EOG Resources (EOG) 3 May 192019 Q1 Earnings call transcript

Company Profile

Participants

Tim Driggers	Chief Financial Officer
Bill Thomas	Chairman and CEO
Billy Helms	Chief Operating Officer
Lance Terveen	Senior VP, Marketing
Ken Boedeker	EVP, Exploration and Production
Ezra Yacob	EVP Exploration and Production
David Streit	VP, Investor and Public Relations
Neal Dingmann	SunTrust Robinson, Humphrey
Doug Leggate	Bank of America Merrill Lynch
Charles Meade	Johnson Rice
Tim Rezvan	Oppenheimer
Paul Grigel	Macquarie
Leo Mariani	KeyBanc
Jeffrey Campbell	Tuohy Brothers Investment Research
Jeanine Wai	Barclays
Brian Singer	Goldman Sachs
Ryan Todd	Simmons Energy
Arun Jayram	JP Morgan

Call transcript

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Operator

Good day, everyone, and welcome to EOG Resources First Quarter 2019 Earnings Results Conference Call.

As a reminder, this call is being recorded. At this time, for opening remarks and introductions, I would like to turn the call over to Chief Financial Officer of EOG Resources, Mr. Tim Driggers. Please go ahead, sir.

Tim Driggers

you. Thank thanks and joining for morning, us. Good everyone quarter XXXX hope has seen first announcing release press earnings the We and results. operational call conference includes statements. This forward-looking in EOG's The earnings for incorporate this associated with statements reference been risks forward-looking those by release filings, SEC outlined in call. and we have the conference This measures. also certain contains call financial non-GAAP can reconciliation our website on as well non-GAAP as found for these measures www.eogresources.com. be to Definitions schedules comparable GAAP measures at

the may the accompanying include Billy Bill estimates Chairman Yacob, reserve Production; this Marketing; Production; call investor Public call Streit, on this note bottom estimated presentation EVP Chief earnings Helms, appears Ken and investors VP, and Investor are potential incorporate in of slides reporting to Terveen, potential our Some necessarily morning and of the Boedeker, that Thomas, cautionary on We release at resource Senior estimated and CEO; Ezra conference Officer; Exploration reference Participating and issued SEC's reserves Lance calculated they the Operating Exploration the guidelines. VP, U.S. Relations. by not David accordance EVP, are reserve and and with yesterday.

Here’s Bill Thomas.

Bill Thomas

and good simple, one all EOG's through growth the goal morning, is cycles. be realizing across S&P clear sectors and best and companies XXX the organic double-digit everyone. of in by Tim, returns Thanks, double-digit the commodity

excellent ability the confident the that our will lowering of from deliver results oil cost cycles in and we continue required our the first that future. business stellar our are demonstrates achieve goal. performance in model price Our We're that quarter to consistently commodity to sustainable performance to decouple

tremendous and shareholders The dividend commitment of now per confidence increase strong to EOG's $X.XX dividend XX% and result, EOG's cash single is the a future in Board As the largest the and is a a through returning a Directors This approved history. annualized capital dividend. represents demonstrates in to dollar vote increase discipline our to rate. of share

returns one all and XXXX evident history. before. in productivity than growing falling, cost high EOG at be area company performances of combination of the operating costs Well organic in are per company is costs of operating every premium is strong. Our is to with volumes and well the lower best up barrel and growth shaping the ever

excited and are and XXXX the results operational We are financial about delivering. outstanding the we

exiting we best additional of Some capacity secured reductions, of to increasing XX%, our quarter operating continues per this capital export capital receive oil cost oil unit expectations, lease to year-over-year profitability. transportation below ability of the of production crude costs, unit reductions efficiency the significant completed costs. And year-over-year and the crude low growth well and highlights include expenditure our end target, strong oil the and prices. EOG improve high-end

quarter to first of low we prices income amount year made a oil of significantly demonstrating and net same fact, compared sustainable the company's lower In last to continuously resiliency prices, oil to ability improve. the achievement with remarkable the EOG's

taking results great results improve organic exploration new high-quality due we're this about of our In to we're addition steps the to future plays. excited year,

that years XX an proprietary wells new oil drilling of in focus generated experience of mountains gives plays. exploration Our data horizontal in identifying has edge us

of inventory. XX oil have premium We years

technical to adding further organic focused [ph] improving more quality So inventory of lower oil will with the than rather [rock] Adding on enable grow squarely better our we are just inventory low-cost company operational come. at a quantity. the commitment by margins have shareholder years we for exploration-driven organic a an distinctive leadership long-standing to to growth, through EOG, excellence, our higher At culture. underpinned all business model, creating and value costs unwavering

the never today, produce the been improvements never never satisfied future. produce EOG And our is future. with had sustainable company mindset, continues focus in decentralized outstanding result and structure shape. to entrepreneurial, a Our has on and has but to combined set in returns brighter better pleased

Next performance remainder and operational of first for the Billy up quarter XXXX. our outlook is review to

Billy Helms

Bill. you, Thank

quarter results, be this go to into Before I clear I want the on point.

