EX-99 2 exh99_1.htm EOG RESOURCES, INC. PRESS RELEASE

		EXHIBIT 99.1


EOG Resources, Inc.
News Release
For Further Information Contact:		Investors
		Maire A. Baldwin
		(713) 651-6EOG (651-6364)

		Media and Investors
		Elizabeth M. Ivers
		(713) 651-7132

EOG RESOURCES REPORTS 2006 RESULTS AND INCREASES DIVIDEND

9 Percent Increase in Overall Organic Year-Over-Year Production
14 Percent Increase in United States Natural Gas Production
205 Percent Production Replacement Achieved
Strong Year-End Net Debt-to-Total Capitalization Ratio Reported
50 Percent Increase in Common Stock Dividend

FOR IMMEDIATE RELEASE: Thursday, February 1, 2007

HOUSTON - EOG Resources, Inc. (EOG) today reported fourth quarter 2006 net income available to common of $237.2 million, or $0.96 per share. This compares to fourth quarter 2005 net income available to common of $461.8 million, or $1.88 per share. For the full year 2006, EOG reported net income available to common of $1,288.9 million or $5.24 per share as compared to $1,252.1 million, or $5.13 per share, for the full year 2005.

The results for the fourth quarter 2006 included a $4.1 million, or $0.02 per share charge for premium and fees related to the repurchase of $46.7 million of preferred stock and a $31.5 million ($20.3 million after tax, or $0.08 per share) gain on the mark-to-market of financial commodity price transactions. During the quarter, the net cash realized related to financial commodity contracts was $48.2 million ($31.0 million after tax, or $0.12 per share). Reflecting these items, fourth quarter 2006 adjusted non-GAAP net income available to common was $252.0 million, or $1.02 per share.

Last year's fourth quarter results included the following items: a one-time tax expense of $23.6 million ($0.10 per share) related to the repatriation of accumulated foreign earnings, an $11.4 million ($7.3 million after tax or $0.03 per share) gain on the mark-to-market of financial commodity price transactions and a one-time interest charge of $7.5 million ($4.9 million after tax or $0.02 per share) related to the early retirement of EOG's 2008 Notes. There was no cash realized related to financial commodity contracts during the fourth quarter 2005. Reflecting these items, fourth quarter 2005 adjusted non-GAAP net income available to common was $482.9 million, or $1.97 per share. On a similar basis, eliminating the items detailed in the attached table, adjusted non-GAAP net income available to common for the full year 2006 was $1,189.4 million, or $4.83 per share, and for the full year 2005 was $1,271.5 million, or $5.21 per share. (Please refer to the attached tables for the reconciliation of adjusted non-GAAP net income available to common to GAAP net income available to common.)

"In 2006, EOG remained true to its strategy by focusing on organic production growth, managing costs and maintaining a strong balance sheet. For the year, we achieved 26 percent return on equity and 25 percent return on capital employed," said Mark G. Papa, Chairman and Chief Executive Officer. (Please refer to the attached tables for the calculation of return on equity and return on capital employed.)

Operational Highlights

Driven by a 14 percent increase in United States natural gas production, total company production for the full year 2006 increased 9 percent over the previous year. During the fourth quarter, United States natural gas production increased 19 percent as compared to the fourth quarter a year ago and 7 percent as compared to the prior quarter. The Fort Worth Basin Barnett Shale, Northeastern Utah Uinta Basin and South Texas Frio and Lobo Plays led the production increases.

EOG's results from the Fort Worth Basin Barnett Shale Play continue to exceed expectations. Production at year-end 2006 surpassed the previously stated goal of 200 million cubic feet per day (MMcfd). In Johnson County, two outstanding natural gas wells, the Heffner Unit #1H and #2H, were drilled as 500 foot offset locations. Simultaneously drilled and completed, the wells began flowing to sales in early January at rates of over 7 MMcfd each and are currently producing 6.0 and 6.8 MMcfd, respectively. EOG has 100 percent working interest in both wells.

EOG also reported results from two offset wells in Hood County in the western part of the play. The Welborn Simon #1H and #2H were also completed in January and began flowing to sales at initial rates of 2.6 and 2.2 MMcfd, respectively. EOG has 100 percent working interest in both wells.

In South Texas, where EOG has recently applied horizontal drilling technology to tight Wilcox sands reservoirs, the North Marshall State Wells Fargo #2H in Webb County was drilled to a vertical depth of over 11,000 feet with a 2,300 foot lateral segment. EOG has a 50 percent working interest in the well, which began producing last week at a gross rate of 13 MMcfd.

In addition to strong results in United States natural gas drilling, EOG has completed five horizontal oil wells to date in the North Dakota Bakken Formation. The most recent, the Warberg 1-25H, was completed in mid-January and is producing over 1,100 barrels of oil per day. EOG plans to increase drilling activity in this play from one to three rigs in early 2007.

"2006 represented a break-out year for EOG; we not only gained a much better understanding of the application of horizontal drilling to resource plays, we also built up a deep drilling inventory," said Papa. "We exited 2006 on track with our operational goals and with strong momentum in the organization."

