More shale oil production expected, Continental Resources says

Nov. 8 (UPI) -- Though constrained somewhat by hurricanes, U.S. shale oil producer Continental Resources said production should finish out the year on a high note.

Full production during the third quarter for Continental was impacted negatively by Hurricane Harvey, which impacted output from the shale reservoirs in Oklahoma. A wet season in North Dakota, meanwhile, handicapped production at the Bakken oil reservoir.

Nevertheless, the company said its third quarter production was roughly 243,000 barrels of oil equivalent per day, a 7 percent increase from the second quarter. Crude oil production, which accounts for more than half of total output, was up 12 percent from the second quarter.

In announcing its results for the third quarter, Continental said it expected even more gains as it finishes out a year when oil prices posted strong gains, after substantial weakness last year. Fourth quarter production should be at least 14 percent higher than the third quarter.

Most of Continental's production came from the Bakken oil reservoir, where production increased 15 percent.

"Continental's operations continue to become more capital efficient each quarter, allowing us to sustain our low-cost advantage," Chairman and CEO Harold Hamm said in a statement.

Hamm added that, compared with fourth quarter 2016, output by the end of the year could be as much as 38 percent higher, which he said would lead to positive growth next year.

Higher production, however, could put a strain on the momentum in crude oil prices, which hit two-year highs in recent trading sessions. Strong production from the United States is countering the impact of an agreement by the Organization of Petroleum Exporting Countries to balance an oversupplied market with coordinated production cuts.

Apart from strong production, more U.S. oil is making its way to the open market. Continental last month sold 1 million barrels of oil from the Bakken shale basin to a Houston-based trading company for delivery to China.

Continental reported revenue during the third quarter of $726.7 million. Income of $10.6 million was in line with consensus. Results were posted late Tuesday.