EOG Resources (EOG) 7 May 212021 Q1 Earnings call transcript

Company Profile

Participants

Tim Driggers	CFO
Bill Thomas	Chairman and CEO
Billy Helms	COO
Ezra Yacob	President
Ken Boedeker	EVP, Exploration and Production
Lance Terveen	SVP of Marketing
David Streit	VP, Investor and Public Relations
Scott Gruber	Citigroup
Arun Jayaram	JPMorgan
Scott Hanold	RBC Capital Markets
Doug Leggate	Bank of America
Neal Dingmann	Truist Securities
Leo Mariani	KeyBanc
Jeanine Wai	Barclays
Charles Meade	Johnson Rice
Neil Mehta	Goldman Sachs
Michael Scialla	Stifel
Vincent Lovaglio	Mizuho
Nitin Kumar	Wells Fargo

Call transcript

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Operator

Good day, everyone and welcome to EOG Resources First Quarter 2021 Earnings Results Conference Call.

As a remainder 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.

Tim Driggers

for thanks and morning, joining 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 and 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

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

Here is Bill Thomas.

Bill Thomas

our maximize share and we shareholder to declared doubling our EOG to well productivity good been. as in morning, cash out ever to shareholder on we standard, through flow Yesterday, priorities expect our dividend and of the free cash with increasing In significant the our future delivering returns in potential cash free shareholders value. our reinvestment long-term and earnings commitment to ability flow cash future. cost value, order generate and flow free flexible special dividends our return to per dividend Tim, are By returning the we priorities substantially to are performance our they've a to regular flow. to strategy our best will is $X cash remain carry we improving and XXXX. $X.X reductions Double maximize Combined the Thanks, our everyone. long-term demonstrate Premium billion shareholders.

of we free adjusted quarter This quarterly billion a earn and net $X.X per earnings of second in flow $X.XX cash the highest income, record generated a company history. quarterly share

balance In leading is cap site to net ratio. peer with low debt a our addition, superior sheet in

review will capital over closing here few our Ezra, allocation strategy will before detail. a And Tim in make Next performance, our Ezra. more and our financial is will go Billy operational cover I remarks. performance

Ezra Yacob

more a Thanks, EOG's value raise natural to adjusted drove year in prices and performance. in the our which It investment impact in the locations dividend of driving of of we The cash gas. $XX confidence enabled XXXX. current than had just drilling on including and the XXXX X net the the drilling investment of times which years. rate and the return XX% our $X.XX than of step-change to locations and again, when us established two announcement the position during strength, and second Bill. Sustainable premium worth we data our at allocation, details our return rate back XX more requires oil every Yesterday, profile improvements location. in demonstrate is which capital doubling free years' latest we flow of our rate averaged line return in XXXX once efficiency last Slide permanently of inventory is inventory capital and fundamental $X.XX drilling In Half we we strategy, return volatility that a in established of continued is in premium a hurdle and ago. progress is at earns Premium. have a and of in reason our investor pace paved the long operational entered hurdle made financial gas. the at This strategy hurdle current at that make unprecedented generate investment Double years Double least just of this a move direct of after-tax our inventory downturn, year is to premium natural $XX. in oil, five presentation, return the illustrated The income resulting positive of transition our oil XX% strategy exploration increased financial achievements the returns-driven at five of time for transition Premium we XXXX Premium $XX

faster innovations can cost Just number being sight like reductions a existing drill locations exploration. them Double we of will both through of we the throughout replace inventory implement through A areas, moment Billy sustainably that in drive did and will will we are operating Premium piloted down confident costs and line discuss increase across company. and we that with them our operating we as well costs the our are inventory of additional than our Premium returns into

focused on on is that will that program exploration XX% exclusively improve return. Our median prospects

the capital In impact a fact To is on look our at is closer of allocation than the financial return our strategy anticipated XX%. premium more performance slate our corporate plays exploration of new required. see current returns focused

prices the to price our earn base of a earn to continues required return establishing XX% employed to with Prior Premium, on fall. replace oil we to EOG $XX well-level ROCE. by As upwards required drilling production capital higher locations XX% returns

oil on needed This just down As last investor averaged the years. presentation. the to XX% X came X and of illustrated price Premium is $XX strategy our ROCE trend Slide earn matured the

there. XXXX For just $XX is price net not which we're and stopping

over as improve. higher is our free up also more in showing $X fall at dividend will returns four returns last We cash improved balance debt it flow than by billion. doubled the performance. reinvesting and net the well-level our sheet, expect The of We nearly reducing to years impact continue our

prize. at of real last result, the our a total performance year capital to potential XX%, debt was but end As is net the financial future just

a results what for. are quarter first aiming preview are we of Our

inventory even in higher to corporate Over margins the the will expect value continue our current return of and operating structure. generates wells The high lower low-cost compound to rate and our coming leads years result more the we decline to few believe of reinvesting the step a opportunity free value. when another improvement it long-term EOG's in viewed financial create flow, catalyst we providing for We in will shareholder as change us years, look be tremendous back performance. cash

year Our driver allocation returns-driven prioritizing we've return year. remains key projects steady capital and improvements fundamental behind is and strategy of high consistency is made consistent, the reinvestment after the

flow As our commitment now a shareholders. follow a to free result, position on are return additional in we cash to through to

returns, a sustainable and priorities investors consistent, flow dividend cash bolt-on support by generating balance you can ahead, remain cash while of to to and followed to free expect return Looking our additional significant flow a growing opportunistic free acquisitions. strong in maintaining investing high sheet

is Billy. here Now

Billy Helms

Thanks, Ezra.

