Page 9 - NorthAmOil Week 09 2021

NorthAmOil PERFORMANCE NorthAmOil

EOG beats profit estimates for fourth quarter

US SHALE producer EOG Resources has reported output rose by 1% and its gas production grew
a net profit of $337mn for the fourth quarter of by 9%, giving it a total increase of 12% in crude
2020, down from a profit of $637mn in the same oil equivalent terms.
quarter of 2019 but up from a loss of $43mn in For 2021, EOG projects that its crude output
the third quarter of 2020. The result illustrates will be 434,000-446,000 bpd, roughly flat year on
how market conditions have improved for the year. This forms part of a broader trend among
shale industry, but have not yet returned to shale drillers, whereby they are prioritising bal-
pre-pandemic levels. ance sheet clean-ups ahead of growth.
EOG’s adjusted earnings for the fourth quar- “The 2021 capital plan is consistent with the
ter totalled $411mn, or $0.71 per share, beating strategy we have followed over the last year of
analysts’ expectations of $0.35 per share, accord- not growing production in an oversupplied
ing to Refinitiv IBES data cited by Reuters. This market,” EOG’s CEO, Bill Thomas, said in a
was up from $252mn in the third quarter of statement.
2020, but down on $787mn in the fourth quarter EOG’s capital expenditures are anticipated
of 2019. The company attributed the improve- to rise to $3.7-4.1bn this year, up from $3.5bn
ment in its profits compared with the third quar- in 2020. The company also announced it would
ter to cost-cutting efforts and the recent recovery hike its dividend to $1.65.
in crude prices. “The increase in the regular dividend
Houston-based EOG said its oil production reflects the significant progress EOG has made
had reached 444,800 barrels per day in the fourth in the past 12 months,” Thomas said. “We have
quarter of 2020, above the guidance midpoint of lowered operating costs and well costs, in turn
441,900 bpd and up 18% on the previous quar- reducing the breakeven oil price needed to
ter. The company’s natural gas liquids (NGLs) maintain our production.”™

POLICY

Regulators ban fracking in

Delaware River watershed

US NORTHEAST THE Delaware River Basin Commission saying in a resolution that drillers had “adversely
(DRBC) voted to permanently ban hydraulic impacted surface-water and groundwater
fracturing last week, asserting that shale gas resources, including sources of drinking water,
development near the waterway, which sup- and have harmed aquatic life in some regions”.
plies drinking water for more than 13mn peo- Confirmed instances of such pollution from
ple, would pose an unacceptable risk. The ban shale drilling have been rare, but the handful of
applies to the entire Delaware River watershed, cases that have emerged over the past decade has
spanning Pennsylvania, Delaware, New Jersey been enough to cause concern over the impacts
and New York. of drilling and fracking.
There had already been a moratorium on The Associated Press reported that in prac-
fracking in place in the region since 2010, and tical terms, the ban affects Wayne and Pike
the commission voted 4-0 to make it permanent, counties in Pennsylvania’s north-east. Both
with the federal government’s representative these counties are part of the Marcellus shale,
abstaining. US’ largest gas field, which has turned the state
This representative, from the US Army Corps into the country’s second-biggest gas producer.
of Engineers, said the newly installed adminis- Nearly 13,000 wells have been drilled across the
tration of President Joe Biden was still in tran- Marcellus to date.
sition and had not given a direct order on how The ban is opposed by certain local land-
to vote. owners and state-level Republican lawmakers
The other members of the DRBC are the gov- in Pennsylvania. Indeed, they have filed lawsuits
ernors of Pennsylvania, Delaware, New Jersey challenging the DRBC’s right to regulate gas
and New York, or their designees. development in the watershed, and hit out at the
The commission cited “significant immediate commission for enacting a ban while litigation
and long-term risks” from shale gas production, is still pending.™

Week 09 04•March•2021 www. NEWSBASE .com P9