UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM10-Q
(Mark One)

☒           QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended SeptemberJune 30, 20192020
or
☐         TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number: 1-9743
 
EOG RESOURCES, INC.
(Exact name of registrant as specified in its charter)
Delaware47-0684736
(State or other jurisdiction

of incorporation or organization)
(I.R.S. Employer

Identification No.)
1111 Bagby,, Sky Lobby 2,, Houston,, Texas77002
(Address of principal executive offices)       (Zip Code)
713-651-7000713-651-7000
(Registrant's telephone number, including area code)

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

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).   
Yes ☒  No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.  See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☒    Accelerated filer ☐    Non-accelerated filer ☐
Smaller reporting company ☐   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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  
Yes ☐  No ☒

Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date.
Title of each classNumber of shares
Common Stock, par value $0.01 per share581,764,095582,243,561 
(as of October 25, 2019)July 30, 2020)

        



EOG RESOURCES, INC.

TABLE OF CONTENTS



PART I.FINANCIAL INFORMATIONPage No.
ITEM 1.Financial Statements (Unaudited)
3
4
PART I.FINANCIAL INFORMATIONPage No.
ITEM 1.Financial Statements (Unaudited)
3
Condensed Consolidated Balance Sheets - September 30, 2019 and December 31, 2018
4
Condensed Consolidated Statements of Stockholders' Equity - Three Months and NineSix Months Ended SeptemberJune 30, 20192020 and 20182019
5
7
8
ITEM 2.
2122
ITEM 3.
3644
ITEM 4.
3644
PART II.OTHER INFORMATION
ITEM 1.
Legal Proceedings
3745
ITEM 1A.
Risk Factors
45
ITEM 2.
Unregistered Sales of Equity Securities and Use of Proceeds
3746
ITEM 4.
Mine Safety Disclosures
3746
ITEM 6.
Exhibits
3847
SIGNATURES
4049
-2-
        



PART I.  FINANCIAL INFORMATION
ITEM 1.  FINANCIAL STATEMENTS
EOG RESOURCES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS)
(In Thousands, Except Per Share Data)
(Unaudited)
Three Months Ended
June 30,		Six Months Ended
June 30,
2020201920202019
Operating Revenues and Other
Crude Oil and Condensate$614,627  $2,528,866  $2,680,125  $4,729,269  
Natural Gas Liquids93,909  186,374  254,444  405,012  
Natural Gas141,696  269,892  351,460  604,864  
Gains (Losses) on Mark-to-Market Commodity Derivative Contracts(126,362) 177,300  1,079,411  156,720  
Gathering, Processing and Marketing362,786  1,501,386  1,401,432  2,787,040  
Gains on Asset Dispositions, Net13,233  8,009  29,693  4,173  
Other, Net3,485  25,803  24,501  69,194  
Total1,103,374  4,697,630  5,821,066  8,756,272  
Operating Expenses    
Lease and Well245,346  347,281  575,005  683,572  
Transportation Costs151,728  174,101  360,024  350,623  
Gathering and Processing Costs96,767  112,643  225,249  223,938  
Exploration Costs27,283  32,522  66,960  68,846  
Dry Hole Costs87  3,769  459  3,863  
Impairments305,415  112,130  1,878,350  184,486  
Marketing Costs444,444  1,500,915  1,553,437  2,770,972  
Depreciation, Depletion and Amortization706,679  957,304  1,706,739  1,836,899  
General and Administrative131,855  121,780  246,128  228,452  
Taxes Other Than Income80,319  204,414  237,679  397,320  
Total2,189,923  3,566,859  6,850,030  6,748,971  
Operating Income (Loss)(1,086,549) 1,130,771  (1,028,964) 2,007,301  
Other Income (Expense), Net(4,500) 8,503  13,608  14,115  
Income (Loss) Before Interest Expense and Income Taxes(1,091,049) 1,139,274  (1,015,356) 2,021,416  
Interest Expense, Net54,213  49,908  98,903  104,814  
Income (Loss) Before Income Taxes(1,145,262) 1,089,366  (1,114,259) 1,916,602  
Income Tax Provision (Benefit)(235,878) 241,525  (214,688) 433,335  
Net Income (Loss)$(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) $2.56  
Average Number of Common Shares    
Basic578,719  577,460  578,581  577,333  
Diluted578,719  580,247  578,581  580,204  
Comprehensive Income (Loss)    
Net Income (Loss)$(909,384) $847,841  $(899,571) $1,483,267  
Other Comprehensive Income (Loss)    
Foreign Currency Translation Adjustments(2,831) (1,665) (1,490) (3,449) 
Other, Net of Tax6  6  12  12  
Other Comprehensive Income (Loss)(2,825) (1,659) (1,478) (3,437) 
Comprehensive Income (Loss)$(912,209) $846,182  $(901,049) $1,479,830  
 Three Months Ended September 30, Nine Months Ended 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 Liquids164,736
 353,704
 569,748
 861,473
Natural Gas269,625
 311,713
 874,489
 912,324
Gains (Losses) on Mark-to-Market Commodity Derivative Contracts85,902
 (52,081) 242,622
 (297,735)
Gathering, Processing and Marketing1,334,450
 1,360,992
 4,121,490
 3,899,250
Gains (Losses) on Asset Dispositions, Net(523) 115,944
 3,650
 94,658
Other, Net30,276
 36,074
 99,470
 96,779
Total4,303,455
 4,781,624
 13,059,727
 12,700,863
Operating Expenses 
  
  
  
Lease and Well348,883
 321,568
 1,032,455
 936,236
Transportation Costs199,365
 196,027
 549,988
 550,781
Gathering and Processing Costs127,549
 114,063
 351,487
 324,577
Exploration Costs34,540
 32,823
 103,386
 115,137
Dry Hole Costs24,138
 358
 28,001
 5,260
Impairments105,275
 44,617
 289,761
 160,934
Marketing Costs1,343,293
 1,326,974
 4,114,265
 3,853,827
Depreciation, Depletion and Amortization953,597
 918,180
 2,790,496
 2,515,445
General and Administrative135,758
 111,284
 364,210
 310,065
Taxes Other Than Income203,098
 209,043
 600,418
 582,395
Total3,475,496
 3,274,937
 10,224,467
 9,354,657
Operating Income827,959
 1,506,687
 2,835,260
 3,346,206
Other Income (Expense), Net9,118
 3,308
 23,233
 (4,516)
Income Before Interest Expense and Income Taxes837,077
 1,509,995
 2,858,493
 3,341,690
Interest Expense, Net39,620
 63,632
 144,434
 189,032
Income Before Income Taxes797,457
 1,446,363
 2,714,059
 3,152,658
Income Tax Provision182,335
 255,411
 615,670
 626,386
Net Income$615,122
 $1,190,952
 $2,098,389
 $2,526,272
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 
  
  
  
Basic577,839
 577,254
 577,498
 576,431
Diluted581,271
 581,559
 581,190
 580,442
Comprehensive Income 
  
  
  
Net Income$615,122
 $1,190,952
 $2,098,389
 $2,526,272
Other Comprehensive Income (Loss) 
  
  
  
Foreign Currency Translation Adjustments833
 (1,952) (2,616) (179)
Other, Net of Tax6
 6
 18
 18
Other Comprehensive Income (Loss)839
 (1,946) (2,598) (161)
Comprehensive Income$615,961
 $1,189,006
 $2,095,791
 $2,526,111



The accompanying notes are an integral part of these condensed consolidated financial statements.
-3-
        



EOG RESOURCES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Share Data)
(Unaudited)
June 30,
2020		December 31,
2019
ASSETS
Current Assets
Cash and Cash Equivalents$2,416,501  $2,027,972  
Accounts Receivable, Net943,354  2,001,658  
Inventories676,580  767,297  
Assets from Price Risk Management Activities207,019  1,299  
Income Taxes Receivable196,958  151,665  
Other156,979  323,448  
Total4,597,391  5,273,339  
Property, Plant and Equipment  
Oil and Gas Properties (Successful Efforts Method)64,406,245  62,830,415  
Other Property, Plant and Equipment4,665,815  4,472,246  
Total Property, Plant and Equipment69,072,060  67,302,661  
Less:  Accumulated Depreciation, Depletion and Amortization(39,838,595) (36,938,066) 
Total Property, Plant and Equipment, Net29,233,465  30,364,595 ��
Deferred Income Taxes1,846  2,363  
Other Assets1,388,969  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 Payable193,763  254,850  
Dividends Payable217,004  166,273  
Liabilities from Price Risk Management Activities—  20,194  
Current Portion of Long-Term Debt21,121  1,014,524  
Current Portion of Operating Lease Liabilities252,642  369,365  
Other188,685  232,655  
Total2,154,381  4,486,988  
Long-Term Debt5,703,141  4,160,919  
Other Liabilities2,138,696  1,789,884  
Deferred Income Taxes4,837,896  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, 2019205,824  205,822  
Additional Paid in Capital5,886,298  5,817,475  
Accumulated Other Comprehensive Loss(6,130) (4,652) 
Retained Earnings14,312,493  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' Equity20,387,557  21,640,716  
Total Liabilities and Stockholders' Equity$35,221,671  $37,124,608  
 September 30,
2019		 December 31,
2018
ASSETS
Current Assets   
Cash and Cash Equivalents$1,583,105
 $1,555,634
Accounts Receivable, Net1,927,996
 1,915,215
Inventories778,120
 859,359
Assets from Price Risk Management Activities122,627
 23,806
Income Taxes Receivable135,680
 427,909
Other272,203
 275,467
Total4,819,731
 5,057,390
Property, Plant and Equipment 
  
Oil and Gas Properties (Successful Efforts Method)61,620,033
 57,330,016
Other Property, Plant and Equipment4,394,486
 4,220,665
Total Property, Plant and Equipment66,014,519
 61,550,681
Less:  Accumulated Depreciation, Depletion and Amortization(35,810,197) (33,475,162)
Total Property, Plant and Equipment, Net30,204,322
 28,075,519
Deferred Income Taxes1,998
 777
Other Assets1,516,218
 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 Payable302,774
 214,726
Dividends Payable166,215
 126,971
Current Portion of Long-Term Debt1,014,200
 913,093
Current Portion of Operating Lease Liabilities384,348
 —
Other211,096
 233,724
Total4,473,713
 3,728,364
    
Long-Term Debt4,163,115
 5,170,169
Other Liabilities1,858,357
 1,258,355
Deferred Income Taxes4,922,804
 4,413,398
Commitments and Contingencies (Note 8)


 


    
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, 2018205,821
 205,804
Additional Paid in Capital5,769,073
 5,658,794
Accumulated Other Comprehensive Loss(3,689) (1,358)
Retained Earnings15,179,381
 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' Equity21,124,280
 19,364,188
Total Liabilities and Stockholders' Equity$36,542,269
 $33,934,474

The accompanying notes are an integral part of these condensed consolidated financial statements.
-4-
        



EOG RESOURCES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(In Thousands, Except Per Share Data)
(Unaudited)
 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  
Common
Stock		Additional
Paid In
Capital		Accumulated
Other
Comprehensive
Income (Loss)		Retained
Earnings		Common
Stock
Held In
Treasury		Total
Stockholders'
Equity
Common
Stock
 
Additional
Paid In
Capital
 
Accumulated
Other
Comprehensive
Income (Loss)
 
Retained
Earnings
 
Common
Stock
Held In
Treasury
 
Total
Stockholders'
Equity
Balance at June 30, 2019$205,809
 $5,729,318
 $(4,528) $14,731,609
 $(31,932) $20,630,276
Balance at March 31, 2019Balance at March 31, 2019$205,807  $5,695,197  $(2,869) $14,050,676  $(45,014) $19,903,797  
Net Income—
 —
 —
 615,122
 —
 615,122
Net Income—  —  —  847,841  —  847,841  
Common Stock Issued Under Stock Plans—
 —
 —
 —
 —
 —
Common Stock Issued Under Stock Plans—  —  —  —  —  —  
Common Stock Dividends Declared, $0.2875 Per Share—
 —
 —
 (167,350) —
 (167,350)Common Stock Dividends Declared, $0.2875 Per Share—  —  —  (166,908) —  (166,908) 
Other Comprehensive Income—
 —
 839
 —
 —
 839
Other Comprehensive LossOther Comprehensive Loss—  —  (1,659) —  —  (1,659) 
Change in Treasury Stock - Stock Compensation Plans, Net—
 (12,220) —
 —
 (759) (12,979)Change in Treasury Stock - Stock Compensation Plans, Net—  (5,834) —  —  12,027  6,193  
Restricted Stock and Restricted Stock Units, Net12
 (2,270) —
 —
 2,258
 —
Restricted Stock and Restricted Stock Units, Net2  1,788  —  —  (1,790) —  
Stock-Based Compensation Expenses—
 54,670
 —
 —
 —
 54,670
Stock-Based Compensation Expenses—  38,566  —  —  —  38,566  
Treasury Stock Issued as Compensation—
 (425) —
 —
 4,127
 3,702
Treasury Stock Issued as Compensation—  (399) —  —  2,845  2,446  
Balance at September 30, 2019$205,821
 $5,769,073
 $(3,689) $15,179,381
 $(26,306) $21,124,280
Balance at June 30, 2019Balance at June 30, 2019$205,809  $5,729,318  $(4,528) $14,731,609  $(31,932) $20,630,276  

 
Common
Stock
 
Additional
Paid In
Capital
 
Accumulated
Other
Comprehensive
Income (Loss)
 
Retained
Earnings
 
Common
Stock
Held In
Treasury
 
Total
Stockholders'
Equity
Balance at June 30, 2018$205,796
 $5,591,643
 $(17,512) $11,714,656
 $(42,189) $17,452,394
Net Income—
 —
 —
 1,190,952
 —
 1,190,952
Common Stock Issued Under Stock Plans2
 (2) —
 —
 —
 —
Common Stock Dividends Declared, $0.22 Per Share—
 —
 —
 (127,504) —
 (127,504)
Other Comprehensive Loss—
 —
 (1,946) —
 —
 (1,946)
Change in Treasury Stock - Stock Compensation Plans, Net—
 (7,034) —
 —
 (18,550) (25,584)
Restricted Stock and Restricted Stock Units, Net5
 (7,548) —
 —
 7,543
 —
Stock-Based Compensation Expenses—
 49,001
 —
 —
 —
 49,001
Treasury Stock Issued as Compensation—
 199
 —
 —
 958
 1,157
Balance at September 30, 2018$205,803
 $5,626,259
 $(19,458) $12,778,104
 $(52,238) $18,538,470

The accompanying notes are an integral part of these condensed consolidated financial statements.


-5-
        



EOG RESOURCES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(In Thousands, Except Per Share Data)
(Unaudited)
Common
Stock		Additional
Paid In
Capital		Accumulated
Other
Comprehensive
Income (Loss)		Retained
Earnings		Common
Stock
Held In
Treasury		Total
Stockholders'
Equity
Common
Stock
 
Additional
Paid In
Capital
 
Accumulated
Other
Comprehensive
Income (Loss)
 
Retained
Earnings
 
Common
Stock
Held In
Treasury
 
Total
Stockholders'
Equity
Balance at December 31, 2018$205,804
 $5,658,794
 $(1,358) $13,543,130
 $(42,182) $19,364,188
Net Income—
 —
 —
 2,098,389
 —
 2,098,389
Balance at December 31, 2019Balance at December 31, 2019$205,822  $5,817,475  $(4,652) $15,648,604  $(26,533) $21,640,716  
Net LossNet Loss—  —  —  (899,571) —  (899,571) 
Common Stock Issued Under Stock Plans—
 —
 —
 —
 —
 —
Common Stock Issued Under Stock Plans—  (14) —  —  —  (14) 
Common Stock Dividends Declared, $0.795 Per Share—
 —
 —
 (461,871) —
 (461,871)
Common Stock Dividends Declared, $0.75 Per ShareCommon Stock Dividends Declared, $0.75 Per Share—  —  —  (436,540) —  (436,540) 
Other Comprehensive Loss—
 —
 (2,598) —
 —
 (2,598)Other Comprehensive Loss—  —  (1,478) —  —  (1,478) 
Change in Treasury Stock - Stock Compensation Plans, Net—
 (19,295) —
 —
 6,719
 (12,576)Change in Treasury Stock - Stock Compensation Plans, Net—  (7,011) —  —  10,673  3,662  
Restricted Stock and Restricted Stock Units, Net17
 (1,886) —
 —
 1,869
 —
Restricted Stock and Restricted Stock Units, Net2  (3,415) —  —  3,413  —  
Stock-Based Compensation Expenses—
 132,323
 —
 —
 


 132,323
Stock-Based Compensation Expenses—  79,643  —  —  —  79,643  
Treasury Stock Issued as Compensation—
 (863) —
 —
 7,288
 6,425
Treasury Stock Issued as Compensation—  (380) —  —  1,519  1,139  
Cumulative Effect of Adoption of ASU 2018-02, "Income Statement - Reporting Comprehensive Income (Topic 220)"—
 —
 267
 (267) —
 —
Balance at September 30, 2019$205,821
 $5,769,073
 $(3,689) $15,179,381
 $(26,306) $21,124,280
Balance at June 30, 2020Balance at June 30, 2020$205,824  $5,886,298  $(6,130) $14,312,493  $(10,928) $20,387,557  

 Common
Stock		Additional
Paid In
Capital		Accumulated
Other
Comprehensive
Income (Loss)		Retained
Earnings		Common
Stock
Held In
Treasury		Total
Stockholders'
Equity
Balance at December 31, 2018$205,804  $5,658,794  $(1,358) $13,543,130  $(42,182) $19,364,188  
Net Income—  —  —  1,483,267  —  1,483,267  
Common Stock Issued Under Stock Plans—  —  —  —  —  —  
Common Stock Dividends Declared, $0.5075 Per Share—  —  —  (294,521) —  (294,521) 
Other Comprehensive Loss—  —  (3,437) —  —  (3,437) 
Change in Treasury Stock - Stock Compensation Plans, Net—  (7,074) —  —  7,478  404  
Restricted Stock and Restricted Stock Units, Net5  384  —  —  (389) —  
Stock-Based Compensation Expenses—  77,653  —  —  —  77,653  
Treasury Stock Issued as Compensation—  (439) —  —  3,161  2,722  
Cumulative Effect of Adoption of ASU 2018-02, "Income Statement - Reporting Comprehensive Income (Topic 220)"—  —  267  (267) —  —  
Balance at June 30, 2019$205,809  $5,729,318  $(4,528) $14,731,609  $(31,932) $20,630,276  
 
Common
Stock
 
Additional
Paid In
Capital
 
Accumulated
Other
Comprehensive
Income (Loss)
 
Retained
Earnings
 
Common
Stock
Held In
Treasury
 
Total
Stockholders'
Equity
Balance at December 31, 2017$205,788
 $5,536,547
 $(19,297) $10,593,533
 $(33,298) $16,283,273
Net Income—
 —
 —
 2,526,272
 —
 2,526,272
Common Stock Issued Under Stock Plans7
 (7) —
 —
 —
 —
Common Stock Dividends Declared, $0.590 Per Share—
 —
 —
 (341,701) —
 (341,701)
Other Comprehensive Loss—
 —
 (161) —
 —
 (161)
Change in Treasury Stock - Stock Compensation Plans, Net—
 (23,458) —
 —
 (23,002) (46,460)
Restricted Stock and Restricted Stock Units, Net8
 (3,421) —
 —
 3,413
 —
Stock-Based Compensation Expenses—
 116,290
 —
 —
 —
 116,290
Treasury Stock Issued as Compensation—
 308
 —
 —
 649
 957
Balance at September 30, 2018$205,803
 $5,626,259
 $(19,458) $12,778,104
 $(52,238) $18,538,470

The accompanying notes are an integral part of these condensed consolidated financial statements.


