Entering text into the input field will update the search result below

Geographical Advantages Keep EOG's Eagle Ford Asset Very Relevant

Apr. 09, 2018 5:53 AM ETEOG Resources, Inc. (EOG)11 Comments
Callum Turcan profile picture
Callum Turcan


  • Looking at the geographical advantages the Eagle Ford has over the Permian Basin.
  • How EOG Resources Inc. is capitalizing on those advantages.
  • Overview of EOG Resources' Eagle Ford development strategy and sources of potential operational upside.

EOG Resources Inc. (NYSE:EOG) has one of the most enviable positions in the Eagle Ford, an oil-rich play spread across South Texas. While the Eagle Ford is not as “hot” as the Permian, Tier 1 EF opportunities have a geographical advantage over similar opportunities on the other side of the state, particularly in regards to oil & gas realizations. Let’s go over EOG Resources Inc.’s largest producing asset, what investors can expect going forward, and where the Eagle Ford outperforms the Permian Basin.

Asset overview

At the end of 2017, EOG Resources had interests in 582,000 net acres across the Eagle Ford play. 99% of that is held by production, meaning EOG doesn’t have to drill uneconomical wells to retain its leaseholds.

The vast majority of the company’s EF acreage (520,000 net acres) is situated in the oil window where the best well returns can be found. The counties with the most prolific wells are Karnes, Gonzales, DeWitt, and the northern parts of Live Oak. Wells in this region have a production mix weighted heavily towards crude and condensate. Below is a map of EOG Resources’ Eagle Ford acreage. As you can see, it has a lot of contiguous acreage in the Tier 1 part of the play.

Source: EOG Resources Inc. (With some additions from the author)

On average, EOG Resources pumped 171,000 bpd of oil/condensate, 31,000 bpds of NGLs, and 180 MMcf/d of natural gas out of the Eagle Ford/Austin Chalk play last year. That was equal to about half of its crude/condensate output in 2017.

The company brought 217 net wells targeting the Eagle Ford Shale formation and another 28 net wells targeting the Austin Chalk formation online last year. This year, EOG plans on bringing 260 net EF wells online on top of the 25 net AC wells. EOG

This article was written by

Callum Turcan profile picture
Worked as an equity analyst for several years in the USA and have been writing financial articles and analyzing publicly traded companies for more than a decade.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

Comments (11)

stealth-trader profile picture
Callum - excellent article. You highlighted a topic that few others consider when thinking about E&P investing. The Permian ‘stacked pay’ opportunity is a great thing to own - but several economic factors, including oil and gas sale prices, must still cooperate to realize a good return. The Eagle Ford continues to offer excellent investment opportunities for E&Ps and investors.
g.dimit profile picture
EOG with a Massive position at Eagle Ford, Expanding to Oklahoma, Creating tremendous Inventory of Assets, to Secure flow & Reduce Risk.

Should the Oil prices Ranges between 65 to 75 Dollars EOG Bound to have outstanding
performance Report.

Long: EOG
I’ve been watching and commenting on the Austin chalk specifically in Karnes county for a couple years now. The initial 24hr test reports were eye popping enough to know there would be a acreage capture Bonanza, which has come true in the Louisiana portion of the play. If you have free time check out the Eog Kilimanjaro unit. I think the initial well produced around 1mmbls + 3bcf in 1.5 years before two other wells were brought online. Crazy numbers.
Is the pay horizon in the Austin Chalk shale or chalk?
It produces best from natural fractured
Chalk which being brittle is explored near flexures or where the layers bend slightly. Chalk is very fine grained, so natural fractures greatly enhance flow rates.
Thanks. Flowing chalk gumming up completions after a few years used to be an issue.
Callum - would Sanchez (SN) with its big Eagle Ford exposure benefit in a similar way to EOG?
Callum Turcan profile picture
@notchweather Sanchez Energy should be able to fetch LLS oil pricing and gas realizations close to Henry Hub, it just operates in a Tier 2 region of a Tier 1 play, so SN's Eagle Ford wells require higher oil prices to break even than EOG Resources. It isn't bad acreage, but it is outside of the DeWitt/Karnes/Gonzales core.
itscalledcommonsense profile picture
Takeaway whack a mole continues...
g.dimit profile picture
EOG Maximize the Massive, Eagle Ford Holdings will Deliver the 'Goods" for Long-Long Time

Outstanding Performer & Quality Company.

Long: EOG
Disagree with this article? Submit your own. To report a factual error in this article, . Your feedback matters to us!
To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.