Devon Energy announced it made accounting method changes in the fourth quarter of 2017. As it prepares to release fourth quarter and full-year revenues, the company said it converted from the full-cost methodology to successful efforts.
“The conversion to successful efforts accounting is one of many shareholder-friendly initiatives underway at Devon,” said Jeff Ritenour, chief financial officer. “We believe the conversion to successful efforts will provide greater transparency into our financial performance, allowing us to better showcase the top-tier returns we’re achieving with our disciplined capital program.”
Ritenour said the fourth-quarter and full-year 2017 results will reflect the accounting change. More detailed information about the conversion to successful efforts will be provided when the quarterly and year-end results are released Feb. 20, 2018.
As defined under accounting procedures, “The successful efforts (SE) method allows a company to capitalize only those expenses associated with successfully locating new oil and natural gas reserves. For unsuccessful (or “dry hole”) results, the associated operating costs are immediately charged against revenues for that period.”