OKLAHOMA CITY, April 12, 2010 /PRNewswire via COMTEX/ --Devon Energy Corporation (NYSE: DVN) today announced that it has agreed to sell all of its Gulf of Mexico shelf assets to Apache Corporