAP measures to GAAP measures.

EOG continued to lower operating costs during the third quarter 2019. Per-unit transportation costs declined nine percent compared to the same prior-year period, depreciation, depletion and amortization expenses fell seven percent year-over-year, and lease and well expenses declined three percent year-over-year.

EOG generated $2.0 billion of discretionary cash flow in the third quarter 2019. After considering cash capital expenditures before acquisitions of $1.5 billion and dividend payments of $166 million, EOG generated free cash flow during the third quarter 2019 of $337 million. Please refer to the attached tables for the reconciliation of non-GAAP measures to GAAP measures. 




“EOG’s operating performance has never been better. The company generated outstanding financial results in the third quarter driven by improvements in every area,” said William R. “Bill” Thomas, Chairman and Chief Executive Officer. “We reduced operating expenses, grew volumes at double-digit rates while lowering well costs and generated substantial free cash flow. EOG has never been in a better position to sustain this success long into the future.”

New Delaware Basin Plays and Premium Inventory Update
EOG expanded its lineup of premium plays in the Delaware Basin with the addition of the Wolfcamp M and the Third Bone Spring. The drilling locations in these two plays are highly economic at a flat $40 oil price and flat $2.50 natural gas price, consistent with EOG’s definition of premium inventory. The company continues to deepen its technical knowledge of the Delaware Basin as it executes its development program. EOG collects significant amounts of data on each well, integrates it with existing models and incorporates analysis from numerous spacing and targeting tests.

EOG has identified an initial 855 net premium drilling locations in the Wolfcamp M, with estimated net resource potential of 1.0 billion barrels of oil equivalent across its 193,000 net acre position. The wells in this deeper section of the Wolfcamp formation produce roughly equal parts oil, NGLs and natural gas. Benefiting from EOG’s low well costs, Wolfcamp M wells deliver strong premium economics and exceptionally low finding costs.

To define the play, EOG has gathered extensive subsurface information and has completed six Wolfcamp M wells, including two during 2019. The Green Drake 16 Fed Com #759H was completed in Lea County, NM with a treated lateral length of 7,200 feet and a 30-day initial production rate of 4,165 barrels of oil equivalent per day (Boed), or 2,145 Bopd, 1,070 barrels per day (Bpd) of NGLs and 5.7 million cubic feet per day (MMcfd) of natural gas. In Reeves County, TX, the State Correa #3H was completed with a treated lateral length of 9,900 feet and a 30-day initial production rate of 2,800 Boed, or 1,175 Bopd, 845 Bpd of NGLs and 4.7 MMcfd of natural gas.

EOG has identified an initial 615 net premium drilling locations in the Third Bone Spring, with estimated net resource potential of 585 million barrels of oil equivalent across its 200,000 net acre position. EOG’s early focus in the Delaware Basin has been on development of the Wolfcamp formation, which sits below the Third Bone Spring. Each of the Wolfcamp wells has drilled through the Third Bone Spring, providing significant technical data and helping to delineate multiple targets within the play.

EOG has completed over 50 Third Bone Spring wells to date, including 10 net wells in 2019. The McGregor D 5 #592H targeted the Third Bone Spring Carbonate and was completed in Loving County, TX with a treated lateral length of 9,700 feet and a 30-day initial production rate of 2,865 Boed, or 1,990 Bopd, 500 Bpd of NGLs and 2.3 MMcfd of natural gas. In Lea County, NM, the Caravan 28 State Com #601H and the Convoy 28 State Com #606H targeted the Third Bone Spring Sand and were completed with an average treated lateral length of 10,000 feet per well and average 30-day initial production rates per well of 3,985 Boed, or 2,730 Bopd, 670 Bpd of NGLs and 3.5 MMcfd of natural gas.

In total, EOG added 1,700 net premium drilling locations to its undrilled premium inventory in the third quarter 2019. Taking into account approximately 640 net wells drilled to date in 2019 and updated location counts across its portfolio, EOG’s premium inventory now totals 10,500 net locations, representing more than 14 years of high-return drilling inventory.

“EOG is a returns-focused company where organic growth is driven by exploration and low-cost development. The announcement of two more premium plays in the Delaware Basin and the addition of 1,700 new net premium drilling locations demonstrate the sustainability of our unique business model,”



Thomas continued. “EOG continues to demonstrate its ability to generate attractive returns on capital through reinvestment in an improving inventory of premium wells across multiple plays. Our best-in-class assets prove that EOG can adapt to changing industry conditions and create significant shareholder value for years to come.”

