Fair Value Measurements (Notes)

3 Months Ended

Mar. 31, 2020

Recurring Fair Value Measurements. As more fully discussed in Note 13 to the Consolidated Financial Statements included in EOG's 2019 Annual Report, certain of EOG's financial and nonfinancial assets and liabilities are reported at fair value on the Condensed Consolidated Balance Sheets. The following table provides fair value measurement information within the fair value hierarchy for certain of EOG's financial assets and liabilities carried at fair value on a recurring basis at March 31, 2020 and December 31, 2019 (in thousands):



	Fair Value Measurements Using:
	Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
At March 31, 2020
Financial Assets: ⁽¹⁾
Crude Oil Swaps	$	—	$	898,090	$	—	$	898,090
Crude Oil Basis Swaps	—		888		—		888
Crude Oil Roll Differential Swaps	—		7,255		—		7,255
Natural Gas Liquids Swaps	—		30,822		—		30,822
Natural Gas Collars	—		3,678		—		3,678
Financial Liabilities:
Crude Oil Basis Swaps	$	—	$	93	$	—	$	93
Natural Gas Basis Swaps	—		7,712		—		7,712

At December 31, 2019
Financial Assets: ⁽¹⁾
Natural Gas Liquids Swaps	$	—	$	3,401	$	—	$	3,401
Natural Gas Basis Swaps	—		970		—		970
Financial Liabilities: ⁽²⁾
Crude Oil Swaps	$	—	$	23,266	$	—	$	23,266


(1)	$933 million and $1 million are included in "Current Assets - Assets from Price Risk Management Activities" at March 31, 2020 and December 31, 2019, respectively, on the Condensed Consolidated Balance Sheets.


(2)	$20 million is included in "Current Liabilities - Liabilities from Price Risk Management Activities" at December 31, 2019, on the Condensed Consolidated Balance Sheets.

The estimated fair value of commodity derivative contracts was based upon forward commodity price curves based on quoted market prices. Commodity derivative contracts were valued by utilizing an independent third-party derivative valuation provider who uses various types of valuation models, as applicable.

Non-Recurring Fair Value Measurements. The initial measurement of asset retirement obligations at fair value is calculated using discounted cash flow techniques and based on internal estimates of future retirement costs associated with property, plant and equipment. Significant Level 3 inputs used in the calculation of asset retirement obligations include plugging costs and reserve lives. A reconciliation of EOG's asset retirement obligations is presented in Note 6.

During the three months ended March 31, 2020, due to the decline in commodity prices, proved oil and gas properties, leasehold costs and other assets with a carrying amount of $1,813 million were written down to their fair value of $357 million, resulting in pretax impairment charges of $1,456 million for the three months ended March 31, 2020.

EOG utilized average prices per acre from comparable market transactions and estimated discounted cash flows as the basis for determining the fair value of unproved and proved properties, respectively, received in non-cash property exchanges. See Note 4.

Fair Value Disclosures. EOG's financial instruments, other than commodity derivative contracts, consist of cash and cash equivalents, accounts receivable, accounts payable and current and long-term debt. The carrying values of cash and cash equivalents, accounts receivable and accounts payable approximate fair value.

At March 31, 2020 and December 31, 2019, EOG had outstanding $5,140 million aggregate principal amount of senior notes, which had estimated fair values at such dates of approximately $5,145 million and $5,452 million, respectively. The estimated fair value of debt was based upon quoted market prices and, where such prices were not available, other observable (Level 2) inputs regarding interest rates available to EOG at the end of each respective period.