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HOUSTON - EOG Resources, Inc. (NYSE:EOG), a $63 billion market cap energy company with strong financial health according to InvestingPro analysis, has been granted an oil exploration concession for Unconventional Onshore Block 3 (UCO3) by Abu Dhabi’s Supreme Council for Financial and Economic Affairs, the company announced today. The concession spans a 3,609 square kilometer area in the Al Dhafra region, where EOG will hold complete equity and operatorship.
In partnership with the Abu Dhabi National Oil Company (ADNOC), EOG will embark on exploration and appraisal of unconventional oil reserves within the concession. Following an initial three-year appraisal phase, there is potential for EOG to transition into a production concession, with ADNOC having the option to participate. The company’s strong balance sheet, with more cash than debt and a current ratio of 1.87, positions it well for this expansion.
Drilling activities are anticipated to commence in the latter half of 2025, aligning with EOG’s capital plan for the year. This new venture is a strategic move for EOG, which is already one of the leading crude oil and natural gas exploration and production companies in the United States, with a significant presence in Trinidad. The company has demonstrated strong operational efficiency with a gross profit margin of 62% and has maintained dividend payments for 36 consecutive years.
EOG’s Chairman and CEO, Ezra Y. Yacob, expressed enthusiasm about the project, highlighting the company’s eagerness to assess the hydrocarbon-rich basin’s potential for horizontal development and to contribute to the expansion of Abu Dhabi’s resource potential.
The awarding of the UCO3 concession to EOG marks a significant step in the company’s international expansion efforts, as it seeks to leverage its expertise in unconventional resource exploration in a new geographical context. This development is based on a press release statement from EOG Resources, Inc.
In other recent news, EOG Resources Inc. reported its first-quarter 2025 earnings, showcasing a mixed financial performance. The company exceeded earnings per share (EPS) expectations with $2.87, surpassing the forecast of $2.71. However, EOG Resources’ revenue fell short, totaling $5.67 billion against the anticipated $5.91 billion. The company also announced a $200 million reduction in its 2025 capital investment plan. Despite these adjustments, EOG Resources maintained a strong cash balance of $6.6 billion. Additionally, the company is planning a strategic bolt-on acquisition in the Eagle Ford, valued at $275 million, which is expected to enhance its drilling inventory. Analysts from firms like JPMorgan highlighted EOG’s capital discipline, noting the company’s focus on protecting shareholder returns and free cash flow. These developments indicate EOG Resources’ strategic moves to optimize its financial standing amidst a challenging revenue environment.
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