Devon Energy Reports Third-Quarter 2016 Results

Devon Energy Corp. (NYSE: DVN) today reported operational and financial results for the third quarter of 2016 and provided guidance for the fourth quarter of 2016.

Highlights
  • Achieved record-setting well results in U.S. resource plays
  • Increased STACK production 38 percent year over year
  • Decreased lease operating expenses 37 percent from peak rates
  • Expected cost savings to reach $1 billion in 2016
  • Completed $3.2 billion asset divestiture program
  • Repurchased $1.2 billion of debt

"Devon delivered an outstanding operational performance in the third quarter," said Dave Hager, president and CEO. "Our development programs generated the best quarterly drill-bit results in Devon's 45 year history. These prolific well results were centered in the STACK play, where production increased by 38 percent. We also continued to achieve significant cost savings in the quarter and we are on pace to reduce operating and G&A expenses by $1 billion in 2016."

"In addition to our strong operating performance, we were able to successfully complete our $3.2 billion divestiture program," Hager said. "These accretive transactions strengthened our investment-grade position and significantly reduced our leverage from earlier this year. This improved financial strength allows us to further accelerate investment in our best-in-class U.S. resource plays, led by the STACK and Delaware Basin."

Record-Setting Well Results in U.S. Resource Plays

Total production averaged 577,000 oil-equivalent barrels (Boe) per day in the third quarter of 2016. Excluding divestiture properties, production from Devon's retained asset base amounted to 550,000 Boe per day. With the shift to higher-margin production, oil is now the largest component of the company's product mix at 45 percent of total volumes. To further enhance the profitability of production, Devon rejected approximately 6,000 barrels per day of ethane during the third quarter.

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