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Whiting Petroleum Corporation's Third Quarter 2008 Earnings Reach a Record $112.4 Million or $2.65 Per Share

Posted on: Wednesday, 29 October 2008, 21:00 CDT

DENVER, Oct. 29 /PRNewswire-FirstCall/ -- Whiting Petroleum Corporation today reported record 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. This compares to third quarter 2007 net income of $47.7 million, or $1.14 per basic share and $1.13 per diluted share, on total revenues of $233.5 million. During the third quarter of 2008, Whiting recognized a non-cash, after-tax unrealized gain on commodity derivative contracts of $6.7 million, or $0.16 per share.

Discretionary cash flow in the third quarter of 2008 totaled a record $255.6 million, more than double the $108.0 million reported for the same period in 2007. A reconciliation of discretionary cash flow to net cash provided by operating activities is included at the end of this news release. The increases in net income and discretionary cash flow in the third quarter of 2008 versus the comparable 2007 period were primarily the result of a 24% increase in the Company's total equivalent production, a 43% increase in the Company's realized oil price (net of hedging) and a 71% increase in its realized gas price.

Production in the third quarter of 2008 totaled a record of 4.64 million barrels of oil equivalent (MMBOE), of which 3.28 million barrels were crude oil (71%) and 1.36 MMBOE was natural gas (29%). This third quarter 2008 production total equates to a daily average production rate of 50,480 barrels of oil equivalent (BOE), compared to the 40,640 BOE per day average rate in 2007's third quarter. The third quarter 2008 daily average production rate of 50,480 BOE represents a 14% sequential increase from the second quarter 2008 average daily rate of 44,200 BOE. September 2008 average production of 51,700 BOE per day represents a 10% increase from the June 2008 average daily rate of 47,100 BOE.

Approximately 1,480 BOE per day of production was interrupted during September 2008 due to Hurricane Ike. Substantially all of this production was back on stream by October 1, 2008.

Production increases were due to a combination of successful drilling results in the prolific Bakken and Piceance projects as well as continued production increases from the Company's CO(2) flood projects at the Postle and North Ward Estes fields. The primary contributor to Whiting's production increases in the third quarter of 2008 came from new wells in the Middle Bakken formation in the Sanish and Parshall fields in Mountrail County, North Dakota. 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 2008:

Operated and Non-operated Bakken Net Production by Field (In BOE) 3rd Qtr 2008 September 2008 ------------ -------------- Parshall Sanish Total Parshall Sanish Total -------- ------ ----- -------- ------ ----- Whiting Operated 72,126 418,100 490,226 38,435 156,070 194,505 Non-Operated 446,679 -- 446,679 156,049 -- 156,049 Other Non-Operated 5,592 41,919 47,511 2,305 19,736 22,041 ----- ------ ------ ----- ------ ------ 524,397 460,019 984,416 196,789 175,806 372,595 ======= ======= ======= ======= ======= ======= Daily BOE 5,700 5,000 10,700 6,560 5,860 12,420 Commercial Banking Facility

In September, Whiting's bank group, as requested, reconfirmed the Company's $900 million borrowing base, maturing in August 2010. The Whiting bank group is comprised of 24 commercial banks holding between 1.8% and 6.8% of the total facility. As of September 30, 2008, approximately $500 million was drawn on the facility and approximately $3 million in letters of credit were outstanding, resulting in approximately $397 million of availability. The large number of banks and relatively low hold levels allow for flexibility should there be additional consolidation within the banking sector.

2009 Capital Spending Budget

Although the Company will not submit its 2009 capital spending budget to its Board of Directors until later this year, Whiting expects to submit a budget in line with the Company's estimated 2009 discretionary cash flow. Such a budget is expected to generate double-digit production growth in 2009.

Nine Months Financial and Operating Results

For the nine months ended September 30, 2008, Whiting reported 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. This compares to net income of $84.9 million, or $2.20 per basic share and $2.19 per diluted share, on total revenues of $586.4 million in the first nine months of 2007. Discretionary cash flow for the first nine months of 2008 totaled $633.4 million, compared to $282.3 million in the comparable 2007 period.