-6-

EOG RESOURCES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(Unaudited)
Nine Months Ended September 30,Six Months Ended
June 30,
2019 201820202019
Cash Flows from Operating Activities   Cash Flows from Operating Activities
Reconciliation of Net Income to Net Cash Provided by Operating Activities:   
Net Income$2,098,389
 $2,526,272
Reconciliation of Net Income (Loss) to Net Cash Provided by Operating Activities:Reconciliation of Net Income (Loss) to Net Cash Provided by Operating Activities:
Net Income (Loss)Net Income (Loss)$(899,571) $1,483,267  
Items Not Requiring (Providing) Cash 
  
Items Not Requiring (Providing) Cash  
Depreciation, Depletion and Amortization2,790,496
 2,515,445
Depreciation, Depletion and Amortization1,706,739  1,836,899  
Impairments289,761
 160,934
Impairments1,878,350  184,486  
Stock-Based Compensation Expenses132,323
 116,290
Stock-Based Compensation Expenses79,643  77,653  
Deferred Income Taxes508,576
 681,702
Deferred Income Taxes(207,692) 324,294  
Gains on Asset Dispositions, Net(3,650) (94,658)Gains on Asset Dispositions, Net(29,693) (4,173) 
Other, Net4,155
 15,314
Other, Net171  5,439  
Dry Hole Costs28,001
 5,260
Dry Hole Costs459  3,863  
Mark-to-Market Commodity Derivative Contracts 
  
Mark-to-Market Commodity Derivative Contracts  
Total (Gains) Losses(242,622) 297,735
Net Cash Received from (Payments for) Settlements of Commodity Derivative Contracts139,708
 (180,228)
Total GainsTotal Gains(1,079,411) (156,720) 
Net Cash Received from Settlements of Commodity Derivative ContractsNet Cash Received from Settlements of Commodity Derivative Contracts723,761  31,290  
Other, Net1,215
 1,652
Other, Net(720) 1,639  
Changes in Components of Working Capital and Other Assets and Liabilities 
  
Changes in Components of Working Capital and Other Assets and Liabilities  
Accounts Receivable(5,855) (553,529)Accounts Receivable1,191,457  (69,746) 
Inventories55,598
 (286,817)Inventories84,575  (11,259) 
Accounts Payable134,253
 537,525
Accounts Payable(1,184,718) 126,853  
Accrued Taxes Payable88,047
 (36,891)Accrued Taxes Payable(61,087) 53,280  
Other Assets394,573
 (103,334)Other Assets252,978  487,387  
Other Liabilities(18,315) (14,776)Other Liabilities(64,403) (58,106) 
Changes in Components of Working Capital Associated with Investing and Financing Activities(38,677) 95,484
Changes in Components of Working Capital Associated with Investing and Financing Activities282,154  (22,034) 
Net Cash Provided by Operating Activities6,355,976
 5,683,380
Net Cash Provided by Operating Activities2,672,992  4,294,312  
Investing Cash Flows 
  
Investing Cash Flows  
Additions to Oil and Gas Properties(4,866,882) (4,571,932)Additions to Oil and Gas Properties(1,990,033) (3,446,497) 
Additions to Other Property, Plant and Equipment(187,350) (202,384)Additions to Other Property, Plant and Equipment(147,366) (116,881) 
Proceeds from Sales of Assets35,409
 11,582
Proceeds from Sales of Assets43,368  17,642  
Other Investing Activities—
 (19,993)
Changes in Components of Working Capital Associated with Investing Activities38,677
 (95,541)Changes in Components of Working Capital Associated with Investing Activities(282,154) 22,056  
Net Cash Used in Investing Activities(4,980,146) (4,878,268)Net Cash Used in Investing Activities(2,376,185) (3,523,680) 
Financing Cash Flows 
  
Financing Cash Flows  
Long-Term Debt BorrowingsLong-Term Debt Borrowings1,483,852  —  
Long-Term Debt Repayments(900,000) —
Long-Term Debt Repayments(1,000,000) (900,000) 
Dividends Paid(420,851) (311,075)Dividends Paid(384,100) (254,681) 
Treasury Stock Purchased(22,238) (58,558)Treasury Stock Purchased(5,057) (8,403) 
Proceeds from Stock Options Exercised and Employee Stock Purchase Plan9,558
 12,098
Proceeds from Stock Options Exercised and Employee Stock Purchase Plan8,614  8,695  
Debt Issuance Costs(5,016) —
Debt Issuance Costs(2,635) (4,902) 
Repayment of Finance Lease Liabilities(9,638) (5,052)Repayment of Finance Lease Liabilities(8,445) (6,403) 
Changes in Components of Working Capital Associated with Financing Activities—
 57
Changes in Components of Working Capital Associated with Financing Activities—  (22) 
Net Cash Used in Financing Activities(1,348,185) (362,530)
Net Cash Provided by (Used in) Financing ActivitiesNet Cash Provided by (Used in) Financing Activities92,229  (1,165,716) 
Effect of Exchange Rate Changes on Cash(174) (2,678)Effect of Exchange Rate Changes on Cash(507) (65) 
Increase in Cash and Cash Equivalents27,471
 439,904
Increase (Decrease) in Cash and Cash EquivalentsIncrease (Decrease) in Cash and Cash Equivalents388,529  (395,149) 
Cash and Cash Equivalents at Beginning of Period1,555,634
 834,228
Cash and Cash Equivalents at Beginning of Period2,027,972  1,555,634  
Cash and Cash Equivalents at End of Period$1,583,105
 $1,274,132
Cash and Cash Equivalents at End of Period$2,416,501  $1,160,485  

The accompanying notes are an integral part of these condensed consolidated financial statements.
-7-



EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

1.    Summary of Significant Accounting Policies

General. The condensed consolidated financial statements of EOG Resources, Inc., together with its subsidiaries (collectively, EOG), included herein have been prepared by management without audit pursuant to the rules and regulations of the United States Securities and Exchange Commission (SEC). Accordingly, they reflect all normal recurring adjustments which are, in the opinion of management, necessary for a fair presentation of the financial results for the interim periods presented. Certain information and notes normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) have been condensed or omitted pursuant to such rules and regulations. However, management believes that the disclosures included either on the face of the financial statements or in these notes are sufficient to make the interim information presented not misleading. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in EOG's Annual Report on Form 10-K for the year ended December 31, 2018,2019, filed on February 26,27, 2020 (EOG's 2019 (EOG's 2018 Annual Report).

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The operating results for the three and ninesix months ended SeptemberJune 30, 2019,2020, are not necessarily indicative of the results to be expected for the full year.

Effective January 1, 2019,2020, EOG adopted the provisions of Accounting Standards Update (ASU) 2016-02, "Leases (Topic 842)"2016-13, "Measurement of Credit Losses on Financial Instruments" (ASU 2016-02)2016-13). ASU 2016-022016-13 changes the impairment model for financial assets and certain other related ASUs requireinstruments by requiring entities to adopt a forward-looking expected loss model that lessees recognize a right-of-use (ROU) asset and related lease liability, representing the obligation to make lease payments for certain lease transactions, on the Condensed Consolidated Balance Sheets and disclose additional leasing information.

will result in earlier recognition of credit losses. EOG elected to adopt ASU 2016-02 and other related ASUs2016-13 using the modified retrospective approach with a cumulative-effect adjustment to the opening balance of retained earnings as of the effective date. Financial results reported in periods prior to January 1, 2019,2020, are unchanged. Additionally, EOG electedassessed its applicable financial assets, which are primarily its accounts receivable from hydrocarbon sales and joint interest billings to third-party companies, including foreign state-owned entities in the package of practical expedients within ASU 2016-02 that allows an entity to not reassess prior to the effective date (i) whether any expired or existing contracts are or contain leases, (ii) the lease classification for any expired or existing leases, or (iii) initial direct costs for any existing leases, butoil and gas industry. Based on its assessment and various potential remedies ensuring collection, EOG did not elect the practical expedient of hindsight when determining the lease term of existing contracts at the effective date. EOG also elected the practical expedient under ASU 2018-01, "Leases (Topic 842) - Land Easement Practical Expedient for Transition to Topic 842," and did not evaluate existing or expired land easements not previously accounted for as leases prior to the January 1, 2019 effective date. There was norecord an impact to retained earnings upon adoption and expects current and future credit losses to be immaterial. EOG continues to monitor the credit risk from third-party companies to determine if expected credit losses may become material.

Recently Issued Accounting Standards. In March 2020, the Financial Accounting Standards Board (FASB) issued ASU 2020-04, "Reference Rate Reform (Topic 848)" (ASU 2020-04), which provides optional expedients and exceptions for accounting treatment of contracts which are affected by the anticipated discontinuation of the London InterBank Offered Rate (LIBOR) and other rates resulting from rate reform. Contract terms that are modified due to the replacement of a reference rate are not required to be remeasured or reassessed under relevant accounting standards. Early adoption is permitted. ASU 2020-04 covers certain contracts which reference these rates and that are entered into on or before December 31, 2022. EOG is evaluating the provisions of ASU 2016-022020-04 and has not determined the full impact on its consolidated financial statements and related disclosures related to its $2.0 billion senior unsecured Revolving Credit Agreement.

In December 2019, the FASB issued ASU 2019-12, "Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes" (ASU 2019-12), which amends certain aspects of accounting for income taxes. ASU 2019-12 removes specific exceptions within existing U.S. GAAP related to the incremental approach for intraperiod tax allocation and to the general methodology for calculating income taxes in interim periods, among other changes. ASU 2019-12 also requires an entity to reflect the effect of an enacted change in tax laws or rates in the annual effective tax rate computation in the interim period that includes the enactment date, among other requirements. ASU 2019-12 is effective for interim and annual periods beginning after December 15, 2020, and early adoption is permitted. EOG is continuing to evaluate the provisions of ASU 2019-12 and has not determined the full impact on its consolidated financial statements and related ASUs. See Note 14.disclosures.


-8-
EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)

2.    Stock-Based Compensation

As more fully discussed in Note 7 to the Consolidated Financial Statements included in EOG's 20182019 Annual Report, EOG maintains various stock-based compensation plans. Stock-based compensation expense is included on the Condensed Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) based upon the job function of the employees receiving the grants as follows (in millions):
Three Months Ended
June 30,		Six Months Ended
June 30,
 2020201920202019
Lease and Well$15.1  $13.6  $30.2  $27.3  
Gathering and Processing Costs0.4  0.3  0.6  0.5  
Exploration Costs6.8  6.5  14.0  13.0  
General and Administrative17.3  18.2  34.8  36.9  
Total$39.6  $38.6  $79.6  $77.7  
 Three Months Ended September 30, Nine Months Ended September 30,
 2019 2018 2019 2018
Lease and Well$13.3
 $12.9
 $40.6
 $37.1
Gathering and Processing Costs0.3
 0.1
 0.8
 0.3
Exploration Costs5.2
 5.8
 18.1
 18.4
General and Administrative35.9
 30.2
 72.8
 60.5
Total$54.7
 $49.0
 $132.3
 $116.3


The Amended and Restated EOG Resources, Inc. 2008 Omnibus Equity Compensation Plan (2008 Plan) provides for grants of stock options, stock-settled stock appreciation rights (SARs), restricted stock and restricted stock units, performance units and other stock-based awards.
EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)



At SeptemberJune 30, 2019,2020, approximately 7.77.0 million common shares remained available for grant under the 2008 Plan. EOG's policy is to issue shares related to 2008 Plan grants from previously authorized unissued shares or treasury shares to the extent treasury shares are available.

Stock Options and Stock-Settled Stock Appreciation Rights and Employee Stock Purchase Plan. The fair value of stock option grants and SAR grants is estimated using the Hull-White II binomial option pricing model. The fair value of Employee Stock Purchase Plan (ESPP) grants is estimated using the Black-Scholes-Merton model. Stock-based compensation expense related to stock option, SAR and ESPP grants totaled $20.4$15.0 million and $21.7$13.6 million during the three months ended SeptemberJune 30, 20192020 and 2018,2019, respectively, and $47.8$29.1 million and $45.4$27.5 million during the ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, respectively.

Weighted average fair values and valuation assumptions used to value stock option, SAR and ESPP grants during the nine-monthsix-month periods ended SeptemberJune 30, 20192020 and 20182019 are as follows:
 Stock Options/SARsESPP
Six Months Ended
June 30,		Six Months Ended
June 30,
 2020201920202019
Weighted Average Fair Value of Grants$16.94  $25.68  $20.80  $22.98  
Expected Volatility42.10 %31.50 %35.24 %36.31 %
Risk-Free Interest Rate0.93 %2.38 %1.56 %2.48 %
Dividend Yield1.94 %0.96 %1.56 %0.83 %
Expected Life5.1 years5.1 years0.5 years0.5 years
 Stock Options/SARs ESPP
 Nine Months Ended September 30, Nine Months Ended September 30,
 2019 2018 2019 2018
Weighted Average Fair Value of Grants$19.49
 $33.49
 $22.83
 $25.52
Expected Volatility32.01% 28.22% 34.83% 24.36%
Risk-Free Interest Rate1.69% 2.68% 2.28% 1.86%
Dividend Yield1.39% 0.72% 1.04% 0.64%
Expected Life5.1 years
 5.0 years
 0.5 years
 0.5 years


Expected volatility is based on an equal weighting of historical volatility and implied volatility from traded options in EOG's common stock. The risk-free interest rate is based upon United States Treasury yields in effect at the time of grant. The expected life is based upon historical experience and contractual terms of stock option, SAR and ESPP grants.

The following table sets forth stock option and SAR transactions for the nine-month periods ended September 30, 2019 and 2018 (stock options and SARs in thousands):
 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018
 
Number of
Stock
Options/SARs
 
Weighted
Average
Grant
Price
 
Number of
Stock
Options/SARs
 
Weighted
Average
Grant
Price
Outstanding at January 18,310
 $96.90
 9,103
 $83.89
Granted1,946
 75.43
 1,884
 126.65
Exercised (1)
(586) 61.19
 (2,144) 69.62
Forfeited(200) 104.89
 (167) 91.89
Outstanding at September 30 (2)
9,470
 $94.53
 8,676
 $96.55
Vested or Expected to Vest (3)
9,127
 $94.51
 8,316
 $96.08
Exercisable at September 30 (4)
5,307
 $94.08
 4,202
 $85.80


(1)The total intrinsic value of stock options/SARs exercised during the nine months ended September 30, 2019 and 2018 was $13.3 million and $103.7 million, respectively. The intrinsic value is based upon the difference between the market price of EOG's common stock on the date of exercise and the grant price of the stock options/SARs.
(2)The total intrinsic value of stock options/SARs outstanding at September 30, 2019 and 2018 was $4.8 million and $269.1 million, respectively. At September 30, 2019 and 2018, the weighted average remaining contractual life was 4.5 years and 4.8 years, respectively.
(3)The total intrinsic value of stock options/SARs vested or expected to vest at September 30, 2019 and 2018 was $4.8 million and $261.9 million, respectively. At September 30, 2019 and 2018, the weighted average remaining contractual life was 4.5 years and 4.7 years, respectively.
(4)The total intrinsic value of stock options/SARs exercisable at September 30, 2019 and 2018 was $4.7 million and $175.5 million, respectively. At September 30, 2019 and 2018, the weighted average remaining contractual life was 3.3 years and 3.4 years, respectively.
-9-
EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)


The following table sets forth stock option and SAR transactions for the six-month periods ended June 30, 2020 and 2019 (stock options and SARs in thousands):
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 19,395  $94.53  8,310  $96.90  
Granted16  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  
(1)The total intrinsic value of stock options/SARs exercised during the six months ended June 30, 2020 and 2019 was $0.4 million and $3.9 million, respectively. The intrinsic value is based upon the difference between the market price of EOG's common stock on the date of exercise and the grant price of the stock options/SARs.
(2)The total intrinsic value of stock options/SARs outstanding at June 30, 2020 and 2019 was $0.1 million and $45.0 million, respectively. At June 30, 2020 and 2019, the weighted average remaining contractual life was 3.9 years and 4.0 years, respectively.
(3)The total intrinsic value of stock options/SARs vested or expected to vest at June 30, 2020 and 2019 was $0.1 million and $44.4 million, respectively. At June 30, 2020 and 2019, the weighted average remaining contractual life was 3.9 years and 3.9 years, respectively.
(4)The total intrinsic value of stock options/SARs exercisable at June 30, 2020 and 2019 was 0 and $37.1 million, respectively. At June 30, 2020 and 2019, the weighted average remaining contractual life was 2.7 years and 2.5 years, respectively.

At SeptemberJune 30, 2019,2020, unrecognized compensation expense related to non-vested stock option, SAR and ESPP grants totaled $100.5$61.6 million. Such unrecognized expense will be amortized on a straight-line basis over a weighted average period of 2.21.5 years.

Restricted Stock and Restricted Stock Units. Employees may be granted restricted (non-vested) stock and/or restricted stock units without cost to them. Stock-based compensation expense related to restricted stock and restricted stock units totaled $24.7$23.4 million and $17.5$23.1 million for the three months ended SeptemberJune 30, 20192020 and 2018,2019, respectively, and $71.1$48.2 million and $58.8$46.4 million for the ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, respectively.

The following table sets forth restricted stock and restricted stock unit transactions for the nine-monthsix-month periods ended SeptemberJune 30, 20192020 and 20182019 (shares and units in thousands):
 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018
 
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 13,792
 $96.64
 3,905
 $88.57
Granted1,728
 80.12
 792
 117.67
Released (1)
(732) 97.51
 (708) 77.46
Forfeited(129) 97.81
 (150) 91.36
Outstanding at September 30 (2)
4,659
 $90.34
 3,839
 $96.52
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 14,546  $90.16  3,792  $96.64  
Granted67  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  
(1)The total intrinsic value of restricted stock and restricted stock units released during the nine months ended September 30, 2019 and 2018 was $61.2 million and $80.2 million, respectively. The intrinsic value is based upon the closing price of EOG's common stock on the date the restricted stock and restricted stock units are released.
(2)The total intrinsic value of restricted stock and restricted stock units outstanding at September 30, 2019 and 2018 was $345.8 million and $489.7 million, respectively.
(1)The total intrinsic value of restricted stock and restricted stock units released during the six months ended June 30, 2020 and 2019 was $13.1 million and $35.7 million, respectively. The intrinsic value is based upon the closing price of EOG's common stock on the date the restricted stock and restricted stock units are released.
(2)The total intrinsic value of restricted stock and restricted stock units outstanding at June 30, 2020 and 2019 was $216.5 million and $347.5 million, respectively.
-10-
EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)


At SeptemberJune 30, 2019,2020, unrecognized compensation expense related to restricted stock and restricted stock units totaled $227.5$154.2 million. Such unrecognized expense will be amortized on a straight-line basis over a weighted average period of 2.01.4 years.

Performance Units. EOG grants performance units annually to its executive officers without cost to them. As more fully discussed in the grant agreements, the performance metric applicable to the performance units is EOG's total shareholder return over a three-yearthree-year performance period relative to the total shareholder return of a designated group of peer companies (Performance Period). Upon the application of the performance multiple at the completion of the Performance Period, a minimum of 0% and a maximum of 200% of the performance units granted could be outstanding. The fair value of the performance units is estimated using a Monte Carlo simulation. Stock-based compensation expense related to the performance unit grants totaled $9.6$1.2 million and $9.8$1.9 million for the three months ended SeptemberJune 30, 20192020 and 2018,2019, respectively, and $13.4$2.3 million and $12.1$3.8 million for the ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, respectively.

EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)


The following table sets forth the performance unit transactions for the nine-monthsix-month periods ended SeptemberJune 30, 20192020 and 20182019 (units in thousands):
 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018
 
Number of
Units
 
Weighted
Average
Price per
Grant Date
 
Number of
Units
 
Weighted
Average
Price per
Grant Date
Outstanding at January 1539
 $101.53
 502
 $90.96
Granted172
 75.09
 107
 127.00
Granted for Performance Multiple (1)
72
 69.43
 72
 101.87
Released (2)
(185) 94.63
 (148) 84.43
Forfeited—
 —
 —
 —
Outstanding at September 30 (3)
598
(4)$92.19
 533
 $101.50
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 1598  $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  
(1)Upon completion of the Performance Period for the performance units granted in 2015 and 2014, a performance multiple of 200% was applied to each of the grants resulting in additional grants of performance units in February 2019 and February 2018, respectively.
(2)
(1)Upon completion of the Performance Period for the performance units granted in 2016 and 2015, a performance multiple of 150% and 200%, respectively, was applied to each of the grants resulting in additional grants of performance units in February 2020 and February 2019, respectively.
(2)The total intrinsic value of performance units released during the six months ended June 30, 2020 and 2019 was $9.0 million and $7.7 million, respectively. The intrinsic value is based upon the closing price of EOG's common stock on the date the performance units are released.
(3)The total intrinsic value of performance units outstanding at June 30, 2020 and 2019 was approximately $27.5 million and $49.2 million, respectively.
(4)Upon the application of the relevant performance multiple at the completion of each of the remaining Performance Periods, a minimum of 179 and a maximum of 907 performance units could be outstanding.

nine months ended September 30, 2019 and 2018, was $15.4 million and $17.7 million, respectively. The intrinsic value is based upon the closing price of EOG's common stock on the date the performance units are released.
(3)
The total intrinsic value of performance units outstanding at September 30, 2019 and 2018 was approximately $44.4 million and $68.0 million, respectively.
(4)Upon the application of the relevant performance multiple at the completion of each of the remaining Performance Periods, a minimum of 102 thousand and a maximum of 1,094 thousand performance units could be outstanding.

At SeptemberJune 30, 2019,2020, unrecognized compensation expense related to performance units totaled $10.1$6.4 million. Such unrecognized expense will be amortized on a straight-line basis over a weighted average period of 2.21.7 years.

3.Net Income Per Share

The following table sets forth the computation of Net Income Per Share for the three-month and nine-month periods ended September 30, 2019 and 2018 (in thousands, except per share data):
 Three Months Ended September 30, Nine Months Ended September 30,
 2019 2018 2019 2018
Numerator for Basic and Diluted Earnings Per Share -       
Net Income$615,122
 $1,190,952
 $2,098,389
 $2,526,272
Denominator for Basic Earnings Per Share - 
  
  
  
Weighted Average Shares577,839
 577,254
 577,498
 576,431
Potential Dilutive Common Shares - 
  
  
  
Stock Options/SARs203
 1,432
 371
 1,317
Restricted Stock/Units and Performance Units3,229
 2,873
 3,321
 2,694
Denominator for Diluted Earnings Per Share - 
  
  
  
Adjusted Diluted Weighted Average Shares581,271
 581,559
 581,190
 580,442
Net Income Per Share 
  
  
  
Basic$1.06
 $2.06
 $3.63
 $4.38
Diluted$1.06
 $2.05
 $3.61
 $4.35


-11-
The diluted earnings per share calculation excludes stock options and SARs that were anti-dilutive. Shares underlying the excluded stock options and SARs were 6.8 million and 0.5 million shares for the three months ended September 30, 2019 and 2018, respectively, and were 6.2 million and 0.2 million shares for the nine months ended September 30, 2019 and 2018, respectively.

EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)

3.Net Income (Loss) Per Share

The following table sets forth the computation of Net Income (Loss) Per Share for the three-month and six-month periods ended June 30, 2020 and 2019 (in thousands, except per share data):
Three Months Ended
June 30,		Six Months Ended
June 30,
 2020201920202019
Numerator for Basic and Diluted Earnings Per Share -
Net Income (Loss)$(909,384) $847,841  $(899,571) $1,483,267  
Denominator for Basic Earnings Per Share -    
Weighted Average Shares578,719  577,460  578,581  577,333  
Potential Dilutive Common Shares -    
Stock Options/SARs/ESPP—  434  —  452  
Restricted Stock/Units and Performance Units—  2,353  —  2,419  
Denominator for Diluted Earnings Per Share -    
Adjusted Diluted Weighted Average Shares578,719  580,247  578,581  580,204  
Net Income (Loss) Per Share    
Basic$(1.57) $1.47  $(1.55) $2.57  
Diluted$(1.57) $1.46  $(1.55) $2.56  

The diluted earnings per share calculation excludes stock options, SARs, restricted stock, restricted stock units and performance units and ESPP grants that were anti-dilutive. Shares underlying the excluded stock options, SARs and ESPP grants were 9.3 million and 6.0 million shares for the three months ended June 30, 2020 and 2019, respectively, and were 9.3 million and 6.0 million shares for the six months ended June 30, 2020 and 2019, respectively. For the three and six months ended June 30, 2020, 4.8 million shares of restricted stock, restricted stock units and performance units were excluded.

4.    Supplemental Cash Flow Information

Net cash paid (received) for interest and income taxes was as follows for the nine-monthsix-month periods ended SeptemberJune 30, 20192020 and 20182019 (in thousands):
 Nine Months Ended September 30,
 2019 2018
Interest (1)
$154,852
 $172,076
Income Taxes, Net of Refunds Received$(314,689) $81,059
Six Months Ended
June 30,
 20202019
Interest (1)
$68,730  $108,994  
Income Taxes, Net of Refunds Received$(76,489) $(331,778) 
(1)Net of capitalized interest of $28 million and $18 million for the nine months ended September 30, 2019 and 2018, respectively.
(1)Net of capitalized interest of $17 million and $18 million for the six months ended June 30, 2020 and 2019, respectively.

EOG's accrued capital expenditures at SeptemberJune 30, 2020 and 2019 and 2018 were $568$246 million and $702$626 million, respectively.

Non-cash investing activities for the ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, included additions of $85$55 million and $222$72 million, respectively, to EOG's oil and gas properties as a result of property exchanges. Non-cash investing activities for the ninesix months ended SeptemberJune 30, 20182020 included additions of $49$73 million to EOG's other property, plant and equipment primarily in connection with a finance lease transaction in the Permian Basin.

Cash paid for leases for the nine months ended September 30, 2019, is disclosed in Note 14.

transaction.
5.Segment Information

Selected financial information by reportable segment is presented below for the three-month and nine-month periods ended September 30, 2019 and 2018 (in thousands):
-12-
 Three Months Ended September 30, Nine Months Ended September 30,
 2019 2018 2019 2018
Operating Revenues and Other       
United States$4,224,510
 $4,653,342
 $12,813,318
 $12,339,086
Trinidad64,726
 84,648
 205,726
 247,272
Other International (1)
14,219
 43,634
 40,683
 114,505
Total$4,303,455
 $4,781,624
 $13,059,727
 $12,700,863
Operating Income (Loss) 
  
  
  
United States$825,983
 $1,458,641
 $2,784,793
 $3,251,377
Trinidad8,991
 48,988
 82,213
 117,106
Other International (1)
(7,015) (942) (31,746) (22,277)
Total827,959
 1,506,687
 2,835,260
 3,346,206
Reconciling Items 
  
  
  
Other Income (Expense), Net9,118
 3,308
 23,233
 (4,516)
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
(1)Other International primarily consists of EOG's United Kingdom, China and Canada operations. The United Kingdom operations were sold in the fourth quarter of 2018.

EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)

5.Segment Information

Selected financial information by reportable segment is presented below for the three-month and six-month periods ended June 30, 2020 and 2019 (in thousands):
Three Months Ended
June 30,		Six Months Ended
June 30,
 2020201920202019
Operating Revenues and Other
United States$1,055,673  $4,611,789  $5,716,408  $8,588,808  
Trinidad33,899  71,132  75,542  141,000  
Other International (1)
13,802  14,709  29,116  26,464  
Total$1,103,374  $4,697,630  $5,821,066  $8,756,272  
Operating Income (Loss)    
United States (2)
$(1,079,201) $1,107,910  $(973,795) $1,958,810  
Trinidad10,234  34,390  22,897  73,222  
Other International (1) (3)
(17,582) (11,529) (78,066) (24,731) 
Total(1,086,549) 1,130,771  (1,028,964) 2,007,301  
Reconciling Items    
Other Income (Expense), Net(4,500) 8,503  13,608  14,115  
Interest Expense, Net(54,213) (49,908) (98,903) (104,814) 
Income (Loss) Before Income Taxes$(1,145,262) $1,089,366  $(1,114,259) $1,916,602  
(1) Other International primarily consists of EOG's China and Canada operations.
(2) EOG recorded pretax impairment charges of $6 million and $1,462 million for the three and six months ended June 30, 2020, respectively, for proved oil and gas properties, leasehold costs and other assets due to the decline in commodity prices. See Note 11. In addition, EOG recorded pretax impairment charges of $219 million for the three and six months ended June 30, 2020, for sand and crude-by-rail assets.
(3) EOG recorded pretax impairment charges of $19 million for the three months ended June 30, 2020, and $79 million for the six months ended June 30, 2020, for proved oil and gas properties and firm commitment contracts related to its decision to exit the Horn River Basin in British Columbia, Canada.

Total assets by reportable segment are presented below at SeptemberJune 30, 20192020 and December 31, 20182019 (in thousands):
 
At
September 30,
2019
 
At
December 31,
2018
Total Assets   
United States$35,765,137
 $33,178,733
Trinidad617,465
 629,633
Other International (1)
159,667
 126,108
Total$36,542,269
 $33,934,474
At
June 30,
2020		At
December 31,
2019
Total Assets
United States$34,534,344  $36,274,942  
Trinidad531,454  705,747  
Other International (1)
155,873  143,919  
Total$35,221,671  $37,124,608  
(1)
(1) Other International primarily consists of EOG's China and Canada operations.


-13-
EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)

6.    Asset Retirement Obligations

The following table presents the reconciliation of the beginning and ending aggregate carrying amounts of short-term and long-term legal obligations associated with the retirement of property, plant and equipment for the nine-monthsix-month periods ended SeptemberJune 30, 20192020 and 20182019 (in thousands):
 Nine Months Ended September 30,
 2019 2018
Carrying Amount at January 1$954,377
 $946,848
Liabilities Incurred78,025
 63,443
Liabilities Settled (1)
(52,443) (15,319)
Accretion31,890
 27,306
Revisions71,145
 (39,137)
Foreign Currency Translations154
 (2,197)
Carrying Amount at September 30$1,083,148
 $980,944
    
Current Portion$27,055
 $18,209
Noncurrent Portion$1,056,093
 $962,735
Six Months Ended
June 30,
 20202019
Carrying Amount at January 1$1,110,710  $954,377  
Liabilities Incurred16,715  56,490  
Liabilities Settled (1)
(24,480) (41,650) 
Accretion23,153  20,523  
Revisions19,990  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  
(1)Includes settlements related to asset sales.
(1)Includes settlements related to asset sales.

The current and noncurrent portions of EOG's asset retirement obligations are included in Current Liabilities - Other and Other Liabilities, respectively, on the Condensed Consolidated Balance Sheets.

7.    Exploratory Well Costs

EOG's net changes in capitalized exploratory well costs for the nine-monthsix-month period ended SeptemberJune 30, 2019,2020, are presented below (in thousands):
Six Months Ended
June 30, 2020
Balance at January 1$25,897 
Additions Pending the Determination of Proved Reserves55,669 
Reclassifications to Proved Properties(2,178)
Costs Charged to Expense (1)
(10,988)
Balance at June 30$68,400 
 Nine Months Ended September 30, 2019
Balance at January 1$4,121
Additions Pending the Determination of Proved Reserves48,917
Reclassifications to Proved Properties(6,286)
Costs Charged to Expense(22,421)
Balance at September 30$24,331
(1)Includes capitalized exploratory well costs charged to either dry hole costs or impairments.


EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)


At SeptemberJune 30, 2019,2020, all capitalized exploratory well costs had been capitalized for periods of less than one year.

8.    Commitments and Contingencies

There are currently various suits and claims pending against EOG that have arisen in the ordinary course of EOG's business, including contract disputes, personal injury and property damage claims and title disputes. While the ultimate outcome and impact on EOG cannot be predicted, management believes that the resolution of these suits and claims will not, individually or in the aggregate, have a material adverse effect on EOG's consolidated financial position, results of operations or cash flow. EOG records reserves for contingencies when information available indicates that a loss is probable and the amount of the loss can be reasonably estimated.

-14-
EOG RESOURCES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)

9.    Pension and Postretirement Benefits

EOG has defined contribution pension plans in place for most of its employees in the United States, and a defined benefit pension plan covering certain of its employees in Trinidad. For the ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, EOG's total costs recognized for these pension plans were $34$20.7 million and $30$23.0 million, respectively. EOG also has postretirement medical and dental plans in place for eligible employees and their dependents in the United States and Trinidad, the costs of which are not material.

10.    Long-Term Debt and Common Stock

Long-Term Debt. EOG had 0 outstanding commercial paper borrowings at SeptemberJune 30, 20192020 and December 31, 20182019, and did not utilize any such borrowings during the nine months ended September 30, 2019. During the nine months ended September 30, 2018, EOG utilized commercial paper borrowings, bearing market interest rates, for various corporate financing purposes. The average borrowings outstanding under the commercial paper program were $11 million during the nine months ended September 30, 2018. The weighted average interest rate for commercial paper borrowings during the ninesix months ended SeptemberJune 30, 2018, was 1.97%.2020 and 2019.

OnAt June 3, 2019, EOG repaid upon maturity the $90030, 2020, $750 million aggregate principal amount of its 5.625%EOG's 4.100% Senior Notes due 2019.

2021 was reclassified as long-term debt as a result of EOG's intent and ability to ultimately replace such amounts with other long-term debt.
On June 27, 2019,
EOG entered intocurrently has a new $2.0 billion senior unsecured Revolving Credit Agreement (New Facility)(Agreement) with domestic and foreign lenders (Banks). The New Facility replaced EOG’s $2.0 billion senior unsecured Revolving Credit Agreement dated as of July 21, 2015, with domestic and foreign lenders (2015 Facility), which had a scheduled maturity date of July 21, 2020 and which was terminated by EOG (without penalty), effective as of June 27, 2019, in connection with the completion of the New Facility.

The New Facility has a scheduled maturity date of June 27, 2024,, and includes an option for EOG to extend, on up to two occasions, the term for successive one-year periods subject to certain terms and conditions. The New FacilityAgreement (i) commits the Banks to provide advances up to an aggregate principal amount of $2.0 billion at any one time outstanding, with an option for EOG to request increases in the aggregate commitments to an amount not to exceed $3.0 billion, subject to certain terms and conditions and (ii) includes a swingline subfacility and a letter of credit subfacility. Advances under the New FacilityAgreement will accrue interest based, at EOG’sEOG's option, on either the London InterBank Offered RateLIBOR plus an applicable margin (Eurodollar Rate)rate) or the Base Ratebase rate (as defined in the New Facility)Agreement) plus an applicable margin. The applicable margin used in connection with interest rates and fees will be based on EOG’s credit rating for its senior unsecured long-term debt at the applicable time.

Consistent with the terms of the 2015 Facility, the New FacilityAgreement contains representations, warranties, covenants and events of default that we believeEOG believes are customary for investment grade,investment-grade, senior unsecured commercial bank credit agreements, including a financial covenant for the maintenance of a ratio of total debt-to-total capitalization (as such terms are defined in the New Facility)Agreement) of no greater than 65%. At SeptemberJune 30, 2019,2020, EOG was in compliance with this financial covenant.

There were 0 borrowings or letters of credit outstanding under the 2015 Facility as of (i) At June 30, 2020 and December 31, 2018 or (ii) the June 27, 2019 effective date of the closing of the New Facility and termination of the 2015 Facility. Further, at September 30, 2019, there were 0 borrowings or letters of credit outstanding under the New Facility.Agreement. The Eurodollar Raterate and Base Ratebase rate (inclusive of the applicable margin), had there been any amounts borrowed under the New FacilityAgreement at SeptemberJune 30, 2019,2020, would have been 2.92%1.06% and 5.0%3.25%, respectively.

On April 1, 2020, EOG RESOURCES, INC.repaid upon maturity the $500 million aggregate principal amount of its 2.45% Senior Notes due 2020.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)On April 14, 2020, EOG closed on its offering of $750 million aggregate principal amount of its 4.375% Senior Notes due 2030 and $750 million aggregate principal amount of its 4.950% Senior Notes due 2050 (together, the Notes). Interest on the Notes is payable semi-annually in arrears on April 15 and October 15 of each year, beginning on October 15, 2020. EOG received net proceeds of approximately $1.48 billion from the issuance of the Notes, which were used to repay the 4.40% Senior Notes due 2020 when they matured on June 1, 2020 (see below), and have also been used (and will continue to be used) for general corporate purposes, including the funding of capital expenditures.

On June 1, 2020, EOG repaid upon maturity the $500 million aggregate principal amount of its 4.40% Senior Notes due 2020.

Common Stock. On May 2, 2019,February 27, 2020, EOG's Board of Directors increased the quarterly cash dividend on the common stock from the previous $0.22$0.2875 per share to $0.2875$0.375 per share, effective beginning with the dividend paid on July 31, 2019,April 30, 2020, to stockholders of record as of July 17, 2019.April 16, 2020.

-15-
EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)

11.    Fair Value Measurements

Recurring Fair Value Measurements.As more fully discussed in Note 13 to the Consolidated Financial Statements included in EOG's 20182019 Annual Report, certain of EOG's financial and nonfinancial assets and liabilities are reported at fair value on the Condensed Consolidated Balance Sheets. The following table provides fair value measurement information within the fair value hierarchy for certain of EOG's financial assets and liabilities carried at fair value on a recurring basis at SeptemberJune 30, 20192020 and December 31, 20182019 (in thousands):
 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  
 Fair Value Measurements Using:
 
Quoted
Prices in
Active
Markets
(Level 1)
 
Significant
Other
Observable
Inputs
(Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
 Total
At September 30, 2019 
  
  
  
Financial Assets: 
  
  
  
Natural Gas Swaps$—
 $3,629
 $—
 $3,629
Crude Oil Swaps—
 119,088
 —
 119,088
Crude Oil Basis Swaps—
 1,162
 —
 1,162
Natural Gas Basis Swaps—
 230
 —
 230
Financial Liabilities:       
Crude Oil Basis Swaps$—
 $1,482
 $—
 $1,482
Natural Gas Basis Swaps—
 21
 —
 21
        
At December 31, 2018       
Financial Assets:       
Crude Oil Basis Swaps$—
 $23,806
 $—
 $23,806
(1) $207 million and $1 million are included in "Current Assets - Assets from Price Risk Management Activities" at June 30, 2020 and December 31, 2019, respectively, on the Condensed Consolidated Balance Sheets. $2 million is included in "Other Assets" at June 30, 2020, on the Condensed Consolidated Balance Sheets.
(2) $20 million is included in "Current Liabilities - Liabilities from Price Risk Management Activities" at December 31, 2019, on the Condensed Consolidated Balance Sheets.


