OKLAHOMA CITY--(BUSINESS WIRE)--Devon Energy Corp. (NYSE:DVN) announced today it has entered into a definitive agreement to sell its non-core Mississippian assets in northern Oklahoma to White Star Petroleum, LLC for $200 million. The transaction is subject to customary terms and conditions and is expected to close in the second quarter of 2016 with an effective date of Jan. 1, 2016.
“This is another important step in executing on our plan to divest $2 billion to $3 billion of non-core assets across our portfolio during 2016,” said Dave Hager, president and CEO. “Proceeds will be used to further strengthen our investment-grade balance sheet. Additionally, this timely transaction accelerates Devon’s efforts to focus exclusively on its best-in-class resource plays in onshore North America.”
Net production from the Mississippian assets averaged 12,800 oil-equivalent barrels (Boe) per day in the first quarter of 2016, of which approximately 30 percent was oil. At Dec. 31, 2015, proved reserves associated with these properties amounted to 11 million Boe. Field-level cash flow accompanying these assets, which excludes overhead costs, totaled $8 million in the first quarter.
The divestiture process for the Company’s remaining non-core assets is ongoing. Devon is marketing its 50 percent interest in the Access Pipeline in Canada and anticipates an announcement in the first half of 2016. Efforts to monetize remaining upstream assets in the U.S. are also progressing. Data rooms for upstream assets have been open since early March and bids are expected in the second quarter. Overall, Devon remains on track to complete its $2 billion to $3 billion of non-core divestitures by year end.
Jefferies LLC acted as the lead financial advisor to Devon on the transaction. RBC Richardson Barr also acted as a financial advisor to Devon on the transaction. Vinson & Elkins LLP acted as legal advisor to Devon.
About Devon Energy
Devon Energy is a leading independent energy company engaged in finding and producing oil and natural gas. Based in Oklahoma City and included in the S&P 500, Devon operates in several of the most prolific oil and natural gas plays in the U.S. and Canada with an emphasis on a balanced portfolio. The Company is the second-largest oil producer among North American onshore independents. For more information, please visit www.devonenergy.com.
This press release contains forward-looking statements within the meaning of the federal securities laws. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company. These risks include, but are not limited to: the failure to consummate the transaction with White Star Petroleum, LLC due to unsatisfied closing conditions or otherwise; the timing, amount of proceeds and ultimate success of divesting the Company’s other non-core assets; and the other risks identified in the Company’s Annual Report on Form 10-K and its other filings with the Securities and Exchange Commission. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in the forward-looking statements. The forward-looking statements in this press release are made as of the date hereof, and the Company does not undertake any obligation to update the forward-looking statements as a result of new information, future events or otherwise.