Eog Resources Inc 10-Q for FY2020 Q2

Eog Resources Inc (EOG)

10-Q 2020-08-06 For: 2020-06-30

Added on April 09, 2026

About this 10-Q

Eog Resources Inc filed this 10-Q on August 6, 2020, covering the quarter ended June 30, 2020 (FY2020 Q2).

Headline figures

Quarter ended June 30, 2020, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $1.1B; down 76.5% from $4.7B a year earlier
Net loss: $909.38M; compared with net income of $847.84M a year earlier
Diluted EPS: -$1.57; compared with $1.46 a year earlier

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Delaware						47-0684736
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)


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


	Three Months Ended June 30,						Six Months Ended June 30,
	2020		2019		2020		2019
Operating Revenues and Other
Crude Oil and Condensate	$	614,627	$	2,528,866	$	2,680,125	$	4,729,269
Natural Gas Liquids	93,909		186,374		254,444		405,012
Natural Gas	141,696		269,892		351,460		604,864
Gains (Losses) on Mark-to-Market Commodity Derivative Contracts	(126,362)		177,300		1,079,411		156,720
Gathering, Processing and Marketing	362,786		1,501,386		1,401,432		2,787,040
Gains on Asset Dispositions, Net	13,233		8,009		29,693		4,173
Other, Net	3,485		25,803		24,501		69,194
Total	1,103,374		4,697,630		5,821,066		8,756,272
Operating Expenses
Lease and Well	245,346		347,281		575,005		683,572
Transportation Costs	151,728		174,101		360,024		350,623
Gathering and Processing Costs	96,767		112,643		225,249		223,938
Exploration Costs	27,283		32,522		66,960		68,846
Dry Hole Costs	87		3,769		459		3,863
Impairments	305,415		112,130		1,878,350		184,486
Marketing Costs	444,444		1,500,915		1,553,437		2,770,972
Depreciation, Depletion and Amortization	706,679		957,304		1,706,739		1,836,899
General and Administrative	131,855		121,780		246,128		228,452
Taxes Other Than Income	80,319		204,414		237,679		397,320
Total	2,189,923		3,566,859		6,850,030		6,748,971
Operating Income (Loss)	(1,086,549)		1,130,771		(1,028,964)		2,007,301
Other Income (Expense), Net	(4,500)		8,503		13,608		14,115
Income (Loss) Before Interest Expense and Income Taxes	(1,091,049)		1,139,274		(1,015,356)		2,021,416
Interest Expense, Net	54,213		49,908		98,903		104,814
Income (Loss) Before Income Taxes	(1,145,262)		1,089,366		(1,114,259)		1,916,602
Income Tax Provision (Benefit)	(235,878)		241,525		(214,688)		433,335
Net Income (Loss)	$	(909,384)	$	847,841	$	(899,571)	$	1,483,267
Net Income (Loss) Per Share
Basic	$	(1.57)	$	1.47	$	(1.55)	$	2.57
Diluted	$	(1.57)	$	1.46	$	(1.55)	$	2.56
Average Number of Common Shares
Basic	578,719		577,460		578,581		577,333
Diluted	578,719		580,247		578,581		580,204
Comprehensive Income (Loss)
Net Income (Loss)	$	(909,384)	$	847,841	$	(899,571)	$	1,483,267
Other Comprehensive Income (Loss)
Foreign Currency Translation Adjustments	(2,831)		(1,665)		(1,490)		(3,449)
Other, Net of Tax	6		6		12		12
Other Comprehensive Income (Loss)	(2,825)		(1,659)		(1,478)		(3,437)
Comprehensive Income (Loss)	$	(912,209)	$	846,182	$	(901,049)	$	1,479,830


	June 30, 2020		December 31, 2019
ASSETS
Current Assets
Cash and Cash Equivalents	$	2,416,501	$	2,027,972
Accounts Receivable, Net	943,354		2,001,658
Inventories	676,580		767,297
Assets from Price Risk Management Activities	207,019		1,299
Income Taxes Receivable	196,958		151,665
Other	156,979		323,448
Total	4,597,391		5,273,339
Property, Plant and Equipment
Oil and Gas Properties (Successful Efforts Method)	64,406,245		62,830,415
Other Property, Plant and Equipment	4,665,815		4,472,246
Total Property, Plant and Equipment	69,072,060		67,302,661
Less: Accumulated Depreciation, Depletion and Amortization	(39,838,595)		(36,938,066)
Total Property, Plant and Equipment, Net	29,233,465		30,364,595
Deferred Income Taxes	1,846		2,363
Other Assets	1,388,969		1,484,311
Total Assets	$	35,221,671	$	37,124,608
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts Payable	$	1,281,166	$	2,429,127
Accrued Taxes Payable	193,763		254,850
Dividends Payable	217,004		166,273
Liabilities from Price Risk Management Activities	—		20,194
Current Portion of Long-Term Debt	21,121		1,014,524
Current Portion of Operating Lease Liabilities	252,642		369,365
Other	188,685		232,655
Total	2,154,381		4,486,988

Long-Term Debt	5,703,141		4,160,919
Other Liabilities	2,138,696		1,789,884
Deferred Income Taxes	4,837,896		5,046,101
Commitments and Contingencies (Note 8)

Stockholders' Equity
Common Stock, $0.01 Par, 1,280,000,000 Shares Authorized and 582,386,619 Shares Issued at June 30, 2020 and 582,213,016 Shares Issued at December 31, 2019	205,824		205,822
Additional Paid in Capital	5,886,298		5,817,475
Accumulated Other Comprehensive Loss	(6,130)		(4,652)
Retained Earnings	14,312,493		15,648,604
Common Stock Held in Treasury, 142,025 Shares at June 30, 2020 and 298,820 Shares at December 31, 2019	(10,928)		(26,533)
Total Stockholders' Equity	20,387,557		21,640,716
Total Liabilities and Stockholders' Equity	$	35,221,671	$	37,124,608


	Common Stock		Additional Paid In Capital		Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Common Stock Held In Treasury		Total Stockholders' Equity
Balance at March 31, 2020	$	205,824	$	5,852,821	$	(3,305)	$	15,440,142	$	(24,807)	$	21,470,675
Net Loss	—		—		—		(909,384)		—		(909,384)
Common Stock Issued Under Stock Plans	—		—		—		—		—		—
Common Stock Dividends Declared, $0.375 Per Share	—		—		—		(218,265)		—		(218,265)
Other Comprehensive Loss	—		—		(2,825)		—		—		(2,825)
Change in Treasury Stock - Stock Compensation Plans, Net	—		(6,635)		—		—		14,872		8,237
Restricted Stock and Restricted Stock Units, Net	—		541		—		—		(541)		—
Stock-Based Compensation Expenses	—		39,571		—		—		—		39,571
Treasury Stock Issued as Compensation	—		—		—		—		(452)		(452)
Balance at June 30, 2020	$	205,824	$	5,886,298	$	(6,130)	$	14,312,493	$	(10,928)	$	20,387,557


	Stock Options/SARs									ESPP
	Six Months Ended June 30,									Six Months Ended June 30,
	2020			2019			2020			2019
Weighted Average Fair Value of Grants	$	16.94		$	25.68		$	20.80		$	22.98
Expected Volatility	42.10		%	31.50		%	35.24		%	36.31		%
Risk-Free Interest Rate	0.93		%	2.38		%	1.56		%	2.48		%
Dividend Yield	1.94		%	0.96		%	1.56		%	0.83		%
Expected Life	5.1 years			5.1 years			0.5 years			0.5 years


	Six Months Ended June 30, 2020				Six Months Ended June 30, 2019
	Number of Stock Options/SARs	Weighted Average Grant Price		Number of Stock Options/SARs	Weighted Average Grant Price
Outstanding at January 1	9,395	$	94.53	8,310	$	96.90
Granted	16	58.40		32	93.29
Exercised ⁽¹⁾	(23)	69.59		(157)	73.39
Forfeited	(389)	91.39		(107)	105.47
Outstanding at June 30 ⁽²⁾	8,999	$	94.66	8,078	$	97.23
Vested or Expected to Vest ⁽³⁾	8,670	$	94.67	7,741	$	96.78
Exercisable at June 30 ⁽⁴⁾	4,963	$	94.61	3,905	$	86.71


