Energy Prospectus

Record Fourth Quarter EBITDAX of $594.5 Million Is 44 Percent Higher Than Final Quarter of 2011
Continental Guides to 2013 Oil Differential Cost of $5 to $7 per Barrel, a 37 Percent Improvement
New Well Results - Latest Bakken Three Forks Well in the Second Bench Flows 1,556 Barrels of Oil Equivalent per Day
- New SCOOP Well Flows 1,761 Barrels of Oil Equivalent per Day

SCOOP project adds another significant layer of growth.

This is the primary reason CLR was up so much today.

"Total production in February 2013 is on track to exceed 120,000 Boepd."

I am working on the forecast model and I will post it to the website tonight.

This is VERY IMPORTANT and results in a significant increase in my valuation.

"Lower differentials (for Bakken crude oil) and more efficient access to premium markets are key factors driving higher cash margins and profitability," said Rick Bott, President and Chief Operating Officer. "We now expect average oil differentials in 2013 will be $5 to $7 per barrel.

"2012 saw fundamental changes in U.S. oil markets, with Bakken crude shipped directly to all major U.S. refining centers and making progress, we believe, toward becoming a national benchmark crude," he said. "Refiners on the East, Gulf and West coasts value the consistently high quality of sweet Bakken crude and the fact that supply from the basin continues to grow.

"Consistent with our strategy to develop versatility in transportation modes and markets, Continental was a first mover in establishing new markets on all three U.S. coasts for Bakken crude. Because of our size, flexibility and growth trajectory, we are one of only a few companies capable of providing a reliable, growing supply of this consistently high-quality crude to major refinery customers," Mr. Bott said. "End-users in turn continue to build pipe and rail off-loading facilities at delivery points throughout the nation to take advantage of the increased visibility of crude oil production growth from the Bakken."

An updated Net Income & Cash Flow Forecast model for Continental Resources (CLR) has been posted under the Sweet 16 Tab.

My increased Fair Value Estimate can be found at the bottom of the spreadsheet.

IMHO the multiple that I am using for CLR is very conservative. This company has more than 30% annual production and proven reserve growth locked in for at least the next five years. In addition to their HUGE Bakken position, the new SCOOP play in Oklahoma is going to layer on even more upside. Also, note that I am using $85/bbl WTI in all of my forecast models. If oil prices stay over $90/bbl much longer all of my Fair Value Estimates will be going up.

The state of Oklahoma should to whatever it can to help CLR. They are going to lead an incredible surge in the state's economy.

CLR should be a Core Holding for any manager of a growth fund.

Here is an excellent article about what CLR has found

http://www.petroleumnewsbakken.com/pntr ... 6362.shtml