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Whiting Petroleum
Whiting Petroleum

Whiting would add rigs if oil prices hit $70 per barrel

WILLISTON, N.D. – Whiting Petroleum Corp , the top oil producer in North Dakota, plans to keep 11 drilling rigs operating through 2016, though it would add “a couple of rigs” if crude prices rise to $70 a barrel, its chief executive said on Thursday.

The comments from CEO Jim Volker were among the most definitive yet from a leader of a big crude producer on what threshold is needed to start fresh drilling and curb recent pullbacks that have rocked the oil sector since prices started to drop last summer.

Thus far this quarter, executives at industry peers have sent mixed messages on adding new rigs. Hess Corp, for example, does not plan to add any rigs this year, while Pioneer Natural Resources Co told Reuters last week that it was considering adding rigs in the near future.

Oil prices have gained more than 15 percent in the past month to $59 a barrel for benchmark West Texas Intermediate , enticing the sector with hopes of a sustained rebound.

“If we were to see $70 oil, which is basically $10 above where we are today, you’d probably see us put a couple of rigs back,” Volker told investors on a Thursday conference call.

It would be a stark turnaround for the company, which spent $27 million in the first quarter to exit existing drilling rig contracts early.

“Some of the rigs that we’ve released we can get back and sort of pick up quickly as a result of the way in which our contracts were written,” Volker added to investors, trying to assuage concerns that the start-and-stop cycle could damage relationships with contractors.

Indeed, Volker said oilfield service companies “have responded quickly and decisively” to requests to cut costs, and reiterated past comments that Whiting can thrive even at $50 per barrel oil prices.

Seeking to highlight Whiting’s ability to keep production high even while containing costs, Volker announced the company’s capital budget for 2016, outlining spending of $1.5 billion, about 25 percent less than 2015.

It was an especially early announcement considering 2015 spending levels at Whiting weren’t announced until late February.

Shares of Denver-based Whiting jumped 3.3 percent in afternoon Thursday trading, erasing earlier losses. Meanwhile, crude oil prices gained about 1.5 percent.

In related news, Whiting Petroleum to offer 35 million shares to reduce debt.

This article was from Reuters and was legally licensed through the NewsCred publisher network.

33 comments

  1. Justin-Bubbles Sperry

  2. Samuel Morrisey,you need to call them.

  3. Debbie van Kley, interesting

  4. Are some in the Balkin pay!

  5. Must be why they are stacking them?!?!!!

  6. We’ll I don’t know where y’all are getting your information but I think you need to research it a little more

  7. Dustin Bowen John Yielding Jeseeka Yielding Felicia Kay Irvin

  8. I bet they would if they hit that price and hung around there for 3-6 months!

  9. I’ll tell em where they can add a couple rigs !! Ha!

  10. I’ve moved a couple different rigs for em this yr in North dakota n not stacked a single one yet.

    • Whiting has stacked rigs – my son’s rig was contracted to whiting and when contract was up , they
      stacked – he said whiting has stacked rigs

  11. Oil won’t be down to long.

  12. In 2008-09 Whiting was one of the few companies that kept drilling, because they are fiscally responsible and keep at budget. If prices don’t improve and they near budget, that’s the only time you’ll see them halt.

  13. This is a true story, but $70 oil doesn’t look to be happening anytime soon. Way too much supply on the market

  14. Something needs to happen. I made it through 2 rounds of layoffs, but got KOd in round three. Lot of people hurting out here…..’

  15. Joshua Karty Brian T Price Philip Coker

  16. Shouldn’t have told their price now OPEC will make sure it stays lower !!!

  17. So can I get an msa with whiting then? Lol

  18. We want them to keep going….into Glasgow area!