Oasis Petroleum Settles in For Lower for Longer, Keeps Rig Activity Lower 

Oasis Petroleum Settles in For Lower for Longer, Keeps Rig Activity Lower 

Oasis Petroleum (NYSE: OAS) is a pure play operator in the Williston basin having about 485,000 net acres. The company expects production to be in the range of 48.5 to 49.5 Mboepd for 2016 which was increased since the previous guidance. Oasis has cut capital expenditures by just over half for the 2016 year down to $200 million for drilling and completion activity. The company expects to spend another $200 million on midstream services and other expenses. Year to date the company has spent $219 million of the budget or 55% with $89 million in D&C capital.

Screen Shot 2016-09-19 at 1.03.27 PM

Source: Oasis Petroleum

Minimal Completion Activity Grows DUC Inventory in the Bakken 

In 2016 Oasis has completed 16 wells of the 53 expected wells in the Williston all in McKenzie county. The company finished the second quarter with 83 drilled but uncompleted wells which ranks as one of the top five operators in the basin holding uncompleted inventory. About 45% of the inventory of uncompleted wells are located in the Wild Basin with the others located in Indian Hills and Alger (~35% of inventory) and in Red Bank and Montana (~20% of inventory).


Oasis rigs in williston north dakota

Source: Oasis Petroleum

The company has focused all frac crews in the core beginning the year in Indian Hills and moving to the Wild Basin during the second quarter. The company has continued to improve operations decreasing the average spud to rig release time by 2.1 days down to 13.5.

Screen Shot 2016-09-19 at 1.05.57 PM Source: Oasis Petroleum

Oasis Hangs onto Positive Free Cash Flow 

The company has shown that they have had a positive free cash flow of $46 million through 2015 and year to date 2016 which shows the strength of early 2015 compared to the ongoing slump in oil prices. Looking more recently, Oasis has had a negative free cash flow for the first six months of 2016 at -$596 million showing the need for increased prices.


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