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EOG's New Oklahoma Oil Play

Apr. 11, 2018 3:54 AM ETEOG Resources, Inc. (EOG)34 Comments
Callum Turcan profile picture
Callum Turcan


  • EOG Resources has set its sights on Oklahoma's Woodford oil play.
  • How EOG built up a 50,000 net acre strong position on the cheap.
  • Overview of EOG Resources' Mid-Continent asset base and future development strategy.

Oklahoma has long been a hotbed for oil & gas activity. For upstream operators the Mid-Continent region has plenty going for it including; ample takeaway capacity, extensive midstream infrastructure, ability to obtain West Texas Intermediate pricing for oil sales due to the region’s proximity to the Cushing oil hub, easy access to favorable gas pricing (including East Texas’ Katy Hub and Louisiana’s Henry Hub pricing benchmarks), relatively easy access to favorable natural gas liquids benchmarks (such as the propane pricing benchmark based in Mont Belvieu, Texas), and extensive oil & gas development opportunities. Let’s dig into how EOG Resources, Inc. (NYSE:EOG) is investing in and capitalizing on Oklahoma’s geographical and geological upside.


At the end of 2017, EOG Resources had an interest in 130,000 net acres in the Mid-Continent region (namely Oklahoma). Management expects EOG will complete 35 net wells this year in the Mid-Continent region, versus just five net completions in 2017. Expect that to drive double-digit production growth through 2020, albeit a task made easy as EOG's existing output is very small. Last year, the firm pumped 2,000 barrels of oil, 1,000 barrels of NGLs, and 12 MMcf/d of dry gas on average out of the region.

EOG Resources entered into a joint-venture with The Carlyle Group L.P. (CG) back in mid-2017 to develop oil & gas opportunities in Ellis County, Oklahoma. Carlyle agreed to fund up to $400 million in development activity targeting the Marmaton Sand play in the Western Anadarko Basin over a four-year period.

Last year, EOG drilled 18 gross wells and completed 10 gross wells in the Mid-Continent. In light of the firm bringing 2 net wells online on its new Woodford acreage that year, it appears EOG has a rough 33% interest in those Marmaton Sand wells.

New position

Where EOG’s Mid-Continent

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.

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