EOG Resources Makes About-Face On FY15 Production Growth

EOG Resources Inc EOG rallied briefly on Thursday after the company unexpectedly said it would pull in its horns in the shale oil business during 2015.

EOG, which missed fourth-quarter earnings expectations by 20 percent, changed hands recently at $93.79, down $1.52. Earlier it traded as high as $94.07.

EOG, one of the nation's largest independent oil and gas producers, told investors it will delay well completions and targeted flat crude production for the year, versus 31 percent growth in 2014.

The company, formerly called Enron Oil and Gas, is "not interested in accelerating crude oil production in a low-price environment," Chief executive William R. Thomas said in a conference call.

Doing so would be "not a smart thing," Thomas said.

Thomson, in November, had told investors that the company expected to "be a leader in organic growth -- crude oil growth next year."

The company on Wednesday said it will cut capital spending 40 percent to $4.9-$5.1 billion in 2015 and complete 45 percent fewer wells compared with 2014.

The downturn in oil prices will reduce global supply and the market will rebalance, Thomas said, adding that he aims to "exit this downturn in better shape than we entered it."

On Wednesday, the company posted a 23 percent decline in fourth-quarter net income to $445 million, or $0.81 a share versus year-earlier profit of $580 million, or $1.06 a share.

Adjusted income equaled $0.79 a share, versus analysts' expectations of $1.02.