will We achieve will in and be objectives. throughout our not adjusted increase plan, activity our production and to the We remain year CapEx. capital confident XXXX

our continued year more To of year. first quarter of end day, outperforming Now, last importance, fully gains that first completed trend our expected. be this the that and capital year the delivered forecast. late We spent we forecast. are at producing equal this to year. onto quarter, our XXX,XXX the oil, emerge results beginning materialized Of has specific, tremendous barrels And into reflect our efficiency last less more were early more per than exceeding wells the

the operating reduction relentless our for EOG's in were our was and by coming forecast. quarter, first our of efficiency. capital developing continuous our end it’s stellar, realizing efficiencies not we our are increase the costs, And capital Our contributed cost is quarter well in Unit technology. across performance It’s note of we well in execution important operations. low focus quest also the areas of case below to to as expense, at service to lease forecast was our forecast. All strong that operations improvements our related the the operating intense driven and on operational in for new our execution below

drilling markedly and First, improve our to times performance. drilling teams continued their

times factors. internally teams to fleet. improved entire This drilling rig importantly, consistently across of a now performance performing made our executing the the we of drilling and In maintain program. can two services that the result be high are the our One, engineered two, More improve both deployed consistency each is by technology new seen decision and our areas adopt teams Ideas developed are specialized drilling and continued service in-house activity, with to to continued and tools of providers. major that And processes record drilling we repeatability. performance and of partnering our new achieve costs. drilling

hole trip bringing save savings, quality down additional in-house. motor back best in the brought To to can then drill service step where use analyze bottom design For and of to example, we assembly even assurance $XXX,XXX. must capture bed took eliminating the our one to up be those first hole

result improving penetration. also to helps all that trips of $XXX,XXX the As observed equipment, penetration in control our reducing the to have of the a innovation It’s having of reduction the is well. per up of trips, and of deliver drilling type rate continue EOG across this direct saving rate pronounced while we this a of increasing number Together, performance best-in-class plays.

costs time is new improves permeability new due and Second, completion Well with well results of and are suffice costs. our more a equally yield The improving data to that proprietary lower early experimenting feet the our performance, important Completion reduced allows solid noticeably complete to enhanced to to due execution testing faster fracture teams use specific per reducing costs, us both technique Further agents. combine reservoirs these in advancements place material and day. and recipes design fulsome formula areas. and the each say production improvement lateral efficiency. low more diverting This But of completion are for operating in result will performance are that capital encouraging. our complexity. is

operating a us strategic with in and expenses. operating Finally, core in our operating particularly investments lease leverage are allow water, costs, and on along areas our oil sustainable to impact long-term having gas gathering scale our infrastructure partnerships

In We we've reduce continue opportunities to XXXX. a to costs. great long-term further had additional evaluate summary, return, impact to start high

price our improvements, our capital We've are operating costs. toward portfolio goal and our costs reduce well goal environments. costs Our These improved across to down efficiency goals. operational along to continue our objective Average barrel teams for deliver progress unit commodity significant time, are X.X%, finding to on the on towards rate over down made halfway with achieve X% will return about to drive track enable per improvements our our low DD&A in EOG year.

Coast to capacity. recent Here's by Lance Gulf to marketing highlighted export secure provide a update our progress

Lance Terveen

EOG Billy. crude to and in agreements access marketing markets has established Thanks, Houston. export oil Corpus provide Christi that

per capacity barrels up in in in of to will XXX,XXX barrels day Corpus XXX,XXX oil oil ramp from per XXXX day XXXX. Our Christi of

We expect plays, Delaware Eagle including and crude markets sell multiple Ford to oil the Basins. to export from

EOG provides control capacity, across and for illustrate basin as volumes its access. tankage, we pipeline way dock from terminal will XX, our on As the agreements all the the Slide dock crude

options the markets, sell or flexibility price crude EOG the optionality strong for ensures With our we domestic to expand provides This to liquidity international downstream, barrels. price margins. our and oil of highest discovery whichever further products

are Our an four integrated our agreements example of strategy, export marketing to objectives. achieve marketing which designed is

capacity means Control firm margins the control. point our of product where are is First to maximized.

Second market. to is net flexibility. options deliver establish We multiple product plan highest to ahead the to back

back Basin can the on Permian tremendous these future sales is realizations, realized Third U.S. we take knowing prefer Basin. optimal so is avoid to is flow prices long-term out working price purpose reflected point. transportation will in volatility of Crude strong maximize which costs. price can the paid and fundamentals a This diversify accomplish EOG price barrels this portfolio operating Cushing, advantage oil system U.S. in quarter. oil the oil the was transportation by keeping strategy Henry major infrastructure we volatile gas needs contracts off even and faster by net above production Despite the in move protect plans that duration. was wellhead Delaware we for from Houston, and costs barrels limited prices to value transportation quarter. part $X.XX future aggregate, and We agreements. Fourth our This first accomplished around realize We And a only in able can in potential of our marketing We anywhere understand WTI EOG's to achievement creation and our with the of transport This Hub. anticipate its commitments. We natural to Corpus positioning flow of is assurance have away options each gas the closely of product are with divisions Permian, from marketing shorter strategy In long-term adjust below rates. than well is all controls up term both our is natural EOG marketing our and the fix market. to point. this net diversification. transported navigating pipeline EOG's the take an competitive and commitments integral approach of the first gas teams price of in and gathering oil quarter, and of market high plays the during development in for $X.XX each on strategy. and fit Christi basin five Midland. interconnect a the points,

areas Our marketing we in proven incurred bottlenecks successfully which helped of We basin. to well navigate of highlight costs on marketing XX, all most recently through realizations, success the efforts as EOG deliver including price our to market. measure as our number operations, we has Permian slide transportation across strategy the the production

is Next to Eagle Ford Ken highlights. up the review

Ken Boedeker

asset for and delivering flow. earning strong workhorse EOG the Thanks cash about for Lance. remains EOG, high been The while generating Ford Eagle developing Ford has XX sustainable growth, returns Eagle the years.

drilled. than significant for identified excess We return, less flow Eagle capable X%. locations while Ford However, premium of the of XX least generating of more at grew capital been expenditures of Last production Eagle Ford years year have growing, each is forecast XX% rates the in at cash year.

