After second quarter earnings of $5.3 million in 2015, Houston-based EOG Resources Inc. reported a second quarter 2016 net loss of $292.8 million or $0.53 per share. It also said its total debt outstanding at the end of June was $7 billion.
The company attributed the losses to lower commodity prices but said that in the second quarter of the year, it also increased its inventory of net premium drilling locations from 3,200 to 4,300. Still, exploration and development expenditures at EOG dropped 49 percent while total crude oil production declined by only 4 percent in the second quarter compared to the same period last year. Natural gas production was down 5 percent for the period.
“The benefits of EOG”s premium drilling strategy are beginning to show in our operating performance,” said William R. “Bill” Thomas, EOG’s Chairman and Chief Executive Officer.
He said because of cost reductions and efficiency improvements, the company increased its targeted number of well completions for 2016 from 270 to 350 net wells. The company expects to drill 250 net wells, 50 more than its original 2016 plans. But it also expects that 201 capital expenditure guidance will remain at $2.4 billion to $2.6 billion.
The South Texas Eagle Ford remains the company’s major focus where in the second quarter, EOG increased its premium inventory by 390 net drilling locations to nearly2,000 total. The company completed 60 wells in the Eagle Ford
In the Delaware Basin, the company expanded its premium inventory as well and said it is “well positioned for years of high-return growth in this world-class basin.” EOG completed 16 wells there.
EOG also added 200 more net premium drilling locations in the DJ Basin Codell in Wyoming.