As more fully discussed in Note 6 to the Consolidated Financial Statements included in EOG's 2010 Annual Report, EOG maintains various stock-based compensation plans. Stock-based compensation expense is included in the Consolidated Statements of Income based upon the job function of the employee receiving the grants as follows (in millions):

		Three Months Ended				Nine Months Ended
		September 30,				September 30,
		2011		2010		2011		2010

Lease and Well	$	9.5	$	8.0	$	24.4	$	20.3
Gathering and Processing Costs		0.2		0.1		0.6		0.4
Exploration Costs		7.8		7.3		19.4		18.1
General and Administrative		24.1		21.3		50.6		42.9
Total	$	41.6	$	36.7	$	95.0	$	81.7

The EOG Resources, Inc. 2008 Omnibus Equity Compensation Plan, as amended (2008 Plan), provides for grants of stock options, stock-settled stock appreciation rights (SARs), restricted stock, restricted stock units and other stock-based awards. At September 30, 2011, approximately 4.9 million common shares remained available for grant under the 2008 Plan. EOG's policy is to issue shares related to the 2008 Plan from previously authorized unissued shares.

Stock Options and Stock-Settled Stock Appreciation Rights and Employee Stock Purchase Plan. The fair value of Employee Stock Purchase Plan (ESPP) grants is estimated using the Black-Scholes-Merton model. The fair value of stock option and SAR grants is estimated using the Hull-White II binomial option pricing model. Stock-based compensation expense related to stock option, SAR and ESPP grants totaled $13.5 million and $12.6 million during the three months ended September 30, 2011 and 2010, respectively, and $33.4 million and $30.4 million during the nine months ended September 30, 2011 and 2010, respectively.

Weighted average fair values and valuation assumptions used to value stock option, SAR and ESPP grants during the nine-month periods ended September 30, 2011 and 2010 are as follows:

		Stock Options/SARs				ESPP
		Nine Months Ended				Nine Months Ended
		September 30,				September 30,
		2011		2010		2011		2010

Weighted Average Fair Value of Grants	$	29.87	$	32.10	$	22.35	$	25.42
Expected Volatility		40.92%		39.74%		29.68%		38.18%
Risk-Free Interest Rate		0.58%		0.87%		0.18%		0.18%
Dividend Yield		0.7%		0.7%		0.7%		0.7%
Expected Life		5.6 yrs		5.5 yrs		0.5 yrs		0.5 yrs

Expected volatility is based on an equal weighting of historical volatility and implied volatility from traded options in EOG's common stock. The risk-free interest rate is based upon United States Treasury yields in effect at the time of grant. The expected life is based upon historical experience and contractual terms of stock option, SAR and ESPP grants.

The following table sets forth stock option and SAR transactions for the nine-month periods ended September 30, 2011 and 2010 (stock options and SARs in thousands):

	Nine Months Ended			Nine Months Ended
	September 30, 2011			September 30, 2010
			Weighted			Weighted
	Number of		Average	Number of		Average
	Stock		Grant	Stock		Grant
	Options/SARs		Price	Options/SARs		Price

Outstanding at January 1	8,445	$	64.49	8,335	$	57.08
Granted	1,470		85.25	1,420		93.02
Exercised (1)	(1,150)		48.41	(924)		40.11
Forfeited	(133)		87.75	(80)		80.12
Outstanding at September 30 (2)	8,632	$	69.80	8,751	$	64.49

Vested or Expected to Vest (3)	8,387	$	69.29	8,221	$	64.01

Exercisable at September 30 (4)	5,382	$	59.25	5,632	$	51.79

(1)

The total intrinsic value of stock options/SARs exercised for the nine months ended September 30, 2011 and 2010 was $69 million and $58 million, respectively. The intrinsic value is based upon the difference between the market price of EOG's common stock on the date of exercise and the grant price of the stock options/SARs.

(2)

The total intrinsic value of stock options/SARs outstanding at September 30, 2011 and 2010 was $91 million and $252 million, respectively. At September 30, 2011 and 2010, the weighted average remaining contractual life was 3.9 years and 4.1 years, respectively.

(3)

The total intrinsic value of stock options/SARs vested or expected to vest at September 30, 2011 and 2010 was $91 million and $241 million, respectively. At September 30, 2011 and 2010, the weighted average remaining contractual life was 3.8 years and 4.1 years, respectively.

(4)

The total intrinsic value of stock options/SARs exercisable at September 30, 2011 and 2010 was $91 million and $233 million, respectively. At September 30, 2011 and 2010, the weighted average remaining contractual life was 2.6 years and 3.0 years, respectively.

At September 30, 2011, unrecognized compensation expense related to non-vested stock option and SAR grants totaled $100 million. This unrecognized expense will be amortized on a straight-line basis over a weighted average period of 3.0 years.

Restricted Stock and Restricted Stock Units. Employees may be granted restricted (non-vested) stock and/or restricted stock units without cost to them. Stock-based compensation expense related to restricted stock and restricted stock units totaled $28.1 million and $24.1 million for the three months ended September 30, 2011 and 2010, respectively, and $61.6 million and $51.3 million for the nine months ended September 30, 2011 and 2010, respectively.

The following table sets forth the restricted stock and restricted stock units transactions for the nine-month periods ended September 30, 2011 and 2010 (shares and units in thousands):

	Nine Months Ended			Nine Months Ended
	September 30, 2011			September 30, 2010
			Weighted			Weighted
	Number of		Average	Number of		Average
	Shares and		Grant Date	Shares and		Grant Date
	Units		Fair Value	Units		Fair Value

Outstanding at January 1	4,009	$	79.13	3,636	$	73.69
Granted	917		90.93	840		93.36
Released (1)	(410)		65.77	(308)		53.99
Forfeited	(202)		82.51	(57)		77.71
Outstanding at September 30 (2)	4,314	$	82.75	4,111	$	79.13

(1)

The total intrinsic value of restricted stock and restricted stock units released for the nine months ended September 30, 2011 and 2010 was $40 million and $30 million, respectively. The intrinsic value is based upon the closing price of EOG's common stock on the date restricted stock and restricted stock units are released.

(2)

The total intrinsic value of restricted stock and restricted stock units outstanding at September 30, 2011 and 2010 was $306 million and $382 million, respectively.

At September 30, 2011, unrecognized compensation expense related to restricted stock and restricted stock units totaled $153 million. Such unrecognized expense will be recognized on a straight-line basis over a weighted average period of 2.7 years.