Key financial results
- In the third quarter of 2026, EOG reported adjusted earnings per share of $4.87 and adjusted cash flow from operations per share of $7.23.
- Third quarter free cash flow reached $2.2 billion.
yielding free cash flow of $2.2 billion.
- Total per unit cash operating costs and DD&A both came in below guidance midpoints.
total per unit cash operating costs and DD&A both came in below guidance midpoints.
- Management did not give detailed GAAP net income figures on the call.
Business segment results
- Total Production: The company delivered record oil, NGL, and natural gas production volumes in the third quarter.
Our third quarter results include record oil, NGL and natural gas production
- UAE: The first two 1-mile laterals on the UAE oil concession have averaged stabilized production of 700 barrels of oil per day per well during their first 30 days on artificial lift.
averaged stabilized production of 700 barrels of oil per day per well.
- Bahrain: Operations in Bahrain remained intermittent due to ongoing conflict.
operations have remained intermittent due to the ongoing conflict.
- Delaware Basin: Delaware Basin well performance exceeded expectations with well costs of less than $710 per foot.
impressive well costs of less than $710 per foot
- Utica: In the Utica, drilled feet per day increased by 24% and completed lateral feet per day by 14% compared to the first half of 2025, with well costs under $600 per foot.
we have improved drilled feet per day by 24% and completed lateral feet per day by 14%
- Eagle Ford: Eagle Ford operations drove well costs to less than $525 per foot, supported by a 4% increase in drilled feet per day and a 15% increase in completed lateral feet per day.
Eagle Ford well costs at less than $525 per foot.
- Dorado: Dorado average lateral length increased by 16% with well costs under $700 per foot, and the Verde Gas Pipeline realized netback uplifts of $0.50 per Mcf year-to-date.
average lateral length by 16% compared to last year, with well costs at less than $700 per foot.
Capital allocation
- EOG returned just over $1.5 billion to shareholders in the third quarter, consisting of approximately $540 million through the regular dividend and $1 billion in share repurchases.
We returned just over $1.5 billion to shareholders during the third quarter, approximately $540 million through our regular dividend and $1 billion in share repurchases.
- Management announced an 8% increase in the regular dividend to an indicated annual rate of $4.40 per share.
we are pleased to announce an 8% increase in our regular dividend for 2027.
- The company continues to expect to return a minimum of 70% of free cash flow to investors this year.
we continue to expect to return a minimum of 70% of free cash flow to the investors this year.
- Third quarter capital expenditures came in below the guidance midpoint due to operational timing shifts.
Third quarter capital expenditures also came in below the guidance midpoint, primarily driven by shifts in our operational timing.
- EOG divested its legacy Barnett and Woodford positions for an aggregate $400 million.
we recently divested our legacy Barnett and Woodford positions for an aggregate $400 million.
Industry trends and dynamics
- Oil market fundamentals remain tight with Middle East exports recovering unevenly, and global inventories well below their 5-year average.
Market fundamentals remain tight. Middle East exports have recovered from lows reached in the spring.
- Oil demand has demonstrated resilience, and the supply recovery remains fragile due to ongoing disruption risks.
- The North American natural gas market is evolving from a seasonal commodity story into a strategic energy resource driven by LNG exports, electricity demand, industrial growth, and grid reliability.
we continue to see the North American market evolve from a seasonal commodity story into a strategic energy resource.
- Service costs are tightening, leading to expectations of modest inflation next year for drilling and completions.
We are seeing services tighten and expect modest inflation next year for drilling and completions.
Competitive landscape
- EOG maintains a balance sheet leverage target of total debt below 1x EBITDA at bottom cycle prices of $45 WTI and $2.50 Henry Hub.
Our leverage target of total debt below 1x EBITDA at bottom cycle prices of $45 WTI and $2.50 Henry Hub remains among the most stringent in the sector.
- The company ended the quarter with $5.7 billion in cash and net debt of approximately $2.2 billion.
We ended the quarter with $5.7 billion in cash and net debt of approximately $2.2 billion.