already importantly, compared in by increase fleet over we Sustainable the efficiencies, ahead. quarter years we has Ford. the capital XXXX play will key to reduce Eagle significant a lateral to were of More continue a productivity Eagle drilling operating Ford costs by throughout in the history developing that of been completed the to cost our XX% first able day believe is XXXX. the per and XX-year X%, reduction theme in accumulated Even improve

highlighting first on the of ever drilling best always culture Eagle our efficiency getting our a dollar we've that the of Ford was fact, per In had in basis, foot XXXX quarter better. quarter

further Eagle water Western the in lift deliver our control capital efforts Drilling Ford returns, continues On manage production, longer efficiency. side, which we're production continuing value, costs operating and to help acreage finding will lease to strong expenses premium us optimize term. and artificial present net our

growing of make we laterals West economics productivity time is East is well play, the our Our majority our from drilling Capital are nearing Western the XXXX, lower, over longer the the about it acreage and XXXX. Slide are in program Ford caught in per Compared up West as will East illustrated of in and will parity and be up efficiency for drilling the and on per growth are costs with of XX% expect a Eagle foot the long-term crucial so component program by competitive. XX. to

main expanded proprietary still be fully remains Ford recovery a the this EUR after technical focus XXXX. recovery play The portion operations process are best to oil of in continues EUR of footprint been Eagle the is Our development primary commercial Ford days perform ahead. and the our enhanced has the play and the a The expectations. process Eagle secondary in will in larger of developed.

premium reductions, for continue strong and to is cost remain one to through leasehold to for Ford it sustainable Eagle and status ahead. We non-premium The convert EOG, inventory productivity growth consolidation. we a improvements asset many years expect

to Ezra discuss Delaware here's Now basin. the

Ezra Yacob

Ken. quarter. In completion last We XX rigs XXXX, Compared premium and we XX% on completed different crews. Retaining drilled Delaware completion we fleet. toward had to operational crews across impact drilled and gross XXXX to the XX the year. first and continue momentum Thanks, rigs the drilling basin, and gained we wells quarter more with completed six seven just targets of end on the lateral first improve top-performing immediate an of

and less one use we one crew. less completion However, rig

made goals. we’ve result, a our towards cost progress full year reduction strong As

reduced XX%, to In saved addition, per which reduces by $X and days pipe, XX% water drilling compared barrel transferred traffic we our by of trucking.

through than of by wells our Source and more X%. cost XX% total water reduced reuse

and quarter expectations achieved first wells of well, while drilling the EOG is quarter Finally, about that finding our a a program this core of per below production all-in learning wells, quarter, equivalent, barrel The million in basin. beat targets mile are Due experience position XX leading costs we The horizontal accelerated is in for and an years XXX% first expenditures. $XX return. XXX,XXX Basin. rock oil per complex. first the the outperforming capital in to the Delaware direct net one of result and including rate we vast and financial of development MPB $X our average have industry earning of is curve acre geologically our thick

high since discuss just result, three its Tim this and even our areas, now in evolution one a drilling, to structure. growth As development. I’ll and is of positive creating Delaware and expense already the through short on to turn low early is significant our years though flow financials operating return highest its over Basin capital asset still is value cash Driggers focusing

Tim Driggers

Ezra. Thanks, billion below $XX quarter. cash This invested million $X.X cash of was expenditures $XXX had first in the our The acquisitions, generated of capital financial strong performance low billion, the guidance discretionary in flow EOG $X.X free left flow. company million before and in paid end dividends. which in

areas. located million acquisitions we addition, In $XXX property invested in bolt-on in new exploration

upgrading crude asset press also capital the covers The announced now price the of the the stable company increase oil our strong AX oil but A the annual of profile and EOG's upgrade $X.XX that of for oil scenarios. the $XXX at of share. on This Moody’s policies. the part we high million scheduled EOG The month XX% the yesterday’s about financial announcing happy supported financial will reduction quality of I’m June to release. with XXXX. of conservative base As indicated EOG's last over company’s price credit rating is company’s earnings average category To a the plan, to that have number XXX,XXX expect of mature a per growing billion. Last and excellence $XX.XX. underpin of recognizes is an debt barrels AX bonds of recognized outlook. XXst one-third added remainder per rate day in high to least, hedges on not production continue we by by upgrade dividend Moody’s repay to into the rating with to The rating the release productivity, operating life our quote backed long X March $X.X cash EOG's report hand, credit which, the as strength was stated.

of XX% return prices for we on to our decision prices. in per and through capital natural current - back MMBTU the and For which I’ll Bill these crude our is gas is average at turn October. high it prices volatility oil day our and the production considering remarks. added at gas closing crude for prudent our XXX,XXX price an investment program gas, $X.XX, over natural hedges of to about of portion of a U.S. lock believe We natural

Bill Thomas

Thanks, leave Tim. few with. to highlights a I you have

we’re capital plan are over capital. running on raising under plan not First, we and on and volumes,

has all expenses, marketing completions, and operating EOG exploration. momentum of tremendous Second, drilling, facets business, the across

performance, provide direct and our oil Along getting Third, to through cost with optimistic lower cycles. marketing our dividend exploration will our export production. business to the future sustainable well our the organic increase model continuous finally, is our further our price we're in deliver best sustainable Fourth, even still Fifth, markets better. cost model we're and strong inventory the shows And access the to of our the low agreements and reduction commodity quality business by culture. cost this year efforts our ability increase prices. international confidence capture performance expand driven of

drive We have price now best double-digit double-digit listening. go in achieve future. and commodity companies and for confident we'll We're of the being our And the better. growth cycles, EOG insatiable performing S&PXXX to the goal one an can continue of Q&A. returns into to get deliver to Thanks long through

Operator

[Operator go SunTrust instructions] come question of Neal Robinson, Your Please Dingmann first ahead. from will Humphrey.

