CLR pins 2019 focus on SCOOP, STACK and Bakken

By Luke Geiver | February 18, 2019

Continental Resources will focus on generating free cash flow through oil volumes in 2019. The Oklahoma exploration and production company with large leaseholds and operations in the Bakken and the Anadarko Basin of Oklahoma, announced plans for spending roughly $2.6 billion this year. Oil production could grow in a range between 13 percent and 19 percent, with half of the growth in production coming from the Bakken and operations in the SCOOP/STACK.

Oklahoma will see a larger share of drilling rigs this year as the company continues to develop its multi-zone, multi-well pad Project Springboard.

If oil trades in the $55/b range and gas is priced at $3.00/Mcf, CLR will generate roughly $500 to $600 million in free cashflow. In typical CLR fashion, the company will rely little on oil hedges, at least for the first part of 2019.

At 25 drilling rigs, the company will be running nearly the same number as 2018’s average. Using an average of nine completion crews, CLR expects to complete 307 gross wells with first production coming this year.

The timing of drilling and completing wells this year will impact CLR’s activity and spend in the Bakken. According to the company capital allocation will be lower in the Williston Basin this year compared to last year due to a lower rig count and the timing of drilling larger pads later in the year, where, the company added, completion spend is not expected to occur until 2020. The Bakken operations will keep four completion crews running.

In Oklahoma, Project Springboard is dominating CLR’s focus. The multiwell pad will keep 12 drilling rigs running and five completion crews.  An additional 7 rigs will operate in the state.

As for 2018 production, the company grew total oil production by roughly 23 percent compared to the previous year.

The Bakken accounts for 52 percent of CLR’s proved reserves, followed by the SCOOP at 30 percent and the STACK at 15 percent.

"In 2019, Continental will deliver enhanced capital efficiency with greater oil-weighted production growth coupled with a lower capital spend. The high quality of our assets and operations will drive sustainable free cash flow generation, debt reduction and industry-leading returns," said Harold Hamm, chairman and CEO.