Production in the first nine months of 2008 totaled 12.4 MMBOE, or 45,280 BOE per day, compared to production of 11.0 MMBOE, or 40,280 BOE per day, in the first nine months of 2007.

James J. Volker, Whiting's Chairman, President and CEO, commented, "We continue to generate substantially all of our production growth organically. Our net production from the Middle Bakken formation rose 48% to 12,420 BOE per day in September 2008 from 8,400 BOE per day in June 2008. Combined production from our CO(2) projects increased 15% to 13,400 BOE per day in September from 11,700 BOE in June as both projects are responding to CO(2) injection and waterflooding. In addition, our net production from the Boies Ranch prospect in the Piceance Basin ramped up to more than 9.5 million cubic feet of gas per day (1,583 BOE per day) in September 2008, an increase of 56% from the June 2008 average daily net rate of 6.1 million cubic feet of gas (1,017 BOE per day)."

Mr. Volker continued, "We expect the trend established in the first nine months of 2008 to continue during the fourth quarter of this year and through 2009."

As of October 20, 2008, 18 operated drilling rigs and 37 operated workover rigs were active on our properties. We were also participating in the drilling of eight non-operated wells, four of which are located in the Parshall field. The breakdown of our operated rigs is as follows:

Region Drilling Workover ------ -------- -------- Rocky Mountain Bakken / Williston 5 3 Piceance 3 1 Other Rockies 2 2 Permian 2 7 Mid-Continent/Michigan 1 1 Gulf Coast 2 0 Postle 2 4 North Ward Estes 1 19 -- -- Totals 18 37 Other Noteworthy Events and Results -- Since July 1, 2008, Whiting has completed 12 significant single-lateral Bakken oil and gas producers in the Sanish field. The following table summarizes the results of these recent wells and the results of all 21 Whiting-operated wells in the Sanish field: Well Name WI NRI Completion IP 1st 1st --------- -- --- Date (BOE/D) 30 Days 60 Days ---- 24-hr. (BOE/D) (BOE/D) Test ------- ------- ---- 1) Kinnoin 11-14H 52% 42% 10/29/08 3,646 N/A N/A 2) Richardson Fed 11-9H 85% 69% 10/22/08 4,570(1) N/A N/A 3) Roggenbuck 11-25H 78% 64% 10/13/08 1,950 N/A N/A 4) Lacey 11-10H 73% 59% 09/29/08 1,811 N/A N/A 5) Pennington 11-3H 66% 54% 09/20/08 1,473 714 N/A 6) Neisheim 1-24H 67% 54% 09/10/08 2,169 1,048 N/A 7) Brehm 44-5H 99% 81% 09/04/08 1,298 709 N/A 8) Kannianen 11-4H 95% 77% 08/09/08 2,226 914 714 9) Smith 11-7H 69% 56% 07/31/08 2,421 717(2) 757 10) Littlefield 11-29H 93% 75% 07/27/08 1,986 673(2) 640 11) Stenseth Trust 11-5H 73% 59% 07/06/08 3,044 903(2) 717 12) Lacey 11-1H 86% 70% 07/01/08 2,330 976 793 13) Behr 11-34H 54% 44% 06/20/08 3,245 1,335 969 14) Abbott 11-18H 99% 80% 06/16/08 1,959 1,088 892 15) Locken 14-28H 78% 63% 05/31/08 1,719 935 756 16) Braaflat 11-11H 97% 78% 05/23/08 2,997 1,505 1,271 17) Maynard Uran 11-24H 84% 68% 04/23/08 2,132 1,056 883 18) Peterson 11-34H 91% 75% 03/19/08 1,088 541 437 19) Liffrig 11-27H 81% 67% 01/24/08 2,530 1,114 932 20) Locken 11-22H 99% 82% 12/16/07 1,651 946 756 21) Peery State 11-25H 99% 80% 05/13/07 1,254 825 738 --- --- ----- --- --- Averages 82% 67% 2,262 941 804 (1) The Richardson Federal 11-9H recorded the highest initial production rate for any Bakken well drilled to date, according to filings with the North Dakota Industrial Commission. (2) The first 30-day average production rate was restricted due to maintenance on the Enbridge crude oil line that transports oil from the Sanish and Parshall fields.

