EOG Resources : Reports Excellent First Quarter 2021 Results; Declares $1.00 per Share Special Dividend

May 6, 2021

EOG Resources Reports Excellent First Quarter 2021 Results; Declares $1.00 per Share Special Dividend

HOUSTON - (PR Newswire) - EOG Resources, Inc. (EOG) today reported first quarter 2021 results. The attached supplemental financial tables and schedules for the reconciliation of non-GAAP measures to GAAP measures and related definitions, along with a related presentation, are also available on EOG's website at http://investors.eogresources.com/investors.

Key Financial Results

In millions of USD, except per-share and ratio data

		1Q 2021	4Q 2020	1Q 2020
	Total Revenue	3,694	2,965	4,718
	Net Income	677	337	10
GAAP	Net Income Per Share	1.16	0.58	0.02
Net Cash Provided by Operating Activities	1,870	1,121	2,585
Total Expenditures	1,067	1,107	1,826
	Current and Long-Term Debt	5,133	5,816	5,222
	Cash and Cash Equivalents	3,388	3,329	2,907
	Debt-to-Total Capitalization	19.8%	22.3%	19.6%
	Adjusted Net Income	946	411	318
GAAP	Adjusted Net Income Per Share	1.62	0.71	0.55
Discretionary Cash Flow	2,010	1,494	1,666
Non-	Cash Capital Expenditures before Acquisitions	945	828	1,685
Free Cash Flow	1,065	666	(19)
	Net Debt	1,745	2,487	2,315
	Net Debt-to-Total Capitalization	7.8%	10.9%	9.7%

First Quarter 2021 Highlights

• Declared special dividend of $1.00 per share and regular quarterly dividend of $0.4125 per share, an indicated annual total cash return to shareholders of $1.5 billion
• Earned an adjusted $1.62 per share, second-highest quarterly EPS in EOG history
• Generated $1.1 billion of free cash flow, a quarterly record
• Capital expenditures 6% below guidance midpoint driven by sustainable efficiency improvements
• Oil production above high-end of guidance range
• Made significant progress toward 5% well cost reduction goal in 2021
• Reached agreement to divest China assets

1Q21 Press Release	1

First Quarter 2021 Highlights

Volumes and Capital Expenditures

		1Q 2021
	1Q 2021	Guidance	4Q 2020	1Q 2020
Wellhead Volumes	Midpoint
Crude Oil and Condensate (MBod)	431.0	425.1	444.8	483.3
Natural Gas Liquids (MBbld)	124.3	130.0	141.4	161.3
Natural Gas (MMcfd)	1,342	1,360	1,292	1,378
Total Crude Oil Equivalent (MBoed)	778.9	781.8	801.5	874.1
Cash Capital Expenditures before Acquisitions ($MM)	945	1,000	828	1,685

From William R. "Bill" Thomas, Chairman and Chief Executive Officer

"Our outstanding first quarter results and special dividend announcement reflect the power of EOG's returns-focused strategy. True to the EOG culture, our employees have embraced the higher hurdle rate with the shift to double-premium, which drove record returns in the first quarter. EOG continues to deliver sustainable improvements in operating performance, once again exceeding expectations.

"Our robust operating performance translates into financial results that allow us to deliver on our cash flow priorities. Earlier this year we raised the regular dividend and reduced debt outstanding. Our long-standing financial discipline now positions EOG to return additional cash to shareholders through a special dividend, bringing total expected return of cash to shareholders in 2021 to $1.5 billion.

"EOG is off to a great start in 2021 and I am confident that we will continue to get better going forward."

1Q21 Press Release	2

First Quarter 2021 Financial Performance

Adjusted Earnings per Share 1Q 2021 vs 4Q 2020

Second-Highest

Ever Quarterly EPS

($0.14) ($0.08) ($0.31) $0.04 $1.62

$1.40

$0.71

Prices and Hedges

Higher prices for crude oil, natural gas and natural gas liquids all contributed to higher earnings. Average crude oil prices increased to $58.02 per barrel in the 1Q from $41.81 per barrel in the 4Q, contributing about 60% of the $1.40 earnings per share increase attributable to higher prices. EOG also realized higher prices for a portion of natural gas sold on a spot basis during periods of strong demand related to winter storms and for natural gas sold at prices tied to LNG export markets. Price gains were partially offset by a decrease in hedge settlement value, to $30 million cash paid in 1Q from $72 million cash received in 4Q.

