By Debbie Cai
EOG Resources Inc.'s (EOG) first-quarter profit rose 53% as
revenue at the natural-gas-and-oil producer strengthened, led by
its largest crude oil and condensate segment.
Shares rose 3.3% to $130.25 after hours as results sharply
topped consensus estimates.
The company, an Enron Corp. spinoff, has looked to focus more on
oil production to offset weak natural-gas prices. Higher oil prices
have helped the company beat profit expectations and post
double-digit revenue growth on a percentage basis in recent
quarters.
Chief Executive Mark G. Papa Monday said the company plans to
channel as much capital as possible into its high rate-of-return
oil drilling this year.
In the latest period, EOG's crude oil and condensate
revenue--the largest contributor to its top line--grew 36%. The
company said its South Texas Eagle Ford crude oil operations
surpassed expectations due to ongoing refinements in production
techniques.
In March, EOG signed an agreement with ZaZa Energy Corp. (ZAZA)
for the joint development of some of ZaZa's Eaglebine properties
located in the Texas counties of Walker, Grimes, Madison, Trinity,
and Montgomery. Under the terms of the agreement, EOG will receive
up to a 75% working interest in up to 55,000 net acres and operate
the joint venture acreage comprising 73,000 of ZaZa's 92,000 net
mineral acres.
For the latest quarter, the company reported a profit of $494.7
million, or $1.82 a share, up from $324 million, or $1.20 a share,
a year earlier. Excluding mark-to-market accounting adjustments and
other items, earnings were up at $1.80 from $1.17 a year
earlier.
Net operating revenue improved 20% to $3.36 billion.
Analysts polled by Thomson Reuters had estimated per-share
earnings of $1.17 and revenue of $3.04 billion.
Natural-gas liquids revenue decreased 15%, while natural-gas
revenue rose 12%.
Total expenses climbed 12% to $2.52 billion.
The stock is up 20% over the past 12 months.
Write to Debbie Cai at debbie.cai@dowjones.com
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