	Six Months Ended June 30, 2020				Six Months Ended June 30, 2019
	Number of Shares and Units	Weighted Average Grant Date Fair Value		Number of Shares and Units	Weighted Average Grant Date Fair Value
Outstanding at January 1	4,546	$	90.16	3,792	$	96.64
Granted	67	51.83		401	96.22
Released ⁽¹⁾	(304)	88.58		(395)	93.84
Forfeited	(36)	90.61		(68)	98.27
Outstanding at June 30 ⁽²⁾	4,273	$	89.67	3,730	$	96.86


	Six Months Ended June 30, 2020					Six Months Ended June 30, 2019
	Number of Units		Weighted Average Price per Grant Date		Number of Units	Weighted Average Price per Grant Date
Outstanding at January 1	598		$	92.19	539	$	101.53
Granted	—		—		—	—
Granted for Performance Multiple ⁽¹⁾	66		100.95		72	69.43
Released ⁽²⁾	(121)		104.69		(83)	85.65
Forfeited	—		—		—	—
Outstanding at June 30 ⁽³⁾	543	(4)	$	90.48	528	$	99.64


	At June 30, 2020		At December 31, 2019
Total Assets
United States	$	34,534,344	$	36,274,942
Trinidad	531,454		705,747
Other International ⁽¹⁾	155,873		143,919
Total	$	35,221,671	$	37,124,608


	Six Months Ended June 30, 2020
Balance at January 1	$	25,897
Additions Pending the Determination of Proved Reserves	55,669
Reclassifications to Proved Properties	(2,178)
Costs Charged to Expense ⁽¹⁾	(10,988)
Balance at June 30	$	68,400


	Fair Value Measurements Using:
	Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
At June 30, 2020
Financial Assets: ⁽¹⁾
Crude Oil Swaps	$	—	$	224,256	$	—	$	224,256
Crude Oil Roll Differential Swaps	—		2,396		—		2,396
Natural Gas Liquids Swaps	—		7,064		—		7,064
Natural Gas Collars	—		4,338		—		4,338
Natural Gas Swaps	—		2,533		—		2,533
Natural Gas Basis Swaps	—		6		—		6
Financial Liabilities:
Crude Oil Roll Differential Swaps	$	—	$	16,855	$	—	$	16,855
Natural Gas Basis Swaps	—		10,671		—		10,671
Natural Gas Liquids Swaps	—		166		—		166
Natural Gas Collars	—		4,313		—		4,313

At December 31, 2019
Financial Assets: ⁽¹⁾
Natural Gas Liquids Swaps	$	—	$	3,401	$	—	$	3,401
Natural Gas Basis Swaps	—		970		—		970
Financial Liabilities: ⁽²⁾
Crude Oil Swaps	$	—	$	23,266	$	—	$	23,266


ICE Brent Differential Basis Swap Contracts
	Volume (Bbld)	Weighted Average Price Differential ($/Bbl)


2020
May 2020 (closed)	10,000	$	4.92


Houston Differential Basis Swap Contracts
	Volume (Bbld)	Weighted Average Price Differential ($/Bbl)


2020
May 2020 (closed)	10,000	$	1.55


Roll Differential Swap Contracts
	Volume (Bbld)	Weighted Average Price Differential ($/Bbl)


2020
February 1, 2020 through June 30, 2020 (closed)	10,000	$	0.70
July 2020 (closed)	88,000	(1.16)
August 1, 2020 through September 30, 2020	88,000	(1.16)
October 1, 2020 through December 31, 2020	66,000	(1.16)



FORM			10-Q


	Six Months Ended June 30,
	2020		2019
Carrying Amount at January 1	$	1,110,710	$	954,377
Liabilities Incurred	16,715		56,490
Liabilities Settled ⁽¹⁾	(24,480)		(41,650)
Accretion	23,153		20,523
Revisions	19,990		8,006
Foreign Currency Translations	(223)		219
Carrying Amount at June 30	$	1,145,865	$	997,965

Current Portion	$	38,792	$	27,416
Noncurrent Portion	$	1,107,073	$	970,549


Crude Oil NYMEX WTI Price Swap Contracts
	Volume (Bbld)	Weighted Average Price ($/Bbl)


2020
January 1, 2020 through March 31, 2020 (closed)	200,000	$	59.33
April 1, 2020 through May 31, 2020 (closed)	265,000	51.36


Crude Oil ICE Brent Price Swap Contracts
	Volume (Bbld)	Weighted Average Price ($/Bbl)


