Hart Energy Publishing

Continental Resources Hedges Gas Production For 2010

June 16, 2009
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Continental Resources Inc., Enid, Okla., (NYSE: CLR) has entered a gas fixed price and basis swaps for 600,000 MMBtu at an average price of $5.27 for December 2009 and for 600,000 MMBtu per month at an average price of $5.68 for calendar 2010. These hedges were put in place to underpin the company’s current and expected level of operations in the Arkoma Woodford play in southeastern Oklahoma.

Continental reported total gas production of 5.5 billion cubic feet for the first quarter ended March 31, which constituted 28% of its total crude oil and gas production. The company's crude oil production remains unhedged.

Continental chairman and chief executive Harold Hamm says, “Consistent with our growth strategy, we chose to secure a predictable cash flow stream on about a third of our natural gas production through 2010. This provides additional flexibility in terms of how we can develop our highest priority unconventional shale plays.”

He adds that crude oil production remains Continental’s primary focus and the company expects to see continued pricing strength on that side of the equation given its outlook on U.S. supply and demand fundamentals.”

Continental has operations in the Rockies, Midcontinent and Gulf Coast regions of the U.S.