Reserves

At December 31, 2006, total company reserves were approximately 6.8 trillion cubic feet equivalent (Tcfe), an increase of 607 billion cubic feet equivalent (Bcfe), or 10 percent higher than year-end 2005. In 2006:

From drilling alone, EOG added 1,414 Bcfe of reserves with drilling capital expenditures of $2,952 million at a reserve replacement cost of $2.09 per thousand cubic feet equivalent (Mcfe) prior to revisions, replacing 246 percent of production,
Total reserve replacement from all sources - the ratio of net reserve additions from drilling, acquisitions, revisions and dispositions to total production - was 205 percent at a total reserve replacement cost of $2.50 per Mcfe and
Excluding the impact of price related revisions of 179 Bcfe due to lower natural gas prices, total reserve replacement was 237 percent at a reserve replacement cost of $2.17 per Mcfe. Price related revisions were based on year-end 2006 benchmark Henry Hub pricing of $5.64 per million British thermal unit and benchmark West Texas Intermediate crude pricing as posted on the New York Mercantile Exchange of $61.05 per barrel, as compared to year-end 2005 pricing of $10.08 and $61.05, respectively. (Please see attached tables for supporting data for the reconciliation of non-GAAP drilling capital expenditures to GAAP total costs incurred in exploration and development activities and for the calculation of reserve replacement percentages and reserve replacement costs.)

For the 19^th consecutive year, internal reserve estimates were within 5 percent of those prepared by the independent reserve engineering firm of DeGolyer and MacNaughton. The firm prepared an independent engineering analysis of properties containing 82 percent of EOG's proved reserves on a Bcfe basis.

Capital Structure

At December 31, 2006, EOG's total debt outstanding was $733 million, and cash on the balance sheet was $218 million, for net debt of $515 million. (Please refer to the attached tables for the reconciliation of non-GAAP net debt to long-term debt.) During the fourth quarter, EOG repurchased $47 million of preferred stock, leaving $53 million outstanding. The company's debt-to-total capitalization ratio was 12 percent at December 31, 2006, down from 19 percent at December 31, 2005.

"During 2006, EOG increased production 9 percent, achieved high returns on its capital expenditure program and repurchased preferred stock, while strengthening the balance sheet. We ended the year with an 8 percent net debt-to-total capitalization ratio," said Papa. (Please refer to the attached tables for the reconciliation of non-GAAP net debt to long-term debt and the calculation of net debt to total capitalization.)

Dividend Increase Announced

Following a 50 percent increase in 2006, EOG's Board of Directors again has increased the cash dividend on the common stock. Effective with the dividend payable on April 30, 2007 to record holders as of April 16, 2007, the quarterly dividend on the common stock will be $0.09 per share. The indicated annual rate of $0.36 per share reflects a 50 percent increase from 2006, the seventh increase in eight years.

Conference Call Scheduled for February 1, 2007

EOG's fourth quarter and year-end 2006 conference call will be available via live audio webcast at 9 a.m. Central Standard Time (10 a.m. Eastern Standard Time) Thursday, February 1, 2007. To listen, log on to www.eogresources.com. The webcast will be archived on EOG's website through Thursday, February 15, 2007.

EOG Resources, Inc. is one of the largest independent (non-integrated) oil and natural gas companies in the United States with proved reserves in the United States, Canada, offshore Trinidad and the United Kingdom North Sea. EOG Resources, Inc. is listed on the New York Stock Exchange and is traded under the ticker symbol "EOG."

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical facts, including, among others, statements regarding EOG's future financial position, business strategy, budgets, reserve information, projected levels of production, projected costs and plans and objectives of management for future operations, are forward-looking statements. EOG typically uses words such as "expect," "anticipate," "estimate," "strategy," "intend," "plan," "target" and "believe" or the negative of those terms or other variations of them or by comparable terminology to identify its forward-looking statements. In particular, statements, express or implied, concerning future operating results, the ability to replace or increase reserves or to increase production, or the ability to generate income or cash flows are forward-looking statements. Forward-looking statements are not guarantees of performance. Although EOG believes its expectations reflected in forward-looking statements are based on reasonable assumptions, no assurance can be given that these expectations will be achieved. Important factors that could cause actual results to differ materially from the expectations reflected in the forward-looking statements include, among others: the timing and extent of changes in commodity prices for crude oil, natural gas and related products, foreign currency exchange rates and interest rates; the timing and impact of liquefied natural gas imports and changes in demand or prices for ammonia or methanol; the extent and effect of any hedging activities engaged in by EOG; the extent of EOG's success in discovering, developing, marketing and producing reserves and in acquiring oil and gas properties; the accuracy of reserve estimates, which by their nature involve the exercise of professional judgment and may therefore be imprecise; the availability and cost of drilling rigs, experienced drilling crews, materials and equipment used in well completions, and tubular steel; the availability, terms and timing of governmental and other permits and rights of way; the availability of pipeline transportation capacity; the availability of compression uplift capacity; the extent to which EOG can economically develop its Barnett Shale acreage outside of Johnson County, Texas; whether EOG is successful in its efforts to more densely develop its acreage in the Barnett Shale and other production areas; political developments around the world; acts of war and terrorism and responses to these acts; weather; and financial market conditions. In light of these risks, uncertainties and assumptions, the events anticipated by EOG's forward-looking statements might not occur. Forward-looking statements speak only as of the date made and EOG undertakes no obligation to update or revise its forward-looking statements, whether as a result of new information, future events or otherwise.

