This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

All Hail Whiting Petroleum, the New King of the Bakken

NEW YORK (TheStreet) --  Whiting Petroleum (WLL - Get Report) plans to buy peer Kodiak Oil & Gas (KOG), which will make it the king of the prolific Bakken Shale formation.

The acquisition will boost Whiting's production and reserves, which is why the company believes the deal will have a positive impact on cash flow, earnings and production per share starting next year.

The deal shows Whiting's resolve to play a central role in the rise of the Bakken formation as North America's leading shale field in terms of barrels-per-well.

Investors showed their delight, pushing Whiting's shares over 7% higher to $84, up 36% for the year to date.

>>Apple's Almost Back: A Chart You Should See

>>Cramer: Digging Under the Whiting-Kodiak Tie-Up

Kodiak Oil and Gas, like Whiting, is a Rocky Mountain-focused exploration and production company. The deal is valued at $6 billion.

The combined company will be the biggest producer and leaseholder at the Bakken formation, surpassing Continental Resources (CLR) and Exxon Mobil (XOM), respectively. The new company will have 855,000 net acres, daily production of more than 107,000 barrels of oil equivalents and a massive inventory of more than 3,400 net future drilling locations.

In the previous quarterly results, Continental Resources produced more than 152,000 barrels of oil equivalents per day, of which 64%, or nearly 97,400 barrels of oil equivalents, came from Bakken.

Whiting CEO James Volker said the new company will have an enterprise value of $17.8 billion and an oil-weighted reserve base of more than 600 million barrels of oil equivalents. The transaction is expected to close in the final quarter of this year. Whiting and Kodiak's shareholders will own 71% and 29% of the new company, respectively.

Kodiak's reserves have been growing at an average rate of 147% per year since 2009 to 167.3 million barrels of oil equivalents by the end of 2013. Meanwhile, its sales have grown from just 601 barrels in 2009 to 29,200 barrels of oil equivalents per day by the end of last year.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
WLL $18.25 -0.76%
AAPL $109.46 -0.82%
FB $87.55 -0.68%
GOOG $600.66 -0.92%
TSLA $245.57 0.00%

Markets

Chart of I:DJI
DOW 16,374.76 +23.38 0.14%
S&P 500 1,951.13 +2.27 0.12%
NASDAQ 4,733.4970 -16.4820 -0.35%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs