EOG Resources Reports Excellent Third Quarter 2021 Results; Raises Regular Dividend 82% and Declares $2.00 per Share Special Dividend

November 4, 2021

EOG Resources Reports Excellent Third Quarter 2021 Results; Raises Regular Dividend 82% and Declares $2.00 per Share Special Dividend

HOUSTON - (PR Newswire) - EOG Resources, Inc. (EOG) today reported third 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

		3Q 2021	2Q 2021	3Q 2020
	Total Revenue	4,765	4,139	2,246
	Net Income (Loss)	1,095	907	(42)
GAAP	Net Income (Loss) Per Share	1.88	1.55	(0.07)
Net Cash Provided by Operating Activities	2,196	1,559	1,214
Total Expenditures	962	1,089	646
	Current and Long-Term Debt	5,117	5,125	5,721
	Cash and Cash Equivalents	4,293	3,880	3,066
	Debt-to-Total Capitalization	19.0%	19.7%	22.1%

	Adjusted Net Income	1,264	1,012	252
GAAP	Adjusted Net Income Per Share	2.16	1.73	0.43
Discretionary Cash Flow	2,296	2,030	1,261
Non-	Cash Capital Expenditures before Acquisitions	935	972	499
Free Cash Flow	1,361	1,058	762
	Net Debt	824	1,245	2,655
	Net Debt-to-Total Capitalization	3.6%	5.6%	11.6%

Third Quarter 2021 Highlights

• Increased regular dividend 82% to an indicated annual rate of $3.00 per share
• Declared special dividend of $2.00 per share
• Updated share repurchase authorization
• Earned adjusted net income of $1.3 billion, or $2.16 per share
• Generated $1.4 billion of free cash flow
• Capital expenditures near low end of guidance range driven by sustainable cost reductions
• Oil and NGL production above high end of guidance ranges
• Total per-unit cash operating costs below guidance midpoint

3Q21 Press Release	1

Third Quarter 2021 Highlights

Volumes and Capital Expenditures

		3Q 2021
		Guidance
	3Q 2021	Midpoint	2Q 2021	3Q 2020
Wellhead Volumes
Crude Oil and Condensate (MBod)	449.5	444.5	448.6	377.6
Natural Gas Liquids (MBbld)	157.9	140.0	138.5	140.1
Natural Gas (MMcfd)	1,422	1,410	1,445	1,190
Total Crude Oil Equivalent (MBoed)	844.4	819.5	828.0	716.0
Cash Capital Expenditures before Acquisitions ($MM)	935	1,000	972	499

From Ezra Yacob, Chief Executive Officer

"EOG delivered exceptionally strong earnings and free cash flow in the third quarter driven by our double premium investment program. We extended our track record of reliable execution with better than expected production, capital expenditures, operating costs and product prices.

"For the second time this year, we've increased our dividend rate. This quarter's 82 percent raise brings our indicated annual rate to $3.00 per share, doubling the dividend compared to last year. Our high-return investment program, first spurred by our shift to a premium investment standard in 2016 and followed by the double premium standard instituted last year, has positioned the company to step up our cash return to shareholders. The sizable increase in the regular dividend closes the gap between the prior dividend level and the significant improvement in EOG's profitability since 2016. It should also be taken as a signal of our confidence that we can continue improving in the future.

"We also continue to deliver on our other cash return priorities, with a second special dividend to be paid this year and an update to our share repurchase authorization. Share repurchases provide the opportunity to create additional value for stockholders when executed prudently and at the right time. We remain firmly committed to our long-term free cash flow priorities.

"EOG has never been in better shape. Our high-return business model is sustainable for the long term, underpinned by a deep inventory of double premium drilling locations. We also remain optimistic about the potential of new exploration plays to improve the overall quality of our inventory. Our financial and operational results, our world-class assets as well as our continued progress on exploration are a testament

to the strength of EOG's underlying business, all driven by our talented employees and unique culture. We

are well positioned to be one of the lowest cost and lowest emissions producers and generate superior cash returns, free cash flow growth and long-term shareholder value."

3Q21 Press Release	2

Third Quarter 2021 Financial Performance

Adjusted Earnings per Share 3Q 2021 vs 2Q 2021

$0.08

$2.16

$0.61 ($0.13)

($0.08) ($0.05)

$1.73

Change in Cash 3Q 2021 vs 2Q 2021

$Billions

	(0.9)
2.3	(0.1)	(0.8)	4.3

3.9	(0.1)

$1.4 Bn Free

Cash Flow

Prices and Hedges

Natural gas, crude oil and NGL prices increased significantly in 3Q compared with 2Q, partially offset by an increase in cash paid for hedge settlements in 3Q of $100 million compared with 2Q.

Volumes

Total company crude oil production of 449,500 Bopd was above the high end of the guidance range due to better well productivity. Increased extraction of ethane boosted NGL production 14% higher than 2Q while contributing to slightly lower natural gas production, along with declines related to plant downtime in Trinidad. Total company equivalent volumes increased 2% compared with 2Q.

