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6 Pages

Devon reaches E&P disposal target with two Midland Basin divestitures totalling US$858 million


Devon reaches E&P disposal target with two Midland Basin divestitures totalling US$858 million

Report summary

Less than ten days after announcing nearly US$1 billion in non-core divestitures, Devon Energy announced definitive agreements to sell its remaining non-core assets in the Midland Basin for US$858 million. The company's northern Midland Basin properties were sold to Pioneer Natural Resources for US$435 million, and the southern Midland Basin properties were sold to an undisclosed buyer for US$423 million. Together with the company's earlier sales, total announced non-core divestments amount to US$2.1 billion. The company's divestment initiative is intended to simplify its portfolio and reduce leverage, after spending US$2.5 billion (46% cash) on tight-oil acquisitions in December 2015. Devon plans to utilise two-thirds of the asset sales' proceeds to strengthen its balance sheet, and the remaining one-third for reinvestment in its primary Lower 48 resource plays - namely the Delaware Basin and STACK play in Oklahoma.

What's included?

This report includes 1 file(s)

  • Devon reaches E&P disposal target with two Midland Basin divestitures totalling US$858 million PDF - 1.09 MB 6 Pages, 6 Tables, 1 Figures

Description

The upstream oil and gas industry conducts activities against a backdrop of growing energy and environmental challenges. Political instabilities, international conflicts and government and environmental regulation have all impacted the production process.

This has forced companies to re-examine their corporate strategy, moving away from high-risk exploratory drilling to lower-risk exploration in mature basins as they search for increased returns.

This Upstream Oil and Gas Deal Insight report provides an in-depth analysis of this deal. You will also find information about upstream assets and the strategic rationale behind the deal.

For investors and businesses, this deal insight report provides an understanding of the effect this deal will have on the market, including oil and gas pricing and assumptions. Use it to keep up to date with deal announcements, gain expert insights and analyse potential developments that might affect your strategy.

Wood Mackenzie goes beyond company-reported data and announcements to give you an independent and informed view. Our unique valuation metrics are underpinned by our deep understanding of upstream assets and companies. We help you objectively benchmark and evaluate asset and corporate deals so you can compare deal economics around the world.

  • Executive summary
  • Transaction details
  • Deal analysis
  • Strategic rationale
  • Oil & gas pricing and assumptions

In this report there are 7 tables or charts, including:

  • Executive summary
  • Transaction details
  • Deal analysis
    • Devon's northern Midland position against select Pioneer's wells
    • Deal analysis: Table 1
    • Deal analysis: Table 2
    • Deal analysis: Table 3
    • Deal analysis: Table 4
  • Strategic rationale
  • Oil & gas pricing and assumptions
    • Oil & gas pricing and assumptions: Table 1
    • Oil & gas pricing and assumptions: Table 2
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