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Devon Energy Corporation (NYSE:DVN) today reported net earnings of $477 million for the quarter ended June 30, 2012, or $1.18 per common share ($1.18 per diluted share). This compares with second-quarter 2011 net earnings of $2.7 billion, or $6.50 per common share ($6.48 per diluted share). A one-time gain of $2.5 billion resulting from the divestiture of assets in Brazil enhanced the company’s second-quarter 2011 earnings.
Devon’s second-quarter 2012 financial results were impacted by certain items securities analysts typically exclude from their published estimates. Adjusting for these items, the company earned $224 million or $0.55 per diluted share in the second-quarter 2012. The adjusting items are discussed in more detail later in this news release.
Strong Oil Growth Drives Production Increase
Devon continued to deliver strong oil production growth in the second-quarter 2012. In aggregate, oil production averaged 149,000 barrels per day, a 26 percent increase compared to the second-quarter 2011. This increase is largely attributable to growth from the company’s Jackfish and Permian Basin projects.
Total production of oil, natural gas and natural gas liquids averaged 679,000 oil-equivalent barrels (Boe) per day in the second quarter. A number of production interruptions primarily related to natural gas processing facilities reduced the company’s second quarter production by 16,000 Boe per day. The most significant occurrence was maintenance downtime at Devon’s Bridgeport facility in North Texas which reduced natural gas liquids production by approximately 10,000 barrels per day in the quarter. Due to the low natural gas liquids price environment, the second quarter was an opportune time for plant maintenance activities. Other minor disruptions at third-party facilities in the Permian Basin, Mid-Continent and Gulf Coast regions also contributed to the reduced volumes. In spite of these issues, which have now been resolved, companywide production increased three percent compared to the second-quarter 2011.