Continental Resources shares up on 2nd Bakken Shale well results

Thu Jul 10, 2008

By Chakradhar Adusumilli

BANGALORE, July 10 (Reuters) – Shares of Continental Resources Inc (CLR) rose as much as 20 percent to a life high, a day after the company said its second crude oil well in the Bakken Shale area of North Dakota reported a higher flow rate than its first.

The oil and gas explorer’s flow rate for the second well was about 58 percent higher than the first, which flowed at an average rate of 693 barrels of crude oil equivalent per day in its initial week of production in May.

The second well, Mathistad 1-35H, began production on July 4 and flowed at an average rate of 1,095 barrels of crude oil equivalent per day, with 90 percent of production being crude oil and 10 percent natural gas.

Natixis Bleichroeder analyst Curtis Trimble said the latest results from the Three Forks/Sanish formation increased the productive profile of the Bakken Shale area.

“Future wells will be closer to the 600 to 1000 barrel a day level versus previous wells that were averaging about 450 barrels a day,” Trimble said by phone.

The analyst, who maintained his “hold” rating, raised his price target on the company to $78 from $75 a share, citing higher estimated commodity prices.

Continental is the largest leaseholder in the Bakken Shale play with about 500,000 acres in North Dakota and Montana.

In April, the U.S. Geological Survey estimated about 3 billion to 4.3 billion barrels of undiscovered, recoverable crude oil in the North Dakota and Montana Bakken Shale play.

Shares of the company, which went public last May, were up $12.02 at $77.28 in afternoon trade on the New York Stock Exchange. They are up more than 400 percent since their debut on the back of rising crude oil prices and oil discoveries.

2 Responses to Continental Resources shares up on 2nd Bakken Shale well results

  1. Dan says:

    Jason nice article, 693 bpd does not seem like much until you do the math. At current prices thats a little over 36 million dollars per year. Nice!.

    Say I was looking at your public charts list. Your comments are intresting, but no date as to when you made them.

  2. Jason says:

    Only 1442 wells short of replacing biofuels.

    Did you see I added NOG yesterday? I’m thinking their wells will have a potentially bigger impact on the bottom line. Only $400M market cap on NOG; CLR over $13B already! CLR market cap has jumped $10B in just over a year!

    The public chart list gets updated daily. I adjust the comments as necessary and place notations on the charts themselves. This is more of a slow moving, overall look at the market. The comments tend to develop over time and look forward, so they aren’t materially changing each day. I am going to start noting the date on specific changes or signals going forward. But the overall tone is definitely longer term than the specific trading systems.

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