The estimated fair value of commodity derivative contracts was based upon forward commodity price curves based on quoted market prices. Commodity derivative contracts were valued by utilizing an independent third-party derivative valuation provider who uses various types of valuation models, as applicable.

Non-Recurring Fair Value Measurements.The initial measurement of asset retirement obligations at fair value is calculated using discounted cash flow techniques and based on internal estimates of future retirement costs associated with property, plant and equipment. Significant Level 3 inputs used in the calculation of asset retirement obligations include plugging costs and reserve lives. A reconciliation of EOG's asset retirement obligations is presented in Note 6.

Proved
-16-
EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)

When circumstances indicate that proved oil and gas properties may be impaired, EOG compares expected undiscounted future cash flows at a depreciation, depletion and amortization group level to the unamortized capitalized cost of the asset. If the expected undiscounted future cash flows, based on EOG's estimate of (and assumptions regarding) future crude oil and natural gas prices, operating costs, development expenditures, anticipated production from proved reserves and other assetsrelevant data, are lower than the unamortized capitalized cost, the capitalized cost is reduced to fair value. Fair value is generally calculated using the Income Approach described in the Fair Value Measurement Topic of the ASC. In certain instances, EOG utilizes accepted offers from third-party purchasers as the basis for determining fair value.

During the first half of 2020, due to the decline in commodity prices, proved oil and gas properties with a carrying amount of $472$1,424 million were written down to their fair value of $340$264 million, resulting in pretax impairment charges of $132$1,160 million for the ninesix months ended SeptemberJune 30, 2019. Included in the $132 million2020. In addition, EOG recorded pretax impairment charges are $89of $72 million for the six months ended June 30, 2020, for a commodity price-related write-down of other assets.

EOG utilized average prices per acre from comparable market transactions and estimated discounted cash flows as the basis for determining the fair value of unproved and proved properties, respectively, received in non-cash property exchanges. See Note 4.

Fair Value of Debt.Disclosures. EOG's financial instruments, other than commodity derivative contracts, consist of cash and cash equivalents, accounts receivable, accounts payable and current and long-term debt. The carrying values of cash and cash equivalents, accounts receivable and accounts payable approximate fair value.

At SeptemberJune 30, 20192020 and December 31, 2018,2019, respectively, EOG had outstanding $5,140$5,640 million and $6,040$5,140 million aggregate principal amount of senior notes, which had estimated fair values at such dates of approximately $5,453$6,416 million and $6,027$5,452 million, respectively. The estimated fair value of debt was based upon quoted market prices and, where such prices were not available, other observable (Level 2) inputs regarding interest rates available to EOG at the end of each respective period.


EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)


12.    Risk Management Activities

Commodity Price Risk. As more fully discussed in Note 12 to the Consolidated Financial Statements included in EOG's 20182019 Annual Report, EOG engages in price risk management activities from time to time. These activities are intended to manage EOG's exposure to fluctuations in commodity prices for crude oil, NGLs and natural gas. EOG utilizes financial commodity derivative instruments, primarily price swap, option, swaption, collar and basis swap contracts, as a means to manage this price risk. EOG has not designated any of its financial commodity derivative contracts as accounting hedges and, accordingly, accounts for financial commodity derivative contracts using the mark-to-market accounting method.

CommodityCrude Oil Derivative Contracts. Prices received by EOG for its crude oil production generally vary from U.S. New York Mercantile Exchange (NYMEX) West Texas Intermediate (WTI) prices due to adjustments for delivery location (basis) and other factors. EOG has entered into crude oil basis swap contracts in order to fix the differential between Intercontinental Exchange (ICE) Brent pricing and pricing in Midland, Texas, and Cushing, Oklahoma (Midland(ICE Brent Differential). Presented below is a comprehensive summary of EOG's MidlandICE Brent Differential basis swap contracts for the nine months ended Septemberas of June 30, 2019.2020. The weighted average price differential expressed in dollars per barrel ($/Bbl) represents the amount of reductionaddition to Cushing, Oklahoma, prices for the notional volumes expressed in barrels per day (Bbld) covered by the basis swap contracts.
ICE Brent Differential Basis Swap Contracts
 Volume (Bbld)Weighted Average Price Differential
($/Bbl)
2020
May 2020 (closed)10,000  $4.92  
 Midland Differential Basis Swap Contracts
   Volume (Bbld) 
Weighted Average Price Differential
($/Bbl)
 
 
 2019    
 January 1, 2019 through October 31, 2019 (closed) 20,000
 $1.075
 November 1, 2019 through December 31, 2019 20,000
 1.075


-17-
EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)

EOG has also entered into crude oil basis swap contracts in order to fix the differential between pricing in the U.S. Gulf CoastHouston, Texas, and Cushing, Oklahoma (Gulf Coast(Houston Differential). Presented below is a comprehensive summary of EOG's Gulf CoastHouston Differential basis swap contracts for the nine months ended Septemberas of June 30, 2019.2020. The weighted average price differential expressed in $/Bbl represents the amount of addition to Cushing, Oklahoma, prices for the notional volumes expressed in Bbld covered by the basis swap contracts.
Houston Differential Basis Swap Contracts
 Volume (Bbld)Weighted Average Price Differential
($/Bbl)
2020
May 2020 (closed)10,000  $1.55  
 Gulf Coast Differential Basis Swap Contracts
   Volume (Bbld) 
Weighted Average Price Differential
($/Bbl)
 
 
 2019    
 January 1, 2019 through October 31, 2019 (closed) 13,000
 $5.572
 November 1, 2019 through December 31, 2019 13,000
 5.572

EOG has also entered into crude oil swaps in order to fix the differential in pricing between the NYMEX calendar month average and the physical crude oil delivery month (Roll Differential). Presented below is a comprehensive summary of EOG's Roll Differential swap contracts as of June 30, 2020. The weighted average price differential expressed in $/Bbl represents the amount of net addition (reduction) to delivery month prices for the notional volumes expressed in Bbld covered by the swap contracts.
Roll Differential Swap Contracts
 Volume (Bbld)Weighted Average Price Differential
($/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, 202088,000  (1.16) 
October 1, 2020 through December 31, 202066,000  (1.16) 

In May 2020, EOG entered into crude oil Roll Differential swap contracts for the period from July 1, 2020 through September 30, 2020, with notional volumes of 22,000 Bbld at a weighted average price differential of $(0.43) per Bbl, and for the period from October 1, 2020 through December 31, 2020, with notional volumes of 44,000 Bbld at a weighted average price differential of $(0.73) per Bbl. These contracts partially offset certain outstanding Roll Differential swap contracts for the same time periods and volumes at a weighted average price differential of $(1.16) per Bbl. EOG expects to pay net cash of $3.2 million for the settlement of these contracts. The offsetting contracts were excluded from the above table.

Presented below is a comprehensive summary of EOG's crude oil NYMEX WTI price swap contracts for the nine months ended Septemberas of June 30, 2019,2020, with notional volumes expressed in Bbld and prices expressed in $/Bbl.
Crude Oil NYMEX WTI Price Swap Contracts
 Volume (Bbld)Weighted Average Price ($/Bbl)
2020
January 1, 2020 through March 31, 2020 (closed)200,000  $59.33  
April 1, 2020 through May 31, 2020 (closed)265,000  51.36  
Crude Oil Price Swap Contracts
  Volume (Bbld) Weighted Average Price ($/Bbl)
2019    
April 2019 (closed) 25,000
 $60.00
May 1, 2019 through September 30, 2019 (closed) 150,000
 62.50
October 1, 2019 through December 31, 2019 150,000
 62.50



-18-

EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)

In April and May 2020, EOG entered into crude oil NYMEX WTI price swap contracts for the period from June 1, 2020 through June 30, 2020, with notional volumes of 265,000 Bbld at a weighted average price of $33.80 per Bbl, for the period from July 1, 2020 through July 31, 2020, with notional volumes of 254,000 Bbld at a weighted average price of $33.75 per Bbl, for the period from August 1, 2020 through September 30, 2020, with notional volumes of 154,000 Bbld at a weighted average price of $34.18 per Bbl and for the period from October 1, 2020 through December 31, 2020, with notional volumes of 47,000 Bbld at a weighted average price of $30.04 per Bbl. These contracts offset the remaining NYMEX WTI price swap contracts for the same time periods and volumes at a weighted average price of $51.36 per Bbl for the period from June 1, 2020 through June 30, 2020, $42.36 per Bbl for the period from July 1, 2020 through July 31, 2020, $50.42 per Bbl for the period from August 1, 2020 through September 30, 2020 and $31.00 per Bbl for the period from October 1, 2020 through December 31, 2020.EOG expects to receive net cash of $364.0 million for the settlement of these contracts. The offsetting contracts were excluded from the above table.

Presented below is a comprehensive summary of EOG's crude oil ICE Brent price swap contracts as of June 30, 2020, with notional volumes expressed in Bbld and prices expressed in $/Bbl.

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  

NGLs Derivative Contracts. Presented below is a comprehensive summary of EOG's Mont Belvieu propane (non-TET) financial price swap contracts (Mont Belvieu Propane Price Swap Contracts) as of June 30, 2020, with notional volumes expressed in Bbld and prices expressed in $/Bbl.
Mont Belvieu Propane Price Swap Contracts
 Volume (Bbld)Weighted Average Price ($/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  

In April and May 2020, EOG entered into Mont Belvieu propane price swap contracts for the period from May 1, 2020 through December 31, 2020, with notional volumes of 25,000 Bbld at a weighted average price of $16.41 per Bbl. These contracts offset the remaining Mont Belvieu propane price swap contracts for the same time period with notional volumes of 25,000 Bbld at a weighted average price of $17.92 per Bbl. EOG expects to receive net cash of $9.2 million for the settlement of these contracts. The offsetting contracts were excluded from the above table.

Natural Gas Derivative Contracts. Presented below is a comprehensive summary of EOG's natural gas price swap contracts as of June 30, 2020, with notional volumes expressed in million British thermal units (MMBtu) per day (MMBtud) and prices expressed in dollars per MMBtu ($/MMBtu).
Natural Gas Price Swap Contracts
 Volume (MMBtud)Weighted Average Price ($/MMBtu)
2021
January 1, 2021 through December 31, 202150,000  $2.75  


-19-
EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)

EOG has entered into natural gas collar contracts, which establish ceiling and floor prices for the sale of notional volumes of natural gas as specified in the collar contracts. The collars require that EOG pay the difference between the ceiling price and the NYMEX Henry Hub natural gas price for the contract month (Henry Hub Index Price) in the event the Henry Hub Index Price is above the ceiling price. The collars grant EOG the right to receive the difference between the floor price and the Henry Hub Index Price in the event the Henry Hub Index Price is below the floor price. In March 2020, EOG executed the early termination provision granting EOG the right to terminate certain 2020 natural gas collar contracts with notional volumes of 250,000 MMBtud at a weighted average ceiling price of $2.50 per MMBtu and a weighted average floor price of $2.00 per MMBtu for the period from April 1, 2020 through July 31, 2020. The net cash EOG received for settling these contracts was $7.8 million. Presented below is a comprehensive summary of EOG's natural gas collar contracts as of June 30, 2020, with notional volumes expressed in MMBtud and prices expressed in $/MMBtu.
Natural Gas Collar Contracts
Weighted Average Price ($/MMBtu)
 Volume (MMBtud)Ceiling PriceFloor Price
2020
April 1, 2020 through July 31, 2020 (closed)250,000  $2.50  $2.00  

In April 2020, EOG entered into natural gas collar contracts for the period from August 1, 2020 through October 31, 2020, with notional volumes of 250,000 MMBtud at a ceiling price of $2.50 per MMBtu and a floor price of $2.00 per MMBtu. These contracts offset the remaining natural gas collar contracts for the same time period with notional volumes of 250,000 MMBtud at a ceiling price of $2.50 per MMBtu and a floor price of $2.00 per MMBtu. EOG expects to receive net cash of $1.1 million for the settlement of these contracts. The offsetting contracts were excluded from the above table.

Prices received by EOG for its natural gas production generally vary from NYMEX Henry Hub prices due to adjustments for delivery location (basis) and other factors. EOG has entered into natural gas basis swap contracts in order to fix the differential between pricing in the Rocky Mountain area and NYMEX Henry Hub prices (Rockies Differential). Presented below is a comprehensive summary of EOG's Rockies Differential basis swap contracts for the nine months ended Septemberas of June 30, 2019.2020. The weighted average price differential expressed in dollars per million British thermal units ($/MMBtu)$/MMBtu represents the amount of reduction to NYMEX Henry Hub prices for the notional volumes expressed in MMBtu per day (MMBtud)MMBtud covered by the basis swap contracts.
 Rockies Differential Basis Swap Contracts
   Volume (MMBtud) 
Weighted Average Price Differential
 ($/MMBtu)
 
 
 2020    
 January 1, 2020 through December 31, 2020 14,000
 $0.55

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, 202030,000  0.55  

EOG has also entered into natural gas basis swap contracts in order to fix the differential between pricing at the Houston Ship Channel (HSC) and NYMEX Henry Hub prices (HSC Differential). In March 2020, EOG executed the early termination provision granting EOG the right to terminate certain 2020 HSC Differential basis swaps with notional volumes of 60,000 MMBtud at a weighted average price differential of $0.05 per MMBtu for the period from April 1, 2020 through December 31, 2020. The net cash EOG paid for settling these contracts was $0.4 million. Presented below is a comprehensive summary of EOG's natural gas priceHSC Differential basis swap contracts as of June 30, 2020. The weighted average price differential expressed in $/MMBtu represents the amount of reduction to NYMEX Henry Hub prices for the nine months ended September 30, 2019, with notional volumes expressed in MMBtud covered by the basis swap contracts.
HSC Differential Basis Swap Contracts
 Volume (MMBtud)Weighted Average Price Differential
($/MMBtu)
2020
January 1, 2020 through December 31, 2020 (closed)60,000  $0.05  
-20-
EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)


EOG has also entered into natural gas basis swap contracts in order to fix the differential between pricing at the Waha Hub in West Texas and NYMEX Henry Hub prices (Waha Differential). Presented below is a comprehensive summary of EOG's Waha Differential basis swap contracts as of June 30, 2020. The weighted average price differential expressed in $/MMBtu.MMBtu represents the amount of reduction to NYMEX Henry Hub prices for the notional volumes expressed in MMBtud covered by the basis swap contracts.
Waha Differential Basis Swap Contracts
 Volume (MMBtud)Weighted Average Price Differential
($/MMBtu)
2020
January 1, 2020 through April 30, 2020 (closed)50,000  $1.40  
Natural Gas Price Swap Contracts
  Volume (MMBtud) Weighted Average Price ($/MMBtu)
2019    
April 1, 2019 through October 31, 2019 (closed) 250,000
 $2.90


In April 2020, EOG entered into Waha Differential basis swap contracts for the period from May 1, 2020 through December 31, 2020, with notional volumes of 50,000 MMBtud at a weighted average price differential of $0.43 per MMBtu. These contracts offset the remaining Waha Differential basis swap contracts for the same time period with notional volumes of 50,000 MMBtud at a weighted average price differential of $1.40 per MMBtu. EOG expects to pay net cash of $11.9 million for the settlement of these contracts. The offsetting contracts were excluded from the above table.

Commodity Derivatives Location on Balance Sheet.The following table sets forth the amounts and classification of EOG's outstanding financial derivative instruments at SeptemberJune 30, 20192020 and December 31, 2018.2019.  Certain amounts may be presented on a net basis on the Condensed Consolidated Financial Statements when such amounts are with the same counterparty and subject to a master netting arrangement (in thousands):
     Fair Value at
Description Location on Balance Sheet September 30, 2019 December 31, 2018
Asset Derivatives      
Crude oil and natural gas derivative contracts -      
Current portion 
Assets from Price Risk Management Activities (1)
 $122,627
 $23,806
Liability Derivatives      
Crude oil and natural gas derivative contracts -      
Noncurrent portion Other Liabilities $21
 $—
   Fair Value at
DescriptionLocation on Balance SheetJune 30, 2020December 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 PortionOther Assets$1,569  $—  
Liability Derivatives
Crude oil, NGLs and natural gas derivative contracts -
Current portion
Liabilities from Price Risk Management Activities (2)
$—  $20,194  
(1)The current portion of Assets from Price Risk Management Activities consists of gross assets of $124 million, partially offset by gross liabilities of $1 million at September
(1) The current portion of Assets from Price Risk Management Activities consists of gross assets of $239 million, partially offset by gross liabilities of $32 million at June 30, 2020. The current portion of Assets from Price Risk Management Activities consists of gross assets of $3 million, partially offset by gross liabilities of $2 million, at December 31, 2019.

(2) The current portion of Liabilities from Price Risk Management Activities consists of gross liabilities of $23 million, partially offset by gross assets of $3 million, at December 31, 2019.
EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)


Credit Risk. Notional contract amounts are used to express the magnitude of a financial derivative. The amounts potentially subject to credit risk, in the event of nonperformance by the counterparties, are equal to the fair value of such contracts (see Note 11). EOG evaluates its exposure to significant counterparties on an ongoing basis, including that arising from physical and financial transactions. In some instances, EOG renegotiates payment terms and/or requires collateral, parent guarantees or letters of credit to minimize credit risk.


-21-
EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)

All of EOG's derivative instruments are covered by International Swap Dealers Association Master Agreements (ISDAs) with counterparties. The ISDAs may contain provisions that require EOG, if it is the party in a net liability position, to post collateral when the amount of the net liability exceeds the threshold level specified for EOG's then-current credit ratings. In addition, the ISDAs may also provide that as a result of certain circumstances, including certain events that cause EOG's credit ratings to become materially weaker than its then-current ratings, the counterparty may require all outstanding derivatives under the ISDAs to be settled immediately. See Note 11 for the aggregate fair value of all derivative instruments that were in a net asset position at SeptemberJune 30, 20192020 and December 31, 2018.2019. EOG had 0 collateral posted orand held collateral of $62 million at SeptemberJune 30, 2019, or2020, and had 0 collateral posted and held 0 collateral at December 31, 2018.2019.

13.  Acquisitions and Divestitures

During the ninesix months ended SeptemberJune 30, 2020, EOG paid cash for property acquisitions of $46 million in the United States. Additionally, during the six months ended June 30, 2020, EOG recognized net gains on asset dispositions of $30 million, primarily due to the sale of proved properties and non-cash property exchanges of unproved leasehold in Texas, New Mexico and the Rocky Mountain area, and received proceeds of approximately $43 million. During the six months ended June 30, 2019, EOG paid cash for property acquisitions of $311$304 million in the United States. Additionally, during the ninesix months ended SeptemberJune 30, 2019, EOG recognized net gains on asset dispositions of $4 million and received proceeds of approximately $35 million. During the nine months ended September 30, 2018, EOG recognized net gains on asset dispositions of $95 million, primarily due to non-cash exchanges of unproved leasehold in Texas, New Mexico and Wyoming and received proceeds of approximately $12$18 million.

14. Leases

In the ordinary course of business, EOG enters into contracts for drilling, fracturing, compression, real estate and other services which contain equipment and other assets and that meet the definition of a lease under ASU 2016-02. The lease term for these contracts, which includes any renewals at EOG's option that are reasonably certain to be exercised, ranges from one month to 30 years. ROU assets and related liabilities are recognized on commencement date on the Condensed Consolidated Balance Sheets based on future lease payments, discounted based on the rate implicit in the contract, if readily determinable, or EOG's incremental borrowing rate commensurate with the lease term of the contract. EOG estimates its incremental borrowing rate based on the approximate rate required to borrow on a collateralized basis. Contracts with lease terms of less than 12 months are not recorded on the Condensed Consolidated Balance Sheets, but instead are disclosed as short-term lease cost.