Per-Unit Costs

Per-unit cash operating costs in 3Q were 5% below the midpoint of the guidance range, primarily due to lower than forecasted lease and well and transportation costs. Compared with 2Q, per-unit cash operating costs increased 3% due to higher gathering and processing and general and administrative costs. In addition, per-unit taxes other than income increased compared with 2Q due to higher product prices.

Free Cash Flow

EOG generated discretionary cash flow (net cash provided by operating activities before exploration costs and changes in working capital) of $2.3 billion in 3Q. The company incurred $935 million of cash capital expenditures before acquisitions, resulting in $1.4 billion of free cash flow.

Capital Expenditures

Cash capital expenditures before acquisitions of $935 million were near the low end of the guidance range due to lower well costs from sustainable efficiency improvements. EOG was able to offset inflationary pressures with efficiency improvements in many areas. In particular, the application of "super-zipper" completion techniques, faster drilling times, lower-cost sand sourcing and the addition of infrastructure to procure lower-cost water all contributed to the overall cost reductions.

3Q21 Press Release	3

Third Quarter 2021 Operating Performance

Cash Operating Costs

$ per Boe

			10.28		10.50	10.00
	9.82		9.71
	9.34
		1.57		1.80
G&A			1.59	1.83
1.89	1.54
G&P	1.74	1.62	1.98	1.70	1.90	1.87
Trans			2.88		3.00
	2.74	2.64	2.84	2.82

LOE

3.45	3.54	3.85	3.58	3.80		3.48
3Q	4Q	1Q	2Q	3Q 2021	3Q
2020	2020	2021	2021	Guidance	2021
				Midpoint

Lease and Well

Per-unit LOE costs were $0.32 below the guidance mid-point due to lower water handling and compression costs. Per-unit LOE costs were $0.10 below 2Q due to overall efficiency improvements. Per- unit costs were in-line with 3Q 2020.

Transportation, Gathering and Processing

Per-unit transportation costs were below the guidance midpoint due to lower than expected NGL and oil transportation fees. Per-unit G&P costs increased from 2Q due to higher fuel prices while transportation costs were in-line with 2Q. Per-unit transportation and G&P costs increased 3% and 7%, respectively, compared with 3Q 2020 due to increased fuel prices and higher storage and terminal fees.

General and Administrative

Per-unit G&A costs were in line with the guidance midpoint. Per- unit G&A costs were above 2Q due to seasonally higher employee related costs. Per-unit G&A costs decreased from 3Q 2020 as increased production volumes more than offset increased employee related costs.

Depreciation, Depletion and Amortization

$ per Boe

12.84

12.49
	12.13	12.00	11.93
11.81

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

Depreciation, Depletion and Amortization

Per-unit DD&A costs were slightly below the guidance midpoint and declined 2% and 4% compared with 2Q 2021 and 3Q 2020, respectively, due to the addition of reserves from new wells at lower finding costs.

3Q21 Press Release	4

Free Cash Flow Allocation Actions

Declared $0.75 per Share Regular Dividend - 82% Increase to $3.00 per Share Indicated Annual Rate

22 Years of Stable and Growing Dividend

$ per Share

28% CAGR

$3.00

$2.00

$1.00

21% CAGR

$0.00																				Premium Drilling
																							1
1999	2000	2001	2002	2003	2004	2005	2006	2007	2008	2009	2010	2011	2012	2013	2014	2015	2016	2017	2018	2019	2020	2021E	2022E

The Board of Directors today declared a regular dividend of $0.75 per share on EOG's Common Stock. The dividend is payable January 28, 2022 to stockholders of record as of January 14, 2022. The new dividend represents a $3.00 per share indicated annual rate, an 82% increase from the previous level. The annual cash commitment towards the dividend is $785 million higher and reflects EOG's low cost of supply, robust cash flow generation and strong balance sheet. A growing, sustainable dividend is the company's primary mode of returning cash to shareholders. EOG has a long track record of delivering against this objective as

the company has never suspended or reduced its regular dividend.

$2.00 per Share Special Dividend

The Board of Directors today also declared a special dividend of $2.00 per share on EOG's Common Stock. The dividend is payable December 30, 2021 to stockholders of record as of December 15, 2021. EOG has now committed to return $2.7 billion of cash to stockholders in 2021, representing approximately 30 percent of expected 2021 discretionary cash flow.

										$1.0 Bn
	$65 WTI									$750 MM
								$1.2 Bn
									$580 MM
	$36 WTI						$940 MM
											$30 WTI
					$500 MM		$1.2 Bn
									Total Capex
											Breakeven
	DCF at		$3.4 Bn		Funds Exploration,
	$30 WTI		Keep Production		International Plays &
		Environmental Projects
			Flat to 4Q 2020 at
			~440 Mbopd

Discretionary	Maintenance	Additional Capital	Regular	Special	Debt Reduction
Cash Flow	Capex	Investment	Dividends	Dividends

Share Repurchase Authorization

In addition, the Board of Directors today updated EOG's share repurchase authorization to $5 billion. The updated authorization is consistent with EOG's long-standing cash flow priorities and complements existing avenues to return cash to shareholders through regular and special dividends. The repurchase authorization enables EOG to opportunistically increase per-share value for stockholders.

3Q21 Press Release	5