EOG to ramp Ohio Utica activity by 50% next year
EOG Resources Inc., Houston, guided to fourth-quarter crude production volumes in line with those of the 3 months ended Sept. 30, but said natural gas production should tick up about 5%. Looking ahead to 2025, executives plan to grow their drilling activity in the Ohio Utica basin by 50%.
During third-quarter 2024, EOG Resources averaged crude oil and condensate production of 493,000 b/d, up from 490,700 in second-quarter 2024. Total volumes averaged about 1,076,000 boe/d, an increase of nearly 3% from the prior quarter. For fourth-quarter 2024, chief executive officer Ezra Yacob and the EOG Resources team are forecasting that the latter number will grow to 1,084,500-1,113,200 boe/d as natural gas output climbs to 2.03-2.12 billion cu ft equivalent per day (bcfed).
Utica spending, production
EOG executives have lauded delineation and testing work in the Utica in recent months and indicated they will dedicate more resources to the play (OGJ Online, Sept. 5, 2024). Speaking on a conference call Nov. 8, chief operating officer Jeff Leitzell said the operator will be “up to two full rigs and one full frac fleet by year-end” as the next step to boosting activity.
“The Utica provides an ideal operational environment to make significant gains quickly. We have decreased drilling days to drill three-mile laterals 29% year-over-year and have already achieved a record of drilling more than two miles in a single day,” Leitzell said. “We also have made significant gains on the completion side, achieving a nearly 13% increase in completed lateral feet per day compared to last year.”
Despite guiding to slightly higher production, the company is sticking to a full-year capital spending budget of about $6.2 billion. Fourth-quarter spending is expected to be $1.23-1.43 billion compared with just under $1.5 billion last quarter.
EOG generated a third-quarter net profit of $1.67 billion on revenues of nearly $6 billion. Those numbers were down from $2.03 billion and $6.2 billion in the same period of 2023, when the company’s average oil price was 9% higher.
Shares of EOG (Ticker: EOG) rose more than 6% to $134 and change on executives’ earnings report, which included word of a higher dividend and plans to refinance the company’s debts. The move lifted the stock back above where it was trading 6 months ago and grew the company’s market capitalization to about $76.5 billion.
Geert De Lombaerde | Senior Editor
A native of Belgium, Geert De Lombaerde has more than two decades of business journalism experience and writes about markets and economic trends for Endeavor Business Media publications Healthcare Innovation, IndustryWeek, FleetOwner, Oil & Gas Journal and T&D World. With a degree in journalism from the University of Missouri, he began his reporting career at the Business Courier in Cincinnati and later was managing editor and editor of the Nashville Business Journal. Most recently, he oversaw the online and print products of the Nashville Post and reported primarily on Middle Tennessee’s finance sector as well as many of its publicly traded companies.