EOG has elected not to separate non-lease components from all leases, excluding those for fracturing services, real estate and salt water disposal, as lease payments under these contracts contain significant non-lease components, such as labor and operating costs.

Lease costs are classified by the function of the ROU asset. The lease costs related to exploration and development activities are initially included in the Oil and Gas Properties line on the Condensed Consolidated Balance Sheets and subsequently accounted for in accordance with the Extractive Industries - Oil and Gas Topic of the Accounting Standards Codification. Variable lease cost represents costs incurred above the contractual minimum payments for operating and finance leases. The components of lease cost for the three month and nine month periods ended September 30, 2019, were as follows (in millions):
 Three Months Ended September 30, 2019 Nine Months Ended September 30, 2019
Operating Lease Cost$138
 $391
Finance Lease Cost:   
Amortization of Lease Assets3
 10
Interest on Lease Liabilities—
 1
Variable Lease Cost39
 167
Short-Term Lease Cost67
 295
Total Lease Cost$247
 $864


EOG RESOURCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(Unaudited)


The following table sets forth the amounts and classification of EOG's outstanding ROU assets and related lease liabilities and supplemental information at September 30, 2019 (in millions, except lease terms and discount rates):
Description Location on Balance Sheet Amount
Assets    
Operating Leases Other Assets $842
Finance Leases 
Property, Plant and Equipment, Net (1)
 56
Total   $898
     
Liabilities    
Current    
Operating Leases Current Portion of Operating Lease Liabilities $384
Finance Leases Current Portion of Long-Term Debt 15
Long-Term    
Operating Leases Other Liabilities 485
Finance Leases Long-Term Debt 46
Total   $930
(1)Finance lease assets are recorded net of accumulated amortization of $57 million at September 30, 2019.



Nine Months Ended September 30, 2019
Weighted Average Remaining Lease Term (in years):
Operating Leases3.2
Finance Leases4.9
Weighted Average Discount Rate:
Operating Leases3.5%
Finance Leases3.0%


-22-
Cash paid for leases was as follows for the nine months ended September 30, 2019 (in millions):
 Nine Months Ended September 30, 2019
Repayment of Operating Lease Liabilities Associated with Operating Activities$162
Repayment of Operating Lease Liabilities Associated with Investing Activities225
Repayment of Finance Lease Liabilities10


Upon adoption of ASU 2016-02 effective January 1, 2019, EOG recognized operating lease ROU assets of $566 million. Non-cash leasing activities for the nine months ended September 30, 2019, included the addition of $703 million of operating leases.

EOG RESOURCES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Concluded)
(Unaudited)


At September 30, 2019, the future minimum lease payments under non-cancellable leases were as follows (in millions):
 Operating Leases Finance Leases
October 1, 2019 to December 31, 2019$116
 $3
2020377
 15
2021198
 15
2022118
 12
202350
 8
2024 and Beyond64
 14
Total Lease Payments923
 67
Less: Discount to Present Value54
 6
Total Lease Liabilities869
 61
Less: Current Portion of Lease Liabilities384
 15
Long-Term Lease Liabilities$485
 $46


At September 30, 2019, EOG had additional leases of $675 million, of which $24 million, $446 million and $205 million were expected to commence in the remainder of 2019 and in 2020 and 2021, respectively, with lease terms of one month to 10 years.

At December 31, 2018 and prior to the adoption of ASU 2016-02 and other related ASUs, the future minimum commitments under non-cancellable leases, including non-lease components and excluding contracts with lease terms of less than 12 months, were as follows (in millions):
 Operating Leases Finance Leases
2019$380
 $15
2020213
 15
202186
 15
202239
 12
202330
 8
2024 and Beyond62
 14
Total Lease Payments$810
 $79





PART I.  FINANCIAL INFORMATION

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
EOG RESOURCES, INC.

Overview

EOG Resources, Inc., together with its subsidiaries (collectively, EOG), is one of the largest independent (non-integrated) crude oil and natural gas companies in the United States with proved reserves in the United States, Trinidad and China. EOG operates under a consistent business and operational strategy that focuses predominantly on maximizing the rate of return on investment of capital by controlling operating and capital costs and maximizing reserve recoveries. Each prospective drilling location is evaluated by its estimated rate of return. This strategy is intended to enhance the generation of cash flow and earnings from each unit of production on a cost-effective basis, allowing EOG to deliver long-term production growth while maintaining a strong balance sheet. EOG implements its strategy primarily by emphasizing the drilling of internally generated prospects in order to find and develop low-cost reserves. Maintaining the lowest possible operating cost structure that is consistent with efficient, safe and environmentally responsible operations is also an important goal in the implementation of EOG's strategy.

Recent Developments. The COVID-19 pandemic and the measures being taken to address and limit the spread of the virus have adversely affected the economies and financial markets of the world, resulting in an economic downturn that has negatively impacted, and may continue to negatively impact, global demand and prices for crude oil and condensate, natural gas liquids (NGLs) and natural gas. See PART II, ITEM 1A, "Risk Factors" below, for further discussion.

In early March 2020, due to the failure of the members of the Organization of the Petroleum Exporting Countries and Russia (OPEC+) to reach an agreement on individual crude oil production limits, Saudi Arabia unilaterally reduced the sales price of its crude oil and announced that it would increase its crude oil production. The combination of these actions and the effects of the COVID-19 pandemic on crude oil demand, resulted in lower commodity prices in March and April 2020. In April 2020, the members of OPEC+ reached an agreement to cut production beginning in May 2020 and extending through April 2022 with the quantity of the production cuts decreasing over time. In May and June 2020, crude oil prices recovered, but remain significantly below average prices in 2019 as a result of the rebalancing of crude oil supply from the actions of OPEC+ and the continuing effect of the COVID-19 pandemic on global demand.

In response to the current commodity price environment, EOG updated its 2020 capital and operating plan to reduce activity across its operating areas and decrease its total anticipated 2020 capital expenditures. EOG also elected to reduce its 2020 crude oil production, including delaying initial production from new wells and shutting-in or otherwise curtailing existing production. As a result, EOG expects its full-year 2020 total crude oil production to be lower than its full-year 2019 total crude oil production. See "2020 Capital and Operating Plan" below for further discussion.

Commodity Prices. As a result of the many uncertainties associated with (i) the world economic environment, (ii) the COVID-19 pandemic and its continuing effect on the economies and financial markets of the world and (iii) any future actions by the members of OPEC+, and the effect of these uncertainties on worldwide supplies of, and demand for, crude oil and condensate, NGLs and natural gas, EOG is unable to predict what changes may occur in crude oil and condensate, NGLs, and natural gas prices in the future. However, prices for crude oil and condensate, NGLs and natural gas have historically been volatile, and this volatility is expected to continue.

The market prices of crude oil and condensate, NGLs and natural gas during the remainder of 2020 will impact the amount of cash generated from EOG's operating activities, which will in turn impact EOG's financial position and results of operations. For the first six months of 2020, the average U.S. New York Mercantile Exchange (NYMEX) crude oil and condensate and natural gas prices were $36.97 per barrel and $1.85 per million British thermal units (MMBtu), respectively, both representing decreases of 36% from the average NYMEX prices for the same period in 2019. Market prices for NGLs are influenced by the components extracted, including ethane, propane and butane and natural gasoline, among others, and the respective market pricing for each component.


-23-


United States. EOG's efforts to identify plays with large reserve potential have proven to be successful. EOG has placed an emphasis on applying its horizontal drilling and completion expertise to unconventional crude oil and liquids-rich reservoirs, EOG continues to drill numerous wells in large acreage plays, which in the aggregate have contributed substantially to, and are expected to continue to contribute substantially to, EOG's crude oil and liquids-rich natural gas production. EOG has placed an emphasis on applying its horizontal drilling and completion expertise to unconventional crude oil and liquids-rich reservoirs.

Crude oil, natural gas liquids (NGLs) and natural gas prices have been volatile, and this volatility is expected to continue. As a result of the many uncertainties associated with the world political environment, worldwide supplies of, and demand for, crude oil and condensate, NGLs and natural gas and the availability of other energy supplies, EOG is unable to predict what changes may occur in crude oil and condensate, NGLs, and natural gas prices in the future. The market prices of crude oil and condensate, NGLs and natural gas in 2019 will continue to impact the amount of cash generated from EOG's operating activities, which will in turn impact EOG's financial position and results of operations. For the first nine months of 2019, the average U.S. New York Mercantile Exchange (NYMEX) crude oil and natural gas prices were $57.06 per barrel and $2.66 per million British thermal units (MMBtu), respectively, representing decreases of 15% and 7%, respectively, from the average NYMEX prices for the same period in 2018. Market prices for NGLs are influenced by crude oil prices and the composition of NGL production, including ethane, propane and butane, among others. Based on its 2019 drilling and completion plans, EOG expects both its 2019 total production and total crude oil production to increase as compared to 2018.

During the first ninesix months of 2019,2020, EOG continued to focus on increasing drilling, completion and operating efficiencies gained in prior years. In addition, EOG continued to evaluate certain potential crude oil and liquids-rich natural gas exploration and development prospects and to look for opportunities to add drilling inventory through leasehold acquisitions, farm-ins, exchanges or tactical acquisitions. On a volumetric basis, as calculated using the ratio of 1.0 barrel of crude oil and condensate or NGLs to 6.0 thousand cubic feet of natural gas, crude oil and condensate and NGL production accounted for approximately 76% and 77% of EOG's United States production during both the first ninesix months of  20192020 and 2018,2019, respectively. During the first ninesix months of 2019,2020, EOG's drilling and completion activities occurred primarily in the Eagle Ford play, Delaware Basin play and Rocky Mountain area. EOG's major producing areas in the United States are in New Mexico North Dakota, Texas and Wyoming.Texas. In the second quarter of 2020, EOG delayed initial production from most newly-completed wells and shut in some existing production.

Trinidad. In Trinidad, EOG continues to deliver natural gas under existing supply contracts. Several fields in the South East Coast Consortium (SECC) Block, Modified U(a) Block, Block 4(a), Modified U(b) Block, the Banyan Field and the Sercan Area have been developed and are producing natural gas which is sold to the National Gas Company of Trinidad and Tobago Limited and its subsidiary, and crude oil and condensate which is sold to Heritage Petroleum Company Limited. In the thirdfirst half of 2020, EOG completed the drilling of one net exploratory well and was in the process of drilling and completing a second well on a different block as of June 30, 2020. Subsequent to the second quarter of 2019, EOG drilled two net wells,2020, it was announced that one of which was an unsuccessfulthe exploratory well.wells found commercial quantities of proved reserves. During the remainder of 2019,2020, EOG plans to drill two additional net wells.wells, continue its evaluation of the remaining exploratory well and begin formulating development plans.

Other International. In the Sichuan Basin, Sichuan Province, China, EOG drilled two wellscontinues to work closely with its partner, PetroChina, under the Production Sharing Contract and other related agreements, to ensure uninterrupted production in order to reach the first nine months of 2019 to complete the drilling program started in 2018. Additionally, EOG completed two drilled uncompleted wells from 2018 in 2019.level allowed by pipeline capacity. All natural gas produced from the Baijaochang Field is sold under a long-term contract to PetroChina.

In March 2020, EOG began the process of exiting its Canada operations.



EOG continues to evaluate other select crude oil and natural gas opportunities outside the United States, primarily by pursuing exploitation opportunities in countries where indigenous crude oil and natural gas reserves have been identified.

Management continues to believe EOG has one of the strongest prospect inventories in EOG's history. When it fits EOG's strategy, EOG will make acquisitions that bolster existing drilling programs or offer incremental exploration and/or production opportunities.

2020 Capital and Operating Plan. Total anticipated 2020 capital expenditures are estimated to range from approximately $3.4 billion to $3.6 billion, including facilities and gathering, processing and other expenditures, and excluding acquisitions and non-cash transactions. The updated 2020 capital and operating plan represents a reduction in total anticipated capital expenditures compared to the original 2020 capital and operating plan and, as a result, EOG expects its full-year 2020 total crude oil production to be lower than its full-year 2019 total crude oil production.

EOG's 2020 capital expenditures will continue to be focused on drilling operations in its high rate-of-return plays as well as targeted infrastructure, exploration and environmental projects that support the long-term value of EOG. EOG remains flexible and will continue to evaluate its 2020 capital and operating plan. EOG expects to continue monitoring market conditions in the second half of the year and adjust its production volumes accordingly, with the anticipation of increasing production as prices improve. EOG will also continue to exercise financial flexibility with a goal toward preserving liquidity while supporting its dividend.

Capital Structure. One of management's key strategies is to maintain a strong balance sheet with a consistently below average debt-to-total capitalization ratio as compared to those in EOG's peer group. EOG's debt-to-total capitalization ratio was 20%22% at SeptemberJune 30, 20192020 and 24%19% at December 31, 2018.2019. As used in this calculation, total capitalization represents the sum of total current and long-term debt and total stockholders' equity.

-24-


At June 30, 2020, EOG maintained a strong financial and liquidity position, including $2.4 billion of cash and cash equivalents and $2.0 billion of availability under its senior unsecured revolving credit facility. EOG's cash and cash equivalents as of June 30, 2020 included $62 million of collateral deposits from counterparties in anticipation of future settlements of financial commodity derivative contracts.

On June 3, 2019,April 1, 2020, EOG repaid, upon maturitywith cash on hand, the $900$500 million aggregate principal amount of its 5.625%2.45% Senior Notes due 2019.2020 that matured on that date.

On June 27, 2019,April 14, 2020, EOG entered into a new $2.0 billion senior unsecured Revolving Credit Agreement (New Facility) with domestic and foreign lenders (Banks). The New Facility replaced EOG's $2.0 billion senior unsecured Revolving Credit Agreement, dated asclosed on its offering of July 21, 2015, which had a scheduled maturity date of July 21, 2020. The New Facility has a scheduled maturity date of June 27, 2024, and includes an option for EOG to extend, on up to two occasions, the term for successive one-year periods subject to certain terms and conditions. The New Facility (i) commits the Banks to provide advances up to an$750 million aggregate principal amount of $2.0its 4.375% Senior Notes due 2030 and $750 million aggregate principal amount of its 4.950% Senior Notes due 2050 (together, the Notes). EOG received net proceeds of approximately $1.48 billion at any one time outstanding,from the issuance of the Notes, which were used to repay the 4.40% Senior Notes due 2020 when they matured on June 1, 2020 (see below), and have also been used (and will continue to be used) for general corporate purposes, including the funding of capital expenditures.

Additionally, on June 1, 2020, EOG repaid, with an option for cash on hand, the $500 million aggregate principal amount of its 4.40% Senior Notes due 2020 that matured on that date.

EOG to request increases in the aggregate commitments to an amount not to exceed $3.0 billion, subject to certain terms and conditions, and (ii) includes a swingline subfacility and a letter of credit subfacility.

Effective January 1, 2019, EOG adopted the provisions of Accounting Standards Update (ASU) 2016-02, "Leases (Topic 842)" (ASU 2016-02). ASU 2016-02 and other related ASUs resulted in the recognition of right-of-use assets and related lease liabilities representing the obligation to make lease payments for certain lease transactions and the disclosure of additional leasing information. The adoption of ASU 2016-02 and other related ASUs resulted in a significant increase to assets and liabilities related to operating leases on the Condensed Consolidated Balance Sheet at September 30, 2019. Financial results prior to January 1, 2019, are unchanged. See Note 1 "Summary of Significant Accounting Policies" and Note 14 "Leases" to EOG's Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q.

Total anticipated 2019 capital expenditures are estimated to range from approximately $6.2 billion to $6.4 billion, excluding acquisitions and non-cash transactions. The majority of 2019 expenditures will be focused on United States crude oil drilling activities. EOGbelieves it has significant flexibility and availability with respect to financing alternatives, including borrowings under its commercial paper program, bank borrowings, borrowings under its $2.0 billion senior unsecured revolving credit facility, described above, joint development agreements and similar agreements and equity and debt offerings.

Management continues to believe EOG has one of the strongest prospect inventories in EOG's history. When it fits EOG's strategy, EOG will make acquisitions that bolster existing drilling programs or offer incremental exploration and/or production opportunities.

-25-

        



Results of Operations

The following review of operations for the three months and ninesix months ended SeptemberJune 30, 20192020 and 20182019 should be read in conjunction with the Condensed Consolidated Financial Statements of EOG and notes thereto included in this Quarterly Report on Form 10‑Q.

10-Q.

Three Months Ended SeptemberJune 30, 20192020 vs. Three Months Ended SeptemberJune 30, 20182019


Operating Revenues. During the thirdsecond quarter of 2019,2020, operating revenues decreased $479$3,595 million, or 10%77%, to $4,303$1,103 million from $4,782$4,698 million for the same period of 2018.2019. Total wellhead revenues, which are revenues generated from sales of EOG's production of crude oil and condensate, NGLs and natural gas, for the thirdsecond quarter of 20192020 decreased $468$2,135 million, or 14%72%, to $2,853$850 million from $3,321$2,985 million for the same period of 2018.2019. EOG recognized net gainslosses on the mark-to-market of financial commodity derivative contracts of $86$126 million for the thirdsecond quarter of 20192020 compared to net lossesgains of $52$177 million for the same period of 2018.2019. Gathering, processing and marketing revenues for the thirdsecond quarter of 20192020 decreased $27$1,138 million, or 2%76%, to $1,334$363 million from $1,361$1,501 million for the same period of 2018.2019. Net lossesgains on asset dispositions were $1$13 million for the thirdsecond quarter of 20192020 compared to net gains of $116$8 million for the same period of 2018.2019.

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Wellhead volume and price statistics for the three-month periods ended SeptemberJune 30, 20192020 and 20182019 were as follows:
 
Three Months Ended
September 30,
 
 2019  2018 
Crude Oil and Condensate Volumes (MBbld) (1)
     
United States463.2
  409.2
 
Trinidad0.8
  0.8
 
Other International (2)
0.1
  5.0
 
Total464.1
  415.0
 
Average Crude Oil and Condensate Prices ($/Bbl) (3)
 
    
United States$56.67
  $69.53
 
Trinidad48.36
  61.71
 
Other International (2)
59.87
  72.81
 
Composite56.66
  69.55
 
Natural Gas Liquids Volumes (MBbld) (1)
     
United States141.3
  127.8
 
Other International (2)
—
  —
 
Total141.3
  127.8
 
Average Natural Gas Liquids Prices ($/Bbl) (3)
 
   
 
United States$12.67
  $30.09
 
Other International (2)
—
  —
 
Composite12.67
  30.09
 
Natural Gas Volumes (MMcfd) (1)
     
United States1,079
  948
 
Trinidad260
  260
 
Other International (2)
34
  28
 
Total1,373
  1,236
 
Average Natural Gas Prices ($/Mcf) (3)
 
   
 
United States$1.97
  $2.67
 
Trinidad2.52
  2.88
 
Other International (2)
4.25
  3.83
 
Composite2.13
  2.74
 
Crude Oil Equivalent Volumes (MBoed) (4)
     
United States784.3
  695.0
 
Trinidad44.1
  44.1
 
Other International (2)
5.8
  9.7
 
Total834.2
  748.8
 
      
Total MMBoe (4)
76.7
  68.9
 
Three Months Ended
June 30,
 20202019
Crude Oil and Condensate Volumes (MBbld) (1)
United States330.9  454.9  
Trinidad0.1  0.6  
Other International (2)
0.1  0.2  
Total331.1  455.7  
Average Crude Oil and Condensate Prices ($/Bbl) (3)
 
United States$20.40  $61.01  
Trinidad0.60  49.56  
Other International (2)
48.78  55.07  
Composite20.40  60.99  
Natural Gas Liquids Volumes (MBbld) (1)
United States101.2  131.1  
Other International (2)
—  —  
Total101.2  131.1  
Average Natural Gas Liquids Prices ($/Bbl) (3)
  
United States$10.20  $15.63  
Other International (2)
—  —  
Composite10.20  15.63  
Natural Gas Volumes (MMcfd) (1)
United States939  1,047  
Trinidad174  273  
Other International (2)
34  36  
Total1,147  1,356  
Average Natural Gas Prices ($/Mcf) (3)
  
United States$1.11  $1.98  
Trinidad2.13  2.69  
Other International (2)
4.36  4.25  
Composite1.36  2.19  
Crude Oil Equivalent Volumes (MBoed) (4)
United States588.5  760.4  
Trinidad29.2  46.1  
Other International (2)
5.7  6.3  
Total623.4  812.8  
Total MMBoe (4)
56.7  74.0  
(1)Thousand barrels per day or million cubic feet per day, as applicable.
(2)Other International includes EOG's United Kingdom, China and Canada operations. The United Kingdom operations were sold in the fourth quarter of 2018.
(3)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).
(4)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.
(1)Thousand barrels per day or million cubic feet per day, as applicable.
(2)Other International includes EOG's China and Canada operations.
(3)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).
(4)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.

