Continental Resources (NYSE:CLR) unveiled an updated strategic plan that includes 30% to 35% production growth in 2013 and a long-term goal of tripling production and proved reserves by 2017. This growth will be accomplished through the aggressive development of the Bakken and Woodford plays.

Forex Broker Guide: Using the right broker is very essential when competing in today's forex marketplace.

Long-Term Growth Plan
Continental Resources estimates that oil and gas production in 2012 will be 36 million barrels of oil equivalent (BOE), using the midpoint of its growth guidance range. The company's growth plan involves increasing production to 108 million BOE, or 295,800 BOE per day by 2017.

Continental Resources reported an estimated 508 million BOE of proved reserves at the end of 2011, and the five-year plan sets a goal of 1.524 billion BOE of proved reserves by 2017. This growth will be generated from the development of oil and gas properties in the Bakken in North Dakota and Montana, and the Woodford Shale in Oklahoma.

SEE: Oil And Gas Industry Primer

Bakken
Continental Resources is a leader in developing the Bakken play in the Williston Basin and other areas and has approximately 972,000 net acres under lease. The company reported oil and gas production of 4.9 million BOE from the Bakken in the second quarter of 2012.

Continental Resources is conducting a pilot program to test tighter density drilling on its properties, including 320 and 160 acre spacing. If this program is successful and can be applied to the company's entire position, Continental Resources estimates that it may have 4.5 billion BOE of resource potential in the Bakken and Three Forks, assuming 160 acre spacing.

Woodford Shale
Continental Resources is also working on developing the Woodford Shale in Oklahoma and has approximately 316,000 net acres under lease. The company's original focus was on the Cana play, which contains a high proportion of natural gas liquids.

Continental Resources has now shifted some of its focus to properties in the South Central Oklahoma Oil Province, which contains a shale oil formation up to 400 feet thick. Management said that this new play compares favorably with the Bakken and Eagle Ford Shale. Continental Resources has approximately 171,000 net acres exposed to this formation and has drilled or participated in 35 wells to date.

SEE: How Shale Fracking May Hurt Your Investment

Other Woodford Operators
Other operators with exposure to the Woodford Shale include Newfield Exploration Company (NYSE:NFX) and PetroQuest Energy (NYSE:PQ).

Newfield Exploration Company has 135,000 net acres under lease and has a position in the South Cana area, which corresponds to the South Central Oklahoma Oil Province. The company is operating five rigs there.

PetroQuest Energy is involved in a joint venture to develop the Woodford and plans to drill between 25 and 30 wells in 2012.

Infrastructure Issues
Operators are developing onshore shale oil and other plays so quickly that the industry is unable to build the required infrastructure needed to process and transport the crude oil and natural gas to market. Marathon Petroleum Corporation (NYSE:MPC) and a private company recently announced a planned truck-to-barge project in Ohio designed to handle growing production from the Utica Shale.

The project will include truck unloading capacity of 24,000 barrels of oil per day and a terminal that can load 50,000 barrels of oil per day onto barges on the Ohio River. Marathon Petroleum Corporation and its partner expect the facility to be operational in 2013.

The Bottom Line
Continental Resources is pushing forward with a new growth plan that will triple the size of the company by 2017. This growth plan is dependent on the rapid development of the Bakken and Woodford Shale plays.

At the time of writing, Eric Fox did not own any shares in any company mentioned in this article.

Related Articles
  1. Mutual Funds & ETFs

    ETF Analysis: PowerShares S&P 500 Downside Hedged

    Find out about the PowerShares S&P 500 Downside Hedged ETF, and learn detailed information about characteristics, suitability and recommendations of it.
  2. Mutual Funds & ETFs

    ETF Analysis: ProShares Large Cap Core Plus

    Learn information about the ProShares Large Cap Core Plus ETF, and explore detailed analysis of its characteristics, suitability and recommendations.
  3. Mutual Funds & ETFs

    ETF Analysis: iShares Core Growth Allocation

    Find out about the iShares Core Growth Allocation Fund, and learn detailed information about its characteristics, suitability and recommendations.
  4. Mutual Funds & ETFs

    ETF Analysis: iShares MSCI USA Minimum Volatility

    Learn about the iShares MSCI USA Minimum Volatility exchange-traded fund, which invests in low-volatility equities traded on the U.S. stock market.
  5. Stock Analysis

    Should You Follow Millionaires into This Sector?

    Millionaire investors—and those who follow them—should take another look at the current economic situation before making any more investment decisions.
  6. Professionals

    What to do During a Market Correction

    The market has corrected...now what? Here's what you should consider rather than panicking.
  7. Mutual Funds & ETFs

    ETF Analysis: Vanguard Mid-Cap Value

    Take an in-depth look at the Vanguard Mid-Cap Value ETF, one of the largest and most popular mid-cap funds in the U.S. equity space.
  8. Mutual Funds & ETFs

    ETF Analysis: Schwab US Broad Market

    Take an in-depth look at the Schwab U.S. Broad Market ETF, an incredibly low-cost fund based on a wide selection of the U.S. equity market.
  9. Professionals

    Tips for Helping Clients Though Market Corrections

    When the stock market sees a steep drop, clients are bound to get anxious. Here are some tips for talking them off the ledge.
  10. Stock Analysis

    The Safest Stocks You Can Invest in Right Now

    These stocks are likely to hold up better than others in a bear market, but there's a twist.
RELATED TERMS
  1. Hard-To-Sell Asset

    An asset that is extremely difficult to dispose of either due ...
  2. Sucker Yield

    When an investor has essentially risked all of his capital for ...
  3. Benchmark Crude Oil

    Benchmark crude oil is crude oil that serves as a pricing reference, ...
  4. PT (Perseroan Terbatas)

    An acronym for Perseroan Terbatas, which is Limited Liability ...
  5. Ltd. (Limited)

    An abbreviation of "limited," Ltd. is a suffix that ...
  6. BHD (Berhad)

    The suffix Bhd. is an abbreviation of a Malay word "berhad," ...
RELATED FAQS
  1. What is the difference between called-up share capital and paid-up share capital?

    The difference between called-up share capital and paid-up share capital is investors have already paid in full for paid-up ... Read Full Answer >>
  2. Why would a corporation issue convertible bonds?

    A convertible bond represents a hybrid security that has bond and equity features; this type of bond allows the conversion ... Read Full Answer >>
  3. How does additional paid in capital affect retained earnings?

    Both additional paid-in capital and retained earnings are entries under the shareholders' equity section of a company's balance ... Read Full Answer >>
  4. What types of capital are not considered share capital?

    The money a business uses to fund operations or growth is called capital, and there are a number of capital sources available. ... Read Full Answer >>
  5. What is the difference between issued share capital and subscribed share capital?

    The difference between subscribed share capital and issued share capital is the former relates to the amount of stock for ... Read Full Answer >>
  6. What happens to the shares of stock purchased in a tender offer?

    The shares of stock purchased in a tender offer become the property of the purchaser. From that point forward, the purchaser, ... Read Full Answer >>

You May Also Like

COMPANIES IN THIS ARTICLE
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!