Whiting's net production from the Middle Bakken formation in the Sanish and Parshall fields of Mountrail County, North Dakota averaged 12,420 BOE per day in September 2008, up 48% from the 8,400 BOE average daily rate in June 2008.

Whiting's net production from the Sanish field in September 2008 averaged 5,860 BOE per day, compared to a net daily rate of 3,400 BOE in June 2008. As reflected in the footnote above, production volumes were restricted as a result of the maintenance performed on the Enbridge pipeline that transports crude oil from the Sanish and Parshall fields to Midwestern markets. However, there was only a minor impact on August production as Whiting found additional crude oil purchasers for its oil production from the area during this period. Whiting expects its 17-mile oil line connecting the Sanish field to the Enbridge pipeline to be in service by February 2009.

Whiting is currently drilling or completing five operated wells in the Sanish field with an average working interest of 86%. These wells include the Company's first Three Forks well, the Braaflat 21-11TFH. Test results from this well are expected in December 2008.

Whiting is also drilling its first in-fill well, the McNamara 42-26H well, an approximate 10,000-foot lateral across two 1,280-acre spacing units in the Sanish field. Test results from this well are also expected in December 2008.

The Company currently has five operated rigs working in the Sanish field and expects to have eight operated rigs drilling in the area by year-end 2008. From January 1 through September 30, 2008, Whiting completed 18 operated wells in the Sanish field and expects to complete an additional 14 to 16 wells during the balance of the year. Whiting expects all of these to be single-lateral wells drilled on 1,280-acre spacing units. Whiting estimates that it has a total of 128 operated locations in the Sanish field, of which 21 have been completed. The 107 remaining operated locations are expected to be drilled during the next 24 to 30 months. Potential in-fill drilling could bring the total to over 200 Middle Bakken wells in the Sanish field alone. Whiting holds interests in a total of 118,571 gross acres (83,310 net acres) in the Sanish field.

Whiting completed construction of the first phase of its Robinson Lake gas processing plant in the Sanish field in late June 2008 and the installation of a 17-mile natural gas/natural gas liquids (NGLs) pipeline to Stanley, North Dakota in August 2008. Whiting-operated net gas sales from the plant are currently averaging approximately 1.0 million cubic feet (MMcf) per day and net NGL sales are currently averaging approximately 130 barrels per day. Whiting expects to complete the expansion of the Robinson Lake gas plant to a capacity of 33 MMcf of gas per day in December 2008, at which time net daily sales are expected to approximate 3 MMcf to 4 MMcf of gas and 700 barrels of NGLs. Net sales are expected to reach approximately 20 MMcf of gas and 3,000 barrels of NGLs by mid-2010.

In the Parshall field, Whiting owns interests in 72,790 gross acres (14,982 net acres). As of September 30, 2008, Whiting has participated in a total of 64 wells that produce from the Bakken formation, 40 of which have been completed in 2008. Whiting expects to participate in an additional 20 to 30 wells in the Parshall field in 2008 with an average working interest of 25%. Four drilling rigs are expected to be working in the Parshall field through 2008. Whiting's net production from the Parshall field in September 2008 averaged 6,560 BOE per day, up 31% from a net daily rate of 5,000 BOE in June 2008.

