SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2020
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number: 1-9743
EOG RESOURCES, INC.
(Exact name of registrant as specified in its charter)
|(State or other jurisdiction of|
incorporation or organization)
| ||(I.R.S. Employer|
1111 Bagby, Sky Lobby 2, Houston, Texas 77002
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 713-651-7000
Securities registered pursuant to Section 12(b) of the Act:
|Title of each class||Trading Symbol(s)||Name of each exchange on which registered|
|Common Stock, par value $0.01 per share||EOG||New York Stock Exchange|
Securities registered pursuant to Section 12(g) of the Act:
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒ No ☐
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes ☐ No ☒
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐
Smaller reporting company ☐ Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant's most recently completed second fiscal quarter. Common Stock aggregate market value held by non-affiliates as of June 30, 2020: $29,444 million.
Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date. Class: Common Stock, par value $0.01 per share, 583,563,479 shares outstanding as of February 12, 2021.
Documents incorporated by reference. Portions of the Definitive Proxy Statement for the registrant's 2021 Annual Meeting of Stockholders, to be filed within 120 days after December 31, 2020, are incorporated by reference into Part III of this report.
TABLE OF CONTENTS
| || ||Page|
|PART I|| |
| || || |
| ||Exploration and Production|
| ||Wellhead Volumes and Prices|
|Human Capital Management|
| ||Other Matters|
| ||Information About Our Executive Officers|
|ITEM 1A.||Risk Factors|
|ITEM 1B.||Unresolved Staff Comments|
| ||Oil and Gas Exploration and Production - Properties and Reserves|
|ITEM 3.||Legal Proceedings|
|ITEM 4.||Mine Safety Disclosures|
| || || |
|PART II|| |
| || || |
Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
|ITEM 6.||Selected Financial Data|
|ITEM 7.||Management's Discussion and Analysis of Financial Condition and Results of Operations|
|ITEM 7A.||Quantitative and Qualitative Disclosures About Market Risk|
|ITEM 8.||Financial Statements and Supplementary Data|
|ITEM 9.||Changes in and Disagreements with Accountants on Accounting and Financial Disclosure|
|ITEM 9A.||Controls and Procedures|
|ITEM 9B.||Other Information|
| || || |
|PART III|| |
| || || |
|ITEM 10.||Directors, Executive Officers and Corporate Governance|
|ITEM 11.||Executive Compensation|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
|ITEM 13.||Certain Relationships and Related Transactions, and Director Independence|
|ITEM 14.||Principal Accounting Fees and Services|
| || || |
|PART IV|| |
| || || |
|ITEM 15.||Exhibits, Financial Statement Schedules|
| || || |
|ITEM 16.||Form 10-K Summary|
ITEM 1. Business
EOG Resources, Inc., a Delaware corporation organized in 1985, together with its subsidiaries (collectively, EOG), explores for, develops, produces and markets crude oil, natural gas liquids (NGLs) and natural gas primarily in major producing basins in the United States of America (United States or U.S.), The Republic of Trinidad and Tobago (Trinidad), The People's Republic of China (China), the Sultanate of Oman (Oman) and, from time to time, select other international areas. EOG's principal producing areas are further described in "Exploration and Production" below. EOG's Annual Reports on Form 10-K, Quarterly Reports on Form 10‑Q, Current Reports on Form 8-K and any amendments to those reports (including related exhibits and supplemental schedules) filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (as amended) are made available, free of charge, through EOG's website, as soon as reasonably practicable after such reports have been filed with, or furnished to, the United States Securities and Exchange Commission (SEC). EOG's website address is www.eogresources.com. Information on our website is not incorporated by reference into, and does not constitute a part of, this report.
At December 31, 2020, EOG's total estimated net proved reserves were 3,220 million barrels of oil equivalent (MMBoe), of which 1,514 million barrels (MMBbl) were crude oil and condensate reserves, 813 MMBbl were NGLs reserves and 5,360 billion cubic feet (Bcf), or 893 MMBoe, were natural gas reserves (see "Supplemental Information to Consolidated Financial Statements"). At such date, approximately 98% of EOG's net proved reserves, on a crude oil equivalent basis, were located in the United States, 1% in Trinidad and 1% in other international areas. Crude oil equivalent volumes are determined using a ratio of 1.0 barrel of crude oil and condensate or NGLs to 6.0 thousand cubic feet (Mcf) of natural gas.
EOG's operations are all crude oil and natural gas exploration and production related. For information regarding the risks associated with EOG's domestic and foreign operations, see ITEM 1A, Risk Factors.
EOG's business strategy is to maximize the rate of return on investment of capital by controlling operating and capital costs and maximizing reserve recoveries. Pursuant to this strategy, each prospective drilling location is evaluated by its estimated rate of return. This strategy is intended to enhance the generation of cash flow and earnings from each unit of production on a cost-effective basis, allowing EOG to deliver long-term growth in shareholder value and maintain a strong balance sheet. EOG is focused on innovation and cost-effective utilization of advanced technology associated with three-dimensional seismic and microseismic data, the development of reservoir simulation models, the use of improved drilling equipment and completion technologies for horizontal drilling and formation evaluation. These advanced technologies are used, as appropriate, throughout EOG to reduce the risks and costs associated with all aspects of oil and gas exploration, development and exploitation. EOG implements its strategy primarily by emphasizing the drilling of internally generated prospects in order to find and develop low-cost reserves. Maintaining the lowest possible operating cost structure, coupled with efficient and safe operations and robust environmental stewardship practices and performance, is integral in the implementation of EOG's strategy.
With respect to information on EOG's working interest in wells or acreage, "net" oil and gas wells or acreage are determined by multiplying "gross" oil and gas wells or acreage by EOG's working interest in the wells or acreage.
Exploration and Production
United States Operations
EOG's operations are located in most of the productive basins in the United States with a focus on crude oil and, to a lesser extent, liquids-rich natural gas plays.
At December 31, 2020, on a crude oil equivalent basis, 48% of EOG's net proved reserves in the United States were crude oil and condensate, 26% were NGLs and 26% were natural gas. The majority of these reserves are in long-lived fields with well-established production characteristics. EOG believes that opportunities exist to increase production through continued development in and around many of these fields and through the utilization of applicable technologies. EOG also maintains an active exploration program designed to extend fields and add new trends and resource plays to its already broad portfolio.
