Continental Resources readies to deliver dividend

By Luke Geiver | November 05, 2019

Days away from delivering its first common stock dividend, Continental Resources believes it has more good news to share. The Oklahoma-based exploration and production company with major operations in the Bakken shale play and the SCOOP/STACK plays of Oklahoma provided investors with a glimpse of its Bakken and Oklahoma operations during a Q3 update this month.

For its dividend, the company will pay out $0.05 per share. Throughout next year, the company will also continue to buyback shares as it sees fit. The company has already rebought $187 million worth of shares it deems to be undervalued. The board of directors approved Continental’s team to repurchase up to $1 billion in shares.

Roughly three years into its manufacturing mode of drilling, completing and bringing on its Bakken production wells, President Jack Stark said the production coming from the Williston Basin is consistent and impressive. The average barrel of oil equivalent production totals for new wells in the Bakken reach or exceed 2,000 boepd. Roughly 80 percent of that production is oil, Stark added.

This quarter, Continental reached daily production figures of 145,436 Bopd. Running six rigs this year, Continental has also completed 57 wells this quarter. Since 2017, Continental has mainly focused on three formations: Middle Bakken, Three Forks 1 and Three Forks 2.

"We are more than two years into manufacturing mode and our Bakken assets are delivering remarkably consistent results with some of the best returns in the industry," said Stark. "These results provide a great snapshot of the quality of our Bakken assets and reinforce the confidence we have in the Bakken as a key driver of Continental's growth for years to come."    

In the SCOOP/STACK plays of Oklahoma, the company is increasing its oil production every quarter. In the SCOOP, the company is now averaging roughly 21,000 barrels of oil per day. Through its Project Springboard—a multi-well pad development in the STACK—there are 39 wells waiting to be completed, all of which should come online next year.

The company remains strong on its Oklahoma assets. Harold Hamm, CEO, said the company is always looking to add more assets in the region.

Although oil supply across the world looks a bit “dismal,” in 2020, according to Hamm, the company will wait until commodity prices and clear market signals show a path to ramping up activity. Capital discipline amongst operators is working to help strengthen the market right now, Hamm said. In the shale gas sector, some plays could ramp down activity to bring more balance to the market, he also said, specifically those in the Marcellus and Haynesville.