Continental Resources posts natural gas production gains
US shale company Continental Resources said November 3 its natural gas production during the third quarter came in slightly higher than expected.
Continental reported total natural gas production averaged 1.05mn ft3/day during the three-month period ending September 30.
Citing “continued outperformance,” Continental in August increased its annual natural gas production guidance to a range of 900mn to 1bn ft3/day. Early in the year, it set its full-year guidance for gas production to a high-water mark of 920mn ft3/day on average.
The total production average of 331,407 barrels of oil equivalent/day marked an 11% increase over Q3 2020 levels.
Continental is a major stakeholder in the Bakken and Anadarko shale basins. The Bakken formation is among the top oil-producing basins in the Lower 48 states, but the smallest natural gas producer. The Anadarko basin in Oklahoma is the fourth-largest natural gas producer and fifth-largest oil producer.
Included in its financial statement for the third quarter was an announcement that it planned to acquire acreage in the Permian shale basin from Pioneer Natural Resources in an all-cash transaction valued at approximately $3.3bn, its first major purchase in the southern US reserve. The deal is expected to close by December.
"Continental's foundation has always been built upon a strong geology-led corporate strategy,” CEO Bill Berry said. “This continues today and has directly led us to our new strategic position in the Permian Basin.”
Permian is the largest shale oil producing basin in the Lower 48 US states and the second-largest gas basin, behind the Appalachian shale. Most of Pioneer’s production was in crude oil.
Andrew Dittmar, a director at data analytics firm Enverus, said Continental’s move into the Permian may have its challenges.
“Most recent Permian deals have gone to companies with existing Permian assets looking to expand their operations,” he said. “Still, even Permian assets that may not represent the core of the play can still stack up well relative to other regions.”
Continental reported third quarter revenue of $1.34bn and net income of $369.3 million, both improvements over the same period last year.