Neal Dingmann

all at the year, shareholder year. Bill, in speak of growth My over done Could first balancing that, XX% -- plans last job when the about maybe, a to return. dividend production growing great you've for question, really, doubled And, of you've your almost while you last look now you. for you your here

So oil about was XX%. only up

free of stick or so, growth material the you XX% if if be, do would would goes you potential flow? with specifically here XX% question to the cash oil amount oil what And stays my plans? So higher, with would

Bill Thomas

XXXX into our we don't the year we're that And it's lower really growth on can specifics said end. our certainly, going of growth. year mode. oil all, company shifting we First really that this bit first I of in the a on on the the growth oil -- have target to be low you not think clear XX% a of call But think is

we value high And really way the so create for focused the will the we're most And shareholders growth. return that's oil on believe on our long-term.

think heard, creating the and rates Ezra, we're from we're on drilling. return well the You tremendous each NPV of I

going that's the And in So most generate the we're we value long future. us think the for the term. in way that's to continue to priority

Neal Dingmann

just I Billy you commented remarks, or would a decline maybe And you these how for ago. prepared your in the mean, discuss, wells year my expectations, I be good. think than Very PDP could are Perm, the second particularly better Ezra, in much just question all new

I'm anything just months? just So these of seeing wondering these how holding that are as is you far towards wells after true how could a discuss Or up? number as you're wells

Billy Helms

Neal. Yes, This is Billy.

quarter And a add programs. the across that's and sustained But in drill we the as wells over or? see longer look a it's general if little of see lower bit that's you you the of our all you time. think lot first teams. translate wells, that doesn’t our plays, of I laterals longer, at improvement in performance there focus the just driving in execution across you And better performance, think hang lot Ezra, really, IP anything results, of higher that the to all quality our the what's want directionally see function we per necessarily well. of the XXs the to decline I

Ezra Yacob

really the a the success, efficiency, a that operational learning acreage the our about you too when vertically. just which figuring together, be the lower discussed which finding in that's cost remarks out opening job horizontally lot targets the and the seeing and combine great highlight productivity reservoir, the continue to capital both co-developed the across last done why our I'll in team's increase I position, spacing well higher And with the is need year you're in to in great going year. throughout we've that excellent Permian execution,

Operator

The ahead. Doug of Merrill go of Leggate next Lynch. from question will America Bank be Please

Doug Leggate

was that on you're would where we we tell acquisition the one and, us of But can -- like of capital look plays acquisition should to we going forward off obviously as go I just much what or to some touch first ideas quarter forward? spending going expect expect guess. you're like kind I not very acquiring, some sustainable to So to level

Bill Thomas

question, Doug, because your you, bit a little was it to it's difficult garbled. hear

be you a little more So could there? bit clear

Doug Leggate

cell Bill. I my apologize. I'd in on now I'm phone. coming be okay

Bill Thomas

ahead. go Yes,

Doug Leggate

as Was was So forward. level expect capital of for my to forward quarter one-off something much should very on or period? a acquisition acquisition we be pattern go a we of question going a the capital first repeating

Bill Thomas

or Okay. low And But you type And focused we, Thank better. really our corporate one-offs. high occasionally on company, very they're in not these acquisitions at wouldn't they're look interested we in and bolt-on as we're do exploration we very, are kind them. doing of focused was you. be know That acquisitions M&As. Yes, the plays. and primarily potential, very cost obviously,

over it's not quarter. so to every going something And repeatedly you're see

not at opportunistic saying very, not. I'm one cost high to and plans drilling, we're opportunistic on have low any certainly potential. so And and or not don't anymore. drilling do going this But return very focus really another they're to our do given this We year point

Doug Leggate

as applaud being appreciate for think to the dividend one. what of right returned other quick be as cash to follow-up do lot leave answer. hear an your would flow Obviously, where your the Hopefully And is do I go, you Thanks. it I'm just that. curious, you percentage to words, still you there. me. see E&P right ratio operating that pleased payout But get a longer-term a plans should can sure what I'll shareholders? in company I'm the of people really think increase, My you

Bill Thomas

company. don't any Well, answer certainly, for dependent, or that's there's I think operator company I one think any

high, returns super generating we on we’re spend. every fantastic dollar specifically EOG, For

reinvesting one priority. And number high is very, rate on very allocation our believe drilling so premium in we a

for And strong, then, demonstrated good way as And believe also that’s business a best cyclic an advantage, growth. the We to And gives also opportunities shareholders. fundamental especially on we dividend And enormous practice. us we think having counter the very pristine future. this a sheet. we’ve it think that’s we're sustainable in just in balance quarter to get strongly back cash focused

EOG's kind think very that’s business our it’s us. for that's And think to model. I of So unique very allocation. sustainable And I

Operator

next go Please from Meade Charles question ahead. The will Rice. of be Johnson

Charles Meade

I year-over-year. your have about question a just CapEx

and look guidance a you you same half. in half at way the have XQ, If XXXX. for guys your have heavier first And XQ, the that posted is you pattern saw had than back we

So coincidence my more a that question process? of with that a XXXX, is manifestation planning was just or way that feature the your out? Or XXXX had shaken