The following is a summary of significant developments during 2020 and anticipated 2021 plans for certain areas of EOG's United States operations.
|Area of Operation|
Crude Oil & Condensate Volumes
Natural Gas Liquids Volumes
Natural Gas Volumes
|Total Net Acres (in thousands)||Net Well Completions||Expected Net Well Completions|
|South Texas||162 ||33 ||281 ||1,138 ||223 ||160 |
|Delaware Basin||183 ||75 ||460 ||404 ||247 ||275 |
|Rocky Mountain||49 ||14 ||159 ||1,167 ||56 ||50 |
|Mid-Continent||10 ||14 ||87 ||310 ||15 ||<5|
|Other Areas||4 ||— ||53 ||851 ||7 ||15 |
|Total||408 ||136 ||1,040 ||3,870 ||548 ||~500|
(1)Thousand barrels per day or million cubic feet per day, as applicable.
The South Texas area includes our Eagle Ford play and our newly announced Dorado gas play. EOG holds approximately 516,000 total net acres in the prolific oil window of the Eagle Ford and approximately 163,000 net acres in the Dorado prospect area. During the second and third quarters of 2020, EOG significantly curtailed its Eagle Ford oil production due to low crude oil prices; operations in the Eagle Ford returned to normal by the end of the third quarter of 2020. In the Dorado play, with the onset of the pandemic and resulting market downturn, EOG elected to defer its 2020 drilling program and instead focus on gathering and analyzing data regarding the production performance of its 2019 Dorado drilling program. In 2020, EOG completed 213 net Eagle Ford wells and, late in 2020, acquired and completed one net Dorado well to further delineate the play. In 2021, EOG expects to complete approximately 145 net Eagle Ford wells and to drill and complete approximately 15 net Dorado wells.
In the Delaware Basin, EOG completed 247 net wells during 2020, primarily in the Delaware Basin Wolfcamp, Bone Spring and Leonard plays. The Delaware Basin consists of approximately 4,800 feet of oil rich stacked pay potential offering EOG multiple co-development opportunities throughout its 404,000 total net acreage position.
In the Delaware Basin Upper Wolfcamp play, EOG has approximately 226,000 net acres and completed 166 net wells in 2020. EOG continued its Upper Wolfcamp development plan with well spacing as close as 500 feet in the crude oil portion of the play and 880 feet in the combination crude oil and natural gas portion. In addition to the Upper Wolfcamp, EOG completed 7 net wells in 2020 in the newly announced Middle Wolfcamp play and has identified 193,000 net prospective acres. Continued improvement and excellent results in the Delaware Basin Wolfcamp program were supported by optimized well spacing, enhanced well completions, precision drilling and continued cost reductions. Moving forward into 2021, the Delaware Basin Wolfcamp play will continue to be a primary area of focus.
In the Bone Spring play, EOG has three main sub-plays: the First, Second and Third Bone Spring. In 2020, EOG completed 56 total net Bone Spring wells within the three sub-plays on its combined 289,000 net prospective acres. Of the three sub-plays, the Second Bone Spring had the majority of the activity in 2020 with EOG completing 42 net wells. The Bone Spring plays continue to be an integral part of EOG’s Delaware Basin plans and portfolio.
In the Leonard play, EOG holds approximately 160,000 net acres and maintained its development plan with 18 net wells completed in 2020. With a strategy of developing deeper targets first while simultaneously collecting data from the shallow targets, the Leonard play will progressively become a more active part of EOG’s program.
Activity in 2021 will remain focused on the Delaware Basin Wolfcamp, Bone Spring, and Leonard plays, where EOG expects to complete approximately 275 net wells.
Activity in the Rocky Mountain area in 2020 was focused on the Wyoming Powder River Basin. In the Powder River Basin, EOG operated a one-rig program and completed 35 net wells in the Niobrara, Mowry, Turner and Parkman formations. In addition, key infrastructure was added in order to lower operating costs and increase price realizations going forward. In the DJ Basin, EOG operated one rig for a partial year and completed 17 net wells in both the Codell and the Niobrara formations. Activity in the DJ Basin is expected to be minimal in 2021 as development continues to shift to the Powder River Basin. In the Williston Basin, EOG completed 3 net wells in the Bakken and Three Forks. In 2020, production in the Rocky Mountain area and Williston Basin was significantly curtailed, primarily in the second quarter, in response to crude oil price declines, but has subsequently returned to normal levels. In 2021, activity will be focused on development in the Powder River Basin with plans to complete approximately 45 net wells. EOG currently holds approximately 1.2 million net acres in the Rocky Mountain area.
In the Mid-Continent area, EOG continued its development of the Woodford Oil Window play with 15 net wells completed during 2020. EOG holds approximately 37,000 net acres in the play and plans to have minimal activity in 2021.
Operations Outside the United States
EOG has operations offshore Trinidad, in the China Sichuan Basin, Oman and in Canada and is evaluating additional exploration, development and exploitation opportunities in these and other select international areas.
Trinidad. EOG, through its subsidiaries, including EOG Resources Trinidad Limited, holds interests in (i) the exploration and production licenses covering the South East Coast Consortium (SECC) Block, Pelican and Banyan Fields, Sercan Area and each of their related facilities and the Ska, Mento, Reggae and deep Teak, Saaman and Poui Areas, all of which are offshore Trinidad; and (ii) a production sharing contract with the Government of Trinidad and Tobago for each of the Modified U(a), Modified U(b) and 4(a) Blocks.
Several fields in the SECC, Modified U(a), Modified U(b) and 4(a) Blocks, Banyan Field and Sercan Area have been developed and are producing natural gas and crude oil and condensate.
In 2020, EOG's net production averaged approximately 180 MMcfd of natural gas and approximately 1.0 MBbld of crude oil and condensate. In 2020, EOG drilled three net wells and completed two net wells. The remaining net well made a discovery that is being evaluated. All wells discovered commercially economic reserves.
In 2021, EOG expects to focus on the design and fabrication of the platform and related infrastructure for the previously announced discovery made in the Modified U(a) Block. In addition, EOG expects to continue its exploration program.
China. Since 2008, EOG has been developing the Baijaochang Field in the Chuan Zhong Block exploration area in the Sichuan Basin, Sichuan Province, China with its partner, PetroChina, under a production sharing contract. In 2020, EOG's net production averaged approximately 26 MMcfd of natural gas. EOG continues to work with PetroChina to ensure uninterrupted production.
