Whiting Announces Strong First Quarter

Whiting Petroleum: 2015 Q1
Whiting Petroleum: 2015 Q1

Whiting Petroleum announces solid first quarter results for Bakken region.

In its Q1 press release, Whiting reported production totaling 15.0 million barrels of oil equivalent (MMBOE), 88% crude oil/natural gas liquids (NGLs). Production averaged 166,930 barrels of oil equivalent per day (BOE/d), a 3% increase over the fourth quarter 2014.

Whiting’s budget remains at $2 billion with capital expenditures expected to decline sharply in the second half of 2015.

James J. Volker, Whiting’s Chairman, President and CEO, commented, “While we are reducing rig count and well cost, production was strong in Q1 2015. We had solid results in the Bakken/Three Forks and Niobrara. Our total rig count will average 11 rigs in the second half of 2015. Nine of these rigs will operate in the Bakken/Three Forks.

Related: Whiting to Reduce Bakken Rig Count

Bakken Highlights

Whiting currently holds an astounding 1,270,092 gross acres in the Williston Basin of North Dakota and Montana. Here are Bakken In the first quarter 2015:

  • Production from the Bakken/Three Forks averaged a record 133,500 BOE/d, an increase of 82% over the 73,325 BOE/d in the first quarter 2014
  • The Bakken/Three Forks represented 80% of Whiting’s total first quarter production.
  • As of December 31, 2014, Whiting had an estimated 7,541 future gross drilling locations in the Bakken/Three Forks formations, of which approximately 60% target the Bakken formation.
  • At Dunn field in Dunn County, North Dakota, initial production rates from four Whiting-operated wells completed in mid-January averaged 3,181 BOE/d per well while 30-day rates averaged 1,255 BOE/d per well.
  • At the Polar field in Williams County, North Dakota, initial production rates from four Whiting-operated wells completed in late February averaged 2,630 BOE/d per well while 30-day rates averaged 1,130 BOE/d per well.
  • At the Koala field, which is located near our Hidden Bench field in McKenzie County, North Dakota, we completed four pad wells in mid-March that flowed an average rate of 2,584 BOE/d per well while 30-day rates averaged 1,395 BOE/d per well.

Read more at whiting.com

Whiting Petroleum: Is It Up for Sale?

Whiting  Petroleum Reportedly Up For Sale
Whiting Petroleum Reportedly Up For Sale

Rumors have been swirling for weeks that Denver-based Whiting Petroleum might be up for sale and some companies may be biting.

Bloomberg reported on Friday that several companies are expressing interest in Whiting including Exxon Mobil Corp., Continental Resources Inc., Hess Corp. and Statoil ASA.

No one is talking openly about a possible deal including Whiting, who has not given any official statement about their intentions. All information has come from anonymous sources and people who are speculating about what the company may do.

Bloomberg quotes Phillip Jungwirth, an analyst with Bank of Montreal, who says that “Whiting is probably exploring a sale along with other strategic alternatives, including selling assets, raising debt and selling shares in order to address investor liquidity concerns.

Some believe that a full sale is unlikely due to the Whiting's heavy debt and that it is more probably that the company will sell off large pieces instead.

In early March, Whiting released its 2014 earning results with CEO James J. Volker boasting a strong year with record production and a string 2015 growth plan. A week later,  rumors started to surface the Whiting was looking around for other opportunities.

Whiting was founded in 1980 and became the largest Bakken/Three Forks producer in the Williston Basin after its acquisition of Kodiak Oil & Gas in June of last year.

Whiting to Reduce Bakken Rig Count

Whiting Bakken Acreage Map
Whiting Bakken Acreage Map

In its fourth quarter earning report, Whiting Petroleum announced a record 2014 and revealed a 2015 spending plan that includes reducing Bakken rig count.

In spite of low crude prices, Whiting ended the year with a Q4 profit of $58 million with cash flows totalling $419 million. Oil production was at record numbers for both the quarter (up 13%) and the entire year, which averaged 41.8 MMBOE and was up 22% over 2013.

Related: Whiting Bakken Production Hits Record Levels in Second Quarter

In July of 2014, Whiting Petroleum announced plans to acquire Kodiak Oil & Gas for $3.8 billion. The deal made the combined company the largest Bakken/Three Forks producer, unseating Harold Hamm’s Continental Resources from the top spot.