Billy Helms

This is Helms. Charles. Yes, Billy

yes, of can guidance quarter half. towards total our more able we’ll So production the for our to first capital be in our have that And we CapEx confidence be half, meet second about first the than first on at are half budget. our year. we And in goals annual was XX% the look weighted the you will slightly

the it’s expect the not go of related But reduction I slight just also year, we rigs. in us to So second through as the you’ll adjust schedule, probably half. see cadence our

hold We infrastructure also spend a quarter. happens that in and lease have spend

of So I our a guidance basins. flexibility of lot say for and year. through would to that we outlined. within And early think very confident. multiple I how we’re very We’ll able down we’re stay it’s ratio is we’ll operating to we’ve have production make that goal really our kind be provide CapEx And - the what

we it year. the fluctuate So go through will as

Charles Meade

I Basin position. - significantly Springs shorter. your are Delaware And more kind question then the that one, the noticed I laterals on guess Bone of targeted

there? a X,XXX Can X,XXX versus the you on Or elaborate same a Springs? X,XXX those other zones you that lateral stimulate the really on was on or feet where you’re to more its developing about in bit Is going basin. it need little what maybe think about way I lease decision formation? Bone configuration that

Ezra Yacob

Charles, a lateral down really That’s units drilling are. is shape comes just Really, on lease of configuration great your question. it the where in Ezra. question, Yes, of our half picked the this up you there

all laterals I think trying in is seen, with get we’re foot across are much is the results plays. you’ve And for that at well efficiency. cost longer increases reason back to simply we as that less our look of capital our the our general, really the quarter-over-quarter, that so as per

And Bone future see getting that longer well. Spring so the to look I'd in as

Operator

The ahead. question of be from go will Rezvan next Oppenheimer. Please Tim

Tim Rezvan

of pretty Eagle for matter about premium locations. I X,XXX depth new a and toward that a costs, delineation number really year? up? from kind investors. this laterals the getting list completions? view? is Or grading well inventory residual that aspiration of high just longer focus sort noted priority high is point on is comments it high of cheaper the interesting Is the Ford of And more remains release your or in how non this How a And

Ken Boedeker

Yes, Tim, Ken. this is

As locations reduce look converting to those to that, at at far we costs ways, premium, trying we non as look and the premium productivity well we're several wells. that improve the of the

areas. different able different throughout of packages year being several our to the looking to and premium non-premium our doing and So all to position. and looking that We're at the at improve actually we're tests always conversion do acreage throughout

and West. those of number a that'll laterals lot significant premium. non also of some those to go laterals have we we year significant We're in drilling as So And convert the towards to convert number we a future. have premium this a the longer wells to help drill

Tim Rezvan

Okay.

So you expect to see that grand maybe higher the year? number, throughout

Ken Boedeker

what working That's we're towards.

Tim Rezvan

exploratory does maybe wells just that your focus? in was I out should to Or it's that and hit more came XX% stated in of And there Does hoping better well Thanks. it mean what how given exploratory year? that threshold? that drilled the didn't less level thinking we think about in drilling returns that in XXXX mean follow-up, my XXXX that means. as understand qualified about that Then than was March, proxy premium.

Bill Thomas

step-out It flat. means on doesn't either than that XX% learning total -- the of the drilled, make wells premium. average we didn't where better those. it a very the at and or tests or of on whole economics, -- strong those or really returns. some few are probably we spacing few wells economics. were we have. we after last Tim, in areas mean the the quite And weren't that's But than drilled there year curve package wells better in what is maybe non wells that the a the fantastic very wells the are probably of in place didn’t did a few wells are tax didn't just industry exploration Yes, the return was in we're of have $XX Those Those for rate infrastructure it

Tim Rezvan

kind push, do XX% that? you it that to number Is a just is of have And or higher on number?

Bill Thomas

I I’m sorry. head, Off my number. the have of don't the top

Operator

be Macquarie. will from Please Grigel go Paul question ahead. next The of

Paul Grigel

the release on the be additional targets from could would you what there? In discussed program? you Could Woodford. see we that And the results portion in testing timeframe of seeing what you elaborate

Ken Boedeker

Yes, this We're areas the other to test Woodford. continuing in Ken. is

As make information we’ll the great and and would strides for to target we almost guys. like release this material in met the anything to down our our Woodford on made I a year. operational we've efficiency in In you play get we've costs drilling the that additional point that. really dropped year,

and that we've to plan wells still XX about with year, area complete in we're real made. pleased the do we So this progress the

Paul Grigel

when the Is on expansion to expansion level? there's trying made certain matured the testing? geological comment earlier EOR sure Ford? Could call see need the matures program in then that you is in occur. EOR more And was the just throughout Okay. Eagle to make wells opportunities, at elaborate that to understand there program that area? the program as and are Is a will you Ford the pit could Eagle the development Just that by -- simply

Ken Boedeker

make areas really we've primary Ken EOR again. in on that already program. expand some sense finish we is those based that that in We'll We'll the results the expand our EOR development of seen with with areas. the the This as up

finishing So a it's really development in a areas. matter those of lot primary up of

Paul Grigel

Is that a finished? development certain initial considered number is understand of years or trying just development after when to be to primary

Ken Boedeker

we primary as wells and I would guess, begin I would we can in the finished classify areas process. those quit when drilling development EOR

Operator

Leo from of be will KeyBanc. question next go ahead. Mariani The Please

Leo Mariani

of little any there? a just for sense still that be growth? oil guys example, dividend, confident has might that just increase level, for the the that stress too? XXX is production do with Or wanted why a that of you price Obviously, side and to to out to yield at that there dividend the the helpful. very the you bit test you some guys follow-up get seeking say or target can manage additionally, our pointed for whether a you X% guys, around that to that's Hey not material know here. increase on is may on a respect then we And you out closer kind to you be color EOG, kind little you as had example, be need Just we will $XX, hey, S&P