Financial Review
EOG further strengthened its financial position during the third quarter 2019. At September 30, 2019, EOG’s total debt outstanding was $5.2 billion for a debt-to-total capitalization ratio of 20 percent. Considering $1.6 billion of cash on the balance sheet at the end of the third quarter, EOG’s net debt was $3.6 billion for a net debt-to-total capitalization ratio of 15 percent. For a reconciliation of non-GAAP measures to GAAP measures, please refer to the attached tables.

Third Quarter 2019 Results Webcast
Thursday, November 7, 2019, 9:00 a.m. Central time (10:00 a.m. Eastern time)
Webcast will be available on EOG 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, Trinidad, and China. 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

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, returns, 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," "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, replace or increase drilling locations, reduce or otherwise control operating costs and capital expenditures, generate cash flows, pay down or refinance indebtedness 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. 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 economically develop its acreage in, produce reserves and achieve anticipated production levels from, and maximize reserve recovery from, its existing and future crude oil and natural gas exploration and development projects;
the extent to which EOG is successful in its efforts to market its crude oil and condensate, natural gas liquids, natural gas and related commodity production;
the availability, proximity and capacity of, and costs associated with, appropriate gathering, processing, compression, storage, transportation and refining 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 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 imposing 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 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 and transportation 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;
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;
physical, electronic and cybersecurity breaches; and
the other factors described under ITEM 1A, Risk Factors, on pages 13 through 22 of EOG’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018 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, 2018, 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.






EOG RESOURCES, INC.
Financial Report
(Unaudited; in millions, except per share data)
 
 
Three Months Ended
 
Nine Months Ended
 
September 30,
 
September 30,
 
2019
 
2018
 
2019
 
2018
 
 
 
 
 
 
 
 
Operating Revenues and Other
$
4,303.5

 
$
4,781.6

 
$
13,059.7

 
$
12,700.9

Net Income
$
615.1

 
$
1,191.0

 
$
2,098.4

 
$
2,526.3

Net Income Per Share
 
 
 
 
 
 
 
Basic
$
1.06

 
$
2.06

 
$
3.63

 
$
4.38

Diluted
$
1.06

 
$
2.05

 
$
3.61

 
$
4.35

Average Number of Common Shares
 
 
 
 
 
 
 
Basic
577.8

 
577.3

 
577.5

 
576.4

Diluted
581.3

 
581.6

 
581.2

 
580.4

 
 
 
 
 
 
 
 
Summary Income Statements
(Unaudited; in thousands, except per share data)
 
 
Three Months Ended
 
Nine Months Ended
 
September 30,
 
September 30,
 
2019
 
2018
 
2019
 
2018
Operating Revenues and Other
 
 
 
 
Crude Oil and Condensate
$
2,418,989

 
$
2,655,278

 
$
7,148,258

 
$
7,134,114

Natural Gas Liquids
164,736

 
353,704

 
569,748

 
861,473

Natural Gas
269,625

 
311,713

 
874,489

 
912,324

Gains (Losses) on Mark-to-Market Commodity Derivative Contracts
85,902

 
(52,081
)
 
242,622

 
(297,735
)
Gathering, Processing and Marketing
1,334,450

 
1,360,992

 
4,121,490

 
3,899,250

Gains (Losses) on Asset Dispositions, Net
(523
)
 
115,944

 
3,650

 
94,658

Other, Net
30,276

 
36,074

 
99,470

 
96,779

Total
4,303,455

 
4,781,624

 
13,059,727

 
12,700,863

Operating Expenses
 
 
 
 
 
 
 
Lease and Well
348,883

 
321,568

 
1,032,455

 
936,236

Transportation Costs
199,365

 
196,027

 
549,988

 
550,781

Gathering and Processing Costs
127,549

 
114,063

 
351,487

 
324,577

Exploration Costs
34,540

 
32,823

 
103,386

 
115,137

Dry Hole Costs
24,138

 
358

 
28,001

 
5,260

Impairments
105,275

 
44,617

 
289,761

 
160,934

Marketing Costs
1,343,293

 
1,326,974

 
4,114,265

 
3,853,827

Depreciation, Depletion and Amortization
953,597

 
918,180

 
2,790,496

 
2,515,445

General and Administrative
135,758

 
111,284

 
364,210

 
310,065

Taxes Other Than Income
203,098

 
209,043

 
600,418

 
582,395

Total
3,475,496

 
3,274,937

 
10,224,467

 
9,354,657

 
 
 
 
 
 
 
 
Operating Income
827,959

 
1,506,687

 
2,835,260

 
3,346,206

 
 