- Management noted that corporate M&A is rarely pursued because internal organic exploration and select small bolt-ons offer superior value.
Corporate M&A has typically never been something that we see a significant amount of value in when we look at the rest of our portfolio and inventory.
Macroeconomic environment
- Management expects oil prices to remain above mid-cycle levels in the near and medium term with upside price volatility risks.
we expect oil prices to remain above mid-cycle price levels in both the near and medium term, and we see the balance of risks supporting upside price volatility.
- Global oil inventory draws are moderating, but stocks remain well below historical averages.
although the pace of inventory draws is beginning to moderate, global inventories remain well below their 5-year average.
- Diesel and steel prices remain elevated, adding inflationary pressures across the industry value chain.
diesel and steel prices remain elevated, but we have mitigated the impact
Growth opportunities and strategies
- EOG signed a long-term natural gas supply agreement with Engie linked to JKM pricing, lifting premium price exposure across LNG feed gas agreements to more than 1 Bcf per day by 2030.
signed a new long-term natural gas supply agreement with Engie, which expands our access to premium markets.
- The company approved the expansion of the Janus gas processing plant in the Delaware Basin, doubling capacity to 600 million cubic feet per day with completion expected in the second half of 2028.
approved the expansion of our Janus gas processing plant in the Delaware Basin.
- The Janus expansion will cost approximately $300 million, with two-thirds of the spending occurring in 2027, and is expected to deliver a rate of return exceeding 30%.
The total cost should be approximately $300 million with 2/3 of that spending occurring in 2027.
- An in-basin sand mine in Ohio is scheduled to open by the end of the year, anticipating cost savings exceeding $300,000 per well.
We expect to have an in-basin sand mine open by the end of this year and anticipate cost savings in excess of $300,000 per well.
Financial guidance and outlook
- For the full year 2026, EOG expects to deliver 5% oil production growth and 14% total production growth.
For the full year 2026, we expect to deliver 5% oil production growth and 14% total production growth with capital expenditures, unchanged at $6.5 billion.
- Capital expenditures for 2026 remain unchanged at $6.5 billion.
with capital expenditures, unchanged at $6.5 billion.
- For 2027, the company anticipates delivering low single-digit oil production growth, consistent with its 3-year scenario.
we anticipate staying consistent with our 3-year scenario and expect to deliver low single-digit oil production growth in 2027.
- Janus Expansion: The 2027 capital plan includes approximately $200 million for the Janus plant expansion.
Management transition
- Ann Janssen will retire next year after 31 years of service at EOG.
Ann will be retiring next year, and Jeff Hibbard will be assuming the CFO role on January 1.
- Jeff Hibbard will assume the Chief Financial Officer role on January 1, 2027.
Jeff Hibbard will be assuming the CFO role on January 1.
Q3 2026 results
| Metric | Result | Change |
|---|---|---|
| Adjusted earnings per share | $4.87 | Not stated |
| Adjusted cash flow from operations per share | $7.23 | Not stated |
| Free cash flow | $2.2 billion | Not stated |
| Cash returned to shareholders | $1.5 billion | Not stated |
| Cash and net debt | $5.7 billion in cash and net debt of approximately $2.2 billion | Not stated |
How management sounded
Balanced (+35 on our -100 to +100 scale). Management expressed strong confidence driven by record production, operational efficiency, and a dividend increase, while maintaining a disciplined approach to capital and costs. Management sounded more upbeat than on 20% of the 302 calls we cover; most companies sound positive on their own calls, so the comparison says more than the label.
Read the analyst Q&A summary and guidance and outlook for this call.
What to watch before the next call
- Progress on the UAE oil concession and path toward commerciality.
- Service cost inflation and steel price trends heading into 2027.
- Execution and capital spending on the Janus gas processing plant expansion.
Earlier calls
- Q2 2026 (Aug 5, 2026), tone Balanced: EOG reported record second quarter adjusted earnings, adjusted cash flow and free cash flow, returning over $1.8 billion to shareholders.
