Whiting Petroleum Corporation (NYSE: WLL) (“Whiting” or the “Company”) today announced second quarter 2021 results.

Second Quarter 2021 Highlights

• Revenue was $352 million for the quarter ending June 30, 2021
• Net loss (GAAP) was $62 million or $1.57 per diluted share
• Adjusted net income (non-GAAP) was $118 million or $3.01 per diluted share
• Adjusted EBITDAX (non-GAAP) was $176 million
• June 30, 2021 net debt of $98 million (non-GAAP)

Lynn A. Peterson, President and CEO commented, "Our team is delivering positive results and the economic conditions continue to be in our favor. We generated net cash provided by operating activities of $183 million and $111 million in adjusted free cash flow during the quarter and over $200 million through six months. We have reinvested approximately a third of our EBITDAX back into our operations with the balance used to rapidly reduce our debt position. Subsequent to the quarter, the Company announced the purchase of assets within our Sanish field in North Dakota and the divestiture of our Redtail assets in Colorado. These transactions will increase our inventory life with higher return locations and will better focus our asset portfolio. These transactions show the flexibility provided by Whiting’s balance sheet, liquidity and cash flow generation. With our operating results to date and our improving outlook for the year, we are updating our guidance for 2021 as discussed below. We have increased our expectations for production and cash flows, while maintaining our capex investments in 2021 at the higher end of our previous guidance.”

Second Quarter 2021 Results

Revenue for the second quarter of 2021 increased $44 million to $352 million when compared to the first quarter of 2021, primarily due to increased commodity prices between periods.

Net loss for the second quarter of 2021 was $62 million, or $1.57 per share, as compared to a net loss of $0.9 million, or $0.02 per share, for the first quarter of 2021. Adjusted net income (non-GAAP) for the second quarter of 2021 was $118 million, or $3.01 per share, as compared to $108 million, or $2.79 per share, for the first quarter of 2021. The primary difference between net loss and adjusted net income for both periods is non-cash expense related to the change in the value of the Company’s hedging portfolio.

The Company’s adjusted EBITDAX (non-GAAP) for the second quarter of 2021 was $176 million compared to $170 million for the first quarter of 2021. This resulted in net cash provided by operating activities of $183 million and adjusted free cash flow (non-GAAP) of $111 million.

Adjusted net income, adjusted net income per share, adjusted EBITDAX and adjusted free cash flow are non-GAAP financial measures. Please refer to the end of this release for disclosures and reconciliations regarding these measures.

Production averaged 92.6 thousand barrels of oil equivalent per day (MBOE/d) and oil production averaged 53.4 thousand barrels of oil per day (MBO/d). Total production benefited from better than forecasted well performance and increased ethane recoveries from our processed natural gas.

Capital expenditures in the second quarter of 2021 were $58 million compared to the first quarter 2021 spend of $56 million. During the quarter, the Company drilled 9 gross/5.6 net operated wells and turned in line 9 gross/5.4 net operated wells. The Company currently has one drilling rig and one completion crew operating in its Sanish Field in North Dakota.

Lease operating expense (LOE) for the second quarter of 2021 was $64 million compared to $59 million in the first quarter of 2021. The increase was primarily due to an increase in well workover costs and certain variable expenses associated with increased activity and production. General and administrative expenses in the second quarter of 2021 of $12 million was a slight increase from the first quarter of 2021 of $10 million. Both quarters included approximately $2.4 million of non-cash stock compensation costs.

During the second quarter, oil differentials improved reflecting a more certain expectation of continued DAPL operations during the EIS. Additionally, as basin total production levels remained relatively flat, there was decreased utilization of pipeline capacity further supporting narrowed differentials.

Full-Year 2021 Guidance

Based on the Company’s increased expectations for the remainder of the year along with the outperformance in the first half of 2021, Whiting adjusted its guidance parameters as shown in the following table. This guidance includes the effect of its previously announced acquisition and divestiture.

As a result of this updated guidance along with WTI oil price of $60 per barrel, the Company now expects to generate over $700 million of EBITDAX and over $425 million of adjusted free cash flow in 2021.

Liquidity

As of June 30, 2021, the Company had a borrowing base of $750 million, borrowings of $115 million and unrestricted cash of $17 million, resulting in total liquidity of $650 million, net of outstanding letters of credit. Whiting expects to continue to fund its operations and its previously announced acquisition fully within operating cash flow and proceeds from its divestiture. Based on the above guidance, the Company forecasts to be in a positive net cash position with no outstanding balance on its credit facility by the end of the 2021.

Conference Call

Whiting will host a conference call on Thursday, August 5, 2021 at 11:00 a.m. Eastern time (9:00 a.m. Mountain time) to discuss the second quarter 2021 results. The call will be conducted by President and Chief Executive Officer Lynn A. Peterson, Executive Vice President Finance and Chief Financial Officer James P. Henderson, Executive Vice President Operations and Chief Operating Officer Charles J. Rimer and Investor Relations Manager Brandon Day. A question and answer session will immediately follow the discussion of the results for the quarter.

