OKLAHOMA CITY--(BUSINESS WIRE)--
Devon Energy Corporation (NYSE:DVN) today announced that it has entered
into a definitive agreement to sell all of its non-core U.S. oil and gas
properties to Linn Energy (Nasdaq: LINE, LNCO) for $2.3 billion, or
approximately $1.8 billion after tax. The agreement covers Devon’s
remaining assets targeted for divestiture and includes properties in the
Rockies, onshore Gulf Coast, and Mid-Continent regions of the U.S.
“With the sale of our remaining non-core assets, the portfolio
transformation that we announced late last year is now complete,” said
John Richels
, president and chief executive officer. “In a short period
of time we transformed our portfolio through three significant steps:
the accretive Eagle Ford entry, the innovative creation of EnLink
Midstream, and the sale of our non-core properties. The sale of Canadian
and U.S. non-core properties over the past few months has generated in
excess of $5 billion of proceeds at an accretive multiple of nearly 7
times 2013 EBITDA.”
“Devon is now concentrated in some of the most attractive North America
resource plays, with liquids expected to approach 60 percent of our
production by year-end and multi-year oil production growth projected to
be in excess of 20 percent,” said Richels. “In addition to creating a
platform that supports competitive and high-margin growth, we remain
committed to maintaining strong investment-grade credit ratings. Upon
completion of this transaction we will have reduced our net debt by more
than $4 billion this year.”
Devon’s production from these non-core U.S. assets is currently 275
million cubic feet of gas equivalent per day, of which approximately 80
percent is natural gas. At December 31, 2013, proved reserves associated
with these properties amounted to 1.242 trillion cubic feet of gas
equivalent. EBITDA accompanying these assets totaled $350 million in
2013.
The transaction is subject to customary terms and conditions and is
expected to close in the third quarter of 2014, with an effective date
of April 1, 2014.
Jefferies LLC acted as lead financial advisor to Devon on the
transaction. Credit Suisse Securities (USA) LLC also acted as a
financial advisor to Devon on the transaction. Vinson & Elkins LLP acted
as legal advisor to Devon.
Devon Energy Corporation is an Oklahoma City-based independent energy
company engaged in oil and gas exploration and production. Devon is a
leading U.S.-based independent oil and gas producer and is included in
the S&P 500 Index. For additional information, visit www.devonenergy.com.
This press release includes "forward-looking statements" as defined
by the Securities and Exchange Commission (SEC). Such statements are
those concerning strategic plans, expectations and objectives for future
operations. All statements, other than statements of historical facts,
included in this press release that address activities, events or
developments that the company expects, believes or anticipates will or
may occur in the future are forward-looking statements. Such statements
are subject to a number of assumptions, risks and uncertainties, many of
which are beyond the control of the company. These risks are identified
in our Form 10-K and our other filings with the SEC. Investors are
cautioned that any such statements are not guarantees of future
performance and that actual results or developments may differ
materially from those projected in the forward-looking statements. The
forward-looking statements in this press release are made as of the date
of this press release, even if subsequently made available by Devon on
its website or otherwise. Devon does not undertake any obligation to
update the forward-looking statements as a result of new information,
future events or otherwise.
Source: Devon Energy Corporation