HOUSTON, Nov 7 (Reuters) - U.S. oil and gas company EOG Resources Inc said on Thursday it expects to increase capital spending next year if crude prices stay near current levels and put more money into targeting wells in Texas and North Dakota .
“If oil prices stay where they are now, we will likely step up our capex over 2013 levels,” Mark Papa, EOG’s executive chairman told investors on the company’s third-quarter earnings call.
In 2013, EOG expects to spend $7.2 billion. The company will release its budget for next year in February when it reports fourth quarter earnings, Papa said.
EOG will direct more capital to drilling in places where it is seeing the best returns, so wells in North Dakota’s Bakken shale and the Eagle Ford formation in south Texas will be at the top of the list, Papa told investors.
On Wednesday after the close, EOG reported a better-than-expected third-quarter profit fueled by growth in crude production.
Still, investors fretted about the possibility crude oil growth may slow on a sequential basis in the fourth quarter. Those concerns contributed to a 4 percent decline in the company’s stock.
Analysts at Baird characterized EOG’s quarterly results as modestly positive. They cautioned in a note to clients on Thursday, “The beat and solid operations update are favorable but investor expectations likely also high for EOG.”