OKLAHOMA CITY--(BUSINESS WIRE)--Devon Energy Corp. (NYSE: DVN) announced today it has entered into a definitive agreement to sell the southern portion of its Barnett Shale position for $553 million. The transaction is subject to customary terms and conditions and is expected to close in the second quarter of 2018.
“Combined with other recent asset sales, divestiture proceeds associated with our 2020 Vision have now reached $1.0 billion,” said Dave Hager, president and CEO. “In conjunction with this asset sale, and consistent with our strategic plan, we announced today in a separate release that our board has authorized a $1.0 billion share-repurchase program and a 33 percent increase in Devon’s quarterly cash dividend. We are very confident about Devon’s future and, as market conditions permit, we will continue to pursue opportunities to further increase cash returns to our shareholders.”
Net production from the southern Barnett divestiture assets, which reside primarily in Johnson County, are currently averaging 200 million cubic feet of gas-equivalent per day. Field-level cash flow accompanying these assets, which excludes overhead costs, is expected to be approximately $100 million in 2018.
The company’s remaining position in the Barnett Shale primarily resides in Denton, Wise and Tarrant counties, with current production of 680 million cubic feet of gas-equivalent per day. This position contains an inventory of approximately 1,500 potential locations, consisting of undrilled inventory and horizontal refrac opportunities.
J.P. Morgan Securities LLC acted as the 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 achieving strong returns and capital-efficient cash flow growth. 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 delay or failure to consummate the transaction due to unsatisfied closing conditions or otherwise; the amount of proceeds received due to purchase price adjustments and other factors, and the ultimate use of those proceeds; 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 (SEC). 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. The SEC permits oil and gas companies, in their filings with the SEC, to disclose only proved, probable and possible reserves that meet the SEC's definitions for such terms, and price and cost sensitivities for such reserves, and prohibits disclosure of resources that do not constitute such reserves. This press release contains certain terms, such as undrilled inventory and locations and other similar terms. These estimates are by their nature more speculative than estimates of proved, probable and possible reserves and accordingly are subject to substantially greater risk of being actually realized. Investors are urged to consider closely the disclosure in our Annual Report on Form 10-K and other SEC filings.