-- Whiting's expansion of its CO(2) flood at the Postle field, located in Texas County, Oklahoma, continues to generate positive results. Production from the field has increased from a net 5,800 BOE per day in December 2007 to a net 6,800 BOE per day in September 2008, an increase of 17%. This project is part of the Company's plan to expand the existing water and CO(2) floods from the eastern half of the Postle field to the western half of the field. The field includes six producing units covering a total of approximately 25,600 gross acres (24,223 net acres) with working interests of 94% to 100%. -- The North Ward Estes field in Ward and Winkler Counties, Texas is responding to the Company's waterflood and CO(2) injection, which it initiated in May 2007 at 2 MMcf per day and ramped up to 100 MMcf per day of CO(2) injection in January of 2008. Net production from North Ward Estes in September 2008 averaged 6,600 BOE per day, up 31% from 5,050 BOE per day in December 2007. The Company expects production rates to continue to increase from both the North Ward Estes and Postle fields. -- Whiting recently completed its first well at the Company's Jimmy Gulch prospect in Rio Blanco County, Colorado as a successful gas producer. The Federal 397-3G-G1 was completed in early October flowing 4.4 MMcf of gas per day through a 32/64-inch choke with a flowing casing pressure of 1,600 psi. Production is from 414 feet of net pay in the Iles and Williams Fork formations. The well was fracture stimulated in nine stages. The Company holds an 87% working interest and a 76% net revenue interest in the new gas well. Based on 20-acre spacing, Whiting has a total of approximately 32 potential locations at its Jimmy Gulch prospect. Potential 10-acre downspacing would add approximately 32 well locations.

At our Boies Ranch prospect in Rio Blanco County, 15 wells were producing at a combined average net rate to Whiting of 9.5 MMcf of gas per day in September 2008, representing a 56% increase from the June 2008 average daily net rate of 6.1 MMcf of gas. Whiting made alternative marketing arrangements for its Piceance Basin gas production in September to mitigate the impact of hydro-testing on a section of the REX pipeline for most of the month. The Company holds an average 72% working interest and an average 63% net revenue interest in the 15 Boies Ranch gas wells. As of October 22, 2008, four additional gas wells had been completed, bringing the total number of gas producers in the field to 19, three wells were being drilled, four wells were being completed and four wells were awaiting completion. Eight of these 11 wells are expected to be on stream by December 2008.

Whiting holds interests in 2,760 gross acres (1,570 net acres) on the Boies Ranch and Jimmy Gulch prospects. Currently, Whiting plans to drill a total of 153 wells at Boies Ranch, 77 on 20-acre spacing and 76 on 10-acre spacing. At Jimmy Gulch, we plan to drill 32 wells on 20-acre spacing. In addition, we own an average 16% working interest in an additional 14,133 lease federal acres in the area.

The following table summarizes the Company's net production and commodity price realizations for the quarters ended September 30, 2008 and 2007:

Three Months Ended ------------------ Production 9/30/08 9/30/07 Change ---------- ------- ------- ------ Oil and condensate (MMbbls) 3.28 2.48 32% Natural gas (Bcf) 8.16 7.55 8% Total equivalent (MMBOE) 4.64 3.74 24% Average Sales Price ------------------- Oil and condensate (per Bbl): Price received $108.04 $67.51 60% Effect of crude oil hedging (1) (12.76) (0.85) ------- ------ Realized price $95.28 $66.66 43% ====== ====== Natural gas (per Mcf): Price received $8.65 $5.06 71% Effect of natural gas hedging - - Realized price $8.65 $5.06 71% ===== ===== (1) Whiting realized a cash loss of $41.9 million before tax on its crude oil hedges during the third quarter of 2008. A summary of Whiting's outstanding hedges is included later in this news release. Third Quarter and Nine Months Costs and Margins

A summary of production, cash revenues and cash costs on a per BOE basis is as follows:

Per BOE, Except Production -------------------------- Three Months Nine Months Ended September 30, Ended September 30, ------------------- ------------------- 2008 2007 2008 2007 ---- ---- ---- ---- Production (MMBOE) 4.6 3.7 12.4 11.0 Sales price, net of hedging $82.59 $54.43 $79.77 $50.55 Lease operating expense 13.93 14.30 14.33 14.05 Production tax 6.08 3.53 5.80 3.17 General & administrative 3.72 2.88 4.18 2.54 Exploration 1.58 2.11 1.74 1.74 Cash interest expense 3.45 3.91 3.56 4.69 Cash income tax expense 0.10 0.91 0.11 0.50 ---- ---- ---- ---- $53.73 $26.79 $50.05 $23.86 ====== ====== ====== ======

With the exception of the Company's gas price basis differential, all of the above financial and operating statistics for the third quarter were in line with or better than its previously announced guidance.