-27-
        



Wellhead crude oil and condensate revenues for the thirdsecond quarter of 20192020 decreased $236$1,914 million, or 9%76%, to $2,419$615 million from $2,655$2,529 million for the same period of 2018.2019. The decrease was due to a lower composite average price ($5501,223 million), partially offset by an increase and a decrease of 49125 MBbld, or 12%27%, in wellhead crude oil and condensate production ($314691 million). IncreasedDecreased production was primarily due to increases in the Permian BasinEagle Ford, the Rocky Mountain area and the Eagle Ford.Permian Basin. EOG's composite wellhead crude oil and condensate price for the thirdsecond quarter of 20192020 decreased 19%67% to $56.66$20.40 per barrel compared to $69.55$60.99 per barrel for the same period of 2019.
2018.

NGL revenues for the thirdsecond quarter of 20192020 decreased $189$92 million, or 53%50%, to $165$94 million from $354$186 million for the same period of 20182019 due to a lower composite average price ($22650 million), partially offset by an increase and a decrease of 1430 MBbld, or 11%23%, in productionNGL deliveries ($3742 million). IncreasedDecreased production was primarily in the Eagle Ford, the Permian Basin.Basin and the Rocky Mountain area. EOG's composite NGL price for the thirdsecond quarter of 20192020 decreased 58%35% to $12.67$10.20 per barrel compared to $30.09$15.63 per barrel for the same period of 2018.2019.


Wellhead natural gas revenues for the thirdsecond quarter of 20192020 decreased $42$128 million, or 14%47%, to $270$142 million from $312$270 million for the same period of 2018.2019. The decrease was due to a lower average composite price ($7686 million), partially offset by an increase and a decrease in natural gas deliveries ($3442 million). Natural gas deliveries for the thirdsecond quarter of 2019 increased 1372020 decreased 209 MMcfd, or 11%15%, compared to the same period of 20182019 due primarily to higher deliveries in the United States resulting from increased production of associated natural gas from the Permian Basin and higherlower natural gas volumes in South Texas, partially offset by lower volumes inTrinidad, the Rocky Mountain area and the Marcellus Shale. EOG's composite wellhead natural gas price for the thirdsecond quarter of 20192020 decreased 22%38% to $2.13$1.36 per Mcf compared to $2.74$2.19 per Mcf for the same period of 2019.
2018.

During the thirdsecond quarter of 2019,2020, EOG recognized net gainslosses on the mark-to-market of financial commodity derivative contracts of $86$126 million compared to net lossesgains of $52$177 million for the same period of 2018.2019. During the thirdsecond quarter of 2019,2020, net cash received from settlements of financial commodity derivative contracts was $108$639 million compared to net cash paidreceived of $92$10 million for the same period of 2018.2019.


Gathering, processing and marketing revenues are revenues generated from sales of third-party crude oil, NGLs and natural gas, as well as fees associated with gathering third-party natural gas and revenues from sales of EOG-owned sand. Purchases and sales of third-party crude oil and natural gas may be utilized in order to balance firm transportation capacity with production in certain areas and to utilize excess capacity at EOG-owned facilities. EOG sells sand in order to balance the timing of firm purchase agreements with completion operations and to utilize excess capacity at EOG-owned facilities. Marketing costs represent the costs to purchase third-party crude oil, natural gas and sand and the associated transportation costs, as well as costs associated with EOG-owned sand sold to third parties.

Gathering, processing and marketing revenues less marketing costs for the thirdsecond quarter of 20192020 decreased $43$82 million as compared to the same period of 20182019 primarily due to lower margins on crude oil marketing activities. The margin on crude oil marketing activities partially offsetfor the second quarter of 2020 was negatively impacted by higher margins on natural gas marketing activities.the decision early in the second quarter of 2020 to reduce commodity price volatility by selling May and June 2020 deliveries under fixed price arrangements.


-28-


Operating and Other Expenses. For the thirdsecond quarter of 2019,2020, operating expenses of $3,475$2,190 million were $200$1,377 million higherlower than the $3,275$3,567 million incurred during the thirdsecond quarter of 2018.2019.  The following table presents the costs per barrel of oil equivalent (Boe) for the three-month periods ended SeptemberJune 30, 20192020 and 2018:2019:
 Three Months Ended September 30,
 2019 2018
Lease and Well$4.55
 $4.67
Transportation Costs2.60
 2.85
Depreciation, Depletion and Amortization (DD&A) -   
Oil and Gas Properties12.33
 12.89
Other Property, Plant and Equipment0.10
 0.44
General and Administrative (G&A)1.77
 1.62
Interest Expense, Net0.52
 0.92
Total (1)
$21.87
 $23.39
Three Months Ended
June 30,
 20202019
Lease and Well$4.32  $4.70  
Transportation Costs2.67  2.35  
Depreciation, Depletion and Amortization (DD&A) -
Oil and Gas Properties11.84  12.55  
Other Property, Plant and Equipment0.62  0.39  
General and Administrative (G&A)2.32  1.65  
Interest Expense, Net0.96  0.67  
Total (1)
$22.73  $22.31  
(1)Total excludes gathering and processing costs, exploration costs, dry hole costs, impairments, marketing costs and taxes other than income.

(1)Total excludes gathering and processing costs, exploration costs, dry hole costs, impairments, marketing costs and taxes other than income.



The primary factors impacting the cost components of per-unit rates of lease and well, transportation, DD&A, G&A and net interest expense for the three months ended SeptemberJune 30, 2019,2020, compared to the same period of 2018,2019, are set forth below. See "Operating Revenues" above for a discussion of wellhead volumes.

Lease and well expenses include expenses for EOG-operated properties, as well as expenses billed to EOG from other operators where EOG is not the operator of a property. Lease and well expenses can be divided into the following categories: costs to operate and maintain crude oil and natural gas wells, the cost of workovers and lease and well administrative expenses. Operating and maintenance costs include, among other things, pumping services, salt water disposal, equipment repair and maintenance, compression expense, lease upkeep and fuel and power. Workovers are operations to restore or maintain production from existing wells.

Each of these categories of costs individually fluctuates from time to time as EOG attempts to maintain and increase production while maintaining efficient, safe and environmentally responsible operations. EOG continues to increase its operating activities by drilling new wells in existing and new areas. Operating and maintenance costs within these existing and new areas, as well as the costs of services charged to EOG by vendors, fluctuate over time.

Lease and well expenses of $349$245 million for the thirdsecond quarter of 2019 increased $272020 decreased $102 million from $322$347 million for the same prior year period primarily due to increaseddecreased operating and maintenance costs ($3350 million) and lease and well administrative expensesdecreased workover expenditures ($944 million), both in the United States, and decreased operating and maintenance costs in Canada ($8 million).

        Transportation costs represent costs associated with the delivery of hydrocarbon products from the lease to a downstream point of sale. Transportation costs include transportation fees, the cost of compression (the cost of compressing natural gas to meet pipeline pressure requirements), the cost of dehydration (the cost associated with removing water from natural gas to meet pipeline requirements), gathering fees and fuel costs.

        Transportation costs of $152 million for the second quarter of 2020 decreased $22 million from $174 million for the same prior year period primarily due to decreased transportation costs in the Rocky Mountain area ($14 million), Eagle Ford ($10 million) and Barnett Shale ($7 million), partially offset by decreased workover expendituresincreased transportation costs in the United StatesPermian Basin ($98 million). Lease and well expenses increased in the United States primarily due to increased operating activities resulting in increased production.South Texas ($3 million).


-29-


DD&A of the cost of proved oil and gas properties is calculated using the unit-of-production method. EOG's DD&A rate and expense are the composite of numerous individual DD&A group calculations. There are several factors that can impact EOG's composite DD&A rate and expense, such as field production profiles, drilling or acquisition of new wells, disposition of existing wells and reserve revisions (upward or downward) primarily related to well performance, economic factors and impairments. Changes to these factors may cause EOG's composite DD&A rate and expense to fluctuate from period to period. DD&A of the cost of other property, plant and equipment is generally calculated using the straight-line depreciation method over the useful lives of the assets.

DD&A expenses for the thirdsecond quarter of 2019 increased $362020 decreased $250 million to $954$707 million from $918$957 million for the same prior year period. DD&A expenses associated with oil and gas properties for the thirdsecond quarter of 20192020 were $58$256 million higherlower than the same prior year period. The increasedecrease primarily reflects increaseddecreased production in the United States ($109202 million), partially offset by and in Trinidad ($8 million) and lower unit rates in the United States ($4247 million). Unit rates in the United States decreased primarily due to upward reserve revisions and reserves added at lower costs as a result of increased efficiencies. DD&A expenses associated with other property, plant and equipment for the second quarter of 2020 were $6 million higher than the same prior year period primarily due to an increase in expense related to gathering and storage assets and equipment.

G&A expenses of $136$132 million for the thirdsecond quarter of 20192020 increased $25$10 million from $111$122 million for the same prior year period primarily due to idle equipment and termination fees ($26 million) and increased information system costs ($2 million), partially offset by a decrease in professional and other services ($11 million) and employee-related costs ($5 million).

Exploration costs of $27 million for the second quarter of 2020 decreased $5 million from $33 million for the same prior year period primarily due to decreased geological and information systemsgeophysical costs resulting from expanded operations.in the United States.

Interest expense, net of $40$54 million for the thirdsecond quarter of 2019 decreased $242020 increased $4 million compared to the same prior year period primarily due to the issuance of the Notes in April 2020 ($15 million), partially offset by repayment in June 2019 of the $900 million aggregate principal amount of 5.625% Senior Notes due 2019 ($13 million), repayment in October 2018 of the $350 million aggregate principal amount of 6.875% Senior Notes due 2018 ($6 million) and higher capitalized interest ($49 million).

Gathering and processing costs represent operating and maintenance expenses and administrative expenses associated with operating EOG's gathering and processing assets as well as natural gas processing fees and certain NGL fractionation fees frompaid to third parties. EOG pays third parties to process the majority of its natural gas production to extract NGLs.

Gathering and processing costs increased $14decreased $16 million to $128$97 million for the thirdsecond quarter of 20192020 compared to $114$113 million for the same prior year period primarily due to increased operating costs and fees in the Permian Basin ($13 million) and the Eagle Ford ($5 million), partially offset by decreased operating costs ($8 million) and decreased gathering and processing fees ($6 million), both in the United Kingdom ($7 million ) due to the sale of operations in the fourth quarter of 2018.Eagle Ford.




Impairments includeinclude: amortization of unproved oil and gas property costs as well as impairments of proved oil and gas properties; other property, plant and equipment; and other assets. Unproved properties with acquisition costs that are not individually significant are aggregated, and the portion of such costs estimated to be nonproductive is amortized over the remaining lease term. Unproved properties with individually significant acquisition costs are reviewed individually for impairment. When circumstances indicate that a proved property may be impaired, EOG compares expected undiscounted future cash flows at a DD&A group level to the unamortized capitalized cost of the asset. If the expected undiscounted future cash flows, based on EOG's estimates of (and assumptions regarding) future crude oil and natural gas prices, operating costs, development expenditures, anticipated production from proved reserves and other relevant data, are lower than the unamortized capitalized cost, the capitalized cost is reduced to fair value. Fair value is generally calculated by using the Income Approach described in the Fair Value Measurement Topic of the Financial Accounting Standards Board's Accounting Standards Codification. In certain instances, EOG utilizes accepted offers from third-party purchasers as the basis for determining fair value.

Impairments of $105$305 million for the thirdsecond quarter of 20192020 were $61$193 million higher than impairments for the same prior year period primarily due to increasedthe impairments of proved propertiessand and crude-by-rail assets in the United States ($40219 million), of proved properties as a result of the decision to exit the Horn River Basin in Canada ($19 million) and increased amortization of unproved property costs in the United States ($2114 million), which were causedpartially offset by an increaselower impairments of other assets in EOG's estimates of undeveloped properties not expected to be developed before lease expiration.the United States ($60 million). EOG recorded impairments of proved properties, other property, plant and equipment and other assets of $41$245 million and $1$65 million for the thirdsecond quarters of 20192020 and 2018,2019, respectively.

-30-


Taxes other than income include severance/production taxes, ad valorem/property taxes, payroll taxes, franchise taxes and other miscellaneous taxes. Severance/production taxes are generally determined based on wellhead revenues, and ad valorem/property taxes are generally determined based on the valuation of the underlying assets.

Taxes other than income for the thirdsecond quarter of 20192020 decreased $6$124 million to $203$80 million (7.1%(9.4% of wellhead revenues) from $209$204 million (6.3%(6.8% of wellhead revenues) for the same prior year period. The decrease in taxes other than income was primarily due to decreased severance/production taxes in the United States ($13119 million) and an increasedecreased ad valorem/property taxes ($8 million), partially offset by a decrease in credits available to EOG in the thirdsecond quarter of 20192020 for state incentive severance tax rate reductions ($34 million), partially offset by higher payroll taxes in Trinidad ($8 million) and an increase in ad valorem/property taxesall in the United States ($4 million).States.

Other income (expense), net of $9 million for the thirdsecond quarter of 2019 increased $62020 decreased $13 million compared to the same prior year period primarily due to a decreasean increase in deferred compensation expense.expense ($7 million) and decrease in interest income ($5 million).

        In response to the economic impacts of the COVID-19 pandemic, the President of the United States signed the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act) into law on March 27, 2020. The CARES Act provides economic support to individuals and businesses through enhanced loan programs, expanded unemployment benefits, and certain payroll and income tax relief, among other provisions.  The primary tax benefit of the CARES Act for EOG was the acceleration of approximately $150 million of additional refundable alternative minimum tax (AMT) credits into tax year 2019.  These credits originated from AMT paid by EOG in years prior to 2018 and were reflected as a deferred tax asset and a non-current receivable as of December 31, 2019 since they had been expected to either offset future current tax liabilities or be refunded on a declining balance schedule through 2021. As a result of the CARES Act, EOG has reclassified these credits from a non-current receivable in Other Assets to a current receivable in Income Taxes Receivable on the Condensed Consolidated Balance Sheet at June 30, 2020. The $150 million of additional refundable AMT credits were received in July 2020.

EOG recognized an income tax provisionbenefit of $182$236 million for the thirdsecond quarter of 20192020 compared to an income tax provision of $255$242 million for the thirdsecond quarter of 2018,2019, primarily due to decreased pretax income, partially offset by the absence of tax benefits from certain tax reform measurement-period adjustments.income.  The net effective tax rate for 2019 increasedthe second quarter of 2020 decreased to 23%21% from 18%22% in 2018. The higher effective tax rate is mostly due to the absence of tax benefits from certain tax reform measurement-period adjustments.

2019.
Nine

Six Months Ended SeptemberJune 30, 20192020 vs. NineSix Months Ended SeptemberJune 30, 20182019


Operating Revenues. During the first ninesix months of 2019,2020, operating revenues increased $359decreased $2,935 million, or 3%34%, to $13,060$5,821 million from $12,701$8,756 million for the same period of 2018.2019. Total wellhead revenues for the first ninesix months of 20192020 decreased $316$2,453 million, or 4%43%, to $8,592$3,286 million from $8,908$5,739 million for the same period of 2018.2019. During the first ninesix months of 2019,2020, EOG recognized net gains on the mark-to-market of financial commodity derivative contracts of $243$1,079 million compared to net lossesgains of $298$157 million for the same period of 2018.2019. Gathering, processing and marketing revenues for the first ninesix months of 2019 increased $2222020 decreased $1,386 million, or 6%50%, to $4,121$1,401 million from $3,899$2,787 million for the same period of 2018.2019. Net gains on asset dispositions were $4$30 million for the first ninesix months of 20192020 compared to net gains of $95$4 million for the same period of 2018.2019.

-31-
        



Wellhead volume and price statistics for the nine-monthsix-month periods ended SeptemberJune 30, 20192020 and 20182019 were as follows:
 Nine Months Ended September 30, 
 2019  2018 
Crude Oil and Condensate Volumes (MBbld)     
United States451.2
  382.9
 
Trinidad0.7
  0.8
 
Other International0.1
  4.1
 
Total452.0
  387.8
 
Average Crude Oil and Condensate Prices ($/Bbl) (1)
 
   
 
United States$57.95
  $67.35
 
Trinidad47.26
  58.91
 
Other International58.43
  71.83
 
Composite57.93
  67.38
 
Natural Gas Liquids Volumes (MBbld)     
United States130.8
  113.9
 
Other International—
  —
 
Total130.8
  113.9
 
Average Natural Gas Liquids Prices ($/Bbl) 
   
 
United States$15.96
  $27.71
 
Other International—
  —
 
Composite15.96
  27.71
 
Natural Gas Volumes (MMcfd)     
United States1,043
  905
 
Trinidad267
  278
 
Other International36
  31
 
Total1,346
  1,214
 
Average Natural Gas Prices ($/Mcf) (1)
 
   
 
United States$2.23
  $2.66
 
Trinidad2.71
  2.91
 
Other International4.29
  4.10
 
Composite2.38
  2.75
 
Crude Oil Equivalent Volumes (MBoed)     
United States755.8
  647.6
 
Trinidad45.1
  47.2
 
Other International6.2
  9.2
 
Total807.1
  704.0
 
      
Total MMBoe220.3
  192.2
 
Six Months Ended
June 30,
 20202019
Crude Oil and Condensate Volumes (MBbld)
United States406.8  445.1  
Trinidad0.3  0.7  
Other International0.1  —  
Total407.2  445.8  
Average Crude Oil and Condensate Prices ($/Bbl) (1)
  
United States$36.17  $58.63  
Trinidad27.75  46.62  
Other International53.41  57.78  
Composite36.16  58.61  
Natural Gas Liquids Volumes (MBbld)
United States131.2  125.4  
Other International—  —  
Total131.2  125.4  
Average Natural Gas Liquids Prices ($/Bbl) (1)
  
United States$10.65  $17.84  
Other International—  —  
Composite10.65  17.84  
Natural Gas Volumes (MMcfd)
United States1,039  1,025  
Trinidad188  270  
Other International35  37  
Total1,262  1,332  
Average Natural Gas Prices ($/Mcf) (1)
  
United States$1.32  $2.37  
Trinidad2.15  2.80  
Other International4.34  4.31  
Composite1.53  2.51  
Crude Oil Equivalent Volumes (MBoed)
United States711.1  741.3  
Trinidad31.6  45.6  
Other International6.1  6.4  
Total748.8  793.3  
Total MMBoe136.3  143.6  
(1)Excludes the impact of financial commodity derivative instruments (see Note 12 to the Condensed Consolidated Financial Statements).
(1) Excludes the impact of financial commodity derivative instruments (see Note 12 to the Condensed Consolidated Financial Statements).