 
 
 
 
 
 
Other Income (Expense), Net
9,118

 
3,308

 
23,233

 
(4,516
)
 
 
 
 
 
 
 
 
Income Before Interest Expense and Income Taxes
837,077

 
1,509,995

 
2,858,493

 
3,341,690

 
 
 
 
 
 
 
 
Interest Expense, Net
39,620

 
63,632

 
144,434

 
189,032

 
 
 
 
 
 
 
 
Income Before Income Taxes
797,457

 
1,446,363

 
2,714,059

 
3,152,658

 
 
 
 
 
 
 
 
Income Tax Provision
182,335

 
255,411

 
615,670

 
626,386

 
 
 
 
 
 
 
 
Net Income
$
615,122

 
$
1,190,952

 
$
2,098,389

 
$
2,526,272

 
 
 
 
 
 
 
 
Dividends Declared per Common Share
$
0.2875

 
$
0.2200

 
$
0.7950

 
$
0.5900

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 





EOG RESOURCES, INC.
Operating Highlights
(Unaudited)
 
 
 
 
Three Months Ended
 
 
 
Nine Months Ended
 
 
 
September 30,
 
 
 
September 30,
 
 
 
2019
 
2018
 
% Change
 
2019
 
2018
 
% Change
Wellhead Volumes and Prices
 
 
 
 
 
 
 
 
 
 
 
Crude Oil and Condensate Volumes (MBbld) (A)
 
 
 
 
 
 
 
United States
463.2

 
409.2

 
13
 %
 
451.2

 
382.9

 
18
 %
Trinidad
0.8

 
0.8

 
0
 %
 
0.7

 
0.8

 
-13
 %
Other International (B)
0.1

 
5.0

 
-98
 %
 
0.1

 
4.1

 
-98
 %
Total
464.1

 
415.0

 
12
 %
 
452.0

 
387.8

 
17
 %
 
 
 
 
 
 
 
 
 
 
 
 
Average Crude Oil and Condensate Prices ($/Bbl) (C)
 
 
 
 
 
 
 
 
 
 
 
United States
$
56.67

 
$
69.53

 
-18
 %
 
$
57.95

 
$
67.35

 
-14
 %
Trinidad
48.36

 
61.71

 
-22
 %
 
47.26

 
58.91

 
-20
 %
Other International (B)
59.87

 
72.81

 
-18
 %
 
58.43

 
71.83

 
-19
 %
Composite
56.66

 
69.55

 
-19
 %
 
57.93

 
67.38

 
-14
 %
 
 
 
 
 
 
 
 
 
 
 
 
Natural Gas Liquids Volumes (MBbld) (A)
 
 
 
 
 
 
 
 
 
 
 
United States
141.3

 
127.8

 
11
 %
 
130.8

 
113.9

 
15
 %
Other International (B)

 

 
 
 

 

 
 
Total
141.3

 
127.8

 
11
 %
 
130.8

 
113.9

 
15
 %
 
 
 
 
 
 
 
 
 
 
 
 
Average Natural Gas Liquids Prices ($/Bbl) (C)
 
 
 
 
 
 
 
 
 
 
 
United States
$
12.67

 
$
30.09

 
-58
 %
 
$
15.96

 
$
27.71

 
-42
 %
Other International (B)

 

 
 
 

 

 
 
Composite
12.67

 
30.09

 
-58
 %
 
15.96

 
27.71

 
-42
 %
 
 
 
 
 
 
 
 
 
 
 
 
Natural Gas Volumes (MMcfd) (A)
 
 
 
 
 
 
 
 
 
 
 
United States
1,079

 
948

 
14
 %
 
1,043

 
905

 
15
 %
Trinidad
260

 
260

 
0
 %
 
267

 
278

 
-4
 %
Other International (B)
34

 
28

 
21
 %
 
36

 
31

 
16
 %
Total
1,373

 
1,236

 
11
 %
 
1,346

 
1,214

 
11
 %
 
 
 
 
 
 
 
 
 
 
 
 
Average Natural Gas Prices ($/Mcf) (C)
 
 
 
 
 
 
 
 
 
 
 
United States
$
1.97

 
$
2.67

 
-26
 %
 
$
2.23

 
$
2.66

 
-16
 %
Trinidad
2.52

 
2.88

 
-12
 %
 
2.71

 
2.91

 
-7
 %
Other International (B)
4.25

 
3.83

 
11
 %
 
4.29

 
4.10

 
5
 %
Composite
2.13

 
2.74

 
-22
 %
 
2.38

 
2.75

 
-14
 %
 
 
 