The company-wide basis differential for natural gas compared to NYMEX in the third quarter was $1.62 per Mcf, which compared to $1.10 per Mcf in the third quarter of 2007 and $0.92 per Mcf in the second quarter of 2008. Whiting expects its gas price differential to be in the range of $1.00 to $1.50 in the fourth quarter of 2008.

During the third quarter, the company-wide basis differential for crude oil compared to NYMEX was $10.09 per barrel, which compared to $7.52 per barrel in the third quarter of 2007 and $10.72 per barrel in the second quarter of 2008. Whiting expects its oil price differential to be in the range of $9.00 to $10.25 in the fourth quarter of 2008.

Third Quarter 2008 Drilling Summary

The table below summarizes Whiting's drilling activity and exploration and development costs incurred for the three and nine months ended September 30, 2008:

Gross/Net Wells Completed ------------------------- Expl. & Dev. Total New % Success Cost Producing Non-Producing Drilling Rate (in millions) --------- ------------- -------- ---- ------------- Q308 70 / 27.4 8 / 5.1 78 / 32.5 90% / 84% $273.2 9M08 201/ 83.2 17 / 7.2 218/ 90.4 92% / 92% $683.5 Outlook for Fourth Quarter and Full-Year 2008

The following table provides a summary of certain estimates for the fourth quarter and full-year 2008 based on current forecasts. Whiting's full-year 2008 capital budget is $900 million (excluding acquisition costs).

Guidance for the fourth quarter and full-year 2008 is as follows: Guidance -------- Fourth Quarter Full-Year 2008 2008 ---- ---- Production (MMBOE) 4.90 - 5.10 17.30 - 17.50 Lease operating expense per BOE $12.90 - $13.20 $13.90 - $14.10 General and admin. expense per BOE $2.80 - $3.00 $3.70 - $3.90 Interest expense per BOE $3.60 - $3.80 $3.80 - $3.95 Depr., depletion and amort. per BOE $16.80 - $17.20 $15.10 - $15.30 Prod. taxes (% of production revenue) 6.7% - 7.0% 6.5% - 6.7% Oil Price Differentials to NYMEX per Bbl $9.00 - $10.25 $9.25 - $ 9.75 Gas Price Differentials to NYMEX per Mcf $1.00 - $1.50 $0.90 - $ 1.10 Oil Hedges and Fixed-Price Gas Contracts

Whiting Petroleum Corporation's outstanding hedges and fixed-price gas contracts as of October 1, 2008 are summarized below:

NYMEX Price As a Percentage of 2008 Contracted Volume Collar Range September 2008 Hedges (Bbls per Month) (per Bbl) Oil Production ------ ---------------- --------- -------------- Q4 110,000 $48.00 - $70.20 10% Q4 120,000 $60.00 - $75.85 11% Q4 100,000 $65.00 - $81.20 9% Fixed Price Natural Gas 2008 Contract As a Contracts Volumes in Price (1) Percentage of --------- MMBtu per per MMBtu September 2008 Month --------- Gas Production ----- -------------- Oct. 2008 - May 2011 24,000 $4.94 1% Oct. 2008 - Sep. 2012 67,000 $4.38 3% (1) Annual 4% price escalation on fixed price contracts.

In conjunction with the Whiting USA Trust I, Whiting entered into certain oil and natural gas hedges on the underlying properties. Whiting's retained 10% interest in the underlying properties combined with its ownership of 2,186,389 trust units results in third-party public holders of trust units receiving 75.8%, and Whiting retaining 24.2%, of the future economic results of the hedge contracts listed below.