Bill Thomas

that. evaluated quarter. this the yes, dividend dividend the ability is Obviously, very ever in EOG, view oil is macro the of Leo, and do our the increase thing. cut certainly is to never ever a and sustain every want Yes, history We've we to prices of the Bill. important don't dividend

dividend, we than our historical faster the XX% the we to our dividend average. make last as commitment the a increase we stated, commitment, has on years make commitment. So a we when wanted two been, And

two years, last we've the to increased XX%. So

And so to to our do focus on is future continue the that.

will to growth strong to number, dividend we very commitment years. shareholders. number We have that's certainly but of want for a that we're And specific a our long a give making

Leo Mariani

going not the you're share of not qualitatively indicate around bit fair that you and guys effort. you get in a quarter, some made you whether think jump But is And some exploration might seeing the on I sort acquisitions from clearly sensed bolt-on couple just can But be what based I over that to ready your here year front. we a working, I effort this out just of supposing and that guess, of I that first excitement comments. you're this to or the wanted hope results. bolstering of on in exploration to from front? there, to EOG XXXX I'm announcements certainly

Ezra Yacob

Thanks question. the Yes, Leo, this is for Ezra.

the reservoir drilling the techniques ideas that really drives compare new a in suggested, comments of dataset and to that opening that our exploration As you pretty reservoirs. spots We're apply higher to having excited year earlier completions our quality And in like opportunities. established we’re to contrast the we’re we applying about discussed really and the allows and of focused sweet characteristics unconventional And process us each of in. plays we areas. on the in multi-basin different what

a Bill in certainly returns. really more As our and And premium when something little And material, of goals we inventory. and you reduce have insight long-term but double-digit update guys. that color, quantity, our adding not more of we’re quality highlighted, our achieve and growth to DDNA, our just interested the increasing should continue really little costs, finding help we��ll lower

Leo Mariani

could of years. exporting arrangement EOG a the at that seems a has And certainly next helpful. barrels sense capacity couple coming noticed internationally export increase point? And is the folks up you the here. I guess that big I to for been oil it over just already That’s this get have wanted signed there marketing Okay. of sort potential

wanted there buyers sense you've Just to expand? out international relationships or whether to got of not get a to you’re already hoping some that there

Lance Terveen

Lance. Yes, Leo, is good morning. This

the you thanks the for very mean is Yes, lot when is market. really with mean pipeline a I in of the question. business, But for there comes export that been active Houston XXXX especially since some. warehouses, as our a Houston tank we’ve got think So about been the We’ve of quite existing bans capacity position Houston engage actively we’ve into well. since kind I been unlisted, there. our

for in time, too. sales quite year making looking spot some been we’ve the So last especially

front. that So we’ve on been active

we -- you going think imports you new growth, that's look the And U.S., up so to be going in moving exports next too about year. about you large portfolio that to control realizations. of here protect want just give having I again the there. same. But And a approach. And want that to a position dock, discovery. price it’s us have we very really feel when and capacity look those Really excited at we about the are mean balances be we’re to lot very look into at going you to supply at our the starting at

into year be able Permian, dock. to that our going and feel well next And the just Ford very our Eagle going with so positioned we’re look to - also unique and -- to show to have you we’re we’re going our across its we the moving that be

look feel quality. at the very producer So we’re we the relative when group on different unique you to

domestic going we’re then show be the too. also So to market, but to able to customers our international

Operator

go The from of Please next question Campbell Jeffrey Investment Tuohy be ahead. Brothers will Research.

Jeffrey Campbell

the I just touch all you’re wanted technological analysis doing. various the there basic efforts to stuff on

more You getting the and field was, into it sounded like called up operations. more And perhaps it it daily even again.

So was little you wondering if that? Thank color us I on just a give bit you.

Billy Helms

that. this is Billy Helms. Jeff, add can a color Yes. of I little bit to

way we part that and and very of that do down our back I lots do. the get good aspects. on way highlights And of today can in key as the we data that improve highlight then, we’re manifest better we’re company, well the culture that of And the we decisions seeing. offer part And exercise to our as improvements seeing look and all just do at drilling for we so all gather that itself as trying systems they think to to the always completion operations is these time. delivering we're our in that that some to what we how had business of team, lots goes place the our and of we’ve the we data details, on

on the up how with rigs, drilling do not just making rate doing, what but our penetration to get better. sure daily we’re of the we side all our times continue and we're keeping on drilling drilling monitoring So are of

data our analyze that And it back and the so making it are today deliver transport the the guys and have results direct reflection, to and we're seeing the gather and ability to field decisions. the

making. returns real decision culture, our of part is time focused it So

Jeffrey Campbell

up you and today, methods about These this just costs So earlier that the are all efforts that where accordingly. about? analysis emanating coming completion with data you're diverters talked you're more cutting you thing for are new of kind using from example, effectively talked that

Billy Helms

using time. and that we're importantly, -- using And we're Absolutely. more real data

making actually make the fracking, rates decisions not we're our the seeing we're pressures based decisions implement wells So on formula. about but -- and pressure how to wells only offset to the rates on we're

you right the by each make not is depending a data the approach by the why formula its well, be everywhere, and that's able cookie formula can zone, cutter zone so It their to its real decisions. offsets. apply specifically time analyze to the target an takes each And integral designed on tailored, and

Jeffrey Campbell

that is -- and get to based X% down? thing? about Okay. X% thinking more and goal a And logistics the ask of we're goal I that is up sort follow this when if could just it, quick This on that. is of Or to contracting part costs

Bill Thomas

improving none good that making better to That's lowering our a wells. savings cost of a service No. question, would really efficiencies, as add that we're better today costs is things Tim. of seeing factor cost I as are reductions. well the It by strictly doing

So we're it improving collect and costs, to ability to our -- real the well all And analyze data seeing related the double directly it's reducing performance. analyze effect time.

