Interview Synopsis

Whiting Petroleum – financials overview & post-bankruptcy outlook

  • Credit
  • Energy
  • North America

Whiting Petroleum filed for Chapter 11 bankruptcy in April 2020, but exited from this state later that year. To find out more about the state of play for this company, as well as the oil industry’s prospects, Third Bridge Forum interviewed a former director from Whiting Petroleum Corp.

Assessing the outlook for Whiting

The discussion started with an assessment of the prospects for the upstream producers in the Bakken and Williston fields. In light of recent consolidations, the specialist remarked that these were inevitable. “There were just way too many small and mid-sized companies, so there weren’t really a lot of economies of scale. When oil is USD 140 a barrel, anyone can throw a hole in the ground and be fairly successful.”

Post-bankruptcy, Whiting has worked on improving its operations. “It seems like they’ve been pretty strategic and pretty smart… Right now the market is definitely rewarding people who have restrictions on their capital and try to live within cash flows and try to grow at a reasonable rate and get out of debt.” They also noted that Whiting should be out of debt by the end of this year. 

Moving on to the topic of headwinds for the oil and gas industry, the former director explained that many banks and lending institutions do not want to be associated with this sector. “Capital is drying up a little bit in oil and gas, and some of those dollars are seeking green alternatives.”

However, they do not envisage demand drying up, with growing middle classes in India and China. In addition, “to build the infrastructure for the renewables, to smelt the steel, to mine the copper, to get the lithium, all the stuff that you need to build a renewable infrastructure takes a large amount of fossil fuels to get there.” 

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The information used in compiling this document has been obtained by Third Bridge from experts participating in Forum Interviews. Third Bridge does not warrant the accuracy of the information and has not independently verified it. It should not be regarded as a trade recommendation or form the basis of any investment decision.

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