Oman. In September 2020, EOG reached an agreement with APEX Oman (Block 36) Inc. to acquire its entire interest in Block 36 in Oman. The Royal Decree was issued on October 28, 2020 at which point EOG became the operator and held all rights under the Exploration and Production Sharing Agreement for Block 36. Additionally, in December 2020 the Ministry of Energy and Minerals for Oman approved the assignment of Block 49 to EOG pursuant to the terms of the farm-in agreement with Tethys Oil Montasar Limited. In accordance with the terms of the farm-in agreement EOG participated in the drilling of an exploratory well which was in progress at December 31, 2020. In 2021, EOG expects to drill two net exploration wells in Block 36.
Canada. EOG maintains approximately 47,000 net acres in the Horn River area in Northeast British Columbia. In March 2020, EOG began the process of exiting its Canada operations.
In 2020, EOG continued its diversified approach to marketing its wellhead crude oil and condensate production. The majority of EOG's United States wellhead crude oil and condensate production was transported by pipeline to downstream markets with the remainder sold into local markets. Major U.S. sales areas accessed by EOG were at various locations along the U.S. Gulf Coast, including Houston and Corpus Christi, Texas; Cushing, Oklahoma; the Permian Basin and the Midwest. In 2020, EOG also sold crude oil at the Houston Ship Channel and the Port of Corpus Christi for export to foreign destinations. In each case, the price received was based on market prices at that specific sales point or based on the price index applicable for that location. In 2021, the pricing mechanism for such production is expected to remain the same. At December 31, 2020, EOG was committed to deliver to multiple parties fixed quantities of crude oil of 8 MMBbls in 2021, all of which is expected to be delivered from future production of available reserves.
In 2020, EOG processed certain of its United States wellhead natural gas production, either at EOG-owned facilities or at third-party facilities, extracting NGLs. NGLs were sold at prevailing market prices, into either local markets or downstream locations. In certain instances, EOG exchanged its NGL production for purity products received downstream, which were sold at prevailing market prices. In 2021, such pricing mechanisms are expected to remain the same.
In 2020, consistent with its diversified marketing strategy, the majority of EOG's United States wellhead natural gas production was transported by pipeline to various locations, including Katy, Texas; East Texas; the Agua Dulce Hub in South Texas; the Cheyenne Hub in Weld County, Colorado; Southern California; and Chicago, Illinois. Remaining natural gas production was sold into local markets. In each case, pricing was based on the spot market price at the ultimate sales point. In 2021, the pricing mechanism for such production is expected to remain the same. Additionally, EOG sells natural gas to a liquefied natural gas liquefaction facility near Corpus Christi, Texas, and receives pricing based on the Platts Japan Korea Marker. At December 31, 2020, EOG was committed to deliver to multiple parties fixed quantities of natural gas of 170 Bcf in 2021, 105 Bcf in 2022, 91 Bcf in 2023, 94 Bcf in 2024, 81 Bcf in 2025 and 1,609 Bcf thereafter, all of which is expected to be delivered from future production of available reserves.
In 2020, a majority of the wellhead natural gas volumes from Trinidad were sold under contracts with prices which were either wholly or partially dependent on Caribbean ammonia index prices and/or methanol prices. The remaining volumes were sold under a contract at prices partially dependent on United States Henry Hub market prices or under a fixed price contract. In 2021, natural gas volumes from Trinidad will be sold under a fixed price contract ending in 2026.
In 2020, all wellhead natural gas volumes from China were sold at regulated prices based on the purchaser's pipeline sales volumes to various local market segments. The pricing mechanism for production in China is expected to remain the same in 2021.
In certain instances, EOG purchases and sells third-party crude oil and natural gas in order to balance firm transportation capacity with production in certain areas and to utilize excess capacity at EOG-owned facilities.
During 2020, three purchasers each accounted for more than 10% of EOG's total wellhead crude oil and condensate, NGLs and natural gas revenues and gathering, processing and marketing revenues. The three purchasers are in the crude oil refining industry. EOG does not believe that the loss of any single purchaser would have a materially adverse effect on its financial condition or results of operations.
Wellhead Volumes and Prices
The following table sets forth certain information regarding EOG's wellhead volumes of, and average prices for, crude oil and condensate, NGLs and natural gas. The table also presents crude oil equivalent volumes which are determined using a ratio of 1.0 barrel of crude oil and condensate or NGLs to 6.0 Mcf of natural gas for each of the years ended December 31, 2020, 2019 and 2018. See ITEM 7, Management's Discussion and Analysis of Financial Condition and Results of Operations - Results of Operations, for wellhead volumes on a per-day basis.
|Year Ended December 31||2020||2019||2018|
Crude Oil and Condensate Volumes (MMBbl) (1)
|Eagle Ford||54.6 ||68.3 ||62.4 |
|Delaware Basin||67.0 ||63.4 ||46.3 |
|Other||27.8 ||34.6 ||35.4 |
|United States||149.4 ||166.3 ||144.1 |
|Trinidad||0.4 ||0.2 ||0.3 |
Other International (2)
|— ||0.1 ||1.6 |
|Total||149.8 ||166.6 ||146.0 |
Natural Gas Liquids Volumes (MMBbl) (1)
| || |
|United States:|| || |
|Eagle Ford||9.7 ||10.7 ||11.4 |
|Delaware Basin||27.7 ||23.5 ||15.8 |
|Other||12.4 ||14.7 ||15.3 |
|United States||49.8 ||48.9 ||42.5 |
Other International (2)
|— ||— ||— |
|Total||49.8 ||48.9 ||42.5 |
Natural Gas Volumes (Bcf) (1)
| || |
|United States:|| |
|Eagle Ford||53 ||53 ||58 |
|Delaware Basin||168 ||147 ||110 |
|Other||160 ||190 ||169 |
|United States||381 ||390 ||337 |
|Trinidad||66 ||95 ||97 |
Other International (2)
|11 ||14 ||11 |
|Total||458 ||499 ||445 |
Crude Oil Equivalent Volumes (MMBoe) (3)
| || |
|United States:|| || |
|Eagle Ford||73.1 ||87.8 ||83.5 |
|Delaware Basin||122.7 ||111.4 ||80.3 |
|Other||66.9 ||81.0 ||78.8 |
|United States||262.7 ||280.2 ||242.6 |
|Trinidad||11.4 ||16.0 ||16.5 |
Other International (2)
|1.8 ||2.4 ||3.4 |
|Total||275.9 ||298.6 ||262.5 |
|Year Ended December 31||2020||2019||2018|
Average Crude Oil and Condensate Prices ($/Bbl) (4)
|United States||$||38.65 ||$||57.74 ||$||65.16 |
|Trinidad||30.20 ||47.16 ||57.26 |
Other International (2)
|43.08 ||57.40 ||71.45 |
|Composite||38.63 ||57.72 ||65.21 |
Average Natural Gas Liquids Prices ($/Bbl) (4)
|United States||$||13.41 ||$||16.03 ||$||26.60 |
Other International (2)
|— ||— ||— |
|Composite||13.41 ||16.03 ||26.60 |
Average Natural Gas Prices ($/Mcf) (4)
|United States||$||1.61 ||$||2.22 ||$||2.88 |
|Trinidad||2.57 ||2.72 ||2.94 |
Other International (2)
|4.66 ||4.44 ||4.08 |
|Composite||1.83 ||2.38 ||2.92 |
(1)Million barrels or billion cubic feet, as applicable.
