EOG’s Position on Global Climate Change

EOG supports efforts to understand and address the contribution of human activities to global climate change through the application of sound scientific research and analysis. EOG is a significant U.S. producer of natural gas, one of the cleanest burning and most environmentally friendly fossil fuels. In addition, the company believes that the reduction of air emissions throughout its operations is both in the best interests of the environment and a prudent business practice. A safety and environmental report that includes climate change issues is presented to the EOG Board of Directors annually.

EOG is a member of the American Exploration and Production Council (AXPC), a national trade association that represents large United States independent natural gas and crude oil exploration and production companies. AXPC companies have been active in voluntarily reducing methane emissions. Additionally, the AXPC has issued a formal position statement on climate change, which supports continued research on the contribution of human activities to climate change and the development of policy and regulatory initiatives in a sound scientific and economically transparent manner. The AXPC supports the sharing of best management practices and recognizes that natural gas will be a critical component of any climate change policy. The complete AXPC position statement, which EOG supports, is available at http://www.axpc.us/policy/pdf/080418.pdf.

EOG is also a member of the Independent Petroleum Association of America (IPAA), a national trade association that represents independent oil and natural gas explorers and producers in the United States. The IPAA and many of its member companies support programs to voluntarily reduce methane emissions. With respect to climate change, it is the stated position of the IPAA that science must serve as the foundation for global climate policymaking; economic and social impacts must be addressed; and the role of American oil and natural gas production must be recognized in any policy actions.

The company strives to promote policies within these and other trade associations that are consistent with EOG’s position on global climate change.

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Emissions Management and Reporting

It is important to EOG, for operational, environmental and economic reasons, to reduce air emissions from its operations. EOG’s facilities are specifically designed to minimize emissions and maximize recovery of all vapors. Where warranted, EOG has installed specialized control equipment to minimize air emissions.

EOG has a program in place to promote compliance with state and federal permits and regulations. EOG recently implemented an Emissions Management System for calculating emissions based on recognized methodologies and accepted engineering practices. This system is being utilized to calculate greenhouse gas (GHG) emissions from the company’s operating facilities.

In September 2011, EOG filed reports with the EPA in accordance with the regulatory requirements for facilities with combustion sources greater than 25,000 tons per year (based on 2010 emissions data). EOG continues to gather data to comply with future reporting requirements. EOG also gathers 2011 greenhouse gas (GHG) emissions data for all facilities subject to EPA’s regulatory requirements, and will report that data to EPA in 2012. It is expected that this data will be made available to the general public by the EPA.

The EPA recently proposed regulations under the Clean Air Act that would further regulate emissions relating to hydraulic fracturing and the completion of wells. Once these regulations are finalized, EOG will implement additional measures as necessary to comply.

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Conservation Programs

EOG frequently reviews energy use and efficiency and takes appropriate actions to reduce consumption as well as improve efficiency as a normal part of its operations. As a result of these reviews, EOG has installed electric or dual-fuel compressors in some areas. Additionally, in support of recent regulatory initiatives, EOG has accelerated use of electric-driven compression in certain regions of the United States to lessen the emissions generated in those areas.

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Regulatory Risks

EOG is aware of the increasing focus of local, state, national and international regulatory bodies on GHG emissions and climate change issues. The company is also aware of legislation proposed by U.S. and Canadian lawmakers to reduce GHG emissions. EOG will continue to monitor and assess any new policies, legislation or regulations in the areas where it operates to determine the impact on operations and take appropriate actions, where necessary.

EOG believes that any new climate change policies must be based on sound scientific and economic considerations, which are fully disclosed to the public, and rely on market forces to efficiently encourage consumer conservation and the development of alternative energy sources. Also, EOG believes that application and enforcement of policies and regulations should apply appropriately to all sectors of the economy and be uniform at the local, state, national and international levels. Moreover, EOG believes any emissions limits or standards imposed on industry should be based on reliable, available and economically feasible technology.

Since GHG emissions from the combustion of natural gas are among the lowest of any fossil fuel on a per-unit basis, EOG expects that the increased use of natural gas in preference to other fossil fuels will be a critical component of any climate change policy. EOG will strive to increase production of natural gas where economically feasible in response to increases in natural gas demand.

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Physical Risks

EOG has offshore operations in the Gulf of Mexico, Trinidad and the United Kingdom and interests in properties operated by third parties in the United Kingdom. These facilities are subject to environmental risks and extreme weather conditions such as hurricanes. Extreme weather conditions could also impact other areas of operations, including access to drilling and production facilities for routine operations, maintenance and repairs, the installation and operation of gathering and production facilities and the availability of, and access to, necessary third-party services, such as gathering, processing, compression and transportation.

EOG will continue as part of the planning process to review the risks to the company posed by diverse environmental matters, including climate change.

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