Continental Resources Q2 Results

[dan_s]

Updating my forecast model this morning. Increasing EURs on SCOOP/STACK wells a big plus. - Dan

CONTINENTAL RESOURCES REPORTS SECOND QUARTER 2016 RESULTS
Outstanding STACK Well Results Increase 2016 Production Guidance to 210,000 to 220,000 Boe per Day; Capital Budget Remains Unchanged
Production Expense Outlook Reduced $0.50 per Barrel of Oil Equivalent (Boe)
New STACK Completions Extend Oil Window West: Madeline 1-9-4XH Flows at 3,538 Boe per Day (71% Oil); Frankie Jo 1-25-24XH Flows at 2,627 Boe per Day (56% Oil)
Enhanced Completions in SCOOP Woodford Oil Window Increase Estimated Ultimate Recovery (EUR) by ~30% to 1.3 Million Boe per Well (62% Oil) for 2-Mile Laterals
Company Agrees to Sell Non-Strategic SCOOP Leasehold for $281 Million, with Proceeds to Be Applied to Debt Reduction

“Continental once again outperformed production guidance in the second quarter thanks to the exceptional quality and performance of our Bakken, SCOOP and STACK assets, as well as exceptional execution by our teams,” commented Harold Hamm, Chairman and Chief Executive Officer. “We are also on track to reduce long-term debt with our agreement to sell a second non-strategic asset for $281 million.”

[dan_s]

I have updated my forecast model for CLR. My valuation increases by $2.60/share to $53.50.

> Q2 production beat my forecast
> CLR raised their production guidance
> LOE coming down
> Increasing gas prices help a lot
> Non-core asset sales shore up the balance sheet