 
 
 
 
 
 
 
 
 
Crude Oil Equivalent Volumes (MBoed) (D)
 
 
 
 
 
 
 
 
 
 
 
United States
784.3

 
695.0

 
13
 %
 
755.8

 
647.6

 
17
 %
Trinidad
44.1

 
44.1

 
0
 %
 
45.1

 
47.2

 
-4
 %
Other International (B)
5.8

 
9.7

 
-40
 %
 
6.2

 
9.2

 
-33
 %
Total
834.2

 
748.8

 
11
 %
 
807.1

 
704.0

 
15
 %
 
 
 
 
 
 
 
 
 
 
 
 
Total MMBoe (D)
76.7

 
68.9

 
11
 %
 
220.3

 
192.2

 
15
 %

(A)
Thousand barrels per day or million cubic feet per day, as applicable.
(B)
Other International includes EOG's United Kingdom, China and Canada operations. The United Kingdom operations were sold in the fourth quarter of 2018.
(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 fiscal quarter ended September 30, 2019).
(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.






EOG RESOURCES, INC.
Summary Balance Sheets
(Unaudited; in thousands, except share data)
 
 
September 30,
 
December 31,
 
2019
 
2018
ASSETS
Current Assets
 
 
 
Cash and Cash Equivalents
$
1,583,105

 
$
1,555,634

Accounts Receivable, Net
1,927,996

 
1,915,215

Inventories
778,120

 
859,359

Assets from Price Risk Management Activities
122,627

 
23,806

Income Taxes Receivable
135,680

 
427,909

Other
272,203

 
275,467

Total
4,819,731

 
5,057,390

 
Property, Plant and Equipment
 
 
 
Oil and Gas Properties (Successful Efforts Method)
61,620,033

 
57,330,016

Other Property, Plant and Equipment
4,394,486

 
4,220,665

Total Property, Plant and Equipment
66,014,519

 
61,550,681

Less: Accumulated Depreciation, Depletion and Amortization
(35,810,197
)
 
(33,475,162
)
Total Property, Plant and Equipment, Net
30,204,322

 
28,075,519

Deferred Income Taxes
1,998

 
777

Other Assets
1,516,218

 
800,788

Total Assets
$
36,542,269

 
$
33,934,474

 
 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
 
 
 
Accounts Payable
$
2,395,080

 
$
2,239,850

Accrued Taxes Payable
302,774

 
214,726

Dividends Payable
166,215

 
126,971

Current Portion of Long-Term Debt
1,014,200

 
913,093

Current Portion of Operating Lease Liabilities
384,348

 

Other
211,096

 
233,724

Total
4,473,713

 
3,728,364

 
 
 
 
 
 
 
 
Long-Term Debt
4,163,115

 
5,170,169

Other Liabilities
1,858,357

 
1,258,355

Deferred Income Taxes
4,922,804

 
4,413,398

Commitments and Contingencies
 
 
 
 
 
 
 
Stockholders' Equity
 
 
 
Common Stock, $0.01 Par, 1,280,000,000 Shares Authorized and 582,066,483 Shares Issued at September 30, 2019 and 580,408,117 Shares Issued at December 31, 2018
205,821

 
205,804

Additional Paid in Capital
5,769,073

 
5,658,794

Accumulated Other Comprehensive Loss
(3,689
)
 
(1,358
)
Retained Earnings
15,179,381

 
13,543,130

Common Stock Held in Treasury, 289,903 Shares at September 30, 2019 and 385,042 Shares at December 31, 2018
(26,306
)
 
(42,182
)
Total Stockholders' Equity
21,124,280

 
19,364,188

Total Liabilities and Stockholders' Equity
$
36,542,269

 
$
33,934,474








EOG RESOURCES, INC.
Summary Statements of Cash Flows
(Unaudited; in thousands)
 
Three Months Ended
 
Nine Months Ended
 
September 30,
 
September 30,
 
2019
 
2018
 
2019
 
2018
Cash Flows from Operating Activities
 
 
 
 
 
 
 
Reconciliation of Net Income to Net Cash Provided by Operating Activities:
 
 
 
 
 
 
 
Net Income
$
615,122

 
$
1,190,952

 
$
2,098,389

 
$
2,526,272

Items Not Requiring (Providing) Cash
 
 
 
 
 
 
 
