EOG Resources 2004 Annual Report to Shareholders

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FINANCIAL AND OPERATING HIGHLIGHTS


(In millions, unless otherwise indicated)	2004		2003		2002

Net Operating Revenues	$	2,271	$	1,745	$	1,095
Income Before Interest Expense and Income Taxes	$	989	$	713	$	179
Net Income Available to Common	$	614	$	419	$	76
Exploration and Development Expenditures	$	1,510	$	1,333	$	836
Wellhead Statistics
Natural Gas Volumes (MMcfd)		1,036		955		924
Natural Gas Prices ($/Mcf)	$	4.86	$	4.40	$	2.60
Crude Oil and Condensate Volumes (MBbld)		27.4		23.2		23.3
Crude Oil and Condensate Price ($/Bbl)	$	40.22	$	29.92	$	24.56
Natural Gas Liquids Volumes (MBbld)		5.6		3.8		3.7
Natural Gas Liquids Price ($/Bbl)	$	27.13	$	21.13	$	14.05

The Company

EOG Resources, Inc. is one of the largest independent (non-integrated) oil and natural gas companies in the United States with substantial proved reserves in the United States, Canada, offshore Trinidad and, to a lesser extent, the United Kingdom North Sea. EOG Resources, Inc. is listed on the New York Stock Exchange and is traded under the ticker symbol "EOG."

On The Cover

A spinning drillbit reflects EOG's high level of drilling activity and its continued focus on organic growth, a long-term strategy that positioned the company to achieve outstanding performance in 2004.

Highlights

For 2004, EOG reported net income available to common of $614 million, compared to $419 million for 2003.
At December 31, 2004, total company reserves were approximately 5.6 Tcfe, an increase of 430 Bcfe, or 8 percent higher than 2003. From drilling alone, EOG added 850 Bcfe of reserves
in 2004.
During 2004, total company production increased 10.4 percent on a daily basis, compared to 2003. EOG is targeting 13.5 percent organic production growth in 2005, which includes an 11 percent increase in natural gas production from the United States and Canada.
At year-end 2004, EOG had approximately 400,000 acres under lease in the Texas Barnett Shale play with net production reaching 30 MMcfed during December.
In the United Kingdom North Sea, EOG commenced production from two Southern Gas Basin wells in the third quarter of 2004 and the first quarter of 2005. These are EOG's first producing assets in that region.

In Trinidad, total 2004 production increased 25 percent, compared to 2003. EOG began natural gas sales to NGC for the N2000 ammonia plant in mid-2004. In February 2005, EOG announced a 10-year extension and amendments to the pricing terms of the SECC natural gas sales contract with NGC and signed a contract to supply natural gas to NGC for an
LNG plant with start-up planned for mid-2006.
A two-for-one stock split in the form of a stock dividend, announced in February 2005, was effective March 1, 2005. In addition, the cash dividend on the common stock was increased by 33 percent, following a 20 percent increase in 2004. Beginning with the dividend payable on April 29, 2005, the post-split quarterly cash dividend on the common stock will be $.04 per share, the fifth increase in six years.

Information regarding forward-looking statements is on page 21 of this annual report to shareholders.

For a glossary of terms see page 56.

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