(2)Other International includes EOG's United Kingdom, China and Canada operations. The United Kingdom operations were sold in the fourth quarter of 2018.
(3)Million barrels of oil equivalent; includes crude oil and condensate, NGLs and natural gas.
(4)Dollars per barrel or per thousand cubic feet, as applicable. Excludes the impact of financial commodity derivative instruments (see Note 12 to Consolidated Financial Statements).
Human Capital Management
As of December 31, 2020, EOG employed approximately 2,900 persons, including foreign national employees. EOG's approach to human capital management includes oversight by the Board of Directors and Compensation Committee and focuses on various areas, including the following:
Culture; Recruiting; Retention. EOG's unique culture is key to its sustainable success. By providing employees with a quality environment in which to work, and by maintaining a consistent college recruiting and internship program, EOG is able to attract and retain some of the industry's best and brightest. To help assess the effectiveness of its approach to human capital management, EOG conducts an annual employee engagement survey. Based on the results of the survey, EOG has received "top workplace" recognition in various office locations.
Compensation, Benefits, Health & Wellness. EOG places a high level of importance on attracting and retaining top talent, by providing competitive salaries, bonuses and a subsidized, comprehensive benefits package. EOG also offers a holistic wellness program, a matching gifts program, a flexible work schedule, paid family care leave, paid leave for illness or injury and an employee assistance program to support the mental well-being of employees and their dependents. In addition, with new-hire stock grants and an annual stock grant program, every employee is a participant in EOG's success.
In 2020, in response to the COVID-19 pandemic, EOG focused on keeping its employees and their families safe, including providing technology and support to employees enabling them to work productively from home. In addition, at its offices and work sites, EOG has instituted social distancing practices and protocols and has provided masks, hand sanitizer and additional cleaning.
Training and Development. EOG provides training in leadership, management skills, communication, team effectiveness, technical skills and development and use of EOG systems and applications. EOG's leadership training is focused on providing continuity of leadership at EOG by developing the skills needed to lead a multi-disciplined, diverse and decentralized workforce. In addition, EOG holds several internal technical conferences each year designed to share best practices and technical advances across the company, including safety and environmental topics. EOG also offers its employees a tuition reimbursement program as well as reimbursement for the cost of professional certification.
Diversity and Inclusion. Gender, racial, ethnic and cultural diversity, and diversity in background and experience, leads to diversity of thought, which is a tremendous asset and is actively embraced by EOG. As reflected in its Code of Business Conduct and Ethics for Directors, Officers and Employees, EOG is committed to providing equal opportunity in all aspects of employment and to hiring, evaluating and promoting employees based on skills and performance. EOG's collaborative culture fosters inclusiveness at all levels of the company. Further, EOG focuses on developing its employees, including those with diverse backgrounds, to allow for career opportunities, including promotion into supervisory and management positions.
Safety. EOG's safety management programs and processes are centered on a performance-based philosophy, pursuant to which EOG sets safety expectations and provides a framework within which management can achieve and assess safety performance in a systematic way. EOG's safety performance is also considered in evaluating employee performance and compensation. EOG provides initial, periodic and refresher safety training to employees as well as to contractors and others who may work at or visit EOG's facilities. These training programs address various topics, including operating procedures, safe work practices and emergency and incident response procedures.
EOG competes with major integrated oil and gas companies, government-affiliated oil and gas companies and other independent oil and gas companies for the acquisition of licenses and leases, properties and reserves and access to the facilities, equipment, materials, services, and employees and other personnel (including geologists, geophysicists, engineers and other specialists) required to explore for, develop, produce, market and transport crude oil, NGLs and natural gas. Certain of EOG's competitors have financial and other resources substantially greater than those EOG possesses and have established strategic long-term positions or strong governmental relationships in countries or areas in which EOG may seek new or expanded entry. As a consequence, EOG may be at a competitive disadvantage in certain respects, such as in bidding for drilling rights or in accessing necessary services, facilities, equipment, materials and personnel. In addition, EOG's larger competitors may have a competitive advantage when responding to factors that affect demand for crude oil, NGLs and natural gas, such as changing worldwide prices and levels of production and the cost and availability of alternative fuels. EOG also faces competition from competing energy sources, such as renewable energy sources. See ITEM 1A, Risk Factors.
2020 Election. In November 2020, Joseph R. Biden Jr. was elected President of the United States. New or revised rules, regulations and policies may be issued, and new legislation may be proposed, during the current administration that could impact the oil and gas exploration and production industry. Such rules, regulations, policies and legislation may affect, among other things, (i) permitting for oil and gas drilling on federal lands, (ii) the leasing of federal lands for oil and gas development, (iii) the regulation of greenhouse gas (GHG) emissions and/or other climate change-related matters associated with oil and gas operations, (iv) the use of hydraulic fracturing on federal lands, (v) the calculation of royalty payments in respect of oil and gas production from federal lands and (vi) U.S. federal income tax laws applicable to oil and gas exploration and production companies. See the below discussion and ITEM 1A, Risk Factors, for additional information.
United States Regulation of Crude Oil and Natural Gas Production. Crude oil and natural gas production operations are subject to various types of regulation, including regulation by federal and state agencies.
United States legislation affecting the oil and gas industry is under constant review for amendment or expansion. In addition, numerous departments and agencies, both federal and state, are authorized by statute to issue, and have issued, rules and regulations applicable to the oil and gas industry. Such rules and regulations, among other things, require permits for the drilling of wells, regulate the spacing of wells, prevent the waste of natural gas through restrictions on flaring, require surety bonds for various exploration and production operations and regulate the calculation and disbursement of royalty payments (for federal and state leases), production taxes and ad valorem taxes.
