UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
Date of Report: October 2, 2001
_______________
EOG RESOURCES, INC.
(Exact name of registrant as specified in its charter)
Delaware 1-9743 47-0684736
(State or other (Commission (I.R.S. Employer
jurisdiction File Identification No.)
of incorporation or Number)
organization)
333 Clay
Suite 4200 77002
Houston, Texas (Zip code)
(Address of principal
executive offices)
713/651-7000
(Registrant's telephone number, including area code)
EOG Resources, Inc.
Item 5. Other Events
---------------------
In September 2001, the Board of Directors of EOG Resources, Inc.
('the Company') cancelled the previous share repurchase
authorization and issued a new 10 million share repurchase
authorization of its common stock. The Company may continue to
actively repurchase shares and is currently targeting a reduction
in the range of 1.0 MM to 1.5 MM shares in the second half of 2001.
Item 9. Regulation FD Disclosure
---------------------------------
Third and Fourth Quarters and Full Year 2001
-------------------------------------------
The third and fourth quarter and full year 2001 forecasts
set forth below are given as of the date of this document only
and are based on current available information and
expectations.
The Company is focused on achieving above average rates
of return on reinvested capital. The Company is closely
monitoring gas prices and is currently adjusting production
and drilling activity downward in a lower gas price
environment as reflected in this 8K.
The Company currently anticipates a mark-to-market gain
in the third quarter from outstanding commodity price swaps
and collars of $58.7MM. During the third quarter, the cash
realized from outstanding commodity price swaps and collars is
expected to be $28.9MM.
The Company does not provide guidance on other income,
other expense, or gain or loss on sales of reserves and
related assets unless specifically noted.
The Company projects full year North America natural
gas and condensate production to be lower than previously
projected due to production moderation in September, October
and November 2001 in the current gas price environment.
The Company is no longer attempting to achieve the previously
stated 4 percent target growth rate for North America.
Updated 2001 Natural Gas Financial Price Swaps and Collars
----------------------------------------------------------
There are price swap contracts in place covering notional
volumes of 115,000 MMBtud of natural gas for August - November
2001 at an average price of $3.27 per MMBtu and 200,000 MMBtud
for December 2001 at an average price of $3.62 per MMBtu.
There are price collars in place for natural gas for the
period July 2001 through November 2001 that set a floor price
of $4.40 per MMBtu and a ceiling price that averages $6.15 per
MMBtu covering notional volumes of 200,000 MMBtud at an
average premium of $0.15 per MMBtu.
Crude Oil Price Swaps
---------------------
There are price swap contracts in place for 2001 crude
oil as detailed below.
Average Average
Quarter Mbd $/Bbl
------- ------- -------
3Q 2001 7.0 $27.72
4Q 2001 5.0 $27.48
2002 Price Swaps
----------------
There are price swap contracts in place covering notional
volumes of 100,000 MMBtud of natural gas for January -
December 2002 at an average price of $3.46 per MMBtu.
There are crude oil price swap contracts in place
covering notional volumes of 3,000 Bpd at an average price of
$26.74 per barrel for January - May 2002.
Physical Sales
--------------
From time to time, over and above financial transactions,
the Company does engage in the forward physical sales of
commodities for one month or more.
Additional estimates are shown in the attached table.
This document includes forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. Forward-
looking statements are not guarantees of performance.
Although the Company believes its expectations reflected in
forward-looking statements are based on reasonable assumptions,
no assurance can be given that these expectations will be achieved.
Important factors that could cause actual results to differ
materially from the expectations reflected in the forward-looking
statements include, among others: the timing and extent of
changes in commodity prices for crude oil, natural gas and
related products and interest rates; the extent and effect
of any hedging activities engaged in by the Company; the
extent of the Company's success in discovering, developing,
marketing and producing reserves and in acquiring oil and gas
properties; the accuracy of reserve estimates, which by their
nature involve the exercise of professional judgment and may
therefore be imprecise; political developments around the world;
and financial market conditions. In light of these risks,
uncertainties and assumptions, the events anticipated by the
Company's forward-looking statements might not occur. The
Company undertakes no obligations to update or revise its forward-
looking statements, whether as a result of new information,
future events or otherwise.