that quarter guidance year end the wells range high first faster because to the storm, of expected. execution. offline The bit the about We was than exceeded of than a winter Uri our more due oil our producing were target recovered

As a declined just last compared fourth quarter result, production quarter the X% to year. first daily our

our year, previous our to reduction the efficiency and due Our cost capital cost target another last to well why driven company. for the A of are forecasted inflationary quarters cost. through gains these addition once track to can activity X% potential each innovation tremendous lower results closer is confident the as help again XX% we will despite Similar some phase this improvements look pressure realized mainly quarter the savings in came in The across in quarter reduce year. EOG explain to are operations are industry on operation. first resumes. during under by the well well in our X% at we

Our drive drilling achieving towards of this teams and depths lower targeted consistently, daily The faster procedures tools is technical on and cost. reliability continual constant with lower are cost. focus creating performance the

well locked through lower the from also well the We cost. Some since less this offline move initial began of back still benefits wells larger simply with to per in of larger deliver increasing we XXXX, Pad complement completion to the ability this Super-Zipper. experiments cementing. and The the per year rig consistently cost our it groups expected Pads utilize operations requiring our well and advanced technique has results at increased technique call efficiencies

the particularly frac to electric learned also Super-Zipper optimize five our that of have We is efficiencies fleets. well suited

utilize has reduced and water savings lease saves expect disposal. built use to each and to Ford Eagle much this This and benefiting and by However benefited techniques a can equipment using continue equipment's minimum number optimizing the a this a X% operating can a operating about of pressure while capacity infrastructure efforts. year. as Completion And as real-time of located our engineering to half water operator from in integrated more as pumping on by day well. operator infrastructure. remaining lease wells to and between as in third-party realized wells, throughout we new we still area where maintain gain cost on practice. through be also expenses software Longer-term, company. expense lessons operating activity conducting physically cannot self-sourcing well of logistics facilities The also has by costs the the split practice conventional perfected the pumping EOG. The software four areas one sand single by complete on single costs Super-Zipper water sourcing will involves simultaneously software spread teams are pandemic in piloted two designed lease accelerated throughout its mobile lower wells. and wells wells innovative of our four The our the of efficiencies a on develop reused be disposal single pipelines Lease installing using the spreads working pad. learned in We we play operations the wireline and the pad, reuse improved well. where from cases compared completion through last and collaboration are increased prioritizes adoption XX% We

reasons, we investor operating have at but costs Our consistent an improvements medium-sized cost cost number every innovative homegrown throughout of and further sustainable the experienced innovation presentation our employees. ideas least activity never believe our high last ideas, which to operating that are Slide productivity test Each in one all all elements operators year many to of active have of areas illustrates field by That's primary the year-after-year functions successful. EOG from won of progress total expand ideas, of new year rollout results if bottom individual companywide, improvements to on of incubator which work continue grade day-to-day inspired bullet, generated day, to as out employees silver we across the list made reduction. well a new our small in well may individual operations. - of up XX productivity powered by our a

structure cost the of cost, the operating to the company spreading throughout continue and result I efficiency and the of a capital have will capital As improve. innovation confidence strong company reduce to that

Here's review our position. Tim to financial

Tim Driggers

The Yesterday's announcement We Billy. remain increase produced Thanks, four cash supported almost strategy long-term cash from free consistent $X.XX dividend the growth the share enabling annual dividend in balance cash dividend growth achieved drove profitability time, per $X.XX by the that a XXXX, execution profit billion. the capital years. disciplined milestone special significant grown cost amounts in free milestone share, has Over of the in The this has reduction. flow. Premium top the of of per now marks commitment shift allocation flow. to of allocation in returns, sheet. last flow $X strong focused through an of dividend priorities improvement to significant for strategy margins, sustainable Since and the XXXX, increasing the a and over debt return and EOG's another for

continue regular goal our the dividend. to growing forward, Going is

remain cut committed never to we its have the sustainability. or We dividend suspended and

been dividends. shift Double to and with $X efforts Premium of also results and for of shift X% making capitalization to we just strong maturities another quarter. EOG's billion, special as advantage. step-change to is with existence. $X.XX retire those potential has the the will billion we're our guide about common low the sheet throughout focused another the the dividend end A have Premium not in was XXXX the With of plans retired improvement, bond future strategic now about It's on the to total debt matures. heart at when totaling balance first creating Net increases, a Since the conservatism bond strategy debt

a with today acquire is new like also at we're Ford sheet enables bolt-on acreage exploration Our new billion superior marvelous or on - which choice and prices liquidity, high-return it unlocking Strong near-term also of export unsecured acquisition $X like years in balance sheet to strength Yates ample where or cycle are plays. assets even secured to be of extends we the on five of companies marketing the the the for operations, line players countries gives to cash our Eagle us partner companies ago. and strong or us agreements, A financial acquisitions the working billion sheet no other ensuring balance in whether debt $X.X service locking providers credit. with other a hand maturities, balance have