A portion of EOG's oil and gas leases in New Mexico, North Dakota, Utah, Wyoming and the Gulf of Mexico, as well as in other areas, are granted by the federal government and administered by the Bureau of Land Management (BLM) and/or the Bureau of Indian Affairs (BIA) or, in the case of offshore leases (which, for EOG, are de minimis), by the Bureau of Ocean Energy Management (BOEM) and the Bureau of Safety and Environmental Enforcement (BSEE), all federal agencies. Operations conducted by EOG on federal oil and gas leases must comply with numerous additional statutory and regulatory restrictions and, in the case of leases relating to tribal lands, certain tribal environmental and permitting requirements and employment rights regulations. In addition, the U.S. Department of the Interior (via various of its agencies, including the BLM, the BIA and the Office of Natural Resources Revenue) has certain authority over our calculation and payment of royalties, bonuses, fines, penalties, assessments and other revenues related to our federal and tribal oil and gas leases.
BLM, BIA and BOEM leases contain relatively standardized terms requiring compliance with detailed regulations and, in the case of offshore leases, orders pursuant to the Outer Continental Shelf Lands Act (which are subject to change by the BOEM or BSEE). Under certain circumstances, the BLM, BIA, BOEM or BSEE (as applicable) may require operations on federal leases to be suspended or terminated. Any such suspension or termination could materially and adversely affect EOG's interests on federal lands. Further, on January 27, 2021, President Biden issued Executive Order 14008 entitled "Tackling the Climate Crisis at Home and Abroad," directing the Secretary of the Interior, to the extent consistent with applicable law and in consultation with other agencies and stakeholders, to, among other things, pause approval of new oil and natural gas leases on federal lands or in offshore waters pending completion of a comprehensive review and reconsideration of federal oil and gas permitting and leasing practices. Any limitation or ban on permitting for oil and gas exploration and production activities on federal lands could have a material and adverse effect on EOG's operations, financial condition and results of operations.
The transportation and sale for resale of natural gas in interstate commerce are regulated pursuant to the Natural Gas Act of 1938, as amended (NGA), and the Natural Gas Policy Act of 1978. These statutes are administered by the Federal Energy Regulatory Commission (FERC). Effective January 1993, the Natural Gas Wellhead Decontrol Act of 1989 deregulated natural gas prices for all "first sales" of natural gas, which includes all sales by EOG of its own production. All other sales of natural gas by EOG, such as those of natural gas purchased from third parties, remain jurisdictional sales subject to a blanket sales certificate under the NGA, which has flexible terms and conditions. Consequently, all of EOG's sales of natural gas currently may be made at market prices, subject to applicable contract provisions. EOG's jurisdictional sales, however, may be subject in the future to greater federal oversight, including the possibility that the FERC might prospectively impose more restrictive conditions on such sales. Conversely, sales of crude oil and condensate and NGLs by EOG are made at unregulated market prices.
EOG owns certain gathering and/or processing facilities in the Permian Basin in West Texas and New Mexico, the Fort Worth Basin Barnett Shale in North Texas, the Williston Basin Bakken and Three Forks plays in North Dakota, and the Eagle Ford in South Texas. State regulation of gathering and processing facilities generally includes various safety, environmental and, in some circumstances, nondiscrimination requirements with respect to the provision of gathering and processing services, but does not generally entail rate regulation. EOG's gathering and processing operations could be materially and adversely affected should they be subject in the future to the application of state or federal regulation of rates and services.
EOG's gathering and processing operations also may be, or become, subject to safety and operational regulations relating to the design, installation, testing, construction, operation, replacement and management of such facilities. Additional rules and legislation pertaining to these matters are considered and/or adopted from time to time. Although EOG cannot predict what effect, if any, such legislation might have on its operations and financial condition, EOG could be required to incur additional capital expenditures and increased compliance and operating costs depending on the nature and extent of such future legislative and regulatory changes.
EOG also owns crude oil rail loading facilities in North Dakota and crude oil truck unloading facilities in certain of its U.S. plays. Regulation of such facilities is conducted at the state and federal levels and generally includes various safety, environmental, permitting and packaging/labeling requirements. Additional regulation pertaining to these matters is considered and/or adopted from time to time. Although EOG cannot predict what effect, if any, any such new regulations might have on its crude-by-rail assets and the transportation of its crude oil production by truck, EOG could be required to incur additional capital expenditures and increased compliance and operating costs depending on the nature and extent of such future regulatory changes. EOG did not transport any crude oil by rail during 2020.
Proposals and proceedings that might affect the oil and gas industry are considered from time to time by Congress, the state legislatures, the FERC and other federal, state and local regulatory commissions, agencies, councils and courts. EOG cannot predict when or whether any such proposals or proceedings may become effective. It should also be noted that the oil and gas industry historically has been very heavily regulated; therefore, there is no assurance that the approach currently being followed by such legislative bodies and regulatory commissions, agencies, councils and courts will remain unchanged.
Environmental Regulation Generally - United States. EOG is subject to various federal, state and local laws and regulations covering the discharge of materials into the environment or otherwise relating to the protection of the environment. These laws and regulations affect EOG's operations and costs as a result of their effect on crude oil and natural gas exploration, development and production operations. Failure to comply with these laws and regulations may result in the assessment of administrative, civil and criminal penalties, including the assessment of monetary penalties, the imposition of investigatory and remedial obligations, the suspension or revocation of necessary permits, licenses and authorizations, the requirement that additional pollution controls be installed and the issuance of orders enjoining future operations or imposing additional compliance requirements.
In addition, EOG has acquired certain oil and gas properties from third parties whose actions with respect to the management and disposal or release of hydrocarbons or other wastes were not under EOG's control. Under environmental laws and regulations, EOG could be required to remove or remediate wastes disposed of or released by prior owners or operators. EOG also could incur costs related to the clean-up of third-party sites to which it sent regulated substances for disposal or to which it sent equipment for cleaning, and for damages to natural resources or other claims related to releases of regulated substances at such third-party sites. In addition, EOG could be responsible under environmental laws and regulations for oil and gas properties in which EOG previously owned or currently owns an interest, but was or is not the operator. Moreover, EOG is subject to the U.S. Environmental Protection Agency's (U.S. EPA) rule requiring annual reporting of GHG emissions and, as discussed further below, is also subject to federal, state and local laws and regulations regarding hydraulic fracturing and other aspects of our operations.
