With its oil production soaring, Continental Resources Inc. is focusing on cutting costs.
The Oklahoma City-based oil company reached a milestone during the second quarter — producing 100,000 barrels of oil a day for the first time in June — as production rose 76 percent over the same period last year.
“We're hitting on all cylinders, with drilling cycle times continuing to be very favorable,” CEO Harold Hamm said Thursday.
Continental expects to report record production of nearly 95,000 barrels of oil equivalent a day when it releases its second-quarter earnings on Aug. 8. Crude oil represented more than 68 percent of that figure.
The company produced about 54,000 barrels a day in the second quarter of 2011.
Despite its increased production, Continental's stock dropped $1.76 a share Thursday. It lost another 40 cents Friday, closing at $66.99.
Continental put almost 150,000 barrels of oil in storage during the second quarter in anticipation of higher prices.
The company expects to report it earned an average of $80.56 a barrel for its oil in the second quarter.
Hamm has said he expects oil to settle at about $100 a barrel. It closed Thursday at $89.42.
The company also has embarked on a cost-cutting program aimed at reducing its well costs. Previous efforts have not met the company's expectations, so it is instituting a more in-depth program.
Continental has idled its least efficient rigs and completion crews to slash its costs.
“We're clearly ahead of plan on production growth,” Hamm said. “Our focus now is on driving down drilling and completion costs and reducing oil transportation costs.”