The United States Securities and Exchange Commission permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. As noted above, statements of proved reserves are only estimates and may be imprecise. Any reserve estimates provided in this press release that are not specifically designated as being estimates of proved reserves may include not only proved reserves, but also other categories of reserves that the SEC's guidelines strictly prohibit EOG from including in filings with the SEC. Investors are urged to consider closely the disclosure in EOG's Annual Report on Form 10-K for fiscal year ended December 31, 2005, available from EOG at P.O. Box 4362, Houston, Texas 77210-4362 (Attn: Investor Relations). You can also obtain this form from the SEC by calling 1-800-SEC-0330 or from the SEC's website at www.sec.gov.

EOG RESOURCES, INC.
FINANCIAL REPORT
(Unaudited; in millions, except per share data)

			Quarter				Twelve Months
			Ended December 31				Ended December 31
				2006	2005		2006		2005
Net Operating Revenues			$	932.5	$	1,213.7	$	3,904.4	$	3,620.2
Net Income Available to Common			$	237.2	$	461.8	$	1,288.9	$	1,252.1
Net Income Per Share Available to Common
	Basic		$	0.98	$	1.92	$	5.33	$	5.24
	Diluted		$	0.96	$	1.88	$	5.24	$	5.13
Average Number of Shares Outstanding
	Basic			242.5		240.4		241.8		238.8
	Diluted			246.5		245.5		246.1		244.0


SUMMARY INCOME STATEMENTS
(Unaudited; in thousands)

			Quarter				Twelve Months
			Ended December 31				Ended December 31
			2006		2005		2006		2005
Net Operating Revenues
	Wellhead Natural Gas		$	709,295	$	1,019,008	$	2,803,245	$	2,938,917
	Wellhead Crude Oil, Condensate and Natural Gas Liquids			191,102		184,489		761,580		668,073
	Gains on Mark-to-Market Commodity Derivative Contracts			31,518		11,415		334,260		10,475
	Other, Net			628		(1,224)		5,330		2,748
		Total		932,543		1,213,688		3,904,415		3,620,213
Operating Expenses
	Lease and Well			104,431		83,056		372,895		286,417
	Transportation Costs			29,687		28,563		110,328		86,938
	Exploration Costs			45,129		38,283		155,008		133,116
	Dry Hole Costs			37,817		8,563		79,567		64,812
	Impairments			40,699		23,237		108,258		77,932
	Depreciation, Depletion and Amortization			230,438		176,974		817,089		654,258
	General and Administrative			47,721		37,039		164,981		125,918
	Taxes Other Than Income			46,245		63,098		200,863		199,007
		Total		582,167		458,813		2,008,989		1,628,398
Operating Income				350,376		754,875		1,895,426		1,991,815

Other Income, Net				9,663		13,330		60,373		35,828

Income Before Interest Expense and Income Taxes				360,039		768,205		1,955,799		2,027,643

Interest Expense, Net				7,519		19,985		43,158		62,506

Income Before Income Taxes				352,520		748,220		1,912,641		1,965,137

Income Tax Provision				109,895		284,564		612,756		705,561

Net Income				242,625		463,656		1,299,885		1,259,576

Preferred Stock Dividends				5,421		1,859		10,995		7,432

Net Income Available to Common			$	237,204	$	461,797	$	1,288,890	$	1,252,144

EOG RESOURCES, INC.
OPERATING HIGHLIGHTS
(Unaudited)

			Quarter				Twelve Months
			Ended December 31				Ended December 31
			2006		2005		2006		2005
Wellhead Volumes and Prices
Natural Gas Volumes (MMcfd)
	United States			894		749		817		718
	Canada			227		225		226		228
		United States & Canada		1,121		974		1,043		946
	Trinidad			254		294		264		231
	United Kingdom			32		44		30		39
		Total		1,407		1,312		1,337		1,216

Average Natural Gas Prices ($/Mcf)
	United States		$	6.09	$	10.38	$	6.56	$	7.86
	Canada			5.85		9.73		6.41		7.14
		United States & Canada Composite		6.04		10.23		6.53		7.69
	Trinidad			2.92		2.25		2.44		2.20	^(A)
	United Kingdom			6.13		10.24		7.69		6.99
		Composite		5.48		8.44		5.74		6.62

Crude Oil and Condensate Volumes (MBbld)
	United States			21.8		20.4		20.7		21.5
	Canada			2.4		2.5		2.5		2.4
		United States & Canada		24.2		22.9		23.2		23.9
	Trinidad			4.4		5.6		4.8		4.5
	United Kingdom			0.1		0.2		0.1		0.2
		Total		28.7		28.7		28.1		28.6

Average Crude Oil and Condensate Prices ($/Bbl)
	United States		$	56.49	$	57.20	$	62.68	$	54.57
	Canada			50.59		54.05		57.32		50.49
		United States & Canada Composite		55.91		56.86		62.09		54.16
	Trinidad			58.41		65.78		63.87		57.36
	United Kingdom			49.57		51.89		57.74		49.62
		Composite		56.39		58.55		62.38		54.63

Natural Gas Liquids Volumes (MBbld)
	United States			9.1		6.9		8.5		6.6
	Canada			1.0		0.7		0.8		0.9
		Total		10.1		7.6		9.3		7.5

Average Natural Gas Liquids Prices ($/Bbl)
	United States		$	36.80	$	42.62	$	39.95	$	35.59
	Canada			36.56		46.68		43.69		35.59
		Composite		36.78		42.97		40.25		35.59

Natural Gas Equivalent Volumes (MMcfed)
	United States			1,079		913		992		886
	Canada			247		244		246		248
		United States & Canada		1,326		1,157		1,238		1,134
	Trinidad			281		327		292		259
	United Kingdom			33		45		31		40
		Total		1,640		1,529		1,561		1,433

Total Bcfe				150.8		140.7		569.9		523.0

(A) Includes $0.23 per Mcf as a result of a revenue adjustment related to an amended Trinidad take-or-pay contract.

