What's the quickest way to double an investment these days? Well, according to EOG Resources (EOG -0.48%) it would be to drill for oil. The company is enjoying a direct after tax rate of return averaging 100% pretty much every single time it puts a drill bit into the ground.

Over the next four years the company sees this high margin oil production delivering a big growth in earnings and free cash flow. Those funds will be used for healthy annual dividend increases as well as an acceleration in its high rate-of-return drilling program. Let's take a closer look at why EOG is just printing money these days. 

Profits Are Soaring Like An Eagle 
EOG has a prime position in the Eagle Ford shale. It's what has fueled the company's rise to the top oil producer in the play. However, thanks to advances in completion techniques, a reduction in the average number of drilling days as well as the fact that EOG has its own source of proppant sand, it's able to simply print money from the play. The following slide shows that these advances are increasing the average initial production rate of each well, while at the same time well costs are falling, which are the key ingredients to improved returns.

Source: EOG Resources Investor Presentation (link opens a PDF)

Because of its position and these returns, the Eagle Ford has really become its crown jewel. However, It's not the only company that is benefiting from having a gem of a position in the play. For example, ConocoPhillips (COP -0.41%), also has a high rate of return position in the play. The company was able to get in early and acquired a lot of its acreage for just $300 per acre. Today it just costs the company about $20 per barrel of incremental finding and developing costs. While that is yielding high-margin growth for Conoco, the play has really been needle-moving for the smaller EOG. 

Bringing it from the Bakken
EOG isn't the top producer in the Bakken, but it is enjoying 100% returns here as well. New frac technology is helping to improve recovery and returns. In addition to that it's using its innovative crude-by-rail system to get top prices for its oil by shipping it to St. James, Louisiana. The slide below shows that by sending its oil to St. James it's able to get upwards of $11 per barrel more of its oil.

Source: EOG Resources Investor Presentation

Like the Eagle Ford, it's using self-sourced sand to keep its well costs down and it is EOG's use of sand in the Bakken that is actually a break from what some of its peers are doing. Companies like Halcon Resources (HK) and Kodiak Oil & Gas (NYSE: KOG) have both found the best returns by using more expensive ceramic proppants. Kodiak, for example enjoys an internal rate of return as high as 84% on its long lateral Bakken wells that cost it $9.5 million to drill. These wells also have estimated ultimate recoveries of about 850,000 barrels of oil equivalent. Meanwhile, Halcon is seeing dramatic improvements in its initial production rates as well as a 40% boost in its estimated ultimate recovery rates which is boosting returns. That being said, EOG is enjoying estimated ultimate recoveries of 940,000 barrels of oil equivalent for wells that cost around the same price. EOG has an even better position in the play, which is a key to producing these tremendous returns for the company. 

Permian Basin
If dominate profits in the two hottest shale oil plays wasn't enough, EOG added another triple digit returning shale play this year. While the company has acreage in both the Delaware Basin and Midland Basin portions of the Permian Basin, it's the Leonard Shale of the Delaware Basin that's currently yielding big returns. Again, EOG is able to earn triple digit after tax returns every time it puts a drill into the ground. One of the drivers of its returns here is that it's able to get premium prices for its oil by utilizing its rail infrastructure and sending its oil to St. James.

Final Foolish Thoughts
EOG is in a great spot these days. It's earning triple digit returns pretty much on every well it drills. Best of all, it has about a dozen years of drilling left in both the Bakken and Eagle Ford and an even larger number of future wells in the Permian to keep that cash flow train rolling. That should help keep EOG leading America's amazing oil boom.