Oct. 28, 2009 (PR Newswire) -- DENVER, Oct. 28 /PRNewswire-FirstCall/ -- Whiting Petroleum Corporation (NYSE: WLL) today reported third quarter 2009 net income available to common shareholders of $30.9 million, or $0.59 per basic and diluted share, on total revenues of $269.3 million. This compares to third quarter 2008 net income of $112.4 million, or $2.66 per basic share and $2.65 per diluted share, on total revenues of $388.4 million. Third quarter 2009 results include a non-cash after-tax hedging gain of $15.8 million, or $0.31 per share.

Discretionary cash flow in the third quarter of 2009 totaled $145.9 million, compared to the $255.6 million reported for the same period in 2008. A reconciliation of discretionary cash flow to net cash provided by operating activities is included at the end of this news release. The decrease in discretionary cash flow and net income in the third quarter of 2009 versus the comparable 2008 period was primarily the result of a 46% decline in the Company's wellhead oil price, including the price of natural gas liquids (NGLs), and a 61% decrease in its wellhead natural gas price.

Production in the third quarter of 2009 totaled a record 5.13 million barrels of oil equivalent (MMBOE), of which 3.95 MMBOE were crude oil/NGLs (77%) and 1.18 MMBOE were natural gas (23%). The third quarter 2009 production total equates to a new record daily average production rate of 55,760 barrels of oil equivalent (BOE), which represents a 10% increase from the 50,480 BOE per day average rate in 2008's third quarter. Production increased in the third quarter of 2009 compared to the third quarter of 2008 due to successful drilling results in the prolific Bakken play in North Dakota as well as continued production increases from the Company's enhanced oil recovery (EOR) projects at the Postle and North Ward Estes fields. Production rose 2% to 5.13 MMBOE in the third quarter of 2009 compared to 5.03 MMBOE in the second quarter of 2009.

Nine Months Financial and Operating Results

For the nine months ended September 30, 2009, Whiting reported a net loss available to common stockholders of $106.0 million, or $2.15 per basic and diluted share, on total revenues of $663.3 million. This compares to net income of $255.2 million, or $6.03 per basic share and $6.01 per diluted share, on total revenues of $998.3 million in the first nine months of 2008. Results in 2009 include non-cash after-tax hedging losses of $96.3 million or $1.93 per share. Discretionary cash flow for the first nine months of 2009 totaled $327.6 million, compared to $633.4 million in the comparable 2008 period.

Production in the first nine months of 2009 totaled 15.1 MMBOE, or 55,140 BOE per day, representing a 21% increase over the 12.4 MMBOE, or 45,280 BOE per day, in the first nine months of 2008.

James J. Volker, Whiting's Chairman, President and CEO, commented, "With a focus on our Bakken drilling program and our two EOR projects, we continue to generate all of our production growth organically. Our Bakken play in North Dakota and our CO2 floods at the Postle and North Ward Estes fields are heavily weighted toward oil. Based on the performance of these projects in the third quarter of 2009, we have increased our year-over-year production growth estimate to a range of 14% to 16%, up from a previous range of 10% to 12%."

Mr. Volker continued, "Our capital expenditures in the third quarter of 2009 were funded through discretionary cash flow, and we expect the same in the fourth quarter of 2009. Our discretionary cash flow in the third quarter of 2009 was $145.9 million. In the third quarter, we used the excess of cash flow over our $80.3 million of capital expenditures to pay down bank debt. At September 30, 2009, borrowings on our credit facility totaled $150 million, down from $220 million at June 30, 2009. Looking ahead, we plan to add three drilling rigs at Sanish field during the first quarter of 2010. This will bring our total operated rig count in the field to nine. We believe we can drill 72 operated wells at Sanish in 2010 with nine rigs. This compares to 36 operated Sanish wells expected to be drilled in 2009 and should set the stage for continued organic growth next year."

Bakken and Three Forks Development Increases Production

Whiting's net production from the Middle Bakken formation in the Sanish and Parshall fields of Mountrail County, North Dakota averaged 17,410 BOE per day in September 2009, up 13% from the 15,448 BOE average daily rate in June 2009 and up 40% from the 12,420 BOE average daily rate in September 2008.

Whiting's net production from the Sanish field in the third quarter of 2009 averaged 10,470 BOE per day, which compared to the 10,765 BOE per day average in the second quarter of 2009. The slight decline reflects the decline in drilling activity and capital expenditures in the third quarter of 2009 versus the second quarter of 2009. Our net production from the Sanish field averaged 10,565 BOE per day in September 2009, a 4% increase from 10,179 BOE per day in June 2009 and an 80% increase from 5,860 BOE per day in September 2008. The Company recently added a drilling rig in the Sanish field, bringing to six the total number of Whiting-operated rigs in the field. As of October 20, 2009, six wells were being drilled in the Sanish field and four wells were being completed. As of October 20, 2009, the Company had participated in a total of 84 producing wells at Sanish, 55 of which are operated by Whiting. The Company holds interests in 119,530 gross acres (69,643 net acres) in the Sanish field.

