Whiting Posts Smaller-Than-Expected Loss, Aided By Cost Cuts
WILLISTON, N.D., April 29 (Reuters) - Whiting Petroleum Corp., North Dakota's largest oil producer, posted a quarterly loss on Wednesday that was narrower than Wall Street expected as the company slashed spending amid a steep drop in crude oil prices.
Whiting's sales price for its crude fell more than 50 percent during the quarter, forcing the company to curtail spending and sharply scale back operations to preserve as much cash as possible.
It was a theme echoed across North Dakota during the quarter. Rival Hess Corp, the state's third-largest oil producer, also reported a quarterly loss on Wednesday.
But Whiting went a step further than Hess, paying $27 million to end drilling rig contracts early and not to exercise the full contract term, which would have cost much more. Whiting had 25 drilling rigs in the fourth quarter; by June it expects to have 11 in operation.
Whiting posted a net loss of $106.1 million, or 63 cents per share, compared with a net profit of $109.1 million, or 91 cents per share, in the year-ago period.
Excluding the drilling rig contract charge and other one-time items, Whiting posted a loss of 23 cents a share. By that measure, analysts expected a loss of 32 cents per share, according to Thomson Reuters I/B/E/S.
"While we are reducing rig count and well cost, production was strong in" the first quarter, Chief Executive James Volker said in a statement.
Production at Whiting, which bought smaller rival Kodiak Oil & Gas last fall, rose 3 percent to an average of 166,930 barrels of oil equivalent per day (boe/d) in the quarter when the two companies' metrics are blended.
For the second quarter, Whiting expects to produce at least 164,444 boe/d. Roughly 38 percent of the company's third- and fourth-quarter production is hedged.
Whiting has no plans to further cut spending, opting to maintain 2015's $2 billion capital budget, Volker said.
Speculation swirled last month that Whiting was for sale, but sources told Reuters a sale was not in the cards. The company later confirmed in a filing with the Securities and Exchange Commission that no sale was pending.
Shares of Denver-based Whiting fell 0.7 percent to $36.51 in after-hours trading on Wednesday.
Executives plan a conference call with investors to discuss the quarterly results on Thursday morning.
(Reporting by Ernest Scheyder; Editing by Diane Craft and Leslie Adler)
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