Depreciation, Depletion and Amortization
953,597

 
918,180

 
2,790,496

 
2,515,445

Impairments
105,275

 
44,617

 
289,761

 
160,934

Stock-Based Compensation Expenses
54,670

 
49,001

 
132,323

 
116,290

Deferred Income Taxes
184,282

 
334,116

 
508,576

 
681,702

(Gains) Losses on Asset Dispositions, Net
523

 
(115,944
)
 
(3,650
)
 
(94,658
)
Other, Net
(1,284
)
 
1,807

 
4,155

 
15,314

Dry Hole Costs
24,138

 
358

 
28,001

 
5,260

Mark-to-Market Commodity Derivative Contracts
 
 
 
 
 
 
 
Total (Gains) Losses
(85,902
)
 
52,081

 
(242,622
)
 
297,735

Net Cash Received from (Payments for) Settlements of Commodity Derivative Contracts
108,418

 
(91,894
)
 
139,708

 
(180,228
)
Other, Net
(424
)
 
1,913

 
1,215

 
1,652

Changes in Components of Working Capital and Other Assets and Liabilities
 
 
 
 
 
 
 
Accounts Receivable
63,891

 
(243,778
)
 
(5,855
)
 
(553,529
)
Inventories
66,857

 
(94,598
)
 
55,598

 
(286,817
)
Accounts Payable
7,400

 
81,548

 
134,253

 
537,525

Accrued Taxes Payable
34,767

 
(59,426
)
 
88,047

 
(36,891
)
Other Assets
(92,814
)
 
(40,491
)
 
394,573

 
(103,334
)
Other Liabilities
39,791

 
38,392

 
(18,315
)
 
(14,776
)
Changes in Components of Working Capital Associated with Investing and Financing Activities
(16,643
)
 
122,763

 
(38,677
)
 
95,484

Net Cash Provided by Operating Activities
2,061,664

 
2,189,597

 
6,355,976

 
5,683,380

 
 
 
 
 
 
 
 
Investing Cash Flows
 
 
 
 
 
 
 
Additions to Oil and Gas Properties
(1,420,385
)
 
(1,591,646
)
 
(4,866,882
)
 
(4,571,932
)
Additions to Other Property, Plant and Equipment
(70,469
)
 
(57,526
)
 
(187,350
)
 
(202,384
)
Proceeds from Sales of Assets
17,767

 
3,306

 
35,409

 
11,582

Other Investing Activities

 
(19,993
)
 

 
(19,993
)
Changes in Components of Working Capital Associated with Investing Activities
16,621

 
(122,791
)
 
38,677

 
(95,541
)
Net Cash Used in Investing Activities
(1,456,466
)
 
(1,788,650
)
 
(4,980,146
)
 
(4,878,268
)
 
 
 
 
 
 
 
 
Financing Cash Flows
 
 
 
 
 
 
 
Lont-Term Debt Repayments

 

 
(900,000
)
 

Dividends Paid
(166,170
)
 
(107,465
)
 
(420,851
)
 
(311,075
)
Treasury Stock Purchased
(13,835
)
 
(26,535
)
 
(22,238
)
 
(58,558
)
Proceeds from Stock Options Exercised and Employee Stock Purchase Plan
863

 
953

 
9,558

 
12,098

Debt Issuance Costs
(114
)
 

 
(5,016
)
 

Repayment of Capital Lease Obligation
(3,235
)
 
(1,698
)
 
(9,638
)
 
(5,052
)
Changes in Components of Working Capital Associated with Financing Activities
22

 
28

 

 
57

Net Cash Used in Financing Activities
(182,469
)
 
(134,717
)
 
(1,348,185
)
 
(362,530
)
 
 
 
 
 
 
 
 
Effect of Exchange Rate Changes on Cash
(109
)
 
(313
)
 
(174
)
 
(2,678
)
 
 
 
 
 
 
 
 
Increase in Cash and Cash Equivalents
422,620

 
265,917

 
27,471

 
439,904

Cash and Cash Equivalents at Beginning of Period
1,160,485

 
1,008,215

 
1,555,634

 
834,228

Cash and Cash Equivalents at End of Period
$
1,583,105

 
$
1,274,132

 
$
1,583,105

 
$
1,274,132






EOG RESOURCES, INC.
Third Quarter 2019 Well Results by Play
(Unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Wells Online
 
 
 
Initial Gross 30-Day Average Production Rate
 
 
Gross
 
Net
 
Lateral Length
(ft)
 
Crude Oil and Condensate
(Bbld) (A)
 
Natural Gas Liquids
(Bbld) (A)
 
Natural Gas
(MMcfd) (A)
 
