Bakken Shale producer Whiting Petroleum Corp. posted higher 1Q2021 revenues despite lower production as commodity prices strengthened.
Output declined in the first quarter to 8.1 million boe from 8.44 million boe in 4Q2020. Natural gas production totaled 10.3 Bcf compared to 10.7 Bcf in 4Q2020, while natural gas liquids (NGL) output rose slightly to 1.56 million bbl from 1.54 million bbl. Oil production fell from 5.1 million bbl to 4.8 million bbl.
The company did not report its first quarter results in 2020, when it was in the middle of Chapter 11 restructuring.
Operating revenue in 1Q2021 climbed on the back of better prices, totaling $307.4 million compared with $212.3 million in 4Q2020. Realized natural gas prices were $2.06/MMBtu in 1Q2021, compared with 55 cents in 4Q2020. For NGLs, prices averaged $17.28/bbl over $6.66/bbl, while oil prices averaged $45.08 from $37.34 in the previous quarter.
Whiting also ramped up spending in the first quarter to $56 million compared to $21 million in the fourth quarter. The company announced in March that it had mobilized a rig to its Sanish field operations in February, and during the quarter it drilled 4.5 net operated wells. It also completed 10.6 net wells and turned in line 9.8.
Company officials said Whiting plans to continue focusing on the Sanish area of the Bakken for the next three years.
“That’s our best area,” COO Chip Rimer said on the call. “We know that area very well. And we’re seeing great results from that.”
Rimer also indicated the company may revisit its Cassandra and Foreman Butte areas, also in the Bakken, as it modifies its completions strategy.
“We’re looking forward to getting some of those areas to get better than what we’ve seen in the past,” Rimer said. We’re tweaking our completions…I think we’re getting great value out of some of those areas that we have explored before in the past.”
Regarding the fate of the Dakota Access Pipeline, which moves Bakken oil production, CEO Lynn Peterson said the company secured additional crude sales and transportation arrangements in 1Q2021 “to serve as flow assurance and price protection” if the system is shut down.
“We believe we are well positioned regardless of the outcome,” he said.
The improvement in commodity prices is also expected to have a positive impact on the debt load. It expects to pay off the remaining $170 million in debt by the end of the year.
Whiting reported a quarterly net loss of $900,000 (minus 2 cents/share) compared to a net loss of $1.2 million ( minus 3 cents) in 4Q2020.
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