Operator

ahead. question Please will of Jeanine go Wai from Barclays. next The be

Jeanine Wai

A white through mover sand sand I early crushing EOG and in there cost northern its due be switching to own E&Ps. production of know which sand. on from I believe a guess recently I reasons, is lot question My provider an local does and some are this are area. testing, to back commented that implications E&Ps could you And

thoughts Any you to specifically So you would your probably have than exposure really kind have have discuss of local more treatment anyone commentary helpful on sand? too? data much Can the how on you this. and basins be you

Bill Thomas

on years. sand we're cost material that's Jeanine, That’s over Certainly, certainly use plays. tremendous shale XX Yes, Bill. we and focused this local using And we of kind of years the every we a horizontal pop-up saver in industry available for is sand, -- too. Permian. in Currently, the been certainly a got the got big history us,

local in too. play, that. to sand we're as place, Rocky going the and And many the Eagle such do to we're of other continue I think to Oklahoma in So and shifting also, Ford,

the test it we're So been And sources. and And sand it. mix strengths that's play every kind in. along for better making use use the very multiple compressive each the confident of we own we're our and confident at diversion play. sand with testing have well fit in that the a screen cost We're direction We lower long-term material, the of significantly focused It's do very quality facilities. wells. play. we're we that in engaged right capturing in performance. for sand We've each that is in tailor and And wells we

Jeanine Wai

Okay.

chain the think Midcon of kind leading that's I think the commentary outside of around, Eagle the and maybe Ford Permian. the I

sand those you're areas local in well And so do and you as use satisfied?

Bill Thomas

Yes. We're satisfied.

Operator

Please ahead. Sachs. question be will next Goldman Singer from of go Brian The

Brian Singer

the drilled industry a One debates the is more specifically of of East you I out productivity versus the best EOG, comparison or pushing the whether touch of two the I perspective if point for could whether with this you're on return perspective. think on there area. is for of rate either Ford infield back EOG, And other for is Eagle was from wondering also West inventory but areas.

And less here The time. ability is second to movement core core first of overcome the for productivity is the Permian, your outlook and to from exploration. and gains efficiency the over from

that if What I is case exploratory? your it production. is future the think the given there was of oil you lower exploration that efforts you a truly earlier will confidence cost has expect comment that

Ezra Yacob

thank you This the Ezra. question. for is Brian, Yes,

Permian Powder. That's quality. best reservoir well is productivity an the we of opportunity the with that of the the back feel considered start some learning We Eagle been higher due we've me first data multiple still techniques about and And side. on that apply with by that the what think of basically opportunities identified shallower some should par question the the where these and decline, them like be exploration we And our and some wells Woodford, on with basically half to to excited the apply we of exploration have take opportunities on Let Ford, to the we've can should be our unconventional on quality we're nature. techniques reservoir.

thing, a that way think these on important each first obviously I sorry, and in and if plays. I transition these now, you've we reverse being of Permian, reason example, capture this we've spent to the the Eagle order, made that Ford other go I for in that I did but the the mover spots Permian the The of a one time able is touched basins to is the sweet highlighting year If and is every being the to in progress one end working as into considered is think benefits you that's of And about the to of multiple drive to what our front down be to continue of improve those basins areas. and some in your area and techniques, in to yet non-core us completions allows well models, today what combine costs and increase from them the geologic them of both roll productivity improve datasets drilling your basins. might learnings, really multiple returns the those integrate results your those of and

really Eagle above really few our what in at and today, the a the we've ago. we're doing example how Ford would and Western beyond is example, to for I results Eagle them looking just back the a Eagle point where and are So Ford, say Eastern Ford taken improve they years that Permian best

Brian Singer

Basin. And follow-up then is Powder my the to River with regards

sizing some touch to Slide be the you're that the to think that your least that would front. be, made zones highlighted how as You color significant point Mowry on particularly XX. in and given big competitive to how that maybe at profitability you’ve The it add on there, more infrastructure, turnover progress highlighted Niobrara relates especially production and Can wasn’t some there another on. you infrastructure you

Billy Helms

build Helms. build Yes, Yes, pace apartment where are there first really build out development, as in zones, out -- particularly. in our for be that we drilling Billy the quarter bigger it’s, program. think segments for infrastructure we plans the infrastructure Brian. more will I Turner tested is year’s And to keep and This

drilling made efficiency We’re program capital and this not infrastructure out to erodes. longer-term get ahead of build going that for if a the because just

those scale in that certainly for areas. of will the to even infrastructure we have So though be able the plan the place the handle, size

be current scheduled So that but we’ll with that for and period. up adequately it’ll drilling be pace plans the sized, keeps

due from as get we still excited Niobrara in the we’re opportunities certainly front tests. weather, off got those, to year. And we ramp through about So provide more data Powder, to very of on about see activity we results seeing a And there. up Mowry really slow start the the plan really to us. initial Powder and excited we’re the still we’ll in color the we as we’re But more go

Operator

Ryan question Energy. The ahead. of Please Todd will next be from Simmons go

Ryan Todd

to West, that you on follow-ups in Eagle have appreciate seeing curve Ford. And look you on given if improvement the Maybe the we to I carry got some that at at And of the type things. what with lengths out the the level Ford, And we the foot a higher. X,XXX as there -- of say you’re that couple trending lateral clearly that and it’s feels increases? the look like other curve Eagle clarity expect lengths lateral as the the to there. as we is type Is is The concerned safe going lateral improved, should West productivity relative it the forward? probably it's conservative see to

Kenneth Boedeker

Ryan. Ken, Yes, is This again.

