In an effort to transform itself through restructuring, Oklahoma City-based Devon Energy Corp. announced on Wednesday that it will sell all remaining non-core assets in the Midland Basin of west Texas for a combined $858 million in two separate transactions. The latest non-core divestitures bump up the company’s recent sales amounting for nearly $2.1 billion, according to the company’s press release.
Devon indicated that Pioneer Natural Resources will purchase assets in northern Midland Basin for $435 million. The southern Midland Basin sale for $423 million is to an unidentified buyer.
“At least two-thirds of our asset sales proceeds are expected to be used to further strengthen our investment-grade balance sheet, while one-third are targeted for reinvestment in our best-in-class U.S. resource plays,” said Dave Hager, Chief Executive Officer. “With the success of our E&P asset sales, we are now in the planning stages to increase our upstream activity by approximately $200 million in the second half of this year. This additional activity will deliver production in early 2017 and beyond. Additionally, we are seeing even better than expected results from our core business and we are raising the mid-point of our full-year 2016 production guidance by 7,000 Boe per day.”
Since Devon Energy has experienced rapid success in raising capital through the sale of non-core assets, the Company will review the possibility of expediting activity by the end of 2016, according to the press release.
