Energy Prospectus

I urge all of you to read the transcript of EOG's Q4 conference call, at least the first five pages.

"..... as a result of (lower well) costs and oil productivity improvements in the Eagle Ford western acreage, we can now generate better returns with $65 oil than we did with $95 oil just two or three years ago. We illustrate this on slide 11 of the investor presentation. Due to low oil prices, we have already seen service cost reductions in many areas and see the potential for 10% to 30% vendor savings during this downturn."

EOG plans to drill wells but not complete them, waiting until completion costs come down and oil prices go back up.

What they are doing is VERY SMART.

They can only do this because they have a very strong balance sheet and more than enough cash flow from operations to fund their $5 billion capital program.

From EOG Conference Call:

"... EOG will be very focused this year on preparing for the recovery in oil prices. The current supply demand imbalance is not very large.

And current prices are far short of what is necessary to sustain the supply need to meet world demand growth. When prices recover, EOG will be prepared to resume strong double-digit oil growth. For now, EOG is intentionally choosing returns over growth.

In fact, that's the way it's always been here at EOG. In summary, I want to leave you with some important summary points.

> Year end, year out EOG consistently approaches capital planning by focusing on returns. 2015 is no different.

> Second, we have halted production growth deliberately. While EOG is one of the few companies that can earn a healthy return at today's oil prices, we are not interested in growing oil into a low-price environment. As we compare today's oil prices to our expectations for a more balanced market, it makes economic sense to slow production until an industry wide supply response is realized and prices respond accordingly. This strategy maximizes the value of our assets and it's the right strategy to create long-term shareholder value.

> Third, our balance sheet places EOG in a strong position. We intend to use our financial flexibility to take advantage of opportunities to grow our inventory by acquiring low-cost high-quality acreage.

> And fourth, with a substantial inventory of high-volume wells to complete, we will be ready to return to double-digit oil growth as oil prices improve.

Finally, we fully expect to emerge from this commodity-priced down cycle in a stronger position than we entered it. In 2015, we have more opportunity than ever to lower finding costs and developing costs and improved returns in 2016 and beyond."