$X.XX full target. with billion paying will we positioned is the This through by The hand, returning After priorities. to special per our in our a down flow priorities address two of a on bond cash on years. million dividend free have share minimum dividend EOG dividend shareholders. is healthy while cash follows also these other cash long-tailed is Now, the billion $X payment cash million a special $X.X consistent priorities. $XXX maturing At this on $XXX aligning above to other meaningful amount, special additional

our Going remain unchanged. flow cash free priorities forward,

to and will gas own performance. course position the our continue cash and of financial We the oil monitor company, of prices

cash As future, available property excess evaluate acquisitions. special further opportunistic low-cost the at becomes the time or dividends right in repurchases bolt-on we share or will the

goes without saying us expect expensive to avoid I think should M&A. corporate it you

value. on to continue shareholder maximize our count to can following EOG consistent strategy You long-term

Bill here's up. Now to wrap

Bill Thomas

Thanks, takeaways. to Tim. would important the I note In conclusion, following like

doubling the to fully our our have embraced EOG hurdle true rate. First employees culture investment

will more flow will breakeven wells, and free substantially. improve, continue cash increase our expect decline our will for As Double flatten, drill we potential price the our will rate will Premium decline, our margins to oil performance we expand

while demonstrating new drive and productivity coming Premium developing to and we with future. dividend returns commitment free pace, improved significant one represents source. to to in shareholder our will significant ideas We this costs. it new technology just our never rate rapid the cash ways special in improve the to using Innovative up Second, continue hurdle that company will we're result alone free are cash returns. finally improvement even a our and And quit Double and new at generating total throughout increase higher quarter, lower flow

We ever shareholder the go and listening, are we'll and excited Q&A. and Thanks to future our than maximize for value. of more deliver ability about now long-term EOG, to

Operator

from [Operator Instructions] Citigroup. And Scott the comes go Gruber of first question Please ahead.

Scott Gruber

you remarks $X special the common the So, you the received, to it now framework the I guys that touched used trying elaborate question amount is the most in future? because the whether we that determine on the know of just was get right prepared right time. the on more a the that bit a timing, little can Can around a special and bit you the repeat framework to obviously folks dividend in sense dividend are

Bill Thomas

reason number, some of is on commitment number. them. of significant we the Certainly significant that to And of be we're little enough returning very background meaningful. go $X our through a to this Scott. give the you going bit I'm a to very And of by the ask demonstrating the kind share, to amount Tim numbers shareholders pick Yes, our cash I think back and per to large to

Tim Driggers

Bill. Thanks,

back to within time consistent our priorities going our it's So, priorities. over

look dividend has that's one If XXXX, to We of debt priorities. billion. our by XXX%, to back $X.X our highest you increased regular reduced since

we us cash. So our When in position, we that cash position now up of cash looked $X.X to a return to with at billion sitting set shareholders. the were to be more

this and out Bill the in to our it point at pointed million So plan to $XXX on a return long-held significant is cash amount, returning time through shareholders. as follows

for it a on we've following through committed time. simply what to So been long

Bill Thomas

Scott. add, to want I

Going and changed. forward, framework free flow priorities haven't our cash

do got we working remarks. little framework. one left first our is said priority reminder, this, on doing absolutely debt the regular is And and the we growth. next and special noted And dividend best Tim certainly dividend a got to in to as that that. shareholders, the opening we've a We believe work are great just back and of And a our that so, context to put you but in with worked, have his give sustainable total is way then reduction already dividend history a have to cash we've

synergy, after also where then of consider a the lot also and And we want wells. and we've areas And opportunities downturns, times that, - the drill opportunistic in and acquisitions lot and in repurchases. in share move keep to potential and and dividend best right that are able that a to now quickly options are next are share want Our for counter the operating we acquisitions, we to be return mind we what obviously of bolt-on certainly got ability things to these doing. those special we'll high favorable have repurchases cyclic then are go our

And can at high potential our in new capture be acreage low a very cost. could we them where some exploration of plays very

this And so, and to a of these we'll all we'll evaluate work just with the on use evaluate options and continue best framework, basis. cash quarter-to-quarter

environment, dynamic We business a the have all time.

the to in most important it's that flexibility value. cash So use shareholder a way the creates to the have

