Oklahoma City-based Devon Energy Corporation will divest nearly $1 billion of non-core assets including some portions of the Barnett Shale near Johnson County, according to a company press release issued Tuesday.
“The successful resource expansion in our world-class STACK and Delaware Basin assets has generated an abundance of opportunities within our portfolio,” said Dave Hager, president and CEO. “Given the multi-decade growth platform these franchise assets provide, we are taking this initial step to bring value forward from non-core assets and sharpen our focus on the highest-returning growth inventory in our portfolio.”
The second quarter of 2017 will kick off the company’s divestiture program, with sales completed over the next 12 to 18 months. The company plans to strengthen its investment-grade financial position and will accelerate redistribution of divestiture proceeds back into higher-market production projects.
“This divestiture program, combined with our excellent liquidity and strong hedge position, supports our capital program and places us firmly on track to achieve our production growth targets in 2017 and 2018,” said Hager. “Importantly, these strategic actions provide certainty for our future capital programs and uniquely position Devon to maintain strong operational momentum through the end of the decade.”
Based on Devon’s current domestic resource base, the growth is concentrated in the STACK and Delaware Basin, where Devon has exposure to more than 30,000 potential drilling locations, of which roughly one third have been successfully de-risked.
On April 29, OK Energy Today reported on Devon’s recent success in the STACK with its spacing pilot big hit in the Pump House plot in Kingfisher County.