Whiting Petroleum Announces 2020 Guidance and Organizational Changes to Better Position the Company for 2021
September 16 2020 - 5:19PM
Business Wire
Changes Expected to Generate Approximately $20
Million in Annual Cost Savings
Whiting Petroleum Corporation (NYSE: WLL) (“Whiting” or the
“Company”) announced today that it has evaluated and reduced its
cost structure to better align Whiting’s business with the current
operating environment. The Company is also updating its 2020
guidance to reflect an increased focus on capital discipline.
Organizational Update
Whiting recently implemented a new organizational structure
whereby the Company has reduced its total workforce by 16%, of
which over 90% were corporate positions. Whiting expects these
changes to the organization to generate approximately $20 million
in annualized cost savings. In conjunction with the reorganization,
Whiting is reducing the compensation of its officers by 15% to 20%,
realigning officer bonus programs, reducing the number of corporate
executives, and initiating salary reductions across a broad group
of employees. The full impact of these G&A reductions is
expected to be realized in 2021, while the effect in 2020 is
largely expected to be offset by related one-time charges.
Outlook for 2H 2020
As the Company has emerged from restructuring and is responding
to the current environment, it is updating its guidance for the
second half of 2020. The following table provides guidance for the
second half 2020 based on current forecasts.
Second Half 2020
Guidance
Production (MBOE/d)
88 - 92
Percent oil
60%
Capital Expenditures (MM)
$ 34 - $ 39
Lease operating expense (MM)
$ 112 - $ 116
"I'm pleased with what we have accomplished in bringing on a new
board, new leadership and new vision for the Company post
emergence. The changes implemented are building a culture of
capital discipline and demonstrating efficiencies and cost savings
throughout the organization. We look forward to announcing
preliminary 2021 guidance in conjunction with our third quarter
2020 results,” said Lynn A. Peterson, Chief Executive Officer of
Whiting.
About Whiting Petroleum
Corporation
Whiting Petroleum Corporation, a Delaware corporation, is an
independent oil and gas company that develops, produces, acquires
and explores for crude oil, natural gas and natural gas liquids
primarily in the Rocky Mountain region of the United States. The
Company’s largest projects are in the Bakken and Three Forks plays
in North Dakota and Niobrara play in northeast Colorado. The
Company trades publicly under the symbol WLL on the New York Stock
Exchange. For further information, please visit
http://www.whiting.com.
Forward-Looking Statements
This news release contains statements that we believe to be
“forward-looking statements” within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. All statements other than historical facts,
including, without limitation, statements regarding our future
financial position, business strategy, projected revenues,
earnings, costs, capital expenditures and debt levels, and plans
and objectives of management for future operations, are
forward-looking statements. When used in this news release, words
such as we “expect,” “intend,” “plan,” “estimate,” “anticipate,”
“believe” or “should” or the negative thereof or variations thereon
or similar terminology are generally intended to identify
forward-looking statements. Such forward-looking statements are
subject to risks and uncertainties that could cause actual results
to differ materially from those expressed in, or implied by, such
statements.
These risks and uncertainties include, but are not limited to:
the effects of the Chapter 11 petitions (the “Chapter 11 Cases”) on
the Company’s liquidity or results of operation or business
prospects; the effects of the Chapter 11 Cases on the Company’s
business and the interests of various constituents; declines in, or
extended periods of low oil, NGL or natural gas prices; the
Company’s level of success in exploration, development and
production activities; the Company’s ability to generate sufficient
cash flows from operations to meet the internally funded portion of
its capital expenditures budget; the Company’s ability to obtain
external capital to finance exploration and development operations;
the Company’s inability to access oil and gas markets due to market
conditions or operational impediments, including any court rulings
which may result in the inability to transport oil on the Dakota
Access Pipeline; the impact of negative shifts in investor
sentiment towards the oil and gas industry; impacts resulting from
the allocation of resources among the Company’s strategic
opportunities; the geographic concentration of the Company’s
operations; impacts to financial statements as a result of
impairment write-downs and other cash and noncash charges; federal
and state initiatives relating to the regulation of hydraulic
fracturing and air emissions; revisions to reserve estimates as a
result of changes in commodity prices, regulation and other
factors; inaccuracies of the Company’s reserve estimates or
assumptions underlying them; the timing of the Company’s
exploration and development expenditures; risks relating to
decreases in the Company’s credit rating; market availability of,
and risks associated with, transport of oil and gas; the Company’s
ability to successfully complete asset dispositions and the risks
related thereto; the Company’s ability to drill producing wells on
undeveloped acreage prior to its lease expiration; shortages of or
delays in obtaining qualified personnel or equipment, including
drilling rigs and completion services; weakened differentials
impacting the price we receive for oil and natural gas; risks
relating to any unforeseen liabilities of ours; the impacts of
hedging on the Company’s results of operations; adverse weather
conditions that may negatively impact development or production
activities; uninsured or underinsured losses resulting from the
Company’s oil and gas operations; lack of control over non-operated
properties; failure of the Company’s properties to yield oil or gas
in commercially viable quantities; the impact and costs of
compliance with laws and regulations governing the Company’s oil
and gas operations; the potential impact of changes in laws that
could have a negative effect on the oil and gas industry; impacts
of local regulations, climate change issues, negative public
perception of the Company’s industry and corporate governance
standards; the Company’s ability to replace its oil and natural gas
reserves; negative impacts from litigation and legal proceedings;
risks related to the Company’s level of indebtedness, the Company’s
ability to comply with debt covenants, periodic redeterminations of
the borrowing base under the Company’s credit agreement and the
Company’s ability to generate sufficient cash flows from operations
to service its indebtedness; unforeseen underperformance of or
liabilities associated with acquired properties or other strategic
partnerships or investments; competition in the oil and gas
industry; any loss of the Company’s senior management or technical
personnel; cybersecurity attacks or failures of the Company’s
telecommunication and other information technology infrastructure;
and other risks described under the caption “Risk Factors” in Item
1A of the Company’s Annual Report on Form 10-K for the period ended
December 31, 2019 and subsequent filings with the SEC. We assume no
obligation, and disclaim any duty, to update the forward-looking
statements in this news release.
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version on businesswire.com: https://www.businesswire.com/news/home/20200916005942/en/
Company Contact: Brandon Day Title: Investor Relations Manager
Phone: 303 390 4969 Email: Brandond@whiting.com
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