December 2016, Vol. 243, No. 12

General

EOG Boosts Permian Estimates, Cites Operational Advances

Houston-based EOG boosted its resource potential in the Delaware sub-basin of the Permian to 6 billion barrels – an increase of 155% compared to its previous estimate of 2.35 billion – based on its study of acreage acquired from Yates.

“Our technical and operational advances applied to the combined assets have produced a major increase in EOG’s Delaware Basin potential,” EOG chief executive Bill Thomas said. “As we continue to make advances in cost management and technology, we believe our resource potential over time will continue to increase in both size and quality.”

EOG increased its resource estimate for the Wolfcamp tight oil play in the Delaware basin from 1.3 billion boe to 2.9 billion boe.

In the Second Bone Spring formation, EOG bumped its resource estimates from 500 million boe to 1.4 billion boe and in the Leonard Shale play, the company increased its estimate from 600 million boe to 1.7 billion boe.

The increases come from a better understanding of the subsurface as well as changes to the company’s drilling plans, which call for an increase in lateral lengths from an average of 4,500 feet to 7,000 feet.

For the quarter EOG reported a net loss of $190 million (35 cents per share) compared to net loss of $4.1 billion ($7.47 per share) in the same period a year ago.

EOG paid $2.5 billion in cash and stock to acquire Yates and its 1.6 million net acres – including 186,000 acres in the Delaware.