To participate in this call please dial:

Domestic Dial-in Number (Toll Free U.S. & International): (877) 328-5506, (412) 317-5422 (International)

Webcast URL: https://dpregister.com/sreg/10158599/eb183f25dc

Replay Information:

Conference ID #: 10158599

Replay Dial-In (Toll Free U.S. & International): (877) 344-7529 (U.S.), (412) 317-0088 (International)

Expiration Date: August 13, 2021

Commodity Price Hedging

Whiting currently has approximately 74% of its forecasted crude oil production and 71% of its forecasted natural gas production hedged for the remainder of 2021. The Company uses commodity hedges in order to reduce the effects of commodity price volatility and to satisfy the requirements of its credit facility. The following table summarizes Whiting’s hedging positions as of July 31, 2021:

Selected Operating and Financial Statistics

References to “Successor” refer to Whiting and its financial position and results of operations after its emergence from reorganization under chapter 11 of the Bankruptcy Code. References to “Predecessor” refer to Whiting and its financial position and results of operations on or before the emergence date (September 1, 2020).

Selected Financial Data

For further information and discussion on the selected financial data below, please refer to Whiting Petroleum Corporation’s Quarterly Report on Form 10‑Q for the quarter ended June 30, 2021 filed with the Securities and Exchange Commission.

About Non-GAAP Financial Measures

About Whiting Petroleum Corporation

Whiting Petroleum Corporation, a Delaware corporation, is an independent oil and gas company engaged in the development, production and acquisition of crude oil, NGLs and natural gas primarily in the Rocky Mountains region of the United States. The Company’s largest projects are in the Bakken and Three Forks plays in North Dakota and Montana and the Niobrara play in northeast Colorado. The Company trades publicly under the symbol WLL on the New York Stock Exchange. For further information, please visit http://www.whiting.com.

Forward-Looking Statements

This news release contains statements that we believe to be “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than historical facts, including, without limitation, statements regarding our future financial position, business strategy, projected production, cash flows, revenues, costs, capital expenditures and debt levels, the effect of acquisitions and divestitures and plans and objectives of management for future operations, are forward-looking statements. When used in this news release, words such as “guidance,” or we “expect,” “intend,” “plan,” “estimate,” “anticipate,” “believe” or “should” or the negative thereof or variations thereon or similar terminology are generally intended to identify forward-looking statements. Such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in, or implied by, such statements.

These risks and uncertainties include, but are not limited to: risks associated with our emergence from bankruptcy; declines in, or extended periods of low oil, NGL or natural gas prices; the occurrence of epidemic or pandemic diseases, including the coronavirus pandemic; actions of the Organization of Petroleum Exporting Countries and other oil exporting nations to set and maintain production levels; the potential shutdown of the Dakota Access Pipeline; our level of success in development and production activities; impacts resulting from the allocation of resources among our strategic opportunities; our ability to replace our oil and natural gas reserves; the geographic concentration of our operations; our inability to access oil and gas markets due to market conditions or operational impediments; market availability of, and risks associated with, transport of oil and gas; weakened differentials impacting the price we receive for oil and natural gas; our ability to successfully complete asset acquisitions and dispositions and the risks related thereto; the impacts of hedging on our results of operations; our ability to use net operating loss carryforwards in future periods; shortages of or delays in obtaining qualified personnel or equipment, including drilling rigs and completion services; the timing of our development expenditures; properties that we acquire may not produce as projected and may have unidentified liabilities; adverse weather conditions that may negatively impact development or production activities; we may incur substantial losses and be subject to liability claims as a result of our oil and gas operations, including uninsured or underinsured losses resulting from our oil and gas operations; lack of control over non-operated properties; unforeseen underperformance of or liabilities associated with acquired properties or other strategic partnerships or investments; competition in the oil and gas industry; cybersecurity attacks or failures of our telecommunication and other information technology infrastructure; our ability to comply with debt covenants, periodic redeterminations of the borrowing base under our Credit Agreement and our ability to generate sufficient cash flows from operations to service our indebtedness; our ability to generate sufficient cash flows from operations to meet the internally funded portion of our capital expenditures budget; revisions to reserve estimates as a result of changes in commodity prices, regulation and other factors; inaccuracies of our reserve estimates or our assumptions underlying them; impacts to financial statements as a result of impairment write-downs and other cash and noncash charges; the impact of negative shifts in investor sentiment towards the oil and gas industry; federal and state initiatives relating to the regulation of hydraulic fracturing and air emissions; the Biden administration could enact regulations that impose more onerous permitting and other costly environmental health and safety requirements; the impact and costs of compliance with laws and regulations governing our oil and gas operations; the potential impact of changes in laws that could have a negative effect on the oil and gas industry; impacts of local regulations, climate change issues, negative perception of our industry and corporate governance standards; negative impacts from litigation and legal proceedings; and other risks described under the caption “Risk Factors” in Item 1A of our Annual Report on Form 10‑K for the period ended December 31, 2020. We assume no obligation, and disclaim any duty, to update the forward-looking statements in this news release.

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