Crude Oil Equivalent
(Boed) (B)
Delaware Basin
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Wolfcamp
 
51

 
48

 
7,300

 
1,950

 
650

 
3.3

 
3,150

Bone Spring
 
24

 
21

 
5,900

 
1,600

 
350

 
1.9

 
2,300

Leonard
 
2

 
1

 
9,700

 
2,000

 
600

 
3.0

 
3,100

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
South Texas Eagle Ford
 
81

 
74

 
7,900

 
1,150

 
100

 
0.6

 
1,350

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
South Texas Austin Chalk
 
4

 
2

 
4,600

 
1,850

 
350

 
1.8

 
2,500

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Powder River Basin
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Turner/Parkman
 
7

 
6

 
9,800

 
800

 
200

 
3.3

 
1,550

Niobrara
 
1

 
1

 
10,200

 
1,250

 
250

 
4.0

 
2,200

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
DJ Basin Codell/Niobrara
 
5

 
4

 
9,700

 
800

 
50

 
0.4

 
900

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Williston Basin Bakken/Three Forks
 
15

 
13

 
10,600

 
2,150

 
300

 
2.0

 
2,800

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Anadarko Basin Woodford Oil Window
 
16

 
14

 
9,900

 
950

 
100

 
0.7

 
1,150

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(A) Barrels per day or million cubic feet per day, as applicable.
(B) Barrels of oil equivalent per day; includes crude oil and condensate, natural gas liquids and natural gas. Crude oil equivalent volumes are determined using a ratio of 1.0 barrel of crude oil and condensate or natural gas liquids to 6.0 thousand cubic feet of natural gas.






EOG RESOURCES, INC.
Reconciliation of Adjusted Net Income
(Unaudited; in thousands, except per share data)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The following chart adjusts the three-month and nine-month periods ended September 30, 2019 and 2018 reported Net Income (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 in 2019 and 2018, to add back impairment charges related to certain of EOG's assets in 2019 and 2018 and to eliminate certain adjustments in 2018 related to the 2017 U.S. tax reform. 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.
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
Three Months Ended
 
September 30, 2019
 
September 30, 2018
 
 
 
 
 
 
 
 
 
 
Before Tax
 
Income Tax Impact
 
After
Tax
 
Diluted Earnings per Share
 
Before Tax
 
Income Tax Impact
 
After
Tax
 
Diluted Earnings per Share
Reported Net Income (GAAP)
$
797,457

 
$
(182,335
)
 
$
615,122

 
$
1.06

 
$
1,446,363

 
$
(255,411
)
 
$
1,190,952

 
$
2.05

Adjustments:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Gains) Losses on Mark-to-Market Commodity Derivative Contracts
(85,902
)
 
18,854

 
(67,048
)
 
(0.12
)
 
52,081

 
(11,472
)
 
40,609

 
0.07

Net Cash Received from (Payments for) Settlements of Commodity Derivative Contracts
108,418

 
(23,796
)
 
84,622

 
0.15

 
(91,894
)
 
20,241

 
(71,653
)
 
(0.12
)
Add: (Gains) Losses on Asset Dispositions, Net
523

 
(89
)
 
434

 

 
(115,944
)
 
28,934

 
(87,010
)
 
(0.15
)
Add: Certain Impairments
27,215

 
(5,973
)
 
21,242

 
0.04

 

 

 

 

Less: Tax Reform Impact

 

 

 

 

 
(57,127
)
 
(57,127
)
 
(0.10
)
Adjustments to Net Income
50,254

 
(11,004
)
 
39,250

 
0.07

 
(155,757
)
 
(19,424
)
 
(175,181
)
 
(0.30
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted Net Income (Non-GAAP)
$
847,711

 
$
(193,339
)
 
$
654,372

 
$
1.13

 
$
1,290,606

 
$
(274,835
)
 
$
1,015,771

 
$
1.75

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Average Number of Common Shares (GAAP)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic
 
 
 
 
 
 
577,839

 
 
 
 
 
 
 
577,254

Diluted
 
 
 
 
 
 
581,271

 
 
 
 
 
 
 
581,559









 
Nine Months Ended
 
Nine Months Ended
 
September 30, 2019
 
September 30, 2018
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Before
Tax
 
Income Tax Impact
 
After
Tax
 
Diluted Earnings per Share
 
Before
Tax
 
Income Tax Impact
 
After
Tax
 
Diluted Earnings per Share
Reported Net Income (GAAP)
$
2,714,059

 
$
(615,670
)
 
$
2,098,389

 
$
3.61

 
$
3,152,658

 
$
(626,386
)
 
