EOG Resources 2nd-quarter profit surges 67% on crude oil growth
BY MICHAEL CALIA
EOG Resources’ second-quarter profit rose 67% as the natural gas and oil producer posted revenue growth for its crude oil and condensate operations.
The company, a spinoff of Enron, has sought to focus more on oil to offset weakness in natural gas prices. Higher oil prices have helped the company beat profit expectations and post double-digit revenue growth on a percentage basis in recent quarters. In the second quarter, however, both the company's oil and natural gas revenue grew.
"EOG has captured premier positions in key U.S. onshore oil plays--the South Texas Eagle Ford, North Dakota Bakken and Delaware Basin, and we continue to enhance their profitability," said Executive Chairman Mark G. Papa.
In the latest period, EOG's crude oil and condensate revenue--the company's largest revenue contributor--grew 46%. For the full year, the company raised its crude oil production growth target to 35% from 28%. It also raised its overall company production growth target to 7.5% from 4%.
EOG in March signed a pact with ZaZa Energy for the joint development of some of ZaZa's Eaglebine properties in several Texas counties. Under the terms of the deal, EOG will receive up to a 75% working interest in up to 55,000 net acres, and will operate the JV acreage comprising 73,000 of ZaZa's 92,000 net mineral acres.
For the latest quarter, the company reported a profit of $659.7 million, or $2.42 a share, up from $395.8 million, or $1.47 a share, a year earlier. Excluding mark-to-market asset dispositions, impairments and other items, earnings rose to $2.10 a share from $1.16 a year earlier.
Net operating revenue improved 32% to $3.84 billion.
Analysts polled by Thomson Reuters had estimated per-share earnings of $1.74 and revenue of $3.54 billion.
Natural-gas liquids revenue increased 19%, while natural-gas revenue rose 29%.
Total expenses climbed 23.96% to $2.75 billion.
Shares were up 1.8% to $156 after hours. Through the close, the stock is up 27% on the year, near all-time highs.
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