Sector: Energy | Focus: Oil & Gas Exploration & Production
HQ: Houston, Texas
Financial Risks
EOG faces commodity price volatility for oil, gas, and NGLs, impacting cash flow and profitability. Inflationary pressures on operating and capital expenditures are a concern, though EOG is mitigating them. Government policies, including climate change regulations, and geopolitical factors pose risks to operations and profitability. Accuracy of reserve estimates and third-party operational success are also potential risks. Credit risk from counterparties in financial derivative contracts is a concern.
Financial Upside
EOG's strong balance sheet, with $6.1B in cash and a $1.9B revolving credit facility, provides financial flexibility. Increased production, particularly in the Delaware Basin and Eagle Ford, and higher crude oil and condensate prices are positive factors. EOG's strategy of maximizing returns on investment and controlling costs could lead to improved profitability. The company is focused on low-cost reserves and improving well performance.