$
2,526,272

 
$
4.35

Adjustments:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Gains) Losses on Mark-to-Market Commodity Derivative Contracts
(242,622
)
 
53,251

 
(189,371
)
 
(0.34
)
 
297,735

 
(65,582
)
 
232,153

 
0.40

Net Cash Received from (Payments for) Settlements of Commodity Derivative Contracts
139,708

 
(30,663
)
 
109,045

 
0.19

 
(180,228
)
 
39,699

 
(140,529
)
 
(0.24
)
Add: (Gains) Losses on Asset Dispositions, Net
(3,650
)
 
910

 
(2,740
)
 

 
(94,658
)
 
24,235

 
(70,423
)
 
(0.12
)
Add: Certain Impairments
116,249

 
(25,514
)
 
90,735

 
0.16

 
20,876

 
(4,598
)
 
16,278

 
0.03

Less: Tax Reform Impact

 

 

 

 

 
(63,651
)
 
(63,651
)
 
(0.11
)
Adjustments to Net Income
9,685

 
(2,016
)
 
7,669

 
0.01

 
43,725

 
(69,897
)
 
(26,172
)
 
(0.04
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted Net Income (Non-GAAP)
$
2,723,744

 
$
(617,686
)
 
$
2,106,058

 
$
3.62

 
$
3,196,383

 
$
(696,283
)
 
$
2,500,100

 
$
4.31

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Average Number of Common Shares (GAAP)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic
 
 
 
 
 
 
577,498

 
 
 
 
 
 
 
576,431

Diluted
 
 
 
 
 
 
581,190

 
 
 
 
 
 
 
580,442








EOG RESOURCES, INC.
Reconciliation of Discretionary Cash Flow
(Unaudited; in thousands)

Calculation of Free Cash Flow
(Unaudited; in thousands)
 
 
 
 
 
 
 
 
The following chart reconciles the three-month and nine-month periods ended September 30, 2019 and 2018 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), Other Non-Current Income Taxes - Net Receivable (Payable), Changes in Components of Working Capital and Other Assets and Liabilities, and Changes in Components of Working Capital Associated with Investing and Financing Activities. 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 and dividends paid (GAAP) during such period, as is illustrated below for the three months and nine months ended September 30, 2019 and 2018. EOG management uses this information for comparative purposes within the industry.
 
 
Three Months Ended
 
Nine Months Ended
 
September 30,
 
September 30,
 
2019
 
2018
 
2019
 
2018
 
 
 
 
 
 
 
 
Net Cash Provided by Operating Activities (GAAP)
$
2,061,664

 
$
2,189,597

 
$
6,355,976

 
$
5,683,380

 
 
 
 
 
 
 
 
Adjustments:
 
 
 
 
 
 
 
Exploration Costs (excluding Stock-Based Compensation Expenses)
29,374

 
27,032

 
85,250

 
96,716

Other Non-Current Income Taxes - Net Receivable (Payable)
33,855

 
(129,941
)
 
179,537

 
62,421

Changes in Components of Working Capital and Other Assets and Liabilities
 
 
 
 
 
 
 
Accounts Receivable
(63,891
)
 
243,778

 
5,855

 
553,529

Inventories
(66,857
)
 
94,598

 
(55,598
)
 
286,817

Accounts Payable
(7,400
)
 
(81,548
)
 
(134,253
)
 
(537,525
)
Accrued Taxes Payable
(34,767
)
 
59,426

 
(88,047
)
 
36,891

Other Assets
92,814

 
40,491

 
(394,573
)
 
103,334

Other Liabilities
(39,791
)
 
(38,392
)
 
18,315

 
14,776

Changes in Components of Working Capital Associated with Investing and Financing Activities
16,643

 
(122,763
)
 
38,677

 
(95,484
)
 
 
 
 
 
 
 
 
Discretionary Cash Flow (Non-GAAP)
$
2,021,644

 
$
2,282,278

 
$
6,011,139

 
$
6,204,855

 
 
 
 
 
 
 
 
Discretionary Cash Flow (Non-GAAP) - Percentage Decrease
-11
 %
 
 
 
-3
 %
 
 
 
 
 
 
 
 
 
 
Discretionary Cash Flow (Non-GAAP)
$
2,021,644

 
$
2,282,278

 
$
6,011,139

 
$
6,204,855

Less:
 
 
 
 
 
 
 
Total Cash Capital Expenditures Before Acquisitions (Non-GAAP) (a)
(1,518,019
)
 
(1,671,922
)
 
