Profits surge

Continental Resources Inc. generated a profit of $10.6 million in the third quarter — up 17 percent from year-ago levels.

Continental Resources Inc. generated a profit of $10.6 million in the third quarter as production surged 17 percent from year-ago levels.

The Oklahoma Citybased oil and natural gas company produced 242,788 barrels of oil equivalent per day in the third quarter, up from 207,850 equivalent barrels per day in the year-ago quarter, led by increased drilling activity and efforts to bring online wells that previously had been drilled but not completed.

“Continental’s performance year-to-date demonstrates industry leadership in capital disciplined production growth,” CEO Harold Hamm said in a statement. “Continental’s operations continue to become more capital efficient each quarter, allowing us to sustain our low-cost advantage.”

Crude oil production was 140,611 barrels per day, or 58 percent of total production. Fourth-quarter production is expected to be 14 percent to 18 percent more than the third quarter, putting the company on pace to finish the year at between 280,000 to 290,000 barrels of oil equivalent per day, up 33 percent to 38 percent from the end of 2016.

“This positions us for strong, cash-flow-positive growth in 2018,” Hamm said.

Numbers from the patch

The production increase has been led by growth in the North Dakota Bakken, which surged 31 percent from the year-ago quarter and was up 15 percent from the second quarter.

The company in the third quarter placed 57 Bakken wells online with an average 24-hour initial production rate of 1,752 barrels of oil equivalent per day, with 80 percent oil.

“Our optimized comcompletions are unlocking more value from our

Bakken assets than ever before,” President Jack Stark said in a statement. “This is a key catalyst that will drive our ability to deliver cash-flow-positive, oil-weighted growth for years to come.”

In Oklahoma, Continental has nine rigs in the STACK and brought online 30 new wells in the SCOOP. Continental crews continued tests in the areas to help determine how closely to space wells and how best to complete them.

Continental’s profit of $10.6 million, or 3 cents a share, in the third quarter was up from a loss of $175 million, or 30 cents a share, in the third quarter of 2016. Revenues increased to $727 million, up from $526 million one year ago.

Adjusted for one-time items, the company had a net income of $32.2 million, or 9 cents a share, compared to an adjusted loss of $82.9 million, or 22 cents a share, one year ago. Earnings before interest, taxes, depreciation, amortization and drilling expenses was $564 million, up from $387 million in the year-ago quarter.

“Continental’s focus on capital

efficiency and cash flow continues to yield results,” Chief Financial Officer John Hart said in a statement. “Our cash flows are strong and improving with rising production and improved commodity prices, each positively benefiting our leverage ratios. We see this trend continuing.

“We also continue to make progress toward our nearterm debt reduction target of $6 billion and our longer-term goal of $5 billion. We recently closed on three separate transactions totaling $136 million, and we are actively marketing several larger packages.”