OKLAHOMA CITY, Jan. 23 /PRNewswire-FirstCall/ -- Devon Energy
Corporation (NYSE: DVN) announced today that it plans to divest all of its
assets in West Africa. The assets include estimated proved reserves of
approximately 90 million oil-equivalent barrels (Boe) at December 31, 2006.
This represents approximately four percent of Devon's proved reserves. The
properties are expected to produce approximately 11 million Boe in 2007.
The most significant producing property to be divested is Devon's
interest in the Exxon-operated Zafiro field in Equatorial Guinea. Other
producing properties are located in Gabon and Cote d'Ivoire. In total,
Devon owns interests in 16 blocks in various stages of production,
exploration and appraisal.
"The significant growth opportunities we have developed onshore in
North America and in the deepwater Gulf of Mexico are providing compelling
rationale for redeploying our financial and intellectual capital in these
areas," commented Devon's president, John Richels. "As a result of the West
African divestitures, we will sharpen our focus in North America. At the
same time we will be concentrating our international operations in Brazil
and China, where we have established competitive advantages."
Use of Proceeds
Although Devon believes a good market exists for its West African
assets, the after-tax proceeds cannot be predicted with certainty. However,
upon closing the sales, Devon expects to use the net proceeds of its West
African divestitures to retire commercial paper balances and to resume the
company's common stock repurchase program.
Expected Impact
With potential share repurchases, Devon does not expect divestitures of
its West African assets to have a material impact upon per share results.
However, the divestitures are expected to have the following positive
impacts:
* Tighter geographic focus,
* Lower overall portfolio risk,
* Improved capital efficiency, and
* Improved financial flexibility.
Timing of Divestitures
The sale process will be managed for Devon by Goldman Sachs & Co. and
Scotia Waterous. Data rooms for interested buyers will be opened in London
and Houston near the end of the first quarter. Acceptance of bids and
completion of purchase and sale agreements are anticipated in the second
half of 2007.
Conference Call to be Webcast Today
Devon will host a conference call webcast today concerning this
announcement. The webcast will begin at 10 a.m. Central Time (11 a.m.
Eastern Time). The webcast may be accessed from Devon's internet home page
at http://www.devonenergy.com .
Devon Energy Corporation is an Oklahoma City-based independent energy
company engaged in oil and gas exploration and production. Devon is one of
the world's leading independent oil and gas producers and is included in
the S&P 500 Index. For additional information, visit
http://www.devonenergy.com .
This press release includes "forward-looking statements" as defined by
the Securities and Exchange Commission. Such statements are those
concerning forecasts, estimates, expectations and objectives for future
operations. Such statements are subject to a number of assumptions, risks
and uncertainties, many of which are beyond the control of the company.
Statements regarding planned divestitures, future production, reserve
additions and capital expenditures are subject to all of the risks and
uncertainties normally incident to the exploration for and development and
production of oil and gas. These risks include, but are not limited to,
inflation or lack of availability of goods and services, environmental
risks, drilling risks and regulatory changes. 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.
SOURCE Devon Energy Corporation
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Related links:
http://www.devonenergy.com
http://www.prnewswire.com/comp/118040.html /
CONTACT:
investors, Zack Hager, +1-405-552-4526, or
media, Brian Engel, +1-405-228-7750, both of Devon Energy
Corporation
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