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Wellhead crude oil and condensate revenues for the first ninesix months of 2019 increased $142020 decreased $2,049 million, or 43%, to $7,148$2,680 million from $7,134$4,729 million for the same period of 20182019 due to an increasea lower composite average price ($1,663 million) and a decrease of 6439 MBbld, or 17%9%, in wellhead crude oil and condensate production ($1,185 million), partially offset by a lower composite average price ($1,171386 million). IncreasedDecreased production was primarily due to increasesdecreases in the Eagle Ford and the Rocky Mountain area, partially offset by increased production in the Permian Basin and the Eagle Ford.Basin. EOG's composite wellhead crude oil and condensate price for the first ninesix months of 20192020 decreased 14%38% to $57.93$36.16 per barrel compared to $67.38$58.61 per barrel for the same period of 2019.
2018.

NGL revenues for the first ninesix months of 20192020 decreased $292$151 million, or 34%37%, to $570$254 million from $862$405 million for the same period of 20182019 due to a lower composite average price ($420172 million), partially offset by an increase of 176 MBbld, or 15%5%, in NGL deliveries ($12821 million). Increased production was primarily in the Permian Basin. EOG's composite NGL price for the first ninesix months of 20192020 decreased 42%40% to $15.96$10.65 per barrel compared to $27.71$17.84 per barrel for the same period of 2019.
2018.

Wellhead natural gas revenues for the first ninesix months of 20192020 decreased $38$254 million, or 4%42%, to $874$351 million from $912$605 million for the same period of 2018.2019. The decrease was due to a lower composite wellhead natural gas price ($140225 million), partially offset by an increase and a decrease in natural gas deliveries ($10229 million). Natural gas deliveries for the first ninesix months of 2019 increased 1322020 decreased 70 MMcfd, or 11%5%, compared to the same period of 20182019 due primarily to lower natural gas volumes in Trinidad, the Rocky Mountain area and the Marcellus Shale, partially offset by higher deliveries in the United States resulting fromSouth Texas and increased production of associated natural gas from the Permian Basin and higher natural gas volumes from South Texas.Basin. EOG's composite wellhead natural gas price for the first ninesix months of 20192020 decreased 14%39% to $2.38$1.53 per Mcf compared to $2.75$2.51 per Mcf for the same period of 2019.
2018.

During the first ninesix months of 2019,2020, EOG recognized net gains on the mark-to-market of financial commodity derivative contracts of $243$1,079 million compared to net lossesgains of $298$157 million for the same period of 2018.2019. During the first ninesix months of 2019,2020, net cash received from settlements of financial commodity derivative contracts was $140$724 million compared to net cash paidreceived for settlements of financial commodity derivative contracts of $180$31 million for the same period of 2018.2019.


Gathering, processing and marketing revenues less marketing costs for the first ninesix months of 20192020 decreased $38$168 million as compared to the same period of 20182019 primarily due to lower margins on crude oil marketing activities, partially offset by higher margins on natural gas marketing activities. The margin on crude oil marketing activities for the first six months of 2020 was negatively impacted by the decline in price on crude oil in inventory awaiting delivery to customers and the decision early in the second quarter of 2020 to reduce commodity price volatility by selling May and June 2020 deliveries under fixed price arrangements.

Operating and Other Expenses. For the first ninesix months of 2019,2020, operating expenses of $10,224$6,850 million were $869$101 million higher than the $9,355$6,749 million incurred during the same period of 2018.2019. The following table presents the costs per Boe for the nine-monthsix-month periods ended SeptemberJune 30, 20192020 and 2018:2019:
 Nine Months Ended September 30,
 2019 2018
Lease and Well$4.69
 $4.87
Transportation Costs2.50
 2.87
DD&A -   
Oil and Gas Properties12.38
 12.64
Other Property, Plant and Equipment0.29
 0.45
G&A1.65
 1.61
Interest Expense, Net0.66
 0.98
Total (1)
$22.17
 $23.42
Six Months Ended
June 30,
 20202019
Lease and Well$4.22  $4.76  
Transportation Costs2.64  2.44  
DD&A -
Oil and Gas Properties12.03  12.40  
Other Property, Plant and Equipment0.49  0.39  
G&A1.81  1.59  
Interest Expense, Net0.73  0.73  
Total (1)
$21.92  $22.31  
(1)Total excludes gathering and processing costs, exploration costs, dry hole costs, impairments, marketing costs and taxes other than income.

(1)Total excludes gathering and processing costs, exploration costs, dry hole costs, impairments, marketing costs and taxes other than income.

The primary factors impacting the cost components of per-unit rates of lease and well, transportation, DD&A, G&A and net interest expense for the ninesix months ended SeptemberJune 30, 2019,2020, compared to the same period of 20182019 are set forth below. See "Operating Revenues" above for a discussion of wellhead volumes.

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Lease and well expenses of $1,032$575 million for the first ninesix months of 2019 increased $962020 decreased $109 million from $936$684 million for the same prior year period primarily due to higherdecreased workover expenditures ($54 million) and decreased operating and maintenance costs ($8150 million), higher lease and well administrative costs ($21 million) and higher workover expenditures ($8 million), allboth in the United States, partially offset by lowerand decreased operating and maintenance costs in the United KingdomCanada ($1114 million) due to the sale of operations in the fourth quarter of 2018. Lease, partially offset by increased lease and well administrative expenses increased in the United States ($13 million).

        Transportation costs of $360 million for the first six months of 2020 increased $9 million from $351 million for the same prior year period primarily due to increased operating activities resultingtransportation costs in increased production.the Permian Basin ($43 million) and South Texas ($8 million), partially offset by decreased transportation costs in the Barnett Shale ($17 million), Rocky Mountain area ($10 million), Eagle Ford ($10 million) and Marcellus Shale ($2 million).

DD&A expenses for the first ninesix months of 2019 increased $2752020 decreased $130 million to $2,790$1,707 million from $2,515$1,837 million for the same prior year period. DD&A expenses associated with oil and gas properties for the first ninesix months of 20192020 were $299$141 million higherlower than the same prior year period. The increasedecrease primarily reflects increased production in the United States ($384 million), partially offset by lower unit rates in the United States ($5671 million) and decreased production in the United States ($61 million) and in Trinidad ($12 million). Unit rates in the United States decreased primarily due to upward reserve revisions and reserves added at lower costs as a result of increased efficiencies. DD&A expenses associated with other property, plant and equipment for the first six months of 2020 were $11 million higher than the same prior year period primarily due to an increase in expense related to gathering and storage assets and equipment.

G&A expenses of $364$246 million for the first ninesix months of 20192020 increased $54$18 million from $310$228 million for the same prior year period primarily due to idle equipment and termination fees ($26 million) and increased information system costs ($5 million), partially offset by a decrease in professional and other services ($8 million) and employee-related and information systems expenses resulting from expanded operations.costs ($7 million).

Interest expense, net of $144$99 million for the first ninesix months of 20192020 decreased $45$6 million compared to the same prior year period primarily due to repayment in October 2018 of the $350 million aggregate principal amount of 6.875% Senior Notes due 2018 ($18 million), repayment in June 2019 of the $900 million aggregate principal amount of 5.625% Senior Notes due 2019 ($1721 million) and higher capitalized interest, partially offset by the issuance of the Notes in April 2020 ($1015 million).

Gathering and processing costsImpairments of $351$1,878 million for the first ninesix months of 2019 increased $27 million compared to the same prior year period primarily due to increased operating costs and fees in the Permian Basin ($41 million) and the Rocky Mountain area ($7 million), partially offset by decreased operating costs in the United Kingdom ($25 million) due to the sale of operations in the fourth quarter of 2018.

Exploration costs of $103 million for the first nine months of 2019 decreased $12 million from $115 million for the same prior year period primarily due to decreased geological and geophysical costs in Trinidad.

Impairments of $290 million for the first nine months of 20192020 were $129$1,694 million higher than impairments for the same prior year period primarily due to increased impairments of proved properties and other assets, primarily related to legacy and non-core natural gas, crude oil and combo plays in the United States ($981,374 million), sand and crude-by-rail assets in the United States ($219 million), as a result of the decision to exit the Horn River Basin in Canada ($79 million) and increased amortization of unproved property costs in the United States ($3123 million), which was caused by an increase in EOG's estimate of undeveloped properties not expected to be developed before lease expiration.. EOG recorded impairments of proved properties, other property, plant and equipment and other assets of $132$1,761 million and $34$91 million for the first ninesix months of 20192020 and 2018,2019, respectively.

Taxes other than income for the first ninesix months of 2019 increased $182020 decreased $159 million to $600$238 million (7.0%(7.2% of wellhead revenues) from $582$397 million (6.5%(6.9% of wellhead revenues) for the same prior year period. The increasedecrease in taxes other than income was primarily due to increaseddecreased severance/production taxes ($128 million), decreased ad valorem/property taxes in the United States ($41 million) primarily as a result of increased valuation of the underlying assets and higher payroll taxes in Trinidad ($8 million), partially offset by decreases in severance/production taxes in the United States ($14 million) and Trinidad ($427 million) and an increase in credits available to EOG in the first ninesix months of 20192020 for state incentive severance tax rate reductions ($12 million).

Other income, net of $23 million for the first nine months of 2019 increased $28 million compared to the same prior year period primarily due to an increase in interest income ($145 million), a decreaseall in deferred compensation expense ($7 million) and higher foreign currency exchange gains ($6 million).the United States.

EOG recognized an income tax provisionbenefit of $616$215 million for the first ninesix months of 20192020 compared to an income tax provision of $626$433 million for the same period in 2018,first six months of 2019, primarily due to decreased pretax income, partially offset by the absence of tax benefits from certain tax reform measurement-period adjustments.income. The net effective tax rate for the first ninesix months of 2019 increased2020 decreased to 19% from 23% from 20% in 2018.the first six months of 2019. The higherlower effective tax rate is mostly due to the absence ofEOG's foreign operations, primarily related to increased losses in Canada, which have not been tax benefits from certain tax reform measurement-period adjustments.effected due to valuation allowances.

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Capital Resources and Liquidity

Cash Flow. The primary sources of cash for EOG during the ninesix months ended SeptemberJune 30, 2019,2020, were funds generated from operations.operations, net proceeds from the issuance of long-term debt and net cash received from settlements of commodity derivative contracts. The primary uses of cash were exploration and development expenditures; funds used in operations; exploration and development expenditures; long-term debt repayments; dividend payments to stockholders; and other property, plant and equipment expenditures. During the first ninesix months of 2019,2020, EOG's cash balance increased $27$389 million to $1,583$2,417 million from $1,556$2,028 million at December 31, 2018.2019.

Net cash provided by operating activities of $6,356$2,673 million for the first ninesix months of 2019 increased $6732020 decreased $1,621 million compared to the same period of 20182019 primarily due to a favorable changedecrease in working capitalwellhead revenues ($4742,453 million), a decrease in net cash paid forreceived relating to income taxes ($396255 million) and a decrease in gathering, processing and marketing revenues less marketing costs ($168 million), partially offset by an increase in net cash received for settlements of commodity derivative contracts ($320692 million), partially offset by a decrease in wellhead revenues ($315 million) and an increase in cash operating expenses ($167239 million) and a favorable change in working capital ($95 million).


Net cash used in investing activities of $4,980$2,376 million for the first ninesix months of 2019 increased2020 decreased by $102$1,147 million compared to the same period of 20182019 due to an increasea decrease in additions to oil and gas properties ($2951,456 million) and an increase in proceeds from the sale of assets ($26 million), partially offset by a favorablean unfavorable change in components of working capital associated with investing activities ($134304 million), and an increase in proceeds from the sale of assets ($24 million), a decrease in other investing activities ($20 million) and a decrease in additions to other property, plant and equipment ($1530 million).

        Net cash provided by financing activities of $92 million for the first six months of 2020 included net proceeds from the issuance of long-term debt ($1,484 million). Net cash used in financing activities for the first six months of 2020 included repayments of long-term debt ($1,000 million) and cash dividend payments ($384 million). Net cash used in financing activities of $1,348$1,166 million for the first ninesix months of 2019 included repayments of long-term debt ($900 million) and cash dividend payments ($421 million). Net cash used in financing activities of $363 million for the first nine months of 2018 included cash dividend payments ($311 million) and purchases of treasury stock in connection with stock compensation plans ($59255 million).


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Total Expenditures. For the year 2019,2020, EOG's updated budget for exploration and development and other property, plant and equipment expenditures is estimated to range from approximately $6.2$3.4 billion to $6.4$3.6 billion, excluding acquisitions and non-cash transactions. The table below sets out components of total expenditures for the nine-monthsix-month periods ended SeptemberJune 30, 20192020 and 20182019 (in millions):
 Nine Months Ended September 30,
 2019 2018
Expenditure Category   
Capital   
Exploration and Development Drilling$3,865
 $3,843
Facilities499
 518
Leasehold Acquisitions (1)
201
 331
Property Acquisitions (2)
332
 79
Capitalized Interest28
 18
Subtotal4,925
 4,789
Exploration Costs103
 115
Dry Hole Costs28
 5
Exploration and Development Expenditures5,056
 4,909
Asset Retirement Costs151
 42
Total Exploration and Development Expenditures5,207
 4,951
Other Property, Plant and Equipment (3)
187
 251
Total Expenditures$5,394
 $5,202
Six Months Ended
June 30,
20202019
Expenditure Category
Capital
Exploration and Development Drilling$1,694  $2,692  
Facilities210  338  
Leasehold Acquisitions (1)
75  145  
Property Acquisitions (2)
51  322  
Capitalized Interest17  18  
Subtotal2,047  3,515  
Exploration Costs67  69  
Dry Hole Costs—  4  
Exploration and Development Expenditures2,114  3,588  
Asset Retirement Costs25  60  
Total Exploration and Development Expenditures2,139  3,648  
Other Property, Plant and Equipment (3)
221  117  
Total Expenditures$2,360  $3,765  
(1)Leasehold acquisitions included $64 million and $162 million for the nine-month periods ended September 30, 2019 and 2018, respectively, related to non-cash property exchanges.
(2)Property acquisitions included $21 million and $60 million for the nine-month periods ended September 30, 2019 and 2018, respectively, related to non-cash property exchanges.
(3)Other property, plant and equipment included $49 million of non-cash additions for the nine-month period ended September 30, 2018 made in connection with a finance lease transaction in the Permian Basin.
(1) Leasehold acquisitions included $48 million and $54 million for the six-month periods ended June 30, 2020 and 2019, respectively, related to non-cash property exchanges.
(2) Property acquisitions included $7 million and $18 million for the six-month periods ended June 30, 2020 and 2019, respectively, related to non-cash property exchanges.
(3) Other property, plant and equipment included $73 million of non-cash additions for the six-month period ended June 30, 2020 made in connection with a finance lease transaction.
        



Exploration and development expenditures of $5,056$2,114 million for the first ninesix months of 20192020 were $147$1,474 million higherlower than the same period of 20182019 primarily due to increaseddecreased exploration and development drilling expenditures in the United States ($1,021 million) and Other International ($9 million), decreased property acquisitions ($253271 million), decreased facilities expenditures ($128 million) and decreased leasehold acquisitions ($70 million), partially offset by increased exploration and development drilling expenditures in Trinidad ($28 million), partially offset by decreased leasehold acquisitions ($130 million) and decreased facilities expenditures ($1931 million). Exploration and development expenditures for the first ninesix months of 20192020 of $5,056$2,114 million consisted of $4,341$1,840 million in development drilling and facilities, $355$206 million in exploration, $332$51 million in property acquisitions and $28$17 million in capitalized interest. Exploration and development expenditures for the first ninesix months of 20182019 of $4,909$3,588 million consisted of $4,353$3,010 million in development drilling and facilities, $459 million in exploration, $79$322 million in property acquisitions, $238 million in exploration and $18 million in capitalized interest.

The level of exploration and development expenditures, including acquisitions, will vary in future periods depending on energy market conditions and other economic factors. EOG believes it has significant flexibility and availability with respect to financing alternatives and the ability to adjust its exploration and development expenditure budget as circumstances warrant. While EOG has certain continuing commitments associated with expenditure plans related to its operations, such commitments are not expected to be material when considered in relation to the total financial capacity of EOG.


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Commodity Derivative Transactions. As more fully discussed in Note 12 to the Consolidated Financial Statements included in EOG's Annual Report on Form 10-K for the year ended December 31, 2018,2019, filed on February 26, 2019,27, 2020, EOG engages in price risk management activities from time to time. These activities are intended to manage EOG's exposure to fluctuations in commodity prices for crude oil, NGLs and natural gas. EOG utilizes financial commodity derivative instruments, primarily price swap, option, swaption, collar and basis swap contracts, as a means to manage this price risk. EOG has not designated any of its financial commodity derivative contracts as accounting hedges and, accordingly, accounts for financial commodity derivative contracts using the mark-to-market accounting method. Under this accounting method, changes in the fair value of outstanding financial instruments are recognized as gains or losses in the period of change and are recorded as Gains (Losses) on Mark-to-Market Commodity Derivative Contracts on the Condensed Consolidated Statements of Income (Loss) and Comprehensive Income.Income (Loss). The related cash flow impact is reflected in Cash Flows from Operating Activities on the Condensed Consolidated Statements of Cash Flows.

The total fair value of EOG's commodity derivative contracts was reflected on the Condensed Consolidated Balance Sheets at SeptemberJune 30, 2019,2020, as a net asset of $123$209 million.

Crude Oil Derivative Contracts.Prices received by EOG for its crude oil production generally vary from NYMEX West Texas Intermediate (WTI) prices due to adjustments for delivery location (basis) and other factors. EOG has entered into crude oil basis swap contracts in order to fix the differential between Intercontinental Exchange (ICE) Brent pricing and pricing in Midland, Texas, and Cushing, Oklahoma (Midland(ICE Brent Differential). Presented below is a comprehensive summary of EOG's MidlandICE Brent Differential basis swap contracts through October 29, 2019.July 30, 2020. The weighted average price differential expressed in dollars per barrel ($/Bbl) represents the amount of reductionaddition to Cushing, Oklahoma, prices for the notional volumes expressed in barrels per day (Bbld) covered by the basis swap contracts.
ICE Brent Differential Basis Swap Contracts
 Volume (Bbld)Weighted Average Price Differential
($/Bbl)
2020
May 2020 (closed)10,000  $4.92  
 Midland Differential Basis Swap Contracts
   Volume (Bbld) 
Weighted Average Price Differential
($/Bbl)
 
 
 2019    
 January 1, 2019 through November 30, 2019 (closed) 20,000
 $1.075
 December 2019 20,000
 1.075


EOG has also entered into crude oil basis swap contracts in order to fix the differential between pricing in the U.S. Gulf CoastHouston, Texas, and Cushing, Oklahoma (Gulf Coast(Houston Differential). Presented below is a comprehensive summary of EOG's Gulf CoastHouston Differential basis swap contracts through October 29, 2019.July 30, 2020. The weighted average price differential expressed in $/Bbl represents the amount of addition to Cushing, Oklahoma, prices for the notional volumes expressed in Bbld covered by the basis swap contracts.
Houston Differential Basis Swap Contracts
 Volume (Bbld)Weighted Average Price Differential
($/Bbl)
2020
May 2020 (closed)10,000  $1.55  

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 Gulf Coast Differential Basis Swap Contracts
   Volume (Bbld) 
Weighted Average Price Differential
($/Bbl)
 
 
 2019    
 January 1, 2019 through November 30, 2019 (closed) 13,000
 $5.572
 December 2019 13,000
 5.572
        



        EOG has also entered into crude oil swaps in order to fix the differential in pricing between the NYMEX calendar month average and the physical crude oil delivery month (Roll Differential). Presented below is a comprehensive summary of EOG's Roll Differential swap contracts through July 30, 2020. The weighted average price differential expressed in $/Bbl represents the amount of net addition (reduction) to delivery month prices for the notional volumes expressed in Bbld covered by the swap contracts.