Compliance with environmental laws and regulations increases EOG's overall cost of business, but has not had, to date, a material adverse effect on EOG's operations, financial condition or results of operations. In addition, it is not anticipated, based on current laws and regulations, that EOG will be required in the near future to expend amounts (whether for environmental control facilities or otherwise) that are material in relation to its total exploration and development expenditure program in order to comply with such laws and regulations. However, given that such laws and regulations are subject to change, EOG is unable to predict the ultimate cost of compliance or the ultimate effect on EOG's operations, financial condition and results of operations.
Climate Change - United States. Local, state, federal and international regulatory bodies have been increasingly focused on GHG emissions and climate change issues in recent years. In addition to the U.S. EPA's rule requiring annual reporting of GHG emissions, the U.S. EPA has adopted regulations for certain large sources regulating GHG emissions as pollutants under the federal Clean Air Act. Further, the U.S. EPA, in May 2016, issued regulations that require operators to reduce methane emissions and emissions of volatile organic compounds (VOC) from new, modified and reconstructed crude oil and natural gas wells and equipment located at natural gas production gathering and booster stations, gas processing plants and natural gas transmission compressor stations. In September 2020, the U.S. EPA issued a final rule that removed the transmission and storage segment from the 2016 new source performance standards, rescinded VOC and methane emissions standards for the transmission and storage segment and rescinded methane emissions standards for the production and processing segments. Various states and industry and environmental groups are separately challenging the U.S. EPA's 2016 standards and its September 2020 final rule. Notwithstanding the current court challenges, the U.S. EPA under the Biden Administration may reconsider the September 2020 final rule, which could result in more stringent methane emission rulemaking.
At the international level, the U.S., in December 2015, participated in the 21st Conference of the Parties of the United Nations Framework Convention on Climate Change in Paris, France. The Paris Agreement (adopted at the conference) calls for nations to undertake efforts with respect to global temperatures and GHG emissions. The Paris Agreement went into effect on November 4, 2016. While the U.S. withdrew from the Paris Agreement on November 4, 2020, President Biden issued an executive order on January 20, 2021 recommitting the United States to the Paris Agreement. In addition, many state and local officials have stated their intent to intensify efforts to uphold the commitments set forth in the international accord. Further, on January 27, 2021, President Biden issued Executive Order 14008 entitled "Tackling the Climate Crisis at Home and Abroad," directing the Secretary of the Interior, to the extent consistent with applicable law and in consultation with other agencies and stakeholders, to, among other things, consider whether to adjust royalties associated with oil and gas resources extracted from federal lands and offshore waters to account for corresponding climate costs.
EOG believes that its strategy to reduce GHG emissions throughout its operations is both in the best interest of the environment and a prudent business practice. EOG has developed a system that is utilized in calculating GHG emissions from its operating facilities. This emissions management system calculates emissions based on recognized regulatory methodologies, where applicable, and on commonly accepted engineering practices. EOG reports GHG emissions for facilities covered under the U.S. EPA's Mandatory Reporting of Greenhouse Gases Rule published in 2009, as amended.
EOG is unable to predict the timing, scope and effect of any currently proposed or future investigations, laws, regulations, treaties or policies regarding climate change and GHG emissions (including any laws and regulations that may be enacted in the U.S. by the new administration), but the direct and indirect costs of such developments (if enacted, issued or applied) could materially and adversely affect EOG's operations, financial condition and results of operations. Further, the increasing attention to global climate change risks has created the potential for a greater likelihood of governmental investigations and private and public litigation, which could increase our costs or otherwise adversely affect our business.
Regulation of Hydraulic Fracturing and Other Operations - United States. Substantially all of the onshore crude oil and natural gas wells drilled by EOG are completed and stimulated through the use of hydraulic fracturing. Hydraulic fracturing technology, which has been used by the oil and gas industry for more than 60 years and is constantly being enhanced, enables EOG to produce crude oil and natural gas that otherwise would not be recovered. Specifically, hydraulic fracturing is a process in which pressurized fluid is pumped into underground formations to create tiny fractures or spaces that allow crude oil and natural gas to flow from the reservoir into the well so that it can be brought to the surface. Hydraulic fracturing generally takes place thousands of feet underground, a considerable distance below any drinking water aquifers, and there are impermeable layers of rock between the area fractured and the water aquifers. The makeup of the fluid used in the hydraulic fracturing process typically includes water and sand, and less than 1% of highly diluted chemical additives; lists of the chemical additives used in fracturing fluids are available to the public via internet websites and in other publications sponsored by industry trade associations and through state agencies in those states that require the reporting of the components of fracturing fluids. While the majority of the sand remains underground to hold open the fractures, a significant amount of the water and chemical additives flow back and are then either reused or safely disposed of at sites that are approved and permitted by the appropriate regulatory authorities. EOG periodically conducts regulatory assessments of these disposal facilities to monitor compliance with applicable regulations.
The regulation of hydraulic fracturing is primarily conducted at the state and local level through permitting and other compliance requirements. In April 2012, however, the U.S. EPA issued regulations specifically applicable to the oil and gas industry that require operators to significantly reduce VOC emissions from natural gas wells that are hydraulically fractured through the use of "green completions" to capture natural gas that would otherwise escape into the air. The U.S. EPA has also issued regulations that establish standards for VOC emissions from several types of equipment, including storage tanks, compressors, dehydrators, and valves and sweetening units at gas processing plants. In addition, in May 2016, the U.S. EPA issued regulations that require operators to reduce methane and VOC emissions from new, modified and reconstructed crude oil and natural gas wells and equipment located at natural gas production gathering and booster stations, gas processing plants and natural gas transmission compressor stations. In September 2020, the U.S. EPA issued amendments to the 2012 and 2016 new source performance standards, which removed the transmission and storage segment from the new source performance standards, rescinded VOC and methane emissions standards for the transmission and storage segment, and rescinded methane emissions standards for the production and processing segments.