Read more: Whiting Petroleum Acquires Kodiak Oil & Gas – $3.8 Billion

James J. Volker, Whiting’s Chairman, President and CEO, commented, “2014 was a strong year for Whiting. We set records in production, proved reserves and discretionary cash flow. In the wake of our acquisition of Kodiak Oil & Gas, we became the largest Bakken/Three Forks producer in the Williston Basin.Our 2015 capital budget of $2.0 billion reflects a disciplined approach to maintaining our financial strength while preserving our long-term growth plans.

2015 Spending Plan

Looking to the new year, Whiting plans for the following:

  • Reduce its capital budget to $2 billion
  • $1.8 billion of the 2015 capital budget will go towards exploration and development activity
  • $59 million is allocated for land and $123 million for facilities
  • Production forecast of 59.0 MMBOE, an increase of 42% over 2014
  • Reducing Bakken rig count from 16 to 10
  • Completed well cost in the Bakken will average $7 million, down from $8.5 million in 2014

Read the full report at whiting.com

Whiting Bakken Production Hits Record Levels in Second Quarter

Whiting Petroleum reported record Bakken/Three Forks production of 80,195 boe/d in the second quarter of 2014. The data was released in the company's second quarter report, and represents a 33% increase in production year-over-year. Bakken/Three Forks production counted for 73% of the company's total production across its portfolio. Currently the company holds 1,059,957 gross (674,162 net) acres in the Williston Basin in North Dakota and Montana. Whiting Petroleum recently announced the acquisition of Kodiak Oil & Gas, in an all stock transaction, for $3.8 billion. The deal makes the combined company the largest Bakken/Three Forks producer, unseating Harold Hamm’s Continental Resources from the top spot.

Read more: Whiting Petroleum Acquires Kodiak Oil & Gas - $3.8 billion

Whiting CEO James Volker said in a prepared statement, “we believe we have plenty of running room in theWilliston Basin, particularly in light of our new completion techniques and downspacing programs.

Whiting Bakken Well Completions Benefiting from Cemented Liners

According to company officials, recent results using cemented liner completions in Whiting's Hidden Bench field have been particularly strong. The 11 wells completed in the second quarter using cemented liners had an average initial production (IP) rate of 2,872 boe/d, a 50% increase over the average of the company's Hidden Bench wells completed with sliding sleeve technology.

Whiting Bakken First Slickwater Frac Job

Whiting's first slickwater frac job, the Sundheim 21-27-1H well at the company's Missouri Breaks field in McKenzie County, North Dakota, was completed on August 24, 2013. It had a 120-day production rate of 374 boe/d, which was 44% greater than an offsetting well, which was completed using an uncemented liner and sliding sleeve technology. Currently the company has 11 slickwater fracs either underway or planned for the third quarter of 2014 at the Missouri Breaks, Sanish, Hidden Bench and Pronghorn fields.

Read more at whiting.com

Whiting Petroleum Acquires Kodiak Oil & Gas - $3.8 Billion

Whiting Bakken Acreage Map
Whiting Bakken Acreage Map

Whiting Petroleum announced on July 13, 2014, that it would acquire Kodiak Oil & Gas, in an all stock transaction, for $3.8 billion. The deal makes the combined company the largest Bakken/Three Forks producer, unseating Harold Hamm's Continental Resources from the top spot.

Next to the Eagle Ford Shale in South Texas, the Bakken Shale is the most prolific shale play in the world, with daily oil production exceeding 1-million b/d. With Whiting's acquisition of Kodiak, the company is positioning itself to be an even more formidable force in the Bakken.

In the first-quarter of 2014, Whiting and Kodiak had combined production of 107,000 boe/d, and officials indicate total 2014 production will be 152,000 boe/d. The combined company has 855,000 net acres and an inventory of 3,460 net drilling locations.

The addition of Kodiak’s complementary acreage position (approx. 173,000 net acres) and substantial inventory of high return drilling locations will provide the opportunity to drive significant value growth for both Whiting and Kodiak shareholders through an acceleration in drilling and increase in operational efficiencies,” said Whiting CEO James Voulkner.
Kodiak Bakken Acreage Map
Kodiak Bakken Acreage Map

Whiting officials said the deal is valued at $6 billion when Kodiak's net debt of $2.2 billion is absorbed.

Kodiak shareholders will receive 0.177 share of Whiting stock in exchange for each of Kodiak common stock they hold, representing a value of $13.90 per share based on the closing price of Whiting shares on July 11, 2014.

The transaction is expected to close in the fourth quarter of 2014.

Read more at whiting.com