2020
April 2020 (closed)	75,000	$	25.66
May 2020 (closed)	35,000	26.53


Mont Belvieu Propane Price Swap Contracts
	Volume (Bbld)	Weighted Average Price ($/Bbl)


2020
January 1, 2020 through February 29, 2020 (closed)	4,000	$	21.34
March 1, 2020 through April 30, 2020 (closed)	25,000	17.92


Natural Gas Price Swap Contracts
	Volume (MMBtud)	Weighted Average Price ($/MMBtu)


2021
January 1, 2021 through December 31, 2021	50,000	$	2.75


Natural Gas Collar Contracts
		Weighted Average Price ($/MMBtu)
	Volume (MMBtud)	Ceiling Price		Floor Price


2020
April 1, 2020 through July 31, 2020 (closed)	250,000	$	2.50	$	2.00


Rockies Differential Basis Swap Contracts
	Volume (MMBtud)	Weighted Average Price Differential ($/MMBtu)


2020
January 1, 2020 through June 30, 2020 (closed)	30,000	$	0.55
July 1, 2020 through December 31, 2020	30,000	0.55


HSC Differential Basis Swap Contracts
	Volume (MMBtud)	Weighted Average Price Differential ($/MMBtu)


2020
January 1, 2020 through December 31, 2020 (closed)	60,000	$	0.05


Waha Differential Basis Swap Contracts
	Volume (MMBtud)	Weighted Average Price Differential ($/MMBtu)


2020
January 1, 2020 through April 30, 2020 (closed)	50,000	$	1.40


		Fair Value at
Description	Location on Balance Sheet	June 30, 2020		December 31, 2019
Asset Derivatives
Crude oil, NGLs and natural gas derivative contracts -
Current portion	Assets from Price Risk Management Activities ⁽¹⁾	$	207,019	$	1,299
Noncurrent Portion	Other Assets	$	1,569	$	—
Liability Derivatives
Crude oil, NGLs and natural gas derivative contracts -
Current portion	Liabilities from Price Risk Management Activities ⁽²⁾	$	—	$	20,194


Period	Total Number of Shares Purchased ⁽¹⁾	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares that May Yet Be Purchased Under The Plans or Programs ⁽²⁾


April 1, 2020 - April 30, 2020	2,164	$	46.39	—	6,386,200
May 1, 2020 - May 31, 2020	4,165	49.50		—	6,386,200
June 1, 2020 - June 30, 2020	1,871	51.01		—	6,386,200
Total	8,200	49.03		—


Exhibit No.		Description

3.1(a)	-	Restated Certificate of Incorporation, dated September 3, 1987 (incorporated by reference to Exhibit 3.1(a) to EOG's Annual Report on Form 10-K for the year ended December 31, 2008) (SEC File No. 001-09743).

3.1(b)	-	Certificate of Amendment of Restated Certificate of Incorporation, dated May 5, 1993 (incorporated by reference to Exhibit 4.1(b) to EOG's Registration Statement on Form S-8, SEC File No. 33-52201, filed February 8, 1994).

3.1(c)	-	Certificate of Amendment of Restated Certificate of Incorporation, dated June 14, 1994 (incorporated by reference to Exhibit 4.1(c) to EOG's Registration Statement on Form S-8, SEC File No. 33-58103, filed March 15, 1995).

3.1(d)	-	Certificate of Amendment of Restated Certificate of Incorporation, dated June 11, 1996 (incorporated by reference to Exhibit 3(d) to EOG's Registration Statement on Form S-3, SEC File No. 333-09919, filed August 9, 1996).

3.1(e)	-	Certificate of Amendment of Restated Certificate of Incorporation, dated May 7, 1997 (incorporated by reference to Exhibit 3(e) to EOG's Registration Statement on Form S-3, SEC File No. 333-44785, filed January 23, 1998).

3.1(f)	-	Certificate of Ownership and Merger Merging EOG Resources, Inc. into Enron Oil & Gas Company, dated August 26, 1999 (incorporated by reference to Exhibit 3.1(f) to EOG's Annual Report on Form 10-K for the year ended December 31, 1999) (SEC File No. 001-09743).

3.1(g)	-	Certificate of Designations of Series E Junior Participating Preferred Stock, dated February 14, 2000 (incorporated by reference to Exhibit 2 to EOG's Registration Statement on Form 8-A, SEC File No. 001-09743, filed February 18, 2000).

