Continental's proven reserves drop

U.S. shale leader Continental Resources reported its proved reserves for the year ending Dec. 31 declined by millions of barrels.

Value of the company's portfolio declined by about 10 percent for the year to $8 billion. The Bakken play in the northern Plains states accounted for about 56 of its total reserves, while shale basins in Oklahoma made up the bulk of the minority of its holdings.

Total proved reserves for 2015 amounted to 1.23 billion barrels oil equivalent, against 1.35 billion boe the previous year. Harold Hamm, the company's CEO, said the loss was compared with a much steeper drop in crude oil prices last year.

"The 9 percent year-over-year reduction in our proved reserves during 2015, compared with an approximately 50 percent reduction in crude oil prices, clearly validates the premier quality of Continental's inventory of assets," he said in a statement.

That contrasts somewhat with expectations laid out in January when the company reported fourth quarter earnings. In a statement laying out plans for the year, Continental, which has headquarters in Oklahoma, said first-quarter production would average around 215,000 boe per day and drop around 13 percent to 185,000 boe in the fourth quarter.

Continental said its 2016 budget of around $920 million marked a 66 percent reduction from last year. In terms of the relationship to crude oil prices, the company said its budget would be cash-flow neutral if West Texas Intermediate, the U.S. benchmark for crude oil prices, is $37 per barrel on average for the year. WTI was trading around $26 per barrel in early Thursday trading. WTI is down about 13 percent from when Continental reported its fourth quarter earnings.

More than half of the company's budget will remain focused on combined shale interests in North Dakota and, to a lesser extent, Oklahoma.