	EOG RESOURCES, INC.
	SUMMARY BALANCE SHEETS
	(Unaudited; in thousands, except share data)


					December 31,		December 31,
					2006		2005

	ASSETS
Current Assets
	Cash and Cash Equivalents			$	218,255	$	643,811
	Accounts Receivable, Net				754,134		762,207
	Inventories				113,591		63,215
	Assets from Price Risk Management Activities				130,612		11,415
	Income Taxes Receivable				94,311		255
	Deferred Income Taxes				-		24,376
	Other				39,177		57,959
	Total				1,350,080		1,563,238

Oil and Gas Properties (Successful Efforts Method)					13,893,851		11,173,389
	Less: Accumulated Depreciation, Depletion and Amortization				(5,949,804)		(5,086,210)
	Net Oil and Gas Properties				7,944,047		6,087,179
Other Assets					108,033		102,903
Total Assets				$	9,402,160	$	7,753,320

	LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
	Accounts Payable			$	896,572	$	679,548
	Accrued Taxes Payable				130,984		140,902
	Dividends Payable				14,718		9,912
	Deferred Income Taxes				144,615		164,659
	Current Portion of Long-Term Debt				-		126,075
	Other				68,123		50,945
	Total				1,255,012		1,172,041


Long-Term Debt					733,442		858,992
Other Liabilities					300,907		283,407
Deferred Income Taxes					1,513,128		1,122,588

Shareholders' Equity
	Preferred Stock, $0.01 Par, 10,000,000 Shares Authorized:
		Series B, Cumulative, $1,000 Liquidation Preference Per Share,
		53,260 Shares Outstanding at December 31, 2006,
			and 100,000 Shares Outstanding at December 31, 2005		52,887		99,062
	Common Stock, $0.01 Par, 640,000,000 Shares Authorized and
		249,460,000 Shares Issued			202,495		202,495
	Additional Paid In Capital				129,986		84,705
	Unearned Compensation				-		(36,246)
	Accumulated Other Comprehensive Income				176,704		177,137
	Retained Earnings				5,151,034		3,920,483
	Common Stock Held in Treasury, 5,724,959 Shares at
		December 31, 2006 and 7,385,862 Shares at December 31, 2005			(113,435)		(131,344)
		Total Shareholders' Equity			5,599,671		4,316,292
Total Liabilities and Shareholders' Equity				$	9,402,160	$	7,753,320

	EOG RESOURCES, INC.
	SUMMARY STATEMENTS OF CASH FLOWS
	(Unaudited; in thousands)


				Twelve Months
				Ended December 31,
				2006		2005
Cash Flows from Operating Activities
Reconciliation of Net Income to Net Cash Provided by Operating Activities:
	Net Income		$	1,299,885	$	1,259,576
	Items Not Requiring Cash
		Depreciation, Depletion and Amortization		817,089		654,258
		Impairments		108,258		77,932
		Stock-Based Compensation Expenses		49,875		12,187
		Deferred Income Taxes		385,842		270,291
		Other, Net		(10,025)		(2,545)
	Dry Hole Costs			79,567		64,812
	Mark-to-Market Commodity Derivative Contracts
		Total Gains		(334,260)		(10,475)
		Realized Gains		215,063		9,807
	Tax Benefits From Stock Options Exercised			-		50,880
	Other, Net			12,291		(5,086)
	Changes in Components of Working Capital and Other Liabilities
		Accounts Receivable		9,905		(315,557)
		Inventories		(50,370)		(23,085)
		Accounts Payable		222,012		248,411
		Accrued Taxes Payable		(106,324)		88,151
		Other Liabilities		(8,766)		(1,213)
		Other, Net		12,349		(10,347)
	Changes in Components of Working Capital Associated with
	Investing and Financing Activities			(123,838)		1,429
Net Cash Provided by Operating Activities				2,578,553		2,369,426

Investing Cash Flows
	Additions to Oil and Gas Properties			(2,819,230)		(1,724,763)
	Proceeds from Sales of Assets			20,041		70,987
	Changes in Components of Working Capital Associated with
	Investing Activities			123,890		(1,538)
	Other, Net			(35,074)		(22,794)
Net Cash Used in Investing Activities				(2,710,373)		(1,678,108)

Financing Cash Flows
	Net Commercial Paper and Revolving Credit Facility Borrowings (Repayments)			65,000		(91,800)
	Long-Term Debt Borrowing			-		250,000
	Long-Term Debt Repayments			(316,625)		(250,755)
	Dividends Paid			(60,443)		(42,986)
	Excess Tax Benefits from Stock-Based Compensation Expenses			28,188		-
	Redemption of Preferred Stock			(50,199)		-
	Proceeds from Stock Options Exercised and Employee Stock Purchase Plan			36,033		64,668
	Other, Net			(836)		(1,437)
Net Cash Used in Financing Activities				(298,882)		(72,310)