Definitions
-----------
$/Bbl US Dollars per barrel
$/Mcf US Dollars per thousand cubic feet
$/Mcfe US Dollars per thousand cubic feet equivalent
MMBtu Million British thermal units
MMBtud Million British thermal units per day
MMcfd Million cubic feet per day
Mbd Thousand barrels per day
WTI West Texas Intermediate
MM Millions
NYMEX New York Mercantile Exchange
$MM US Dollars in millions
SIGNATURE
Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned thereunto duly
authorized.
EOG RESOURCES, INC.
Date: October 2, 2001 By: /s/ TIMOTHY K. DRIGGERS
-----------------------------
Timothy K. Driggers
Vice President, Accounting
and Land Administration
(Principal Accounting Officer)
EOG Resources, Inc
Estimated Ranges
3Q 2001 4Q 2001 Full Year 2001
------------ ------------- --------------
Daily Production
Natural Gas (MMcfd)
US 680 - 685 625 - 675 680 - 690
Canada 120 - 125 140 - 145 125 - 130
Trinidad 110 - 115 110 - 115 110 - 115
Total 910 - 925 875 - 935 915 - 935
Crude Oil (Mbd)
US 21.0 - 22.0 20.5 - 22.5 22.0 - 22.5
Canada 1.5 - 2.0 1.5 - 2.0 1.6 - 2.0
Trinidad 1.5 - 2.0 1.5 - 2.0 1.8 - 2.0
Total 24.0 - 26.0 23.5 - 26.5 25.4 - 26.5
Natural Gas Liquids (Mbd)
US 3.0 - 4.3 3.5 - 4.0 3.0 - 3.5
Canada 0.5 - 0.7 0.5 - 1.0 0.5 - 1.0
Total 3.5 - 5.0 4.0 - 5.0 3.5 - 4.5
Operating Costs
Unit Costs ($/Mcfe)
Lease and Well $0.41 - $0.43 $0.43 - $0.46 $0.42 - $0.44
Depreciation, Depletion $0.97 - $1.02 $0.99 - $1.02 $0.96 - $1.00
and Amortization
Expenses ($MM)
Exploration, Dry Hole 40.0 - 55.0 35.0 - 60.0 175.0 - 215.0
and Impairment
General and Administrative 21.0 - 23.0 18.0 - 23.0 75.0 - 83.0
Net Interest 10.0 - 12.0 11.0 - 13.0 45.0 - 50.0
Capitalized Interest 1.5 - 2.0 1.5 - 2.0 7.5 - 8.5
Taxes Other than Income 6.5 - 7.0 7.0 - 7.5 6.0 - 7.0
(% of Revenue)
Taxes
Effective Rate 37% - 39% 35% - 40% 35% - 40%
Deferred Ratio 150% - 200% 50% - 60% 55% - 70%
Preferred Dividends($MM) 2.8 - 3.0 2.8 - 3.0 11.0 - 11.5
Average Shares Outstanding(MM)
Basic 115.5 - 115.8 114.5 - 116.0 116.0 - 117.0
Fully Diluted 117.0 - 117.5 115.0 - 118.0 117.5 - 119.0
Capital Expenditures Excluding
Acquisitions ($MM)
North America 735 - 825
International 65 - 75
Total 800 - 900
Pricing
Natural Gas ($/Mcf)
Differentials
US - below NYMEX Henry Hub $0.00 - $0.05 $0.05 - $0.10 $0.00 - $0.10
Canada - below NYMEX Henry Hub $0.45 - $0.55 $0.30 - $0.50 $0.45 - $0.60
Realizations
Trinidad $1.22 $1.22 $1.22
Crude Oil ($/Bbl)
Differentials
US - below WTI $1.00 - $1.25 $0.75 - $1.00 $0.80 - $1.00
Canada - below WTI $2.50 - $3.00 $2.75 - $3.50 $2.75 - $3.25
Trinidad - below WTI $3.50 - $4.00 $2.25 - $2.75 $1.00 - $1.50