From time to time, there have been various other proposals to regulate hydraulic fracturing at the federal level. In addition, there were proposals and positions taken by President Biden during his campaign regarding the use of hydraulic fracturing on federal lands and waters. Further, on January 27, 2021, President Biden issued Executive Order 14008 entitled "Tackling the Climate Crisis at Home and Abroad," directing the Secretary of the Interior, to the extent consistent with applicable law and in consultation with other agencies and stakeholders, to, among other things, pause approval of new oil and natural gas leases on federal lands or in offshore waters pending completion of a comprehensive review and reconsideration of federal oil and gas permitting and leasing practices.
In addition to the above-described federal regulations, some state and local governments have imposed, or have considered imposing, various conditions and restrictions on drilling and completion operations, including requirements regarding casing and cementing of wells; testing of nearby water wells; restrictions on access to, and usage of, water; disclosure of the chemical additives used in hydraulic fracturing operations; restrictions on the type of chemical additives that may be used in hydraulic fracturing operations; and restrictions on drilling or injection activities on certain lands lying within wilderness wetlands, ecologically or seismically sensitive areas, and other protected areas. Such federal, state and local permitting and disclosure requirements, operating restrictions, conditions or prohibition could lead to operational delays and increased operating and compliance costs and, moreover, could delay or effectively prevent the development of crude oil and natural gas from formations which would not be economically viable without the use of hydraulic fracturing.
Compliance with laws and regulations relating to hydraulic fracturing and other aspects of our operations increases EOG's overall cost of business, but has not had, to date, a material adverse effect on EOG's operations, financial condition or results of operations. In addition, it is not anticipated, based on current laws and regulations, that EOG will be required in the near future to expend amounts that are material in relation to its total exploration and development expenditure program in order to comply with such laws and regulations. However, EOG is unable to predict (i) the timing, scope and effect of any currently proposed or future laws or regulations regarding hydraulic fracturing in the United States or other aspects of our operations and (ii) the ultimate cost of compliance or the ultimate effect on EOG's operations, financial condition and results of operations relating to such future laws and regulations. The direct and indirect costs of such laws and regulations (if enacted) could materially and adversely affect EOG's operations, financial condition and results of operations.
Other International Regulation. EOG's exploration and production operations outside the United States are subject to various types of regulations, including environmental regulations, imposed by the respective governments of the countries in which EOG's operations are conducted, and may affect EOG's operations and costs of compliance within those countries. EOG currently has operations in Trinidad, China and Canada, and an exploration program in Oman. EOG is unable to predict the timing, scope and effect of any currently proposed or future laws, regulations or treaties, including those regarding climate change and hydraulic fracturing, but the direct and indirect costs of such laws, regulations and treaties (if enacted) could materially and adversely affect EOG's operations, financial condition and results of operations. EOG will continue to review the risks to its business and operations outside the United States associated with all environmental matters, including climate change and hydraulic fracturing regulation. In addition, EOG will continue to monitor and assess any new policies, legislation, regulations and treaties in the areas outside the United States where it operates to determine the impact on its operations and take appropriate actions, where necessary.
Other Regulation. EOG has sand mining and processing operations in Texas and Wisconsin, which support EOG's exploration and development operations. EOG's sand mining operations are subject to regulation by the federal Mine Safety and Health Administration (in respect of safety and health matters) and by state agencies (in respect of air permitting and other environmental matters). The information concerning mine safety violations and other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K (17 CFR 229.104) is included in Exhibit 95 to this report.
For additional discussion regarding the regulatory-related risks to which EOG's operations, financial condition and results of operations are or may be subject, see ITEM 1A, Risk Factors.
Energy Prices. EOG is a crude oil and natural gas producer and is impacted by changes in the prices for crude oil and condensate, NGLs and natural gas. During the last three years, average United States commodity prices have fluctuated, at times rather dramatically. Average crude oil and condensate prices received by EOG for production in the United States decreased 33% in 2020 and 11% in 2019 and increased 28% in 2018, each as compared to the immediately preceding year. EOG's quarterly price realizations ranged from $20.40 per barrel to $46.97 per barrel in 2020. Average NGL prices received by EOG for production in the United States decreased 16% in 2020 and 40% in 2019 and increased 18% in 2018, each as compared to the immediately preceding year. These fluctuations resulted in a 27% decrease in the average wellhead natural gas price received by EOG for production in the United States in 2020, a 23% decrease in 2019, and a 31% increase (inclusive of a positive revenue adjustment of $0.44 per Mcf related to the adoption of Accounting Standards Update 2014-09) in 2018, each as compared to the immediately preceding year.
Due to the many uncertainties associated with the world political and economic environment (for example, the actions of other crude oil exporting nations, including the Organization of Petroleum Exporting Countries, and the duration and impact of the ongoing COVID-19 pandemic), the global supply of, and demand for, crude oil, NGLs and natural gas and the availability of other energy supplies, the relative competitive relationships of the various energy sources in the view of consumers and other factors, EOG is unable to predict what changes may occur in the prices of crude oil and condensate, NGLs and natural gas in the future. For additional discussion regarding changes in crude oil and condensate, NGLs and natural gas prices and the risks that such changes may present to EOG, see ITEM 1A, Risk Factors.
Including the impact of EOG's crude oil and NGL derivative contracts (exclusive of basis swaps) and based on EOG's tax position, EOG's price sensitivity in 2021 for each $1.00 per barrel increase or decrease in wellhead crude oil and condensate price, combined with the estimated change in NGL price, is approximately $99 million for net income and $127 million for pretax cash flows from operating activities. Including the impact of EOG's natural gas derivative contracts and based on EOG's tax position and the portion of EOG's anticipated natural gas volumes for 2021 for which prices have not been determined under long-term marketing contracts, EOG's price sensitivity for each $0.10 per Mcf increase or decrease in wellhead natural gas price is approximately $31 million for net income and $40 million for pretax cash flows from operating activities. For a summary of EOG's financial commodity derivative contracts through February 18, 2021, see ITEM 7, Management's Discussion and Analysis of Financial Condition and Results of Operations - Capital Resources and Liquidity - Commodity Derivative Transactions. For a summary of EOG's financial commodity derivative contracts for the twelve months ended December 31, 2020, see Note 12 to Consolidated Financial Statements.
Risk Management. EOG engages in price risk management activities from time to time. These activities are intended to manage EOG's exposure to fluctuations in prices of crude oil, NGLs and natural gas. EOG utilizes financial commodity derivative instruments, primarily price swap, option, swaption, collar and basis swap contracts, as a means to manage this price risk. See Note 12 to Consolidated Financial Statements. For a summary of EOG's financial commodity derivative contracts through February 18, 2021, see ITEM 7, Management's Discussion and Analysis of Financial Condition and Results of Operations ‑ Capital Resources and Liquidity - Commodity Derivative Transactions.
