• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 16 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 4 days Does Toyota Know Something That We Don’t?
  • 4 days World could get rid of Putin and Russia but nobody is bold enough
  • 4 hours America should go after China but it should be done in a wise way.
  • 7 days OPINION: Putin’s Genocidal Myth A scholarly treatise on the thousands of years of Ukrainian history. RCW
  • 6 days China is using Chinese Names of Cities on their Border with Russia.
  • 7 days Russian Officials Voice Concerns About Chinese-Funded Rail Line
  • 7 days CHINA Economy IMPLODING - Fastest Price Fall in 14 Years & Stock Market Crashes to 5 Year Low
  • 6 days CHINA Economy Disaster - Employee Shortages, Retirement Age, Birth Rate & Ageing Population
  • 7 days Putin and Xi Bet on the Global South
  • 7 days "(Another) Putin Critic 'Falls' Out Of Window, Dies"
  • 8 days United States LNG Exports Reach Third Place
  • 8 days Biden's $2 trillion Plan for Insfrastructure and Jobs
Charles Kennedy

Charles Kennedy

Charles is a writer for Oilprice.com

More Info

Premium Content

Devon Sells Canadian Conventional Assets for $2.8 Billion

US oil producer Devon Energy will sell the bulk of its conventional assets in Canada for around $2.8 billion in cash to Canadian Natural Resources.

The sale—expected to close in the second quarter--is in line with Oklahoma City-based Devon’s new strategy, which includes divesting natural gas holdings and refocusing on North American crude oil assets, which are more profitable.

"This tax-efficient transaction provides for a clean exit from our Canadian conventional business at a value of nearly 7 times 2013 EBITDA, a substantial premium compared to Devon's current trading multiple," Devon CEO John Richels said in a statement.

Devon’s 2.2 million acres of conventional assets in Canada currently produce about 383 million cubic feet per day of natural gas, 10,800 barrels per day of light crude oil, and 12,000 barrels per day of natural gas liquids.

Related Article: Small Companies Poised to Ride Canadian Natural Gas Wave

Left out of the deal is Devon’s heavy-oil operations in Alberta and natural gas-rich assets in the Horn River area of northeastern British Columbia.

According to Devon, the proceeds from the sale in Canada will be used to repay debt in the Texas Eagle Ford shale, where the company has invested $6 billion since November.

For Canadian Natural Resources out of Calgary, the acquisition of Devon’s conventional assets could increase the company’s total production by some 11%--or to over 780,000 barrels of oil equivalent per day.

Canadian Natural Resources shares went up 3.7% on the Toronto Stock Exchange on the announcement.

In the meantime, Devon has seen a boost in oil production to a record 177,000 barrels a day—a 17% gain over the same quarter of 2012--largely due to increases in its Permian Basin operations in west Texas.

ADVERTISEMENT

In its fourth quarter 2013 results, Devon reported adjusted income of $447 million, or $1.10 a share, along with a net income of $207 million, or 51 cents a share. This compares to a loss of $357 million, or 89 cents a share, in the same period of 2012.

By Charles Kennedy of Oilprice.com


Download The Free Oilprice App Today

Back to homepage





Leave a comment

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News