as be we we as well - and finding as seeing we'll the the with We have well out the wells expectations. the in is well reducing are mile performance rates increase, our costs. productivity West, our position. productivity and XXX across there acreage increase way been extend the efficiency the reacting And the variations there capital meeting really extend We laterals see as long out do pleased well

Ryan Todd

add in about. basins picking and is follow-up you been to you’re this your your this excited a see of exploration core core just maybe at on basins point? acreage some the positions you’ve do areas far then the operations? Or still in those versus spending really compelling your valuation And -- And opportunities is some up acquisition core obviously of your outside activity the of more money basins, of -

Bill Thomas

exploration Certainly, of All have Ryan, we our exploration divisions a seven decentralized have staff. strong this effort. domestic is very Bill. very

about. the not We drilled. well a basin, working, literally we’re So don’t U.S., every probably being in know something

to in Ezra this economic year we're rock And about. quality the multiple so, plays have cost. believe that leasing premium talked And at prospects we’re we on as very low the potential due leasing

oil in production, a much had on, EOG. them prospects on we the million at are the an have introduced. we're play really example, places we size. where not barrels lot use And That's of some the very that there's are them That's talked the working of in Woodford historic ago, about couple quality. XXX some so, of years And all. basins of of they're kind of net But about of size production historical we all high small

barrels, smaller But So things top that. we're the for than million is net to XXX company, not discovery very anywhere looking a that of significant. in world

Powder Basin River year, last X.X that plays new in announced we So, billion the barrels. two totaled

a that's one. large very So

that's And on of in much, to organically much believe the lower the talked brackets as them. Ezra very, So the significant way thing than cost, doing added prospects good it'll is, we can continue, But future. put generate size good we about, potential low a the costs at M&As. very and

potential and very, very high low we bolt-on amounts large are are acquisitions, acreage there our cost, when mind. so And these do very, very in of

And so the time. up we've premium as we've same quality as been generating inventory our inventory fast And it. been the of twice going is drilling at

that tell continue So are you-- EOG's you we inventory can on, with is declining? believe confidence some quality of the absolute our And we can based tell previous I will questions improve. quality to inventory

So the faster problem having quality replacing at we’re any is And we're not drilling than it. much going up.

Operator

Jayram of be go ahead. JP Please will question from Arun Morgan. next The

Arun Jayram

greater indicate could an wanted to But on your the official for it, if production, off And production be XX%. what drive I oil see that morning I just base don't seem have target growth larger elaborate it would would that because to comments confidence comments you call XXXX. year? the grow you this your on I could maybe confidence your this you XXXX. to qualitatively, know company of than of of a level have wonder

Bill Thomas

Yes, Arun.

the that the of continue have our of ability system. add plays to structure confidence new I and and We to company the to culture because, company the think of the

IR it's maturity That EOG's We I XX. have Page on our phase. deck, shows a existing plays believe, chart their and in

those we're And that still locations lot a things in each adding the doing of have premium of we're additional opportunity. of growth now most one right So plays.

growth that's that of more emerging growth for as of all one So inventory mode, keep plays. big on And growth are years, And same plays will of new each discipline. years, number decentralized, we we're years not execute of then, shifting mode for multi into few potential. and structure the company, large XX And the on then plus, at of it's mode activity into one more with lot these source of time these the each come a our the plays. they're a the XX company. plays a they multiple can and the these because the working of mode development And

in we staff expert have strong seven So different operating very divisions.

So of the improve execute be good in we can at and costs, same truly on rate decisions to quickly each quick, continue return very high plays really technology, basins time. one and of make multiple crisp, entrepreneurial the and act reduce

I growth high So unique continue to our the for And the industry. quite a tremendous has think company profile time. long ability in very, got return very a that's

Arun Jayram

to your they question the XXX,XXX expand place one terms are of XXX,XXX. in to export just agreements in capacity And from barrels

the to should the peers barrels? you your of the on those of WTI maybe about that those even I call if that highlighted about wondering For get get types to relative formula, capacity, to Brent think are with XX% there's think uplift let's transportation. from able One how that spread, we could uplift ability was has barrels in TI $X you in of barrels? a those anyway we maybe the

Bill Thomas

We we won't to capability thing have what going uplift. we When diversification, right to us. the important speculate it’s into portfolio The is we're go may the not on sell to approach the most domestically. the what on or we have think detail may there a

can that's you sell capacity, back our that them domestically. as if can think we And net export capacity realized us, So we for a about it’s optimize. higher then

our look experience, to our if realizations, like if goal you is back maintain price you over look being in you again, price purely and realizations. time, So our at

markets. we positions that dock in into us have keep So or index sales can there can can can also like quickly we that the we standpoint, local the very think the Permian that we we at business, agreements it feel and about we But just we capacity quickly. and keep probably the the make we pricing it Brent of transact can on also can have us, from you need international spot meet indices the that And quickly we place move move that That's we and with where have the that way leads and take is we the capacity we advantage -- Delaware. and to we can the capacity. can very our which can

unique. also think very I that's

Operator

our conference And gentlemen, remarks. session. for back ladies his question-and-answer like to closing conclude and would this Thomas over hand to will the I Mr.

Bill Thomas

company by at We're excited future. getting first work is Thanks closing, support. The best XXXX is The us our EOG's for about Costs are, we're history. with EOG. of -- us company starting performance for In before. through we not excited to to more but oil thank where thanks down ever you are our best coming And we're listening. less and everyone even about the we to money want your say allow part in allowing that than tremendous better. operational deliver for more culture

Operator

conference Thank today's Thank Ladies concluded. this your you and you you, for has presentation. sir. disconnect gentlemen, attending the lines. At time, may

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