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Did EOG Resources Generate Positive Free Cash Flow in 4Q17?

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EOG Resources’ 4Q17 operating cash flow

In 4Q17, EOG Resources (EOG) reported operating cash flow of ~$1.3 billion, marginally higher than Wall Street analysts’ expectation. 

On a YoY (year-over-year) basis, EOG’s 4Q17 operating cash flow was ~65% higher than the ~$805 million it generated in 4Q16. Even on a sequential basis, EOG’s 4Q17 operating cash flow was ~38% higher than the ~$961 million it generated in 3Q17.

EOG Resources’ YoY increase in operating cash flow can be attributed to its higher production and higher realized prices in 4Q17 compared to 4Q16. To learn more, refer to Parts Two and Three of this series.

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EOG Resources’ free cash flow in 4Q17

In 4Q17, EOG Resources spent ~$1.1 billion in capex (capital expenditure), meaning that its free cash flow was positive at ~$271 million. EOG’s peer Encana (ECA) reported ~-$140 million in free cash flow in 4Q17. Encana reported 4Q17 operating cash flow of ~$369 million, whereas it spent ~$509 million in capex in 4Q17.

EOG Resources’ cash flows in 2017

For 2017, EOG Resources reported operating cash flow of ~$4.3 billion, ~79% higher than its operating cash flow of ~$2.4 billion in 2016. In 2017, EOG Resources spent ~$4.1 million in capex, meaning EOG’s 2017 free cash flow was positive at ~$141 million.

EOG Resources’ capex guidance

For 2018, EOG Resources expects its capex to be in the range of $5.4 billion–$5.8 billion. EOG’s 2018 capex guidance excludes any 2018 acquisitions. EOG’s peer Range Resources (RRC) expects its capex to be $941 million.

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