3.1(h)	-	Certificate of Elimination of the Fixed Rate Cumulative Perpetual Senior Preferred Stock, Series A, dated September 13, 2000 (incorporated by reference to Exhibit 3.1(j) to EOG's Registration Statement on Form S-3, SEC File No. 333-46858, filed September 28, 2000).

3.1(i)	-	Certificate of Elimination of the Flexible Money Market Cumulative Preferred Stock, Series C, dated September 13, 2000 (incorporated by reference to Exhibit 3.1(k) to EOG's Registration Statement on Form S-3, SEC File No. 333-46858, filed September 28, 2000).

3.1(j)	-	Certificate of Elimination of the Flexible Money Market Cumulative Preferred Stock, Series D, dated February 24, 2005 (incorporated by reference to Exhibit 3.1(k) to EOG's Annual Report on Form 10-K for the year ended December 31, 2004) (SEC File No. 001-09743).

3.1(k)	-	Amended Certificate of Designations of Series E Junior Participating Preferred Stock, dated March 7, 2005 (incorporated by reference to Exhibit 3.1(m) to EOG's Annual Report on Form 10-K for the year ended December 31, 2007) (SEC File No. 001-09743).

3.1(l)	-	Certificate of Amendment of Restated Certificate of Incorporation, dated May 3, 2005 (incorporated by reference to Exhibit 3.1(l) to EOG's Quarterly Report on Form 10-Q for the quarter ended June 30, 2005) (SEC File No. 001-09743).

3.1(m)	-	Certificate of Elimination of Fixed Rate Cumulative Perpetual Senior Preferred Stock, Series B, dated March 6, 2008 (incorporated by reference to Exhibit 3.1 to EOG's Current Report on Form 8-K, filed March 6, 2008) (SEC File No. 001-09743).

3.1(n)	-	Certificate of Amendment of Restated Certificate of Incorporation, dated April 28, 2017 (incorporated by reference to Exhibit 3.1 to EOG's Current Report on Form 8-K, filed May 2, 2017) (SEC File No. 001-09743).

3.2	-	Bylaws, dated August 23, 1989, as amended and restated effective as of September 22, 2015 (incorporated by reference to Exhibit 3.1 to EOG's Current Report on Form 8-K, filed September 28, 2015) (SEC File No. 001-09743).

4.1	-	Officers' Certificate Establishing 4.375% Senior Notes due 2030 and 4.950% Senior Notes due 2050 of EOG, dated April 14, 2020 (incorporated by reference to Exhibit 4.2 to EOG's Current Report on Form 8-K, filed April 14, 2020) (SEC File No. 001-09743).


Exhibit No.		Description

4.2	-	Form of Global Note with respect to the 4.375% Senior Notes due 2030 of EOG (included in, and incorporated by reference to, Exhibit 4.2 to EOG's Current Report on Form 8-K, filed April 14, 2020) (SEC File No. 001-09743).

4.3	-	Form of Global Note with respect to the 4.950% Senior Notes due 2050 of EOG (included in, and incorporated by reference to, Exhibit 4.2 to EOG's Current Report on Form 8-K, filed April 14, 2020) (SEC File No. 001-09743).

31.1	-	Section 302 Certification of Periodic Report of Principal Executive Officer.

31.2	-	Section 302 Certification of Periodic Report of Principal Financial Officer.

32.1	-	Section 906 Certification of Periodic Report of Principal Executive Officer.

32.2	-	Section 906 Certification of Periodic Report of Principal Financial Officer.

95	-	Mine Safety Disclosure Exhibit.

101.INS	-	Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

*101.SCH	-	Inline XBRL Schema Document.

*101.CAL	-	Inline XBRL Calculation Linkbase Document.

*101.DEF	-	Inline XBRL Definition Linkbase Document.

*101.LAB	-	Inline XBRL Label Linkbase Document.

*101.PRE	-	Inline XBRL Presentation Linkbase Document.

104	-	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).


			EOG RESOURCES, INC.
			(Registrant)



Date:	August 6, 2020	By:	/s/ TIMOTHY K. DRIGGERS Timothy K. Driggers Executive Vice President and Chief Financial Officer (Principal Financial Officer and Duly Authorized Officer)