Effect of Exchange Rate Changes on Cash				5,146		3,823

(Decrease) Increase in Cash and Cash Equivalents				(425,556)		622,831
Cash and Cash Equivalents at Beginning of Period				643,811		20,980
Cash and Cash Equivalents at End of Period			$	218,255	$	643,811

EOG RESOURCES, INC.
QUANTITATIVE RECONCILIATION OF ADJUSTED NET INCOME AVAILABLE TO COMMON (Non-GAAP)
TO NET INCOME AVAILABLE TO COMMON (GAAP)
(Unaudited; in thousands, except per share data)


The following chart adjusts three-month and twelve-month periods ended December 31 reported Net Income Available to Common (GAAP) to reflect actual cash realized from oil and gas hedges by eliminating the unrealized mark-to-market gains or losses from these transactions, to add the one-time premium and fees for preferred stock redemption in the fourth quarter of 2006, to add the one-time tax expense related to Texas (US) franchise tax law revision in the second quarter of 2006, to add the interest charge related to early retirement of the 2008 Notes and the tax expense related to the repatriation of accumulated foreign earnings in the fourth quarter of 2005, to eliminate tax benefits related to the Alberta (Canada) provincial tax rate reduction and Canadian federal tax rate reduction in the second quarter of 2006 and to eliminate the upward revenue adjustment for an amended Trinidad gas sales agreement recorded in the second quarter of 2005. EOG believes this presentation may be useful to investors who follow the practice of some industry analysts who adjust reported company earnings to match realizations to production settlement months and make certain other adjustments to exclude one-time items. EOG management uses this information for comparative purposes within the industry.


		Quarter				Twelve Months
		Ended December 31				Ended December 31
		2006		2005		2006		2005

Reported Net Income Available to Common (GAAP)		$	237,204	$	461,797	$	1,288,890	$	1,252,144

Mark-to-Market (MTM) Commodity Derivative Contracts Impact
	Total Gains		(31,518)		(11,415)		(334,260)		(10,475)
	Realized Gains		48,171		-		215,063		9,807
	Subtotal		16,653		(11,415)		(119,197)		(668)

	After Tax MTM Impact		10,716		(7,346)		(76,703)		(430)

Add: Premium and Fees for Preferred Stock Redemption			4,049		-		4,049		-
Add: Tax Expense Related to Texas (US) Franchise Tax Law Revision			-		-		5,221		-
Add: Interest Charge Related to Early Retirement of the 2008 Notes,
	Net of Tax		-		4,855		-		4,855
Add: Tax Expense Related to the Repatriation of Accumulated Foreign
	Earnings		-		23,625		-		23,625
Less: Tax Benefit Related to Alberta (Canada) Provincial Tax
	Rate Reduction		-		-		(13,449)		-
Less: Tax Benefit Related to Canadian Federal Tax Rate Reduction			-		-		(18,593)		-
Less: Revenue Adjustment for an Amended Trinidad Gas Sales
	Agreement, Net of Tax		-		-		-		(8,672)


Adjusted Net Income Available to Common (Non-GAAP)		$	251,969	$	482,931	$	1,189,415	$	1,271,522

Adjusted Net Income Per Share Available to Common (Non-GAAP)
	Basic	$	1.04	$	2.01	$	4.92	$	5.32
	Diluted	$	1.02	$	1.97	$	4.83	$	5.21

Average Number of Shares Outstanding
	Basic		242,515		240,427		241,782		238,797
	Diluted		246,477		245,463		246,100		243,975

EOG RESOURCES, INC.
QUANTITATIVE RECONCILIATION OF DISCRETIONARY CASH FLOW AVAILABLE TO COMMON (Non-GAAP)
TO NET CASH PROVIDED BY OPERATING ACTIVITIES (GAAP)
(Unaudited; in thousands)

The following chart reconciles three-month and twelve-month periods ended December 31 Net Cash Provided by Operating Activities (GAAP) to Discretionary Cash Flow Available to Common (Non-GAAP). EOG believes this presentation may be useful to investors who follow the practice of some industry analysts who adjust Net Cash Provided by Operating Activities for Exploration Costs (excluding Stock-Based Compensation Expenses), Changes in Components of Working Capital, Other Liabilities and Preferred Stock Dividends. EOG management uses this information for comparative purposes within the industry.

			Quarter					Twelve Months
			Ended December 31					Ended December 31
			2006		2005			2006		2005
Net Cash Provided by Operating Activities (GAAP)			$	599,005	$	865,214	$	2,578,553	$	2,369,426

Adjustments
	Exploration Costs (excluding Stock-Based Compensation Expenses)			42,634		38,283		144,147		133,116
	Changes in Components of Working Capital and Other Liabilities
		Accounts Receivable		100,612		144,129		(9,905)		315,557
		Inventories		(3,651)		8,349		50,370		23,085
		Accounts Payable		(117,420)		(169,172)		(222,012)		(248,411)
		Accrued Taxes Payable		57,241		(80,133)		106,324		(88,151)
		Other Liabilities		11,392		49		8,766		1,213
		Other, Net		5,744		11,151		(12,349)		10,347
	Changes in Components of Working Capital Associated
		with Investing and Financing Activities		57,842		(3,371)		123,838		(1,429)
	Preferred Stock Dividends			(5,421)		(1,859)		(10,995)		(7,432)

Discretionary Cash Flow Available to Common (Non-GAAP)			$	747,978	$	812,640	$	2,756,737	$	2,507,321