(4,846,221
)
 
(4,869,951
)
Dividends Paid (GAAP)
(166,170
)
 
(107,465
)
 
(420,851
)
 
(311,075
)
Free Cash Flow (Non-GAAP)
$
337,455

 
$
502,891

$
$
744,067

 
$
1,023,829

 
 
 
 
 
 
 
 





(a) See below reconciliation of Total Expenditures (GAAP) to Total Cash Expenditures Excluding Acquisitions (Non-GAAP) for the three month and nine-month periods ended September 30, 2019 and 2018:
 
 
 
 
 
 
 
 
Total Expenditures (GAAP)
$
1,629,343

 
$
1,828,348

 
$
5,394,389

 
$
5,201,921

Less:
 
 
 
 
 
 
 
Asset Retirement Costs
(90,970
)
 
(10,834
)
 
(151,551
)
 
(41,789
)
Non-Cash Expenditures of Other Property, Plant and Equipment

 
(1,257
)
 
(586
)
 
(48,937
)
Non-Cash Acquisition Costs of Unproved Properties
(10,666
)
 
(101,821
)
 
(64,387
)
 
(161,823
)
Acquisition Costs of Proved Properties
(9,688
)
 
(42,514
)
 
(331,644
)
 
(79,421
)
Total Cash Capital Expenditures Before Acquisitions (Non-GAAP)
$
1,518,019

 
$
1,671,922

 
$
4,846,221

 
$
4,869,951







EOG RESOURCES, INC.
Total Expenditures
(Unaudited; in millions)
 
 
Three Months Ended
 
Nine Months Ended
 
September 30,
 
September 30,
 
2019
 
2018
 
2019
 
2018
 
 
 
 
 
 
 
 
Exploration and Development Drilling
$
1,173

 
$
1,340

 
$
3,865

 
$
3,843

Facilities
161

 
178

 
499

 
518

Leasehold Acquisitions
56

 
159

 
201

 
331

Property Acquisitions
10

 
42

 
332

 
79

Capitalized Interest
10

 
7

 
28

 
18

Subtotal
1,410

 
1,726

 
4,925

 
4,789

Exploration Costs
34

 
33

 
103

 
115

Dry Hole Costs
24

 

 
28

 
5

Exploration and Development Expenditures
1,468

 
1,759

 
5,056

 
4,909

Asset Retirement Costs
91

 
11

 
151

 
42

Total Exploration and Development Expenditures
1,559

 
1,770

 
5,207

 
4,951

Other Property, Plant and Equipment
70

 
58

 
187

 
251

Total Expenditures
$
1,629

 
$
1,828

 
$
5,394

 
$
5,202







EOG RESOURCES, INC.
Reconciliation of Adjusted EBITDAX
(Unaudited; in thousands)
 
 
 
 
 
 
 
 
The following chart adjusts the three-month and nine-month periods ended September 30, 2019 and 2018 reported Net Income (GAAP) to Earnings Before Interest Expense (Net), Income Taxes (Income Tax Provision), 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 (GAAP) to add back Interest Expense (Net), Income Taxes (Income Tax Provision), 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.
 
 
 
 
 
 
 
 
 
Three Months Ended
 
Nine Months Ended
 
September 30,
 
September 30,
 
2019
 
2018
 
2019
 
2018
 
 
 
 
 
 
 
 
Net Income (GAAP)
$
615,122

 
$
1,190,952

 
$
2,098,389

 
$
2,526,272

 
 
 
 
 
 
 
 
Adjustments:
 
 
 
 
 
 
 
Interest Expense, Net
39,620

 
63,632

 
144,434

 
189,032

Income Tax Provision
182,335

 
255,411

 
615,670

 
626,386

Depreciation, Depletion and Amortization
953,597

 
918,180

 
2,790,496

 
2,515,445

Exploration Costs
34,540

 
32,823

 
103,386

 
115,137

Dry Hole Costs
24,138

 
358

 
28,001

 
5,260

Impairments
105,275

 
44,617

 
289,761

 
160,934

EBITDAX (Non-GAAP)
1,954,627

 
2,505,973

 
6,070,137

 
6,138,466

Total (Gains) Losses on MTM Commodity Derivative Contracts
(85,902
)
 
52,081

 
(242,622
)
 
297,735

Net Cash Received from (Payments for) Settlements of Commodity Derivative Contracts
108,418

 
(91,894
)
 
139,708

 
(180,228
)
(Gains) Losses on Asset Dispositions, Net
523

 
(115,944
)
 
(3,650
)