Contracted Volume NYMEX Price Collar Range ----------------- ------------------------ Oil Natural Gas Bbls per Mcf per Oil Gas Hedges Month Month (per Bbl) (per MMBtu) ------ ----- ----- --------- ----------- Q4 08 51,436 228,830 $82.00 - $131.58 $7.00 - $19.00 2009 48,166 198,974 $76.00 - $137.43 $6.50 - $17.11 2010 43,488 170,589 $76.00 - $134.98 $6.50 - $15.06 2011 39,614 150,313 $74.00 - $140.15 $6.50 - $14.62 2012 36,189 132,232 $74.00 - $141.72 $6.50 - $14.27 Selected Operating and Financial Statistics Three Months Ended Nine Months Ended ------------------ ----------------- September 30, September 30, ------------- ------------- 2008 2007 2008 2007 ---- ---- ---- ---- Selected operating statistics Production Oil and condensate, Mbbl 3,284 2,480 8,676 7,106 Natural gas, MMcf 8,160 7,551 22,394 23,336 Oil equivalents, MBOE 4,644 3,739 12,408 10,995 Average Prices Oil, Bbl (excludes hedging) $108.04 $67.51 $104.21 $58.37 Natural gas, Mcf (excludes hedging) $8.65 $5.06 $8.87 $6.14 Per BOE Data Sales price (including hedging) $82.59 $54.43 $79.77 $50.55 Lease operating $13.93 $14.30 $14.33 $14.05 Production taxes $6.08 $3.53 $5.80 $3.17 Depreciation, depletion and amortization $15.99 $13.19 $14.47 $13.02 General and administrative $3.72 $2.88 $4.18 $2.54 Selected Financial Data (In thousands, except per share data) Total revenues and other income $388,434 $233,528 $998,258 $586,355 Total costs and expenses $211,487 $156,181 $594,666 $450,890 Net income $112,417 $47,713 $255,179 $84,850 Net income per common share, basic $2.66 $1.14 $6.03 $2.20 Net income per common share, diluted $2.65 $1.13 $6.01 $2.19 Average shares outstanding, basic 42,322 42,027 42,305 38,555 Average shares outstanding, diluted 42,465 42,152 42,464 38,728 Net cash provided by operating activities $282,361 $122,656 $611,452 $272,609 Net cash used in investing activities $(286,922) $(82,318) $(855,586) $(325,047) Net cash provided by (used in) financing activities $ - $(39,523) $250,000 $50,771 Conference Call

The Company's management will host a conference call with investors, analysts and other interested parties on Thursday, October 30, 2008 at 11:00 a.m. EDT (10:00 a.m. CDT, 9:00 a.m. MDT) to discuss Whiting's third quarter 2008 financial and operating results. Please call (800) 688-0836 (U.S./Canada) or (617) 614-4072 (International) and enter the pass code 75669563 to be connected to the call. Access to a live Internet broadcast will be available at http://www.whiting.com/ by clicking on the link titled "Webcasts." Slides for the conference call will be available on this website beginning at 11:00 a.m. (EDT) on October 30, 2008.

A telephonic replay will be available beginning approximately two hours after the call on Thursday, October 30, 2008 and continuing through Thursday, November 6, 2008. You may access this replay at (888) 286-8010 (U.S./Canada) or (617) 801-6888 (International) and entering the pass code 72718542. You may also access a web archive at http://www.whiting.com/ beginning approximately one hour after the conference call.