All of EOG's crude oil, NGL and natural gas activities are subject to the risks normally incident to the exploration for, and development, production and transportation of, crude oil, NGL and natural gas, including rig and well explosions, cratering, fires, loss of well control and leaks and spills, each of which could result in damage to life, property and/or the environment. EOG's operations are also subject to certain perils, including hurricanes, flooding and other adverse weather events. Moreover, EOG's activities are subject to governmental regulations as well as interruption or termination by governmental authorities based on environmental and other considerations. Losses and liabilities arising from such events could reduce EOG's revenues and increase costs to EOG to the extent not covered by insurance.
Insurance is maintained by EOG against some, but not all, of these risks in accordance with what EOG believes are customary industry practices and in amounts and at costs that EOG believes to be prudent and commercially practicable. Specifically, EOG maintains commercial general liability and excess liability coverage provided by third-party insurers for bodily injury or death claims resulting from an incident involving EOG's operations (subject to policy terms and conditions). Moreover, in the event an incident involving EOG's operations results in negative environmental effects, EOG maintains operators extra expense coverage provided by third-party insurers for obligations, expenses or claims that EOG may incur from such an incident, including obligations, expenses or claims in respect of seepage and pollution, cleanup and containment, evacuation expenses and control of the well (subject to policy terms and conditions). In the event of a well control incident resulting in negative environmental effects, such operators extra expense coverage would be EOG's primary coverage, with the commercial general liability and excess liability coverage referenced above also providing certain coverage to EOG. All of EOG's drilling activities are conducted on a contractual basis with independent drilling contractors and other third-party service contractors. The indemnification and other risk allocation provisions included in such contracts are negotiated on a contract-by-contract basis and are each based on the particular circumstances of the services being provided and the anticipated operations.
In addition to the above-described risks, EOG's operations outside the United States are subject to certain risks, including the risk of increases in taxes and governmental royalties, changes in laws and policies governing the operations of foreign-based companies, expropriation of assets, unilateral or forced renegotiation, modification or nullification of existing contracts with governmental entities, currency restrictions and exchange rate fluctuations. Please refer to ITEM 1A, Risk Factors, for further discussion of the risks to which EOG is subject with respect to its operations outside the United States.
Information About Our Executive Officers
The current executive officers of EOG and their names and ages (as of February 25, 2021) are as follows:
|William R. Thomas||68||Chairman of the Board and Chief Executive Officer|
|Lloyd W. Helms, Jr.||63||Chief Operating Officer|
|Ezra Y. Yacob||44||President|
|Kenneth W. Boedeker||58||Executive Vice President, Exploration and Production|
|Timothy K. Driggers||59||Executive Vice President and Chief Financial Officer|
|Michael P. Donaldson||58||Executive Vice President, General Counsel and Corporate Secretary|
William R. Thomas was elected Chairman of the Board and Chief Executive Officer effective January 2014. He was elected Senior Vice President and General Manager of EOG's Fort Worth, Texas, office in June 2004, Executive Vice President and General Manager of EOG's Fort Worth, Texas, office in February 2007 and Senior Executive Vice President, Exploitation in February 2011. He subsequently served as Senior Executive Vice President, Exploration from July 2011 to September 2011, as President from September 2011 to July 2013 and as President and Chief Executive Officer from July 2013 to December 2013. Mr. Thomas joined a predecessor of EOG in January 1979. Mr. Thomas is EOG's principal executive officer.
Lloyd W. Helms, Jr. was elected Chief Operating Officer in December 2017. Prior to that, he served as Executive Vice President, Exploration and Production from August 2013 to December 2017. He was elected Vice President, Engineering and Acquisitions in September 2006, Vice President and General Manager of EOG's Calgary, Alberta, Canada office in March 2008, and served as Executive Vice President, Operations from February 2012 to August 2013. Mr. Helms joined a predecessor of EOG in February 1981.
Ezra Y. Yacob was elected President effective January 2021. Prior to that, he served as Executive Vice President, Exploration and Production from December 2017 to January 2021 and as Vice President and General Manager of EOG's Midland, Texas, office from May 2014 to December 2017. He also previously served as Manager, Division Exploration in EOG's Fort Worth, Texas, and Midland, Texas, offices from March 2012 to May 2014 as well as in various geoscience and leadership positions. Mr. Yacob joined EOG in August 2005.
Kenneth W. Boedeker was elected Executive Vice President, Exploration and Production in December 2018. He served as Vice President and General Manager of EOG's Denver, Colorado, office from October 2016 to December 2018, and as Vice President, Engineering and Acquisitions from July 2015 to October 2016. Prior to that, Mr. Boedeker held technical and managerial positions of increasing responsibility across multiple offices and functional areas within EOG. Mr. Boedeker joined EOG in July 1994.
Timothy K. Driggers was elected Executive Vice President and Chief Financial Officer in April 2016. Previously, Mr. Driggers served as Vice President and Chief Financial Officer from July 2007 to April 2016. He was elected Vice President and Controller of EOG in October 1999, was subsequently named Vice President, Accounting and Land Administration in October 2000 and Vice President and Chief Accounting Officer in August 2003. Mr. Driggers is EOG's principal financial officer. Mr. Driggers joined a predecessor of EOG in August 1995.
Michael P. Donaldson was elected Executive Vice President, General Counsel and Corporate Secretary in April 2016. Previously, Mr. Donaldson served as Vice President, General Counsel and Corporate Secretary from May 2012 to April 2016. He was elected Corporate Secretary in May 2008, and was appointed Deputy General Counsel and Corporate Secretary in July 2010. Mr. Donaldson joined EOG in September 2007.
ITEM 1A. Risk Factors
Our business and operations are subject to many risks. The risks described below may not be the only risks we face, as our business and operations may also be subject to risks that we do not yet know of, or that we currently believe are immaterial. If any of the events or circumstances described below actually occurs, our business, financial condition, results of operations or cash flows could be materially and adversely affected and the trading price of our common stock could decline. The following risk factors should be read in conjunction with the other information contained herein, including the consolidated financial statements and the related notes. Unless the context requires otherwise, “we,” “us,” “our” and “EOG” refer to EOG Resources, Inc. and its subsidiaries.
Risks Related to our Financial Condition, Results of Operations and Cash Flows