In the following video, the Fool's Joel South reviews the important performance metrics for Kodiak Oil & Gas as it heads into 2013.

First, Joel looks at production. Is Kodiak consistently reaching management's outlines for production guidance? How does the company compare with other companies working in the same North Dakota counties?

Second, Joel examines cost-cutting. Producing oil in the Williston Basin is an expensive proposition, and Kodiak needs to keep its expenses to a minimum. Q4 2012 saw Kodiak reducing its lease operating expenses, for example. Investors should be sure to look for additional cost-cutting efforts.

Joel then looks at hedging. Oil prices fluctuate, and Joel believes Kodiak needs to have itself at least 85% hedged to protect itself from an unexpected decline in oil revenues.

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