Scott Gruber

- strategy growth And be the guys explicit you your markets next The in case very maybe factors will, looking relates ground, then follow-up out seems X% have growth and healed beyond. XXXX discussion growth around a and now to around the to my XX%. you're at, But around to and call. have case potential XX% some the been you you that to the laid below if on year last for middle there some X% oil

again. and it XX%? it's grow zero right you going just if if or between if to What we're rate the X% determine to a ground to to it's So is have time there your healed, to growth the markets just grow, at X% that are markets latest somewhere middle hear to of cadence? wanted and time is XX%, XXXX, factors healed, around What at the grow growth looking I oil to have thoughts is

Bill Thomas

thanks, I We Yes, demand recovered is that make sure want for is to And really going way it's we're grow not to to that. think and that. we on Scott do to until question. which levels we're have, on clear the pre-COVID

inventories obviously want looking certainly a spare be can that, to and lot that our now. we're in we everybody that means, that oil lot below than year five-year think world it And demand. that U.S. of see for every will just the make market right going capacity lower determine shut And I and then the factors not And year to sure supply into are to average. match a inventories is plans. year

so, to be rate or to - grow at want growth no we to a this plan all else to market those our and like at lower we a all, that's doing are want Above right and And the disciplined we we plans committed to market growth be flexible, that's we If want need growth do. will able to staying are we we fits fit not not modify oil conditions. and year, whatever into is, what whatever forcing everything that ready. market conditions to very

Operator

question next ahead. Please Jayaram go comes The JPMorgan. from of Arun

Arun Jayaram

first to free dovetail $X.X minimal target. guided I debt kind paid cash talk. leave know already your I of my billion $X.X the down? year bit is a dividends, and you've that above question Bill this So another cash to flow, for guess XXX dividend on little billion cash Yes, billion flow, than you're $X.X special of more in free for you've

of for the the more price is, if the potentially this cash in here bolt-ons question gauging looking guess are up I market oil at terms return you year? So how versus holds

Bill Thomas

thanks, potential, the evaluate and looking where evaluate are where take bolt-on evaluating on anything, quarter, are - we but we're we quarter. that. every and we specific give any Yes you can't I every at Arun. constantly we We

we sure upgrade want We the we make premium, that that consider So do quality premium something would a difference company the to fully make leave future our high very room of significant want that. double in to to inventory.

lot cash we're a very believe - So, cash coming. fortunate and lot hopefully lot got got of a we've of a of we we've

keep et lot and a in be mind a growing about, us want about And for excuse our cetera. reduction mind Tim year XXXX, and dividend. to So also in acquisitions, regular me, and great dividends, opportunities continue to we as of our we additional then special in to debt bolt-on able targets that's consider to keep in talked think

committed the the just at maximize in need value. shareholder keep the So to be we're to all shareholders that proper and thing total we'll the those just to doing to know for you able right right the framework time

Arun Jayaram

costs, the Uri wanted a that given call cited Great provide some gas you this How your and gas you in and to being of free some bit for know to that if storm, flow was pricing my would I this the Bill more you the I best contributed to flow? cash is puts follow-up, detail winter conditions quarter free the company's history. unique natural how are on incremental there cash JKM. take little see leverage the But what out? price How on but quarter? could

Bill Thomas

to to storm I'm Tim, it Tim But give special detail? needs the to with Well Tim, everybody natural ask going the turning give to had on some just nothing some you'll process. do that. to details gas dividend in know over before the

Tim Driggers

When the the you but very a down line. flow, everything that's our of cash and big to Uri to quarter. income. $XX in was they're cash bottom It the there, effects about our component in million Obviously, flow, net immaterial was income boil net Sure.

Operator

Scott question The go from Markets. of Please Capital comes Hanold ahead next RBC

Scott Hanold

Thanks.

I to foremost, commentary and First the to I plan not on what your - you're is. direct very desire appreciate and want grow,

you predictability? cash, of $X peers would even to cash a Do see more to air see is whether predictable billion some up is of of there I'm rather Or the if base is like build we there that think the benefit What shareholders, beyond it's other you Do setting a flow. that free into a your more opportunistic? annually. did. lot to return in bit. you benefit after a sort dividend even your So all hopefully talking 'XX, return a I or all clear does do cash mean if do that what something environment, strategically stay you we're wondering around current

Bill Thomas

very dynamic environment. were a Yes, Scott. always We business in

So way it's that the to believe the important, in to cash creates we of a value. shareholder flexibility use have most

reasons we say want be does - at want market because in X% where to position the - put we're not clearly are need the don't formula don't one of to get more into a we to reason the when biggest oil don't We we strict oil. growing the

So the we want to can the time use be to at in and where in a to we maximize maximize do thing our cash of right position the plan to right the shareholder value.

