Summary
EOG Resources Inc. (EOG) filed an 8-K on October 3, 2001, detailing a new 10 million share repurchase authorization, signaling a commitment to returning value to shareholders. The company also provided updated forecasts for the third and fourth quarters and the full year 2001, reflecting adjustments in production and drilling activity due to a lower gas price environment. Management is focusing on achieving above-average returns on reinvested capital, and has consequently moderated its North American natural gas and condensate production targets, moving away from its previous 4% growth objective.
Key Highlights
- 1EOG Resources has authorized a new 10 million share repurchase program, replacing a prior authorization.
- 2The company anticipates repurchasing between 1.0 million and 1.5 million shares in the second half of 2001.
- 3EOG is adjusting production and drilling activity downward in response to a lower natural gas price environment.
- 4A mark-to-market gain of approximately $58.7 million is anticipated for the third quarter from commodity price swaps and collars.
- 5Cash realized from commodity price swaps and collars in the third quarter is expected to be $28.9 million.
- 6Full-year 2001 North American natural gas and condensate production forecasts have been reduced due to moderation in September, October, and November.
- 7EOG is no longer targeting a 4% growth rate for North American production in 2001.