About Whiting Petroleum Corporation

Whiting Petroleum Corporation, a Delaware corporation, is an independent oil and gas company that acquires, exploits, develops and explores for crude oil, natural gas and natural gas liquids primarily in the Permian Basin, Rocky Mountains, Mid-Continent, Gulf Coast and Michigan regions of the United States. 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 the Private Securities Litigation Reform Act of 1995. All statements other than historical facts, including, without limitation, statements regarding our future financial position, business strategy, projected revenues, earnings, costs, capital expenditures and debt levels, and plans and objectives of management for future operations, are forward-looking statements. When used in this news release, words such as 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: declines in oil or gas prices; our level of success in exploitation, exploration, development and production activities; adverse weather conditions that may negatively impact development or production activities; the timing of our exploration and development expenditures, including our ability to obtain drilling rigs and CO(2); our ability to obtain external capital to finance acquisitions; our ability to identify and complete acquisitions and to successfully integrate acquired businesses; unforeseen underperformance of or liabilities associated with acquired properties; our ability to successfully complete potential asset dispositions; inaccuracies of our reserve estimates or our assumptions underlying them; failure of our properties to yield oil or gas in commercially viable quantities; uninsured or underinsured losses resulting from our oil and gas operations; our inability to access oil and gas markets due to market conditions or operational impediments; the impact and costs of compliance with laws and regulations governing our oil and gas operations; risks related to our level of indebtedness and periodic redeterminations of our borrowing base under our credit agreement; our ability to replace our oil and gas reserves; any loss of our senior management or technical personnel; competition in the oil and gas industry in the regions in which we operate; risks arising out of our hedging transactions; and other risks described under the caption "Risk Factors" in our Form 10-K for the year ended December 31, 2007. We assume no obligation, and disclaim any duty, to update the forward-looking statements in this news release.

SELECTED FINANCIAL DATA

For further information and discussion on the selected financial data below, please refer to Whiting Petroleum Corporation's Third Quarter Form 10-Q for the three and nine months ended September 30, 2008, to be filed with the Securities and Exchange Commission.