Scott Hanold

Thank you for this for that. And maybe my next Ezra. question, one's

shift Premium all you a of significant organic You Did to more talked that is about But to to shows any increases shift? X the uptick. a how Eagle to color shifting has that generated have Ford have versus mix that's relative versus Double EURs, shift mix do would upward. on Page organic? you massive just is sense I assume buys say, that much Permian how on has all much relatively

Ezra Yacob

Permian recently just the wells XXXX the This the announced Ford, the the entire River is well. as variety and across Powder a Premium that have including those variety locations fairly is and we What have definitely in would capture wide of are play, Austin say so Chalk, part question. Yes, Basin. have there I the Dorado that but we Eagle distributed Delaware Double fairly Premium in our portfolio, for the Permian, we simply thanks percentage is are a Ezra. Double because Scott, Yes in higher of of many targets located Basin

Operator

Please ahead. question Bank Leggate America. of Doug of comes go The from next

Doug Leggate

story. press you. line taking where quite Scott Good or I Thank draws off I Bill I'm this Scott's growth Ezra, afraid could isn't I under just my headset. everyone. on I morning, wonder if thinking not I'm a apologize. was the point.

So my question is real simple.

free return rate? one XX% lowest a that to XX% back you're capacity have to everyone in the reflection of $XX leading at money. industry got arguably whole spend to What follows, if has goes more sector cash the the my growth your a flow happens oil, yields but of is point currently price, You the share your

Ezra Yacob

want We're make or I on really clear. Yes, XX% Doug. stuck rate. to growth it X% not growth rate,

on the right the making We right at are totally do focused we sure time. thing

oil fundamentals. we, how to market much price not going guide we're It's the So the does grow.

really we've on fundamentals - adjust year strong of may we're have that those so that our market focused and focused at We we're fundamentals, we we grow And think will that which I all. means out don't each each set certainly year, our on X%. and next to laid growth a at a plan to just the fundamental X%, what maybe grow and show. see - We'll year we market's plan

Doug Leggate

to actually not you of to trying My choose back very that seven really is I to at It's the is Double what kind was answer, XX current That's to. inventory follow-up great Bill. Premium of stone Ezra if years go one get quickly. growth years do assumes pace, XX shrink some.

you and plays level? And into activity that Thanks. up how again think about So talk it I'll that how - sustainability, there. the about can leave hold you

Ezra Yacob

Similarly, years, Yes. we've focused Doug. we're year-after-year. question. consistently getting on the done That's better good as few over a past

of to every inventory well innovations some by to to Premium year technology sustainable existing costs well gains, the so through productivity some driving applying but and well down convert our able we're opening remarks, in which And through Billy into reductions, spoke also increase that Double of metric. cost

In addition of that we few other have avenues.

The our It's step touched effort. decline, another but opening exploration focused to high adding opportunities inventory. effort impact current acquisition of increase Bill the I also plays as comments really low the again exploration bolt-on in in focused development, making about our acreage on on, then is And change our first, has preexisting on areas is which of that talked price that lower-cost opportunities ROCE company, return translates and you're rate that's corporate And and reinvesting cost growth what any us year-after-year required allows a company. company profile really essentially our financials adding down year. higher the lower the return regardless double-digit when again, for driving to to into overall the base of in to and your you're reserves really every

Operator

question Securities. go Please Dingmann of ahead. next The from Neal comes Truist

Neal Dingmann

talk see you or rate? would at at question let's current higher, you strip, Guys, what how you about do wondering, how first around just another again that? is to your look reinvestment, and reinvestment so could one, assume I'm $X the of my sort number that

Bill Thomas

Neal. Yes. that. to the on ask to for going question. comment Billy Thanks We're

Billy Helms

Yes. Thanks, Neal.

will the that We're is grow You as going like earlier, where We in of for our then he the against to not opportunities out see needs reinvestment going are pointed and what's the of mentioned And and know we rate, oil cash and and assets, the market make point. the that all the looking for are we to trying kind prices as forward do always sure we're that each in. are into company. always same to what market a the Bill and certainly develop market do. - at not the what just what we balance look year, need re-emphasize is, the need already thing,

formula, that really is at market a not it's So, straight current time. the more it's about where

Neal Dingmann

when but at developed in in PRB. potential, I'm got immediately the how as produce looking I'm same. of might they that. that glad regional process. some just not a Could the quite compete. wish you've sort but to I this the hear it And you of others more then follow-up. more just factor your high about talk know you areas I Bill, just Premium would have think not but the sort I exciting, call would hurdles, locations, allocation But say wondering, what I like strictly question about, a talked you if on maybe new does

So with factor some of in I'm do high-potential plan? this those how you wells just wondering

Billy Helms

Neal, is Billy this Yes, again.

at stab Let that. me take a

on where we our as plays portfolio. all So of the our decentralized beauty having at culture assets, focused we across a that's look multiple are of

a you Ford life further that might mature years. more that cycle in Eagle River for phase think You said the Basin about maturity their growth say play. early XX phases It's different play. maturing down had in have as as just Basin. about is then the Delaware window Powder growth it the It's is certainly And like a than or that are you of it early plays

maximize then delineating our returns. play each of the time, first, over those idea we of the drive down in the certainly infrastructure go putting cost with So and to in one

each though, to through steady a lifecycle the of have operate able a the of creation the of company that one different those and future commands that company. we and different maintain pace investment amount overall activity way is very So value a