Immediately east of the Sanish field is the Parshall field, where we own interests in 74,840 gross acres (18,365 net acres). The Company's net production from its interests in the Parshall field during the third quarter of 2009 averaged 6,830 BOE per day, a 34% increase from the 5,085 BOE per day average in the second quarter of 2009. Our net production from the Parshall field averaged 6,845 BOE per day in September 2009, a 30% increase from 5,268 BOE per day in June 2009 and a 4% increase from the 6,560 BOE average daily rate in September 2008. The principal operator of the Parshall field, EOG Resources, Inc., has completed all of the 16 wells that had been waiting on completion earlier in 2009. As of October 20, 2009, we have participated in 109 wells in Parshall, of which 108 are producing and one is being drilled.

We recently completed three prolific oil wells in the Sanish field. On October 23, 2009, Whiting posted a new record initial production rate for a Bakken well. The Maki 11-27H flowed 4,345 barrels of oil and 2.5 million cubic feet (MMcf) of gas (4,761 BOE) per day during a 24-hour test of the Middle Bakken. The production rate was gauged on a 40/64-inch choke with a flowing casing pressure of 1,190 pounds per square inch (psi). The previous record was held by the Whiting-operated Richardson Federal 11-9H with an initial production rate of 4,570 BOE per day. The Maki well was fracture stimulated in 18 stages, 10 stages using sliding sleeves and eight stages using the "plug and perf" method. The Maki well was drilled in the northeast portion of Sanish field, approximately three miles north-northeast of the Richardson Federal well. Whiting holds a 76% working interest and a 62% net revenue interest in the Maki 11-27H.

During a 24-hour test of the Middle Bakken formation on September 18, 2009, the Tollefson 44-10H flowed 2,409 barrels of oil and 1.4 MMcf of gas (2,636 BOE) per day. The initial 24-hour production rate was gauged on a 32/64-inch choke with a flowing casing pressure of 970 psi. Whiting drilled the Tollefson 44-10H well in the southeastern portion of the Sanish field. Whiting, the operator of the well, holds a 38% working interest and a 31% net revenue interest in the new producer.

Approximately six miles to the northwest, Whiting completed the Kannianen 11-5H on September 3, 2009 flowing at an initial daily rate of 1,773 barrels of oil and 1.3 MMcf of gas (1,998 BOE) per day. The initial 24-hour production rate was gauged on a 32/64-inch choke with a flowing casing pressure of 740 psi. Whiting, the operator of the well, holds a 46% working interest and a 38% net revenue interest in the new producer, which was drilled near the center of the field.

Whiting recently drilled its third Three Forks well in the Sanish field. The Ogden 11-3TFH, located on the northwest side of Sanish field, is scheduled to be completed within the next three weeks. The well is expected to be fracture stimulated in 24 stages, all with sliding sleeves. Whiting is the first operator in the world to utilize a 24-stage sliding sleeve completion system. Whiting holds a 57% working interest and a 47% net revenue interest in the Ogden well.

From January 1, 2009 through October 23, 2009, Whiting has completed 30 new producers in the Sanish field. The Company estimates that it will drill and complete a total of 36 wells in the Sanish field in 2009.

Whiting completed the installation of its 17-mile oil line connecting the Sanish field to the Enbridge pipeline in Stanley, North Dakota. The pipeline is expected to be on stream in the fourth quarter of 2009. The 8-inch diameter line will have a daily capacity of approximately 65,000 barrels of oil per day. Enbridge Inc. has ongoing construction to expand its oil pipeline in Mountrail County, North Dakota, initially to a capacity of 161,000 barrels of oil per day from its current capacity of 110,000 barrels per day. This expansion is expected to be completed in the first quarter of 2010.

Whiting continues to reduce its completed well cost for Bakken wells in the Sanish field. The reduction in costs is primarily the result of our "Drill Wells On Paper" (DWOP) program which applies the best practices and best logistical planning of all our drilling and completion contractors to produce drilling and completion efficiencies. This has reduced the average time from spud date to rig release to below 30 days from 60 days earlier in our drilling program. The completed well cost for our most recent wells in the Sanish field are expected to be approximately $5 million per well, down from $8 million to $10 million per well when the development project was initiated.

In December 2008, Whiting completed the expansion of its Robinson Lake gas plant to an inlet capacity of 10 MMcf of gas per day from 3 MMcf of gas per day. Three 2,000-hp electric compressors were installed this summer, bringing the plant's current capacity to 21 MMcf per day. Whiting owns a 50% interest in the plant. The plant receives 25% of net proceeds from natural gas and NGL sales. As of October 20, 2009, sales from the plant were 11.4 MMcf of gas and 2,435 barrels of NGLs per day. Whiting was netting 1.4 MMcf of gas and 304 barrels of NGLs per day from its plant ownership. There are currently 53 Whiting-operated wells and 37 third-party wells connected to the gas gathering system.

