Leading Bakken oil producer Continental Resources Inc. (CLR) plans to boost its production as well as proved reserves by three-fold by year-end 2017.
This is in line with Continental’s strategic plan to amplify production from the 2012 mid-range estimate of 36 million barrels of oil equivalent (:MMBOE) to 108 MMBOE by 2017. The growth will come mainly from its Bakken shale acreage in North Dakota and Montana and Oklahoma's Anadarko Woodford area. Continental’s proved reserves of 610 MMBOE in mid 2012 is also anticipated to triple at the end of 2017.
The company is also targeting annual production growth of 30% to 35% next year. Continental’s average production was 94,852 BOE per day for the second quarter ended June 30, 2012. Its production expectation for 2013 relies upon an estimated capital outlay of $3.4 billion and the completion of 300 net wells.
Oklahoma City-based Continental is an independent exploration and production (E&P) company focused on the Bakken, Cana and Niobrara shale plays. It has leases on nearly 1 million acres in the Bakken Shale region. As of June 30, the company had leases on about 315,675 net acres in the Anadarko Woodford region.
The company operates in the North, South and Eastern regions of the U.S. Its North region is north of Kansas and west of the Mississippi river and comprises North Dakota Bakken, Montana Bakken, the Red River units and the Niobrara play in Colorado and Wyoming. The first two hold the most promise for Continental.
The Southern region includes Kansas and all properties south of Kansas and west of the Mississippi river comprising the Anadarko Woodford and Arkoma Woodford plays in Oklahoma. The Anadarko and Arkoma Woodford plays comprise the second most important focus for the company.
Continental’s peer company, Houston, Texas-based EOG Resources Inc. (EOG) is one of the best independents in the E&P sector. It continues to demonstrate solid execution in its key growth assets, particularly in the Eagle Ford and Bakken plays. Its crude oil and condensate production was up almost 52% year over year in the second quarter of 2012. This was primarily driven by significant contributions from EOG Resources’ Eagle Ford and Bakken plays.
Continental retains a Zacks #3 Rank, which is equivalent to a Hold rating for a period of one to three months.
More From Zacks.com