Continental Resources releases 2016 Bakken plans

By Luke Geiver | January 27, 2016

Continental Resources intends to invest $322 million into its Bakken operations in 2016. The Oklahoma-based producer will run four drilling rigs throughout its Williston Basin operations. Combined with its Bakken investments, Continental Resources plans to spend a total of $920 million in 2016.

“We will continue to focus our investments in our core operating areas and expect to realize further efficiency gains and cost reductions as we optimize our portfolio,” said John Hart, senior vice president and chief financial officer. “In terms of budget, each $5 move in WTI prices impacts our full-year cash flow by $150 million to $200 million.”

The company believes its 2016 budget plans will leave it cash flow neutral at an average WTI price of $37/b for the full year. But, at an average WTI price of $40/b, Continental Resources estimates 2016 results would be cash flow positive in excess of $100 million.

By the end of the year, the company could have roughly 200 drilled but uncompleted Bakken wells in its inventory, a number Jack Stark, president and chief operating officer, said would represent a significant asset for the company.

With a 19-rig program and a plan to defer completions until the end of the year for most of its Bakken wells, Continental expects to average 200,000 barrels of oil equivalent per day this year.

Harold Hamm, CEO, said earlier this year he believes oil prices could increase to roughly $65/b. “Strategically, we are dedicated to preserving the value of our premier assets and building operational efficiencies in preparation for crude oil prices to stabilize and start recovering later this year,” Hamm said. “Fortunately our lean organization and strong liquidity have us well-positioned to manage through this period until the recovery begins.”