The following table summarizes the Company's operated and non-operated net production from the Sanish and Parshall fields in the third quarter and in September 2009:

Operated and Non-operated Net Production by Field
(In BOE)

3rd Qtr 2009                  September 2009
----------------------------  --------------------------
Parshall    Sanish    Total   Parshall    Sanish   Total
--------    ------    -----   --------    ------   -----
Whiting
Operated       59,990   847,090   907,080    18,457   276,974  295,431
Non-Operated   568,588   116,273   684,861   186,925    39,953  226,878
-------   ------- ---------   -------   -------  -------
628,578   963,363 1,591,941   205,382   316,927  522,309
=======   ======= =========   =======   =======  =======
Daily
BOE             6,830    10,470    17,300(1)  6,845    10,565   17,410(1)

(1) Includes net BOEs from plant operations of approximately 500 BOE
per day

Increasing Production from EOR Projects

Production continues to increase from our Postle field, which produces from the Morrow sandstone, in Texas County, Oklahoma. In the third quarter of 2009, the field produced at an average net rate of 8,670 BOE per day, representing a 32% increase from the 6,560 BOE net daily rate in the third quarter of 2008. In September 2009, the field produced at an average net rate of 9,000 BOE per day, Postle's highest production rate in 33 years. The September 2009 average daily rate represents a 3% sequential increase over the net 8,734 BOE per day rate in June 2009. Four of the five units in the Postle field are currently active CO2 EOR projects. The fifth unit produces from the Cherokee formation, not the Morrow, and is being evaluated for waterflood reactivation. CO2 injection into the fifth unit is not currently planned. As of October 20, 2009, there were three workover rigs active in the field.

Earlier this year, our Midland team was presented with a 2008 Excellence Award from the Oil and Gas Investor for "Best Field Rejuvenation" at the Postle field. Net production from the field has more than doubled since Whiting acquired it in August 2005, from 4,200 BOE per day to 9,000 BOE per day in September 2009.

Production also continues to ramp up at our North Ward Estes field in Ward and Winkler Counties, Texas. Production from the field increased 12% from a net 5,740 BOE per day in the third quarter of 2008 to a net 6,415 BOE per day in the third quarter of 2009. The field's production averaged 6,635 BOE in September 2009, up slightly from the 6,593 BOE average rate in June 2009. Whiting initiated CO2 injection in Phase I in May 2007 and in Phase II in March 2009. In this field, Whiting is developing new and reactivated wells for water and CO2 injection and production purposes. Whiting plans to install oil, gas and water processing facilities in a total of four phases through 2015. We estimate that Phase III-A will be substantially complete in the fourth quarter of 2010. As of October 20, 2009, there were 11 workover rigs active in the field.

Other Operations Updates

--  Lewis & Clark Prospect.  Whiting recently reached total measured depth
at its Federal 32-4HBKCE, a casing exit in Golden Valley County, North
Dakota.  This horizontal well is scheduled to test an 8,550-foot lateral
in the Three Forks formation.  The well will be fracture stimulated in
16 stages with completion results expected in mid-November 2009. Whiting
holds an 86% working interest and a 70% net revenue interest in the
well.
--  Flat Rock Field.  Completion operations are under way at the Company's
Ute Tribal 11-30-14-20 well, located in the Flat Rock field in Uintah
County, Utah.  This vertical well will test the Entrada formation at a
depth of approximately 11,500 feet.  Whiting holds a 100% working
interest and an 85% net revenue interest in the well.  The Company moved
a drilling rig to Flat Rock field in early September 2009 after signing
a fixed-price gas contract for the field's production.  The contract
covers daily volumes of 10 MMcf of gas from September 1, 2009 through
December 31, 2014 at a wellhead price of $5.50 per Mcf.  Effective
January 1, 2010 through December 2011, an additional 5 MMcf of daily gas
volumes are under contract at a fixed-price of $5.38 per Mcf at the
wellhead.

--  Sulphur Creek Field.  Whiting recently executed a similar fixed-price
gas contract for production from its Boies Ranch prospect in Rio Blanco
County, Colorado.  The contract, which is effective November 1, 2009,
covers daily volumes of 5 MMcf through December 31, 2010, 4 MMcf in
2011, 3 MMcf in 2012, 2 MMcf in 2013, and 1 MMcf in 2014 at a
fixed-price of $5.34 at the wellhead.  A consolidated schedule of these
two fixed-price gas contracts can be found on page 13 of this news
release.

Operated Rig Count

As of October 20, 2009, Whiting was running nine operated drilling rigs and 34 operated workover rigs. We were also participating in the drilling of one non-operated well in the Parshall field.