Investopedia: Whiting Petroleum - Right Place, Right Time, Right Type

Everybody watches, talks about and makes predictions about oil prices. And like the weather, the reality of what actually happens often puzzles if not outright embarrasses the experts and their elaborate models. Whiting Petroleum (NYSE:WLL) offers a relatively simple equation for investors - if investors think oil prices will rise, or at least stay consistently high, this is a good stock to own for its production growth and undeveloped resource base. 


A Disappointing First Quarter
Investors may get a chance to buy Whiting shares a little cheaper now after the first quarter, as the Street seems relatively unimpressed with the results. Revenue growth was solid at 23%, but the company's price realizations, production details and exploration costs delivered a below-expectation bottom line result.

Production was mixed in the first quarter, up 10% (on a barrels per day basis) from last year, but down 3% sequentially. Bad weather in North Dakota hurt production, while a higher percentage of natural gas liquids (NGL) impacted the overall price realizations in an unfavorable way. (For more, see Oil And Gas Industry Primer.)

Costs were also higher this time around. Whiting engages in some relatively sophisticated operations with service providers like Baker Hughes (NYSE:BHI) and those technologies don't come for free. Per-barrel cash costs rose about 13%, though depreciation and depletion (DDA) costs were relatively flat on the same basis. 



Read the full piece at Investopedia:
http://stocks.investopedia.com/stock-analysis/2011/Whiting-Petroleum-Right-Place-Right-Time-Right-Type-WLL-CLR-BHI-APA-APC-CRED-BEXP0429.aspx