EOG RESOURCES, INC.
RESERVES SUPPLEMENTAL DATA
(Unaudited)

2006 RESERVES RECONCILIATION SUMMARY
		United				U.S. and				United		Other		Total
NATURAL GAS (Bcf)		States		Canada		Canada		Trinidad		Kingdom		Int'l		Int'l		Total
Beginning Reserves		2,948.1		1,322.8		4,270.9		1,251.6		34.9		-		1,286.5		5,557.4
Revisions due to prices		(114.6)		(55.4)		(170.0)		-		-		-		-		(170.0)
Revisions other than price		(60.3)		(53.3)		(113.6)		(0.8)		(5.0)		-		(5.8)		(119.4)
Purchases in place		16.7		8.1		24.8		-		-		-		-		24.8
Extensions, discoveries and other additions		985.4		174.3		1,159.7		141.0		-		-		141.0		1,300.7
Sales in place		(0.6)		(4.3)		(4.9)		-		-		-		-		(4.9)
Production		(303.8)		(82.6)		(386.4)		(96.4)		(10.9)		-		(107.3)		(493.7)

Ending Reserves		3,470.9		1,309.6		4,780.5		1,295.4		19.0		-		1,314.4		6,094.9

LIQUIDS (MMBbls) (A)
Beginning Reserves		84.1		8.8		92.9		13.2		0.1		-		13.3		106.2
Revisions due to prices		(1.3)		(0.2)		(1.5)		-		-		-		-		(1.5)
Revisions other than price		7.1		1.0		8.1		-		-		-		-		8.1
Purchases in place		0.4		-		0.4		-		-		-		-		0.4
Extensions, discoveries and other additions		17.7		1.2		18.9		-		-		-		-		18.9
Sales in place		(0.7)		-		(0.7)		-		-		-		-		(0.7)
Production		(10.7)		(1.2)		(11.9)		(1.7)		-		-		(1.7)		(13.6)

Ending Reserves		96.6		9.6		106.2		11.5		0.1		-		11.6		117.8

NATURAL GAS EQUIVALENTS (Bcfe)
Beginning Reserves		3,452.4		1,375.7		4,828.1		1,330.7		35.6		-		1,366.3		6,194.4
Revisions due to prices		(122.4)		(56.6)		(179.0)		-		-		-		-		(179.0)
Revisions other than price		(17.4)		(47.4)		(64.8)		(0.5)		(5.1)		-		(5.6)		(70.4)
Purchases in place		19.2		8.1		27.3		-		-		-		-		27.3
Extensions, discoveries and other additions		1,091.5		181.3		1,272.8		141.0		-		-		141.0		1,413.8
Sales in place		(4.7)		(4.3)		(9.0)		-		-		-		-		(9.0)
Production		(368.0)		(89.7)		(457.7)		(106.8)		(11.1)		-		(117.9)		(575.6)

Ending Reserves		4,050.6		1,367.1		5,417.7		1,364.4		19.4		-		1,383.8		6,801.5


Net Proved Developed Reserves (Bcfe)
At December 31, 2005		2,509.9		1,192.9		3,702.8		750.7		29.5		-		780.2		4,483.0
At December 31, 2006		2,893.5		1,218.8		4,112.3		646.7		19.4		-		666.1		4,778.4

(A) Includes crude oil, condensate and natural gas liquids.


2006 EXPLORATION AND DEVELOPMENT EXPENDITURES ($ Million)

Acquisition Cost of Unproved Properties	$	176.5	$	43.3	$	219.8	$	0.9	$	5.0	$	-	$	5.9	$	225.7
Exploration Costs		370.8		50.0		420.8		56.0		14.1		7.0		77.1		497.9
Development Costs		1,803.1		334.0		2,137.1		78.3		13.2		-		91.5		2,228.6

Total Drilling		2,350.4		427.3		2,777.7		135.2		32.3		7.0		174.5		2,952.2

Acquisition Cost of Proved Properties		12.5		9.5		22.0		-		-		-		-		22.0

Total		2,362.9		436.8		2,799.7		135.2		32.3		7.0		174.5		2,974.2

Proceeds from Sales in Place		(11.2)		(4.2)		(15.4)		-		(4.6)		-		(4.6)		(20.0)

Net Expenditures	$	2,351.7	$	432.6	$	2,784.3	$	135.2	$	27.7	$	7.0	$	169.9	$	2,954.2

Asset Retirement Costs	$	10.2	$	5.6	$	15.8	$	1.4	$	4.7	$	-	$	6.1	$	21.9



RESERVE REPLACEMENT COST ($ / Mcfe) *
Total Drilling, Before Revisions	$	2.15	$	2.36	$	2.18	$	0.96	$	-	$	-	$	1.24	$	2.09
All-in Total, Net of Revisions & Dispositions	$	2.43	$	5.33	$	2.66	$	0.96	$	(5.43)	$	-	$	1.25	$	2.50
All-in Total, Net of Performance Revisions Only	$	2.16	$	3.14	$	2.27	$	0.96	$	(5.43)	$	-	$	1.25	$	2.17

RESERVE REPLACEMENT *
Drilling Only		297%		202%		278%		132%		0%		-		120%		246%
All-in Total, Net of Revisions & Dispositions		263%		90%		229%		132%		-46%		-		115%		205%
All-in Total, Net of Performance Revisions Only		296%		154%		268%		132%		-46%		-		115%		237%

*See attached reconciliation schedule for calculation methodology

EOG RESOURCES, INC.
Quantitative Reconciliation of Net Debt (Non-GAAP)
as Used in the Calculation of
the Net Debt-To-Total Capitalization Ratio
to Long-Term Debt (GAAP)
(Unaudited; In Millions, Except Ratio Information)

The following chart reconciles Long-Term Debt (GAAP) to Net Debt (Non-GAAP) as used in the Net Debt-to-Total Capitalization ratio calculation. A portion of the cash is associated with international subsidiaries; tax considerations may impact debt paydown. EOG believes this presentation may be useful to investors who follow the practice of some industry analysts who utilize Net Debt in their Net Debt-to-Total Capitalization calculation. EOG management uses this information for comparative purposes within the industry.