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 1, 2020 through August 31, 2020 (closed)88,000  (1.16) 
September 202088,000  (1.16) 
October 1, 2020 through December 31, 202066,000  (1.16) 

        In May 2020, EOG entered into crude oil Roll Differential swap contracts for the period from July 1, 2020 through September 30, 2020, with notional volumes of 22,000 Bbld at a weighted average price differential of $(0.43) per Bbl, and for the period from October 1, 2020 through December 31, 2020, with notional volumes of 44,000 Bbld at a weighted average price differential of $(0.73) per Bbl. These contracts partially offset certain outstanding Roll Differential swap contracts for the same time periods and volumes at a weighted average price differential of $(1.16) per Bbl. EOG expects to pay net cash of $3.2 million for the settlement of these contracts. The offsetting contracts were excluded from the above table.

Presented below is a comprehensive summary of EOG's crude oil NYMEX WTI price swap contracts through October 29, 2019,July 30, 2020, with notional volumes expressed in Bbld and prices expressed in $/Bbl.
Crude Oil NYMEX WTI Price Swap Contracts
 Volume (Bbld)Weighted Average Price ($/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  

        In April and May 2020, EOG entered into crude oil NYMEX WTI price swap contracts for the period from June 1, 2020 through June 30, 2020, with notional volumes of 265,000 Bbld at a weighted average price of $33.80 per Bbl, for the period from July 1, 2020 through July 31, 2020, with notional volumes of 254,000 Bbld at a weighted average price of $33.75 per Bbl, for the period from August 1, 2020 through September 30, 2020, with notional volumes of 154,000 Bbld at a weighted average price of $34.18 per Bbl and for the period from October 1, 2020 through December 31, 2020, with notional volumes of 47,000 Bbld at a weighted average price of $30.04 per Bbl. These contracts offset the remaining NYMEX WTI price swap contracts for the same time periods and volumes at a weighted average price of $51.36 per Bbl for the period from June 1, 2020 through June 30, 2020, $42.36 per Bbl for the period from July 1, 2020 through July 31, 2020, $50.42 per Bbl for the period from August 1, 2020 through September 30, 2020 and $31.00 per Bbl for the period from October 1, 2020 through December 31, 2020.EOG expects to receive net cash of $364.0 million for the settlement of these contracts. The offsetting contracts were excluded from the above table.


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Crude Oil Price Swap Contracts
  Volume (Bbld) Weighted Average Price ($/Bbl)
2019    
April 2019 (closed) 25,000
 $60.00
May 1, 2019 through September 30, 2019 (closed) 150,000
 62.50
October 1, 2019 through December 31, 2019 150,000
 62.50
        Presented below is a comprehensive summary of EOG's crude oil ICE Brent price swap contracts through July 30, 2020, with notional volumes expressed in Bbld and prices expressed in $/Bbl.

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  

NGLs Derivative Contracts. Presented below is a comprehensive summary of EOG's Mont Belvieu propane (non-TET) financial price swap contracts (Mont Belvieu Propane Price Swap Contracts) through July 30, 2020, with notional volumes expressed in Bbld and prices expressed in $/Bbl.
Mont Belvieu Propane Price Swap Contracts
 Volume (Bbld)Weighted Average Price ($/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  
        In April and May 2020, EOG entered into Mont Belvieu propane price swap contracts for the period from May 1, 2020 through December 31, 2020, with notional volumes of 25,000 Bbld at a weighted average price of $16.41 per Bbl. These contracts offset the remaining Mont Belvieu propane price swap contracts for the same time period with notional volumes of 25,000 Bbld at a weighted average price of $17.92 per Bbl. EOG expects to receive net cash of $9.2 million for the settlement of these contracts. The offsetting contracts were excluded from the above table.

Natural Gas Derivative Contracts. Presented below is a comprehensive summary of EOG's natural gas price swap contracts through July 30, 2020, with notional volumes expressed in million British thermal units (MMBtu) per day (MMBtud) and prices expressed in dollars per MMBtu ($/MMBtu).
Natural Gas Price Swap Contracts
 Volume (MMBtud)Weighted Average Price ($/MMBtu)
2021
January 1, 2021 through December 31, 202150,000  $2.75  


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        EOG has entered into natural gas collar contracts, which establish ceiling and floor prices for the sale of notional volumes of natural gas as specified in the collar contracts. The collars require that EOG pay the difference between the ceiling price and the NYMEX Henry Hub natural gas price for the contract month (Henry Hub Index Price) in the event the Henry Hub Index Price is above the ceiling price. The collars grant EOG the right to receive the difference between the floor price and the Henry Hub Index Price in the event the Henry Hub Index Price is below the floor price. In March 2020, EOG executed the early termination provision granting EOG the right to terminate certain 2020 natural gas collar contracts with notional volumes of 250,000 MMBtud at a weighted average ceiling price of $2.50 per MMBtu and a weighted average floor price of $2.00 per MMBtu for the period from April 1, 2020 through July 31, 2020. The net cash EOG received for settling these contracts was $7.8 million. Presented below is a comprehensive summary of EOG's natural gas collar contracts through July 30, 2020, with notional volumes expressed in MMBtud and prices expressed in $/MMBtu.
Natural Gas Collar Contracts
Weighted Average Price ($/MMBtu)
 Volume (MMBtud)Ceiling PriceFloor Price
2020
April 1, 2020 through July 31, 2020 (closed)250,000  $2.50  $2.00  

        In April 2020, EOG entered into natural gas collar contracts for the period from August 1, 2020 through October 31, 2020, with notional volumes of 250,000 MMBtud at a ceiling price of $2.50 per MMBtu and a floor price of $2.00 per MMBtu. These contracts offset the remaining natural gas collar contracts for the same time period with notional volumes of 250,000 MMBtud at a ceiling price of $2.50 per MMBtu and a floor price of $2.00 per MMBtu. EOG expects to receive net cash of $1.1 million for the settlement of these contracts. The offsetting contracts were excluded from the above table. 

Prices received by EOG for its natural gas production generally vary from NYMEX Henry Hub prices due to adjustments for delivery location (basis) and other factors. EOG has entered into natural gas basis swap contracts in order to fix the differential between pricing in the Rocky Mountain area and NYMEX Henry Hub prices (Rockies Differential). Presented below is a comprehensive summary of EOG's Rockies Differential basis swap contracts through October 29, 2019.July 30, 2020. The weighted average price differential expressed in dollars per million British thermal units ($/MMBtu)$/MMBtu represents the amount of reduction to NYMEX Henry Hub prices for the notional volumes expressed in MMBtu per day (MMBtud)MMBtud covered by the basis swap contracts.

Rockies Differential Basis Swap Contracts
 Volume (MMBtud)Weighted Average Price Differential
($/MMBtu)
2020
January 1, 2020 through July 31, 2020 (closed)30,000  $0.55  
August 1, 2020 through December 31, 202030,000  0.55  
 Rockies Differential Basis Swap Contracts
   Volume (MMBtud) 
Weighted Average Price Differential
 ($/MMBtu)
 
 
 2020    
 January 1, 2020 through December 31, 2020 30,000
 $0.549

        EOG has also entered into natural gas basis swap contracts in order to fix the differential between pricing at the Houston Ship Channel (HSC) and NYMEX Henry Hub prices (HSC Differential). In March 2020, EOG executed the early termination provision granting EOG the right to terminate certain 2020 HSC Differential basis swaps with notional volumes of 60,000 MMBtud at a weighted average price differential of $0.05 per MMBtu for the period from April 1, 2020 through December 31, 2020. The net cash EOG paid for settling these contracts was $0.4 million. Presented below is a comprehensive summary of EOG's natural gas priceHSC Differential basis swap contracts through October 29, 2019, withJuly 30, 2020. The weighted average price differential expressed in $/MMBtu represents the amount of reduction to NYMEX Henry Hub prices for the notional volumes expressed in MMBtud covered by the basis swap contracts.
HSC Differential Basis Swap Contracts
 Volume (MMBtud)Weighted Average Price Differential
($/MMBtu)
2020
January 1, 2020 through December 31, 2020 (closed)60,000  $0.05  
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        EOG has also entered into natural gas basis swap contracts in order to fix the differential between pricing at the Waha Hub in West Texas and NYMEX Henry Hub prices (Waha Differential). Presented below is a comprehensive summary of EOG's Waha Differential basis swap contracts through July 30, 2020. The weighted average price differential expressed in $/MMBtu represents the amount of reduction to NYMEX Henry Hub prices for the notional volumes expressed in MMBtud covered by the basis swap contracts.
Waha Differential Basis Swap Contracts
 Volume (MMBtud)Weighted Average Price Differential
($/MMBtu)
2020
January 1, 2020 through April 30, 2020 (closed)50,000  $1.40  

        In April 2020, EOG entered into Waha Differential basis swap contracts for the period from May 1, 2020 through December 31, 2020, with notional volumes of 50,000 MMBtud at a weighted average price differential of $0.43 per MMBtu. These contracts offset the remaining Waha Differential basis swap contracts for the same time period with notional volumes of 50,000 MMBtud at a weighted average price differential of $1.40 per MMBtu. EOG expects to pay net cash of $11.9 million for the settlement of these contracts. The offsetting contracts were excluded from the above table.

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Natural Gas Price Swap Contracts
  Volume (MMBtud) 
Weighted
Average Price
($/MMBtu)
2019    
April 1, 2019 through October 31, 2019 (closed) 250,000
 $2.90

        



Information Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q includes 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. 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 (i) economically develop its acreage in, (ii) produce reserves and achieve anticipated production levels and rates of return from, (iii) decrease or otherwise control its drilling, completion, operating and capital costs related to, and (iv) maximize reserve recovery from, its existing and future crude oil and natural gas exploration and development projects;projects and associated potential and existing drilling locations;
•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;
•security threats, including cybersecurity threats and disruptions to our business and operations from breaches of our information technology systems, physical breaches of our facilities and other infrastructure or breaches of the information technology systems, facilities and infrastructure of third parties with which we transact business;
•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 drilling, completing and operating 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;
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•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;
•the duration and economic and financial impact of epidemics, pandemics or other public health issues, including the COVID-19 pandemic;
•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; and
physical, electronic and cybersecurity breaches; and
•the other factors described under ITEM 1A, Risk Factors, on pages 13 through 2223 of EOG's Annual Report on Form 10-K for the fiscal year ended December 31, 2018,2019, under ITEM 1A, Risk Factors, on page 37 of EOG's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2020, and under ITEM 1A, Risk Factors, in this Quarterly Report on Form 10-Q, 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.


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PART I.  FINANCIAL INFORMATION


ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
EOG RESOURCES, INC.

EOG's exposure to commodity price risk, interest rate risk and foreign currency exchange rate risk is discussed in (i) the "Derivative"Commodity Derivative Transactions," "Financing," "Foreign Currency Exchange Rate Risk" and "Outlook" sections of "Management's Discussion and Analysis of Financial Condition and Results of Operations - Capital Resources and Liquidity" on pages 40 through 4346 of EOG's Annual Report on Form 10-K for the year ended December 31, 2018,2019, filed on February 26,27, 2020 (EOG's 2019 (EOG's 2018 Annual Report); and (ii) Note 12, "Risk Management Activities," to EOG's Consolidated Financial Statements on pages F-29F-30 through F-31F-33 of EOG's 20182019 Annual Report. There have been no material changes in this information. For additional information regarding EOG's financial commodity derivative contracts and physical commodity contracts, see (i) Note 12, "Risk Management Activities," to EOG's Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q; (ii) "Management's Discussion and Analysis of Financial Condition and Results of Operations - Results of Operations - Operating Revenues" in this Quarterly Report on Form 10-Q; and (iii) "Management's Discussion and Analysis of Financial Condition and Results of Operations - Capital Resources and Liquidity - Commodity Derivative Transactions" in this Quarterly Report on Form 10-Q.


ITEM 4. CONTROLS AND PROCEDURES
EOG RESOURCES, INC.

Disclosure Controls and Procedures. EOG's management, with the participation of EOG's principal executive officer and principal financial officer, evaluated the effectiveness of EOG's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended (Exchange Act)) as of the end of the period covered by this Quarterly Report on Form 10-Q (Evaluation Date). Based on this evaluation, EOG's principal executive officer and principal financial officer have concluded that EOG's disclosure controls and procedures were effective as of the Evaluation Date in ensuring that information that is required to be disclosed in the reports EOG files or furnishes under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the United States Securities and Exchange Commission's rules and forms and (ii) accumulated and communicated to EOG's management, as appropriate, to allow timely decisions regarding required disclosure.

Internal Control Over Financial Reporting. There were no changes in EOG's internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) promulgated under the Exchange Act) that occurred during the quarterly period covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, EOG's internal control over financial reporting.



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PART II. OTHER INFORMATION

EOG RESOURCES, INC.

ITEM 1. LEGAL PROCEEDINGS

See Part I, Item 1, Note 8 to Condensed Consolidated Financial Statements, which is incorporated herein by reference.

ITEM 1A. RISK FACTORS

        There have been no material changes from the risk factors disclosed in Item 1A. Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2019, other than the following:

Outbreaks of communicable diseases can adversely affect our business, financial condition and results of operations.

        Global or national health concerns, including a widespread outbreak of contagious disease, can, among other impacts, negatively impact the global economy, reduce demand and pricing for crude oil, natural gas liquids (NGLs) and natural gas, lead to operational disruptions and limit our ability to execute on our business plan, any of which could materially and adversely affect our business, financial condition and results of operations. Furthermore, uncertainty regarding the impact of any outbreak of contagious disease could lead to increased volatility in crude oil, NGLs and natural gas prices.

For example, the current pandemic involving a highly transmissible and pathogenic coronavirus (COVID-19) and the measures being taken to address and limit the spread of the virus have adversely affected the economies and financial markets of the world, resulting in an economic downturn that has negatively impacted, and may continue to negatively impact, global demand and prices for crude oil and condensate, natural gas liquids (NGLs) and natural gas.The resulting decline in commodity prices has materially and adversely affected our cash flows and results of operations; if such decline were to continue for an extended period of time or worsen, our cash flows and results of operations would be further adversely affected.For further discussion regarding the potential impacts on us of lower commodity prices and extended declines in commodity prices, see ITEM 1A, Risk Factors, of our Annual Report on Form 10-K for the fiscal year ended December 31, 2019, filed on February 27, 2020.

If the COVID-19 outbreak should continue or worsen, we may also experience disruptions to commodities markets, equipment supply chains and the availability of our workforce, which could adversely affect our ability to conduct our business and operations.Further, if the resulting economic downturn and adverse impact on commodity prices should continue or worsen, our customers and other contractual parties may be unable to pay amounts owed to us from time to time and to otherwise satisfy their contractual obligations to us, and may be unable to access the credit and capital markets for such purposes.Such inability of our customers and other contractual counterparties may materially and adversely affect our business, financial condition, results of operations and cash flows.

There are still too many variables and uncertainties regarding the COVID-19 pandemic - including the ultimate geographic spread of the virus, the duration and severity of the outbreak and the extent of travel restrictions and business closures imposed in affected countries - to fully assess the potential impact on our business, financial condition and results of operations.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table sets forth, for the periods indicated, EOG's share repurchase activity:
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)
    
         
July 1, 2019 - July 31, 2019 17,498
 $92.82
 —
 6,386,200
August 1, 2019 - August 31, 2019 11,181
 73.92
 —
 6,386,200
September 1, 2019 - September 30, 2019 149,912
 75.87
 —
 6,386,200
Total 178,591
 77.41
 —
  
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, 20202,164  $46.39  —  6,386,200  
May 1, 2020 - May 31, 20204,165  49.50  —  6,386,200  
June 1, 2020 - June 30, 20201,871  51.01  —  6,386,200  
Total8,200  49.03  —   
(1)The 178,591 total shares for the quarter ended September 30, 2019, consist solely of shares that were withheld by or returned to EOG (i) in satisfaction of tax withholding obligations that arose upon the exercise of employee stock options or stock-settled stock appreciation rights or the vesting of restricted stock, restricted stock unit, or performance unit grants or (ii) in payment of the exercise price of employee stock options. These shares do not count against the 10 million aggregate share repurchase authorization by EOG's Board of Directors (Board) discussed below.
(2)In September 2001, the Board authorized the repurchase of up to 10 million shares of EOG's common stock. During the third quarter of 2019, EOG did not repurchase any shares under the Board-authorized repurchase program.

(1)The 8,200 total shares for the quarter ended June 30, 2020, consist solely of shares that were withheld by or returned to EOG (i) in satisfaction of tax withholding obligations that arose upon the exercise of employee stock options or stock-settled stock appreciation rights or the vesting of restricted stock, restricted stock unit, or performance unit grants or (ii) in payment of the exercise price of employee stock options. These shares do not count against the 10 million aggregate share repurchase authorization by EOG's Board of Directors (Board) discussed below.
(2)In September 2001, the Board authorized the repurchase of up to 10 million shares of EOG's common stock. During the second quarter of 2020, EOG did not repurchase any shares under the Board-authorized repurchase program.

ITEM 4. MINE SAFETY DISCLOSURES

The information concerning mine safety violations and other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K (17 CFR 229.104) is included in Exhibit 95 to this Quarterly Report on Form 10-Q.

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ITEM 6.  EXHIBITS
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).
    10.1
    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 of Performance Unit Award Agreement for Amended and Restated EOG Resources, Inc. 2008 Omnibus Equity Compensation Plan (applicable to grants made effective September 26, 2019 and subsequent grants)8-K, filed April 14, 2020) (SEC File No. 001-09743).
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    31.1Exhibit 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.



Exhibit No.    32.2Description
    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).

*Attached as Exhibit 101 to this report are the following documents formatted in XBRL (Extensible Business Reporting Language): (i) the Condensed Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) - Three Months and NineSix Months Ended SeptemberJune 30, 20192020 and 2018,2019, (ii) the Condensed Consolidated Balance Sheets - SeptemberJune 30, 20192020 and December 31, 2018,2019, (iii) the Condensed Consolidated Statements of Stockholders' Equity - Three Months and NineSix Months Ended SeptemberJune 30, 20192020 and 2018,2019, (iv) the Condensed Consolidated Statements of Cash Flows - NineSix Months Ended SeptemberJune 30, 20192020 and 20182019 and (v) the Notes to Condensed Consolidated Financial Statements.
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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 thereunto duly authorized.



EOG RESOURCES, INC.
(Registrant)
Date:NovemberAugust 6, 20192020By:
/s/ TIMOTHY K. DRIGGERS
Timothy K. Driggers
Executive Vice President and Chief Financial Officer
(Principal Financial Officer and Duly Authorized Officer)

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