Nov 5 (Reuters) - Oil producer EOG Resources Inc posted a better-than-expected profit on Thursday as cost cuts and efficiency gains helped offset falling crude prices.
The company, which operates in North Dakota and Texas, slashed costs to pump, transport, process and market oil and natural gas, signs that Chief Executive Bill Thomas said show the company is working "to be successful in a low commodity price environment."
Bucking an industry trend, EOG did not raise its production forecast, opting to keep more oil in the ground longer to wait for higher prices.
EOG posted a net loss of $4.08 billion, or $7.47 per share, compared to a net profit of $1.1 billion, or $2.01 per share, in the year-ago period.
Part of the loss was due to a $4.1 billion write-down in the value of some shale acreage in line with plunging crude prices. EOG said these were older and "marginal" assets.
Excluding hedging gains and other one-time items, the company posted a profit of 2 cents per share.
By that measure, analysts expected a loss of 30 cents per share, according to Thomson Reuters I/B/E/S.
The volume of the crude the company produced fell 7 percent to 569,600 barrels of oil equivalent per day (boe/d).
EOG has hedged 10,000 boe/d of production for November and December at an average price of $89.98 per barrel, and has hedges for 82,500 boe/d of production with a floor price of $45 per barrel for November. U.S. oil prices are trading around $45 per barrel.
Houston-based EOG cut its capital budget earlier this year by about $200 million, but still expects to spend $4.9 billion to $5.9 billion this year.
The company has scheduled a conference call with investors on Friday to discuss the results.
Shares of EOG, which closed unchanged on Thursday at $86.47, have lost about 6 percent of their value so far this year.
(Reporting by Ernest Scheyder; Editing by Chris Reese and Richard Chang)
Copyright 2016 Thomson Reuters. Click for Restrictions.
WHAT DO YOU THINK?
Click on the button below to add a comment.
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
Most Popular Articles
From the Career Center
Jobs that may interest you