EOG Resources(US:EOG)2024-11-07 21:34Financial Performance - EOG's operating revenues for Q3 2024 decreased by $247 million, or 4%, to $5,965 million compared to $6,212 million in Q3 2023[106] - Total wellhead revenues fell by $251 million, or 5%, to $4,384 million in Q3 2024 from $4,635 million in Q3 2023[106] - Operating revenues for the first nine months of 2024 increased by $284 million, or 2%, to $18,113 million compared to $17,829 million in the same period of 2023[130] - Wellhead crude oil and condensate revenues for the first nine months of 2024 increased by $509 million, or 5%, to $10,660 million, driven by a 4% increase in production[134] - Wellhead natural gas revenues for the first nine months of 2024 decreased by $211 million, or 17%, to $1,057 million, primarily due to a lower composite average price[136] Production and Deliveries - EOG's crude oil and condensate production increased by 9.7 MBbld, or 2%, to 493.0 MBbld in Q3 2024, while the average price decreased by 8% to $76.92 per barrel[110][108] - NGL revenues rose by $23 million, or 5%, to $524 million in Q3 2024, driven by a 10% increase in NGL deliveries[111] - Natural gas deliveries increased by 266 MMcfd, or 16%, in Q3 2024, contributing to a total of 1,970 MMcfd[112] Expenses - Operating expenses for Q3 2024 were $3,876 million, an increase of $221 million from $3,655 million in Q3 2023[116] - DD&A expenses for Q3 2024 increased by $133 million to $1,031 million from $898 million in the same period last year, primarily due to increased production in the U.S. and Trinidad[124] - G&A expenses for Q3 2024 rose to $167 million, an increase of $6 million from $161 million in the prior year, mainly due to higher professional and other services costs[125] - Operating expenses for the first nine months of 2024 were $11,623 million, an increase of $893 million from $10,730 million in the same period of 2023[139] Cash Flow and Dividends - EOG's quarterly cash dividend was increased from $0.91 to $0.975 per share, effective January 31, 2025[101] - EOG repurchased 6.1 million shares for approximately $758 million in Q3 2024, with $1.8 billion remaining under the share repurchase authorization[102] - Net cash provided by operating activities for the first nine months of 2024 was $9,380 million, an increase of $1,144 million from the same period in 2023, driven by higher wellhead revenues and reduced cash used in working capital[152] - Net cash used in financing activities for the first nine months of 2024 was $3,845 million, which included $2,253 million for treasury stock purchases and $1,578 million in cash dividend payments[154] Expenditures - Total expenditures for the first nine months of 2024 were $5,207 million, slightly up from $5,184 million in the same period of 2023[157] - Exploration and development expenditures for the first nine months of 2024 were $4,333 million, a $14 million increase compared to $4,319 million in 2023, primarily due to higher facilities and leasehold acquisition costs[158] - EOG's updated budget for exploration and development expenditures for the full year 2024 is estimated to be between $6.1 billion and $6.3 billion[156] Risks and Challenges - EOG is facing risks from government policies and regulations related to climate change, including potential impacts on operations and costs[170] - The company is addressing climate change-related initiatives and consumer demand for alternative energy sources, which may affect its market position[170] - EOG's ability to integrate acquired oil and gas properties and accurately estimate reserves and costs is crucial for its operational success[170] - The company is experiencing competition for licenses, leases, and personnel in the oil and gas exploration and production industry[170] - EOG's financial stability may be influenced by its access to credit markets and the ability to secure financing for capital expenditures[170] - The accuracy of reserve estimates is critical, as they involve professional judgment and may be imprecise[170] - Weather conditions can impact crude oil and natural gas demand, as well as cause delays in drilling and production operations[170] - EOG's customers' ability to meet their obligations is essential for maintaining financial health and operational continuity[170] - The company is subject to geopolitical factors and political conditions that could disrupt operations in its areas of operation[170] - EOG's forward-looking statements are subject to uncertainties, and actual results may differ from anticipated outcomes[171] Derivatives and Contracts - EOG recognized net gains of $79 million on financial commodity derivatives in Q3 2024, up from $43 million in Q3 2023[113] - The total fair value of EOG's financial commodity and other derivative contracts was a net asset of $77 million as of September 30, 2024[161] - EOG entered into a 10-year agreement in February 2024 to sell 180,000 MMBtud of natural gas production starting in 2027, with a portion indexed to Brent crude oil prices[166] - The company anticipates that exploration and development expenditures will vary based on energy market conditions and has significant flexibility in financing alternatives[159]