		12/31/2006

	Total Shareholders' Equity - (a)	$ 5,600

	Long-Term Debt	733
	Less: Cash	(218)
	Net Debt (Non-GAAP) - (b)	515

	Total Capitalization (Non-GAAP) - (a) + (b)	$ 6,115

	Net Debt-to-Total Capitalization - (b) / [(a) + (b)]	8%

EOG RESOURCES, INC.
Quantitative Reconciliation of Common Shareholders' Equity (Non-GAAP)
as Used in the Calculation of the Return on Equity (ROE)
to Total Shareholders' Equity (GAAP)
(Unaudited; In Millions, Except Ratio Information)

The following chart reconciles Total Shareholders' Equity (GAAP) to Common Shareholders' Equity (Non-GAAP) as used in the Return on Equity (ROE) calculation. EOG believes this presentation may be useful to investors who follow the practice of some industry analysts who utilize Common Shareholders' Equity in their ROE calculation. EOG management uses this information for comparative purposes within the industry.

	1998	1999	2000	2001	2002	2003	2004	2005	2006

Total Shareholders' Equity	$ 1,280.3	$ 1,129.6	$ 1,380.9	$ 1,642.7	$ 1,672.4	$ 2,223.4	$ 2,945.4	$ 4,316.3	$ 5,599.7
Less: Preferred Stock	-	(147.2)	(147.2)	(147.6)	(148.0)	(148.4)	(98.8)	(99.1)	(52.9)
Common Shareholders' Equity (Non-GAAP)	$ 1,280.3	$ 982.4	$ 1,233.7	$ 1,495.1	$ 1,524.4	$ 2,075.0	$ 2,846.6	$ 4,217.2	$ 5,546.8

Average Common Shareholders' Equity - (a)		$ 1,131.4	$ 1,108.1	$ 1,364.4	$ 1,509.8	$ 1,799.7	$ 2,460.8	$ 3,531.9	$ 4,882.0

Net Income Available to Common - (b)		$ 568.6	$ 385.9	$ 387.6	$ 76.1	$ 419.1	$ 614.0	$ 1,252.1	$ 1,288.9


Return on Equity (ROE) - (b) / (a)		50.3%	34.8%	28.4%	5.0%	23.3%	25.0%	35.5%	26.4%

Average ROE 1999 - 2006									28.6%

EOG RESOURCES, INC.
Quantitative Reconciliation of After-Tax Interest Expense (Non-GAAP) and Net Debt (Non-GAAP)
as Used in the Calculation of the Return on Capital Employed (ROCE) to Interest
Expense (GAAP) and Current and Long-Term Debt (GAAP), Respectively
(Unaudited; In Millions, Except Ratio Information)

The following chart reconciles Interest Expense (GAAP) and Current and Long-Term Debt (GAAP) to After-Tax Interest Expense (Non-GAAP) and Net Debt (Non-GAAP), respectively, as used in the Return on Capital Employed (ROCE) calculation. EOG believes this presentation may be useful to investors who follow the practice of some industry analysts who utilize After-Tax Interest Expense and Net Debt in their ROCE calculation. EOG management uses this information for comparative purposes within the industry.

		1998		1999		2000		2001		2002		2003		2004		2005		2006

Interest Expense			$	61.8	$	61.0	$	45.1	$	59.7	$	58.7	$	63.1	$	62.5	$	43.2
Tax Benefit Imputed (based on 35%)				(21.6)		(21.4)		(15.8)		(20.9)		(20.5)		(22.1)		(21.9)		(15.1)
After-Tax Interest Expense (Non-GAAP) - (a)			$	40.2	$	39.6	$	29.3	$	38.8	$	38.2	$	41.0	$	40.6	$	28.1

Net Income - (b)			$	569.1	$	396.9	$	398.6	$	87.2	$	430.1	$	624.9	$	1,259.6	$	1,299.9

Total Shareholders' Equity	$	1,280.3	$	1,129.6	$	1,380.9	$	1,642.7	$	1,672.4	$	2,223.4	$	2,945.4	$	4,316.3	$	5,599.7

Current and Long-Term Debt		1,142.8		990.3		859.0		856.0		1,145.1		1,108.9		1,077.6		985.1		733.4
Less: Cash		(6.3)		(24.8)		(20.2)		(2.5)		(9.8)		(4.4)		(21.0)		(643.8)		(218.3)
Net Debt (Non-GAAP)		1,136.5		965.5		838.8		853.5		1,135.3		1,104.5		1,056.6		341.3		515.1

