Continental adds SCOOP acreage, expects increased production

By Patrick C. Miller | May 16, 2017

Continental Resources Inc. saw high production rates from new wells in North Dakota’s Bakken and Oklahoma’s SCOOP and STACK shale plays during the first quart of 2017, according to the company’s report for the first quarter of 2017.

"I am very pleased with the performance of our assets and operations so far this year,” said Harold Hamm, Continental’s chairman and CEO. “Relative to 2017 guidance, we are ahead on production, under on CAPEX and expect to be at the top-end or better than our production guidance for the year."

Continental’s Bakken wells exceeded the 980,000 barrels boepd EUR curve by an average of 65 percent in the first 30 days. Its SCOOP Springer wells outperformed the 940,000 boepd EUR curve by an average 60 percent in the first 30 days. STACK Meramec wells flowed at 1,907 to 3,011 boe during their initial 24-hour tests.

"In the Bakken, we have seen industrywide basin wellhead netbacks strengthen by approximately $2 per barrel with new pipeline capacity and additional markets becoming available,” Hamm said. “This will begin to positively impact our economics over the next several months."

Hamm noted that Continental continues to expand the strategic scope of its assets, adding about 300,000 net reservoir acres under its existing leasehold in the SCOOP play’s Sycamore reservoir.

Jack Stark, Continental president, said, "We are excited about Continental's Sycamore position and the added value it will bring to the company. We plan to drill five to seven additional wells during the year focused on delineating the high-liquids windows of the play."

For the quarter ending Mach 31, Continental reported a net income of $.47 million. Net cash provided by operating activities for the first quarter of 2017 was $470.2 million. EBITDAX during the quarter was $482.5 million.

Quarterly net production totaled 19.2 million boe or 213,755 boepd, an increase of approximately 4,000 boe per day from previous quarter. March production averaged approximately 222,500 boepd. The company expects second quarter 2017 production will range from 220,000 to 225,000 boepd. Continental is currently tracking at the top end or better than its annual production guidance. If warranted, it will update its guidance in August.

Total net production for first quarter 2017 included 119,201 barrels of oil per day (56 percent of production) and 567 million cubic feet of natural gas per day (44 percent of production). Oil as a percentage of total production is expected to continue increasing to approximately 60 percent by the end of 2017.

Continental said it has four operated drilling rigs working in the Bakken and plans to maintain that level through year’s end. The company also has seven stimulation crews working in the play and plans to be at nine by mid-year.

"Our optimized completions are another game changer for the Bakken," Stark said. "This technology is delivering record 30-day production rates and almost doubling the rates of return expected from our previous economic models."