WHITING PETROLEUM CORPORATION CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands) September 30, December 31, 2008 2007 ------------ ------------ ASSETS CURRENT ASSETS: Cash and cash equivalents $20,644 $14,778 Accounts receivable trade, net 192,711 110,437 Deferred income taxes 1,949 27,720 Prepaid expenses and other 26,562 9,232 ------ ----- Total current assets 241,866 162,167 PROPERTY AND EQUIPMENT: Oil and gas properties, successful efforts method: Proved properties 4,137,940 3,313,777 Unproved properties 132,908 55,084 Other property and equipment 69,546 37,778 ------ ------ Total property and equipment 4,340,394 3,406,639 Less accumulated depreciation, depletion and amortization (789,192) (646,943) --------- --------- Total property and equipment, net 3,551,202 2,759,696 --------- --------- DEBT ISSUANCE COSTS 11,826 15,016 OTHER LONG-TERM ASSETS 30,252 15,132 ------ ------ TOTAL $3,835,146 $2,952,011 ========== ========== WHITING PETROLEUM CORPORATION CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands, except share and per share data) September 30, December 31, 2008 2007 ---- ---- LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $40,269 $19,280 Accrued capital expenditures 82,840 58,988 Accrued liabilities 35,393 29,551 Accrued interest 21,222 11,240 Oil and gas sales payable 53,347 26,205 Accrued employee compensation and benefits 37,153 21,081 Production taxes payable 29,643 12,936 Current portion of deferred gain on sale 15,235 - Current portion of tax sharing liability 2,587 2,587 Current portion of derivative liability 25,046 72,796 ------ ------ Total current liabilities 342,735 254,664 NON-CURRENT LIABILITIES: Long-term debt 1,118,560 868,248 Asset retirement obligations 42,254 35,883 Production Participation Plan liability 61,006 34,042 Tax sharing liability 24,004 23,070 Deferred income taxes 381,753 242,964 Long-term derivative liability 5,243 - Deferred gain on sale 77,229 - Other long-term liabilities 2,933 2,314 ----- ----- Total non-current liabilities 1,712,982 1,206,521 COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' EQUITY: Common stock, $0.001 par value; 75,000,000 shares authorized, 42,584,833 and 42,480,497 shares issued as of September 30, 2008 and December 31, 2007, respectively 43 42 Additional paid-in capital 972,050 968,876 Accumulated other comprehensive loss (15,867) (46,116) Retained earnings 823,203 568,024 ------- ------- Total stockholders' equity 1,779,429 1,490,826 --------- --------- TOTAL $3,835,146 $2,952,011 ========== ========== WHITING PETROLEUM CORPORATION CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (In thousands, except per share data) Three Months Ended Nine Months Ended ------------------ ----------------- September 30, September 30, ------------- ------------- 2008 2007 2008 2007 ---- ---- ---- ---- REVENUES AND OTHER INCOME: Oil and natural gas sales $425,392 $205,594 $1,102,658 $557,953 Loss on oil hedging activities (41,879) (2,101) (112,902) (2,101) Gain on sale of properties - 29,682 - 29,682 Amortization of deferred gain on sale 4,720 - 7,677 - Interest income and other 201 353 825 821 --- --- --- --- Total revenues and other income 388,434 233,528 998,258 586,355 ------- ------- ------- ------- COSTS AND EXPENSES: Lease operating 64,690 53,472 177,866 154,512 Production taxes 28,245 13,197 71,988 34,888 Depreciation, depletion and amortization 74,233 49,308 179,555 143,214 Exploration and impairment 10,939 10,420 30,566 26,239 General and administrative 17,281 10,780 51,903 27,941 Change in Production Participation Plan liability 9,117 2,254 26,964 6,404 Interest expense 17,543 16,263 48,760 56,514 (Gain) loss on mark-to-market derivatives (10,561) 487 7,064 1,178 -------- --- ----- ----- Total costs and expenses 211,487 156,181 594,666 450,890 ------- ------- ------- ------- INCOME BEFORE INCOME TAXES 176,947 77,347 403,592 135,465 INCOME TAX EXPENSE: Current 481 3,401 1,353 5,542 Deferred 64,049 26,233 147,060 45,073 ------ ------ ------- ------ Total income tax expense 64,530 29,634 148,413 50,615 ------ ------ ------- ------ NET INCOME $112,417 $47,713 $255,179 $84,850 ======== ======= ======== ======= NET INCOME PER COMMON SHARE, BASIC $2.66 $1.14 $6.03 $2.20 ========= ========== ========= ========= NET INCOME PER COMMON SHARE, DILUTED $2.65 $1.13 $6.01 $2.19 ========= ========== ========= ========= WEIGHTED AVERAGE SHARES OUTSTANDING, BASIC 42,322 42,027 42,305 38,555 ====== ====== ====== ====== WEIGHTED AVERAGE SHARES OUTSTANDING, DILUTED 42,465 42,152 42,464 38,728 ====== ====== ====== ====== WHITING PETROLEUM CORPORATION Reconciliation of Net Cash Provided by Operating Activities to Discretionary Cash Flow (In thousands) Three Months Ended September 30, ------------- 2008 2007 ---- ---- Net cash provided by operating activities $282,361 $122,656 Exploration 7,323 7,903 Changes in working capital (34,063) (22,533) -------- -------- Discretionary cash flow (1) $255,621 $108,026 ======== ======== Nine Months Ended September 30, ------------- 2008 2007 ---- ---- Net cash provided by operating activities $611,452 $272,609 Exploration 21,550 19,081 Changes in working capital 391 (9,423) --- ------- Discretionary cash flow (1) $633,393 $282,267 ======== ======== (1) Discretionary cash flow is computed as net income plus exploration and impairment costs, depreciation, depletion and amortization, deferred income taxes, non-cash interest costs, non-cash compensation plan charges, gain/loss on mark-to-market derivatives and other non-current items less the gain on sale of properties and amortization of deferred gain on sale. The non-GAAP measure of discretionary cash flow is presented because management believes it provides useful information to investors for analysis of the Company's ability to internally fund acquisitions, exploration and development. Discretionary cash flow should not be considered in isolation or as a substitute for net income, income from operations, net cash provided by operating activities or other income, cash flow or liquidity measures under GAAP and may not be comparable to other similarly titled measures of other companies.

Whiting Petroleum Corporation

CONTACT: John B. Kelso, Director of Investor, Relations +1-303-837-1661,john.kelso@whiting.com

Web Site: http://www.whiting.com/

Source: PRNewswire-FirstCall

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