Operator

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

Leo Mariani

here. spending am I

So CapEx here time on up up? your driving in everything on causing of sure just is what that the your sort was quarter. picking what second wondered based I guidance, I wasn't just that, was

Billy Helms

Yes, Leo, this is Billy.

be completed. guidance the quarter little relative the of second the a quarter the up are is timing it's available to bit the So simply wells when CapEx, to first in on

first bit So second completion little we than activity That's simply we'll a did in in quarter. the have the quarter more yes.

the The in the to I think and quarter year of that per our will the have really day, spent year. general be with in rest rest more XX%, of XX% half. a CapEx much average of first remaining volumes keeping be through the will XXX,XXX spend about ratably the barrels the pretty

forward. going quarter a XXX,XXX a barrels - So each be maintaining day we will it's

Leo Mariani

to at I'm Okay, that's out the If particularly on plays kind wrong, bit helpful you confirm to more drill there just drilling ask to in sure. exploration XXXX devoting for the multiple are think I guys of wanted I certainly this just wanted here. point. plays. capital guys not you And

can in think high maybe able you just of in couple speak bit little as your of as a And kind up level, to of next the did well. a competences, you being what of last the years these I prove some and to result year? that

Ezra Yacob

exploration appreciate on question. year. I about this the is - to Yes, exploration our effort plays, the Ezra. million allocated we've we're Leo. Yes, right, $XXX This you're

few exploration hope some soon. bit and due the some results at of putting into and and wells a in a we done some course, prospects, pullback results prospects. confident then, acreage very prices provide we're of allocation across across with and seeing, at of of the We're we're would drilling to different point more to appraisal that call I'd we're to phases, where prospects able we have what was little this the to was the multiple leasing, kind here Over of on But it that be wells, associated a there dominantly year we've in feeling at, with drilling move are of back XXXX to others where we're started say. in the COVID. together I drilling, We're the downturn reduction years, last the capital

Operator

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

Jeanine Wai

a up Maybe Ezra, exploration. following question on for

saw You're you we believe in a that prospects nominal foreign paid offshore I amount and Oman now, oil last month the Beehive interest in Australia.

So still can in you to you other Australia? international And have talk plays? interest about you what attracted do

Ezra Yacob

really as as question. knows stepped company. the it's you hydrocarbon impactful to of potential really - forecasting West with It's a be prospect nearly of here we to we've where that very our offshore really the a the very This Yes, a outgrowth we're from. Ezra. think we It's have for in water Trinidad shallow low industry returns, really there we've you what North in there, play that a mentioned away XX - an Australia, Australia upfront of cost. Yes, operating our and Jeanine. exposing opportunity, shallow our in to Shelf, the has opportunity it the waters It we compete type has have province, prolific years, is to a is the domestic us geologic has where the into on potential moved this the Trinidad, mentioned, obviously, for opportunity everyone that That's in and been opportunity region. experience great is a a

and there. experience off-take from perspective, thing not think returns. amount a only not service oilfield The fit we've of shallow attractive we our very, course does is procedures has developed an cost ourselves can these availability techniques, prospect. into we the of the in operator, where entry make into it some again and operational of also about niche exciting found the to very it so geologic level we and only And of some but good And prospects water as low but technical and kind many Australia upside operations of come

Jeanine Wai

- - returns again the horse for in on Okay. and beating and the question, the net section consistent of cash Interesting, that first dividend simply is market I formulaic. the are while looking apologize, second my we for but on special the

With this out kind comes you cash You having plus due to one mentioned than time, health of that cetera. billion to priorities. paid $X.XX bolt-ons know you and business a the dividend for quarter, a $X get then in is in be probably mentioned you evaluation, capitalize I really credit get is meaningful. can every operating holding needs and everything it times high it couple that for et mind, on don't you to for $XXX clarify, minimum of XXXX And billion the that, just also in it, optionality also the more else the kind maturity? million can't frequently specifically just it of evaluate return of when special you matter of

So commentary and you. really a have comfortable placeholder if any kind of you be helpful. that Thank for would

Bill Thomas

billion at given to I the some of ample set the for those reducing balance run we bond And XXXX. the there. on cash plans looking on and aside, $X.XX billion. Tim's $X Jeanine, think keep to have then answers we want that's Yes, are to sheet some business in around

in, cash. into cash how that's shareholder. commitment our framework really just and the cash the fits our So we already when giving dividend out of in use use we But the that that's and we've all back to special laid fits the of evaluation to part

position, So the than be a from we've - that, be very in small, size bolt-on our but look we will look $XX at past a certainly million deal, potential too. opportunities. at any million truly they cash bigger $XX They can could done

we'll framework evaluate to So our and return cash to where working and the the and the all for to continue shareholders business, company that through that, and outlook is our goal into is, take framework.

