Devon Energy To Sell Gulf Of Mexico Assets, Others

OKLAHOMA CITY (AP) — Independent oil and gas producer Devon Energy Corp. said Monday it will divest its Gulf of Mexico and international assets.

Devon expects the divestitures will create after-tax proceeds of $4.5 billion to $7.5 billion. The company plans to use the proceeds to invest in its U.S. and Canadian portfolio and retire debt.

Shares advanced in afternoon trading.

The sales will add double-digit percentage earnings, cash flow, production and reserves beginning in 2011, President John Richels told investor analysts on a conference call.

Devon Energy will spend between $200 million and $275 million for the reorganization, with $175 million to $225 million in 2009 and the remainder next year, he said.

Following discussions with rating agencies, Devon Energy does not expect any ratings changes as a result of its divestiture, Richels said.

In addition, the repositioning of Devon Energy's assets will maintain a "very similar reserve and production balance" between oil and natural gas, he said.