EOG Resources Expands with $5.6 Billion Acquisition of Encino Partners

Published 1 days agoEOG

EOG Resources Expands with $5.6 Billion Acquisition of Encino Partners

This week, EOG Resources made a major move to bolster its foothold in the Utica shale basin by announcing a $5.6 billion deal to acquire Encino Acquisition Partners. Including debt, this acquisition will bring EOG an additional 675,000 net core acres, increasing its resource portfolio to an impressive 12 billion barrels of oil equivalent. This strategic play is among the latest in EOG's efforts to solidify its presence in key shale regions. Reuters reported that the acquisition clearly demonstrates EOG's focus on expanding its resource base.

In addition to expanding its shale holdings, EOG Resources is setting its sights on enhancing shareholder returns. The company plans a debt increase to $5-$6 billion in the next 12 to 18 months, which will support a more than 100% allocation of its free cash flow back to shareholders. This strategy includes a $5 billion extension of its share buyback program and a boost to its dividend, following a strong third-quarter performance where profits exceeded expectations.

Supporting this strategy of value creation, EOG recently reported a better-than-expected fourth-quarter adjusted profit of $2.74 per share against analyst predictions of $2.57. This was attributed to a 6.7% rise in quarterly oil production, even in the face of declining oil prices. The company returned $1.3 billion to shareholders in the first quarter of 2025 through dividends and share repurchases, while also announcing a new international oil discovery in Trinidad. This broad strategy reflects EOG's dedication to strategic growth and improving shareholder returns.

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