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Whiting Petroleum Corporation Drilling Operations: One Well Drilling, One Well Being Completed And One Well Producing In The Sanish Field Of Mountrail County, North Dakota. (Photo: Business Wire)

These risks and uncertainties include, but are not limited to: declines in oil or natural gas prices; our level of success in exploration, development and production activities; adverse weather conditions that may negatively impact development or production activities; the timing of our exploration and development expenditures; our ability to obtain sufficient quantities of CO 2 necessary to carry put our enhanced oil recovery projects; inaccuracies of our reserve estimates or our assumptions underlying them; revisions to reserve estimates as a result of changes in commodity prices; risks related to our level of indebtedness and periodic redeterminations of the borrowing base under our credit agreement; our ability to generate sufficient cash flows from operations to meet the internally funded portion of our capital expenditures budget; our ability to obtain external capital to finance exploration and development operations and acquisitions; federal and state initiatives relating to the regulation of hydraulic fracturing; the potential impact of federal debt reduction initiatives and tax reform legislation being considered by the U.S. Federal government that could have a negative effect on the oil and gas industry; impacts of the global recession and tight credit markets; our ability to identify and complete acquisitions and to successfully integrate acquired businesses; unforeseen underperformance of or liabilities associated with acquired properties; our ability to successfully complete potential asset dispositions; the impacts of hedging on our results of operations; failure of our properties to yield oil or gas in commercially viable quantities; uninsured or underinsured losses resulting from our oil and gas operations; our inability to access oil and gas markets due to market conditions or operational impediments; the impact and costs of compliance with laws and regulations governing our oil and gas operations; our ability to replace our oil and natural gas reserves; any loss of our senior management or technical personnel; competition in the oil and gas industry in the regions in which we operate; risks arising out of our hedging transactions; and other risks described under the caption “Risk Factors” in our Annual Report on Form 10-K for the period ended December 31, 2011. We assume no obligation, and disclaim any duty, to update the forward-looking statements in this news release.

SELECTED FINANCIAL DATA

For further information and discussion on the selected financial data below, please refer to Whiting Petroleum Corporation’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2012, to be filed with the Securities and Exchange Commission.

WHITING PETROLEUM CORPORATION

CONSOLIDATED BALANCE SHEETS (Unaudited)

(In thousands)

           
June 30, 2012

December 31, 2011

 
ASSETS
 
Current assets:
Cash and cash equivalents $ 6,807 $ 15,811
Accounts receivable trade, net 293,672 262,515
Prepaid expenses and other   23,220     20,377  
Total current assets   323,699     298,703  
 
Property and equipment:
Oil and gas properties, successful efforts method:
Proved properties 7,765,534 7,221,550
Unproved properties 382,495 354,774
Other property and equipment   155,482     150,933  
Total property and equipment 8,303,511 7,727,257

Less accumulated depreciation, depletion and   amortization

  (2,238,740 )   (2,088,517 )
Total property and equipment, net 6,064,771 5,638,740
 
Debt issuance costs 29,735 33,306
 
Other long-term assets   92,379     74,860  

TOTAL ASSETS

$ 6,510,584   $ 6,045,609  
 

WHITING PETROLEUM CORPORATION

CONSOLIDATED BALANCE SHEETS (Unaudited)

(In thousands, except share and per share data)

           
June 30, 2012 December 31,

2011

LIABILITIES AND EQUITY
 
Current liabilities:
Accounts payable trade $ 102,004 $ 56,673
Accrued capital expenditures 109,635 142,827
Accrued liabilities and other 146,012 157,214
Revenues and royalties payable 116,410 103,894
Taxes payable 35,099 31,195
Derivative liabilities 23,364 73,647
Deferred income taxes   11,140     1,584
Total current liabilities 543,664 567,034
Long-term debt 1,420,000 1,380,000
Deferred income taxes 960,284 823,643
Derivative liabilities 17,085 47,763
Production Participation Plan liability 80,641 80,659
Asset retirement obligations 55,184 61,984
Deferred gain on sale 126,932 29,619

Other long-term liabilities

  26,973     25,776
Total liabilities   3,230,763     3,016,478
Commitments and contingencies
Equity:

Preferred stock, $0.001 par value, 5,000,000 shares    authorized; 6.25% convertible perpetual preferred stock,    172,391 issued and outstanding as of June 30, 2012 and    December 31, 2011, aggregate liquidation preference of    $17,239,100 at June 30, 2012

- -

Common stock, $0.001 par value, 300,000,000 shares    authorized; 118,584,788 issued and 117,631,451    outstanding as of June 30, 2012, 118,105,279 issued and    117,380,884 outstanding as of December 31, 2011

119 118
Additional paid-in capital 1,557,345 1,554,223
Accumulated other comprehensive income (loss) (951 ) 240
Retained earnings   1,715,089     1,466,276
Total Whiting shareholders’ equity 3,271,602 3,020,857
Noncontrolling interest   8,219     8,274
Total equity   3,279,821     3,029,131

TOTAL LIABILITIES AND EQUITY

$ 6,510,584   $ 6,045,609
 

WHITING PETROLEUM CORPORATION

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

(In thousands, except per share data)

