Prior to the oil price crash, Continental was one of the fastest growing companies in our coverage. But following a series of dramatic spending cuts, 2016 production will fall 3%, and further declines are expected in 2017. Despite the slow down in the company's growth story, we believe the longer-term outlook is positive. Continental has exposure to some of the top performing unconventional plays Onshore US with substantial running room: we forecast an 11% CAGR between 2016 and 2020, the second highest growth rate in the US focused peer group.
The main risk to this outlook is that financial constraints limit growth, particularly in the near term. Managing its debt position will be key - by the end of Q3 2016, Continental’s gearing was 62%. Asset sales of over US$600 million will be used to pay down loan notes, making some progress towards the company’s target net debt figure of US$6 billion. But further action will be required to meet this objective.
The upstream oil and gas industry conducts activities against a backdrop of growing energy and environmental challenges. Political instabilities, international conflicts and government and environmental regulation have all impacted the production process.
This has forced companies to re-examine their corporate strategy, moving away from high-risk exploratory drilling to lower-risk exploration in mature basins as they search for increased returns.
This Upstream Oil and Gas Company report offers thought-provoking insight into corporate financial health, investment strategy and operational outlook supported by our proprietary asset data and energy research experts.
Widely used by both the energy and financial sectors, our report gives you a unique perspective on key strategic and financial challenges, as well as opportunities facing this oil and gas company.
Wood Mackenzie provides an independent evaluation and expert opinion on the operational performance, strategy and future of the world's top oil and gas companies. Our unique, objective analysis helps you understand, validate, compare and challenge market and corporate views so you can assess strategic opportunities.
Wood Mackenzie's clients include every major player in the global energy, metals and mining industries. We are recognised as a leading authority by international and national energy, metals and mining companies, leading financial institutions, governments and government agencies. We work with a range of diverse teams within our clients, from strategy and policy makers, business developers and market analysts, through to corporate finance, risk teams and investors.
Having Wood Mac analysis is table-stakes. Others are nice to have.
Analyst Metal Mining Producer
Wood Mac has the highest quality data and is demanded by our staff.
Portfolio Manager Integrated Oil Company
Others can provide data but we value the quality of the Wood Mac analysis above other sources.
As the trusted source of commercial intelligence for the world's natural resources sector for more than 40 years, we empower clients to make better strategic decisions with objective analysis and advice. Find out more...
Company report | Nov 2016
Continental Resources corporate report
Have questions? Just let us know how to contact you and we will respond to you as soon as possible.