Operator

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

Charles Meade

hasn't months opportunistic about I I share of comments talked guess my you, I back your for bad and have your stock. past, in MO whole you just In morning question, repurchases repurchases. the usually the downturn would recognize being you a it's Bill team see ways, to easy you had an your goes it more look good in pro-cyclical. Yes, But have guys a kind Bill that it's and retrospect, And word and Yes, share of to Six ago, in to some because specifically the one been your you prepared to really right. it. at said is, way three said you wind they handle downturn. you're in maybe it it hard a and question remember on when the there. you I in recognize reputation up and a

opportunistic, the recognize can just time would of things, in downturns, guidepost you're what, So so know you or when those is there it? be of any see is that you it how to you one when about share you one it's

Bill Thomas

top the know, we're sophisticated. it information the when where of and kind a and being the the able with do. We analysis biggest of through Yes gotten time along lot goes can right think you a market our supply-demand on of think developed buybacks. now and it's consider And opportunistic Charles, on to the the when very on confidence determine got gaining - cash now share I headed we to to lot oil of that we we is able technology, be market counter-cyclic course have want I maybe that's continue cash that oil watch and time, have opportunity to indicator. we, certainly have fundamentals But will we'll in a sheet sophisticated be price do more of if we have is We've keep who it to right model that when we've that, and happens. to a do that the balance and about an to downturn

Operator

of go Please The from Goldman ahead. Mehta question Neil comes Sachs. next

Neil Mehta

here. morning, Good and a on quarter team good congrats

lands on that the Delaware like risks of does any is first exposure for And the new The general in federal apply federal seem on your with how lands? process some in permitting Bill it updates diminished. the in Washington has has to been And question around conversations permits?

Billy Helms

Yes, Neal, this is Helms. Billy

of levels our permits, all We're well. permits. prior very receiving very permits change this on in is protect were permit just certainly we permit, steady obtaining So we coming stream The federal to our active a been since too. are as the administration to areas permits moratorium receiving lifted, has activity stream in of the

relationships benefited, So the with able I has well. regulators real with the think it working maintain if been is through to and the process working is, we've them

activity, to any said administration Biden not the And So maintain as he I really we're on seeing wants activity restrictions that think leases. there. clearly valid

So continue to then. that be comforted by we're very we'll able the fact

Neil Mehta

macro. just is on follow-up the the And

direction price You you're what guys little and have gas? the you're thinking talked evaluate that for you trending. of commodity the about real-time? seeing here moving could a unpack the And are Bit bit to price you for way from curious both natural and things oil about tools if oil for how

Billy Helms

demand, very, the Yes. and little talked a improving. COVID very definitely oil and about are recovery on oil already been the Neil we seeing steady It's on but are we bouncy fundamentals as improvements.

pre-COVID we're up out, inventory know day. on inventories the during there'll I fairly the from XX to draws We'll of by a that think activity. XXX million we'll now are be barrel The maybe end maybe see. to we Demand barrels the just have around to somewhere a it of and levels watch on get you summer And we think dropping. think especially million day. right year here consistent pickup

but good. you the year, the back that. capacity we demand fine. I'm you bit and everything certainly is extended right And online. a everything up the responded as going I watch drawing that's And okay. put in in spare direction. We'll what it picks then data spare when know little going really as going is to further the oil be been see just started out have to will but capacity the market beginning have the so give to prices It's that's out be is to believe think than And all of looking again at it,

higher On the supply. less that is. different it's what saying, we're are natural and than than it's low, is bullish. this not Inventories supply consensus view we're think seeing what gas, and year mildly and the demand I is

the was entering to year, going low be we're summer and and it So of the particularly pretty the fall inventories.

So depends gas. depending is the on on obviously always weather

have optimistic turns also. on we're And that how just to but all so, see gas out, we'll

Operator

The Scialla ahead. Stifel. Michael comes from go of Please next question

Michael Scialla

Yes, good morning, everybody.

ESG You sustainability long time, quite your a ambitions. highlighted for

And transition the where EOG? carbon, or see economic to tax? wanted on opportunities price in you energy Just stand on see do for you any carbon the

Bill Thomas

ask Yes, Ken Michael talk that. I'm to to on going Boedeker

not he carbon that. and transpires our before We'll or with issues to going out come the on leave opinions like starts the Just up we're tax whatever legislatures that on to work those - with so that.

Ken So, about want opportunities? you talk to other

Ken Boedeker

years, there. return goals Yes, over X% that you but business the year can returns our in and - made of our towards before we our on emissions see X% really might four do got ambition no progress the a our reduce every we it's one use lower of budget consider carbon net-zero second flaring we've World the that in our can emissions. have of routine by slides progress phase Scope no substantial by lower and a make that lead in our And XXXX. to, two we that this and capital down endorsed by the capture we as Bank, We're focused interest with competitive such been have to that in with really reducing we've last emissions and our intensity of to projects believe applying presentation indicated on XXXX, rates coming as technology reducing attached our own excellent to

Michael Scialla

doing of Super-Zippers. cost, and to you're And Okay, thank the well you. things you some the Bill, lower mentioned larger pads the

laterals three-mile in about Some of your competitors talked have the Permian.

see two-mile Permian laterals, some what if done have the prevent issues toward that in plus laterals particularly not, three-mile guys you you or in Eagle do trend think that? a are Ford, the the would but I