           
Three Months Ended

June 30,

Six Months Ended

June 30,

2012       2011 2012       2011
REVENUES AND OTHER INCOME:
Oil and natural gas sales $ 492,756 $ 473,865 $ 1,051,453 $ 899,548
Gain on hedging activities 759 2,391 1,886 5,454
Amortization of deferred gain on sale 8,892 3,570 12,645 6,937
Gain (loss) on sale of properties (362 ) 1,227 (362 ) 1,227
Interest income and other   129     153     258     261  
Total revenues and other income   502,174     481,206     1,065,880     913,427  
COSTS AND EXPENSES:
Lease operating 89,504 73,785 184,294 145,307
Production taxes 40,763 34,258 85,374 65,902
Depreciation, depletion and amortization 160,589 110,250 316,709 217,978
Exploration and impairment 27,902 20,171 55,480 42,408
General and administrative 25,209 20,913 59,577 39,326
Interest expense 17,905 15,279 36,361 29,737

Change in Production Participation Plan    liability

(953 ) 2,650 (18 ) 2,207
Commodity derivative (gain) loss, net   (100,025 )   (113,618 )   (70,622 )   20,820  
Total costs and expenses   260,894     163,688     667,155     563,685  
INCOME BEFORE INCOME TAXES 241,280 317,518 398,725 349,742
INCOME TAX EXPENSE:
Current 1,109 1,565 2,535 3,615
Deferred   89,320     112,804     146,893     123,564  
Total income tax expense   90,429     114,369     149,428     127,179  
NET INCOME 150,851 203,149 249,297 222,563
Net loss attributable to noncontrolling interest   31     -     55     -  
NET INCOME AVAILABLE TO SHAREHOLDERS 150,882 203,149 249,352 222,563
Preferred stock dividends   (270 )   (269 )   (539 )   (539 )

NET INCOME AVAILABLE TO COMMON    SHAREHOLDERS

$ 150,612   $ 202,880   $ 248,813   $ 222,024  
EARNINGS PER COMMON SHARE:
Basic $ 1.28   $ 1.73   $ 2.12   $ 1.89  
Diluted $ 1.27   $ 1.71   $ 2.10   $ 1.87  
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic   117,622     117,373     117,569     117,308  
Diluted   118,853     118,659     118,889     118,707  
 

WHITING PETROLEUM CORPORATION

Reconciliation of Net Income Available to Common Shareholders to

Adjusted Net Income Available to Common Shareholders

(In thousands, except for per share data)

           
Three Months Ended Six Months Ended
June 30, June 30,
2012       2011 2012       2011

Net Income Available to Common  Shareholders

$ 150,612 $ 202,880 $ 248,813 $ 222,024
 
Adjustments Net of Tax:
Amortization of Deferred Gain on Sale (5,560 ) (2,284 ) (7,906 ) (4,414 )
(Gain) Loss on Sale of Properties 227 (785 ) 227 (781 )

Impairment Expense

8,998 4,993 20,149 9,827

One-time Charge Under ProductionParticipation Plan Related to Trust IIOffering

- - 5,928 -
Unrealized Derivative Gains   (67,470 )   (84,527 )   (58,378 )   (5,453 )
Adjusted Net Income (1) $ 86,807   $ 120,277   $ 208,833   $ 221,203  
 

Adjusted Net Income Available to Common  Shareholders per Share, Basic

$ 0.74   $ 1.02   $ 1.78   $ 1.89  

Adjusted Net Income Available to Common  Shareholders per Share, Diluted

$ 0.73   $ 1.02   $ 1.76   $ 1.87  
 
(1)     Adjusted Net Income Available to Common Shareholders is a non-GAAP financial measure. Management believes it provides useful information to investors for analysis of Whiting’s fundamental business on a recurring basis. In addition, management believes that Adjusted Net Income Available to Common Shareholders is widely used by professional research analysts and others in valuation, comparison and investment recommendations of companies in the oil and gas exploration and production industry, and many investors use the published research of industry research analysts in making investment decisions. Adjusted Net Income Available for Common Shareholders should not be considered in isolation or as a substitute for net income, income from operations, net cash provided by operating activities or other income, cash flow or liquidity measures under US GAAP and may not be comparable to other similarly titled measures of other companies.
 

WHITING PETROLEUM CORPORATION

Reconciliation of Net Cash Provided by Operating Activities to Discretionary Cash Flow

(In thousands)

           
Three Months Ended Six Months Ended
June 30, June 30,
2012       2011 2012       2011

Net cash provided by operating activities

$ 282,193 $ 374,163 $ 635,185 $ 588,218
Exploration 13,510 12,367 23,254 26,966
Exploratory dry hole costs (4 ) (1,395 ) (255 ) (4,297 )
Changes in working capital 15,095 (71,586 ) 4,785 (12,988 )
Preferred stock dividends paid   (270 )   (269 )   (539 )   (539 )
Discretionary cash flow (1) $ 310,524   $ 313,280   $ 662,430   $ 597,360  
 
(1)       Discretionary cash flow is computed as net income plus exploration and impairment costs, depreciation, depletion and amortization, deferred income taxes, non-cash interest costs, non-cash compensation plan charges, non-cash losses on mark-to-market derivatives and other non-current items less the gain on sale of properties, amortization of deferred gain on sale, non-cash gains on mark-to-market derivatives, and preferred stock dividends paid. The non-GAAP measure of discretionary cash flow is presented because management believes it provides useful information to investors for analysis of the Company’s ability to internally fund acquisitions, exploration and development. Discretionary cash flow should not be considered in isolation or as a substitute for net income, income from operations, net cash provided by operating activities or other income, cash flow or liquidity measures under GAAP and may not be comparable to other similarly titled measures of other companies.
 

Photos/Multimedia Gallery Available: http://www.businesswire.com/cgi-bin/mmg.cgi?eid=50354319&lang=en



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