Volume

Overcoming downtime from Winter Storm Uri, which reduced 1Q production by approximately 3%, total company crude oil production of 431,000 Bopd was above the high end of the guidance range and just 3% lower than 4Q. NGL production was 12% lower, partially offset by a 4% increase in natural gas production, driven by the market-based decision to reduce ethane extraction. Total company equivalent volumes decreased 3%.

Per-Unit Costs

Total per-unit costs in 1Q were slightly above the mid-point of the guidance range, due to higher prices for fuel and power during the winter storm. Compared with 4Q, higher taxes other than income related to increased product prices accounted for about half the increase in per-unit costs. Higher fuel and power, DD&A and production-related costs also contributed to the increase.

Change in Cash 1Q 2021 vs 4Q 2020

$Billions

					Free Cash Flow
	(0.9)				EOG generated discretionary cash flow (net cash provided by operating
$2.0	(0.0)	(0.2)			activities before exploration expense and changes in working capital) of
3.3	(0.8)	3.4	$2.0 billion in 1Q. The company incurred $945 million of cash capital
			expenditures before acquisitions, resulting in $1.1 billion of free cash

flow.

Record $1.1 Bn Free Cash Flow

Capital Expenditures

Cash capital expenditures before acquisitions were below the midpoint of the guidance range due to lower well costs from sustainable efficiency improvements. Faster drilling times, more efficient completion operations and lower-cost sand and water sourcing contributed to lower overall well costs. EOG is well on track to meet or exceed its 5% well cost reduction goal for 2021.

Debt

On February 1, 2021, EOG repaid, with cash on hand, the $750 million aggregate principal amount of its 4.100% Senior Notes due 2021 that matured on that date.

1Q21 Press Release	3

First Quarter 2021 Operating Performance

Cash Operating Costs

$ per Boe

			11.02						10.28	10.20
		9.82				9.82	9.34
G&A		2.32			1.57	1.65
1.44			1.89
		1.54
G&P			1.71
1.62				1.98	1.80
		1.74		1.62
Trans			2.67
2.62					2.88	2.80
				2.64
				2.74
LOE
4.14	4.32		3.45	3.54		3.85	3.95
		1Q		2Q	3Q		4Q	1Q	1Q 2021
		2020	2020		2020	2020		2021	Guidance
											Midpoint

Lease and Well

Per-unit LOE costs declined 7% compared with the prior-year period due to lower water handling costs, workover costs and overall efficiency improvements. Per-unit LOE also was $0.10 below the 1Q 2021 guidance midpoint. Compared with the 4Q 2020, per-unit LOE costs increased slightly due to higher fuel and power prices during the winter storm and seasonal factors.

Depreciation, Depletion and Amortization

$ per Boe

12.84 12.85

12.57 12.46 12.49

11.81

1Q	2Q	3Q	4Q	1Q	1Q 2021
2020	2020	2020	2020	2021	Guidance
					Midpoint

Transportation, Gathering and Processing

Per-unit transportation costs increased in 1Q as EOG expanded its transportation and storage capacity to provide greater flexibility and support higher price realizations. Higher fuel and power prices during the winter storm also contributed to increased transportation and gathering and processing costs.

General and Administrative

G&A costs on a per-unit basis were in-line with the 4Q 2020 and slightly below the guidance midpoint.

Depreciation, Depletion and Amortization

Per-unit DD&A costs in the 1Q were in-line with the target, which was higher compared with the 4Q due to negative price- related reserve revisions.

1Q21 Press Release	4

Special Dividend and China Divestiture

Declared $1.00 per Share Special Dividend

2021 Cash Flow Allocation

$3.4 Bn

Free Cash Flow

$1.9 Bn

at $60 WTI

$60 WTI

$0.6 Bn

$39 WTI

$0.9 Bn

Total Capex

Breakeven

$0.5 Bn

at $32 WTI

DCF at $32

$3.4 Bn

WTI

Discretionary

Maintenance

Additional

Current

Special

Additional

Cash Flow

Capex

Capital

Dividend

Dividend

Free Cash

Investment

Flow

The Board of Directors declared a regular dividend of $0.4125 per share on EOG's Common Stock. The indicated annual rate is $1.65. The Board also declared a special dividend of $1.00 per share on EOG's Common Stock. Both dividends are payable July 30, 2021 to stockholders of record as of July 16, 2021.

China Divestiture

EOG reached an agreement to divest all of its assets in China for proceeds of approximately $140 million. Closing, subject to customary conditions, is expected in the second quarter of 2021. Current net production from the divested assets is approximately 25 MMcfd of natural gas.

1Q21 Press Release	5