Bill Thomas

Michael. thanks, Yes,

the laterals, multiple in more Ford, predominantly we makes three-mile do the several, say I'd Bakken And We've done X.X on and in and the we've you're in between where So and plays and sense. right. it Eagle also laterals own some then had the DJ. probably three-mile

that allow but particular that circumstances access issues more unique and that the are us, geology there driven also but they're the surface. on by for in area, So, happen to

through always a makes as just go not that a rule, three-mile I'm lateral. think it to I sure sense general

that lot time depend have. take to of two-mile working able how a on efficiencies lateral mile you think the the the complete been geology last through economically geology. kinds a we those to of account to does of location I approach to have have spend and things single and into And we compared it detail well of lot lateral every best

can a there so on So limitations do not and are where that effectively, approach. you broad-brush some it's

Operator

comes Lovaglio Mizuho. The of go from next Please question Vincent ahead.

Vincent Lovaglio

ask I Thanks for having me wanted on. the premium double on to locations.

these in geology pursuit last And unique opportunities? pursuit, touched to in is also if lower it double plays described of that premium? how anything guys You might of so, on one's the are have but across also Slide that but to that might higher opportunities decline differentiated affect quarter, the itself those if productivity, there the you and your Why that are development new X? on

Ezra Yacob

But as industry Yacob. in performance that refined and not in those areas geology. before. down that usually highlighting our That's to reservoirs new completions the can higher drilling a potentially to the what to higher, change deck. apply higher permeability looking our question. where you apply to, company horizontal we been we're change into there horizontal rocks be Ezra existing a as We're the going haven't horizontals. exploration better is is get portfolio permeability, are And higher in we get we've rock routinely and to for declines. technology going plays at as this is, we looking what forward looking to the is - Vin, unique target We're quality a the and Yes quality It prospects These it's And drilled lends to really to the look really our only about with down talked new that really we've that really step of big the yes, is a slide great for step comes are touched future. itself that the going on really this forward. shallower for with plays drilling, historically the double think to premium eventually are in really, porosity down be the the

Vincent Lovaglio

other flexibility forward? maybe can additional maybe give Ford Thanks. you could right then it on that EOR? plays? Just where your that stands now thoughts unconventional And across going the maybe footprint how on color in any Thanks. improve second, environmental Eagle Perfect. And

Ken Boedeker

Ken. is this Yes,

we some that As in return. are with much and higher we've price the far and our challenged into. EOR high units graded as environment continuing goes that down were is Ford process, Eagle right premium gas of have more EOR units to inject now EOR double in in our blow other our

areas evaluating are company. based for that we So other it on across the

Operator

Kumar next The question Fargo. comes Wells from go Nitin Please of ahead.

Nitin Kumar

the Hi, special dividend other some good been at question different looking double congratulations. time, migrated is of a from the Slide definitely morning, and My all asked. you've to The perhaps premium that is Over first very strategy. gentlemen little was this receiving I well. ones have market of X

XX%. as favorable high is, the happens going as With half to premium environment it here? have mentioned as the returns Ezra inventory is lower is pace exploration your single macro what or the of core to

opportunity your an about of opening monetize wondering, to market there is that A&D of with just those, or we part think So to inventory? how some should

Bill Thomas

question general for excellent ask comment evaluating your we property appreciate going Ken always on I and company. and to that we That's are appreciate I'm it, Yes, Boedeker sales, to in the and compliments.

Ken Boedeker

in our assets we XX as value. the giving see grading of We're fair to Sure, premium with double the we've high we thanks, last them Bill. always assets high $X continue actually minimal potential remaining. and over properties our will And and years, portfolio billion divesting about market grade sold those

Bill Thomas

few the that a of premium as it those know people think short industry. the even inventory turn seller's years, and - are you certainly it And some that we assets of it is in the know, been last inventory hasn't best probably the will you premium, single in market, have we the but get

those, have certainly So a value. lot of

Nitin Kumar

compete don't Okay. cost within And - $XX and capital they for today, your program? they are where oil don't with they

Bill Thomas

huge the Yes, highest return rate of our our forward. and right quarters But the shift performance the to script slides been to going needs definitely we XX% talking last at a what the standard good shift believe and be for And in lot rate several in reinvestment premium compete program XX% for detail of in for XX% XX% It's we've that's at of a clear our industry, exceptional returns. and return a it a correct. about the is, certainly, company double flat. now. that's separator in it doesn't our will really information. is by in EOG, far It drive

Operator

for our conference any session. This to to over turn question-and-answer concludes like Mr. Thomas the I closing back would remarks.

Bill Thomas

our testament proud to of improve results their of outstanding In ability to employees generate EOG EOG's first the We're significant closing, excellent contributions and all are value. to a quarter company. shareholder continuously

Our excitement about EOG's never been increase ability has returns value and improve greater. to

So, thanks thanks for for your listening, and support.

Operator

now today's you The conference attending concluded. and has presentation Thank disconnect. now you for may

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