Total Capitalization (Non-GAAP)	$	2,416.8	$	2,095.1	$	2,219.7	$	2,496.2	$	2,807.7	$	3,327.9	$	4,002.0	$	4,657.6	$	6,114.8

Average Total Capitalization (Non-GAAP) - (c)			$	2,256.0	$	2,157.4	$	2,358.0	$	2,652.0	$	3,067.8	$	3,665.0	$	4,329.8	$	5,386.2


Return on Capital Employed (ROCE) - [(a) + (b)] / (c)				27.0%		20.2%		18.1%		4.8%		15.3%		18.2%		30.0%		24.7%

Average ROCE 1999 - 2006																		19.8%

EOG RESOURCES, INC.
Quantitative Reconciliation of Total Exploration and Development Expenditures for Drilling Only (Non-GAAP)
and Total Exploration and Development Expenditures, Net of Proceeds from Sales in Place (Non-GAAP)
as Used In the Calculation of Reserve Replacement Costs ($ / Mcfe)
to Total Costs Incurred in Exploration and Development Activities (GAAP)
(Unaudited; In Millions, Except Ratio Information)

The following chart reconciles Total Costs Incurred in Exploration and Development Activities (GAAP) to Total Exploration and Development Expenditures for Drilling Only (Non-GAAP) and Total Exploration and Development Expenditures, Net of Proceeds from Sales in Place (Non-GAAP) as used in the calculation of Reserve Replacement Costs per Mcfe. There are numerous ways that industry participants present Reserve Replacement Costs, including "Drilling Only" and "All-In," which reflect total exploration and development expenditures divided by total net reserve additions from extensions and discoveries only, or from all sources. Combined with Reserve Replacement, these statistics provide management and investors with an indication of the results of the current year capital investment program.
Reserve Replacement Cost statistics are widely recognized and reported by industry participants and are used by EOG management and other third parties for comparative purposes within the industry. Please note that the actual cost of adding reserves will vary from the reported statistics due to timing differences in reserve bookings and capital expenditures. Accordingly, some analysts use three or five year averages of reported statistics, while others prefer to estimate future costs. EOG has not included future capital costs to develop proved undeveloped reserves in Total Exploration and Development Expenditures.



	United		U.S. and		United	Other	Total
	States	Canada	Canada	Trinidad	Kingdom	Int'l	Int'l	Total
Total Costs Incurred in Exploration and
Development Activities (GAAP)	2,373.1	442.4	2,815.5	136.6	37.0	7.0	180.6	2,996.1

Less: Asset Retirement Costs	(10.2)	(5.6)	(15.8)	(1.4)	(4.7)	-	(6.1)	(21.9)
Less: Acquisition Cost of Proved Properties	(12.5)	(9.5)	(22.0)	-	-	-	-	(22.0)

Total Exploration & Development Expenditures
for Drilling Only (Non-GAAP) (A)	2,350.4	427.3	2,777.7	135.2	32.3	7.0	174.5	2,952.2

Total Costs Incurred in Exploration and
Development Activities (GAAP)	2,373.1	442.4	2,815.5	136.6	37.0	7.0	180.6	2,996.1

Less: Asset Retirement Costs	(10.2)	(5.6)	(15.8)	(1.4)	(4.7)	-	(6.1)	(21.9)
Less: Proceeds from Sales in Place	(11.2)	(4.2)	(15.4)	-	(4.6)	-	(4.6)	(20.0)

Total Exploration & Development Expenditures
Net of Proceeds from Sales in Place (Non-GAAP) (B)	2,351.7	432.6	2,784.3	135.2	27.7	7.0	169.9	2,954.2

Net Reserve Additions From All Sources
- Natural Gas Equivalents (Bcfe)
Revisions due to prices (C)	(122.4)	(57.0)	(179.4)	-	-	-	-	(179.4)
Revisions other than price	(17.4)	(47.0)	(64.4)	(0.5)	(5.1)	-	(5.6)	(70.0)
Purchases in place	19.2	8.1	27.3	-	-	-	-	27.3
Extensions, discoveries and other additions (D)	1,091.5	181.3	1,272.8	141.0	-	-	141.0	1,413.8
Sales in place	(4.7)	(4.3)	(9.0)	-	-	-	-	(9.0)

Total (E)	966.2	81.1	1,047.3	140.5	(5.1)	-	135.4	1,182.7

Production (F)	368.0	89.7	457.7	106.8	11.1	-	117.9	575.6

RESERVE REPLACEMENT COSTS ($ / Mcfe)
Total Drilling, Before Revisions (A / D)	$ 2.15	$ 2.36	$ 2.18	$ 0.96	$ -	$ -	$ 1.24	$ 2.09
All-in Total, Net of Revisions & Dispositions (B / E)	$ 2.43	$ 5.33	$ 2.66	$ 0.96	$ (5.43)	$ -	$ 1.25	$ 2.50
All-in Total, Net of Performance Revisions Only (B / (E - C))	$ 2.16	$ 3.13	$ 2.27	$ 0.96	$ (5.43)	$ -	$ 1.25	$ 2.17

RESERVE REPLACEMENT
Drilling Only (D / F)	297%	202%	278%	132%	0%	-	120%	246%
All-in Total, Net of Revisions & Dispositions (E / F)	263%	90%	229%	132%	-46%	-	115%	205%
All-in Total, Net of Performance Revisions Only ((E - C) / F)	296%	154%	268%	132%	-46%	-	115%	237%