Oil and gas producer EOG Resources Inc. (NYSE: EOG) on Aug. 2 reported sharply higher second-quarter profit but missed Wall Street per-share estimates, earning $1.20 compared with analysts’ expectations for $1.23.
EOG grew its total crude production by 15% from a year ago to a company record of 384,600 barrels per day, pushing profit for the quarter to $696.7 million from $23.1 million a year earlier.
The company said it was targeting 18% growth in its crude production for the year.
U.S. producers are benefiting from a bump in oil activity as benchmark U.S. crude futures have climbed almost 40% in the past year to about $70 per barrel. EOG said it increased crude derivative contracts during the second quarter and received an average crude and condensate price of $67.91, up from $47.51 a year ago.
Results for other companies, including Devon Energy Corp. and Anadarko Petroleum Corp., took a hit during the quarter because of the settlement of commodity derivatives. Companies hedged production at about $55 per barrel, losing out on revenue gains from market prices that rose above $70 per barrel last quarter.
EOG also said it increased its estimated resource potential in Wyoming’s Powder River Basin oil field to 2.1 billion barrels of oil equivalent. That basin is now its third largest asset, the company said.
EOG said it would operate a two-rig program in the Powder River Basin during 2018 and would expand its drilling activity next year. It is targeting well costs between $4.5 million and $6.1 million per well.
The company reported net operating revenues of $4.24 billion, up from $2.61 billion a year ago.
Anadarko said this week it had grown its footprint in the Powder River Basin to 300,000 acres (121,400 hectares) and had begun an appraisal effort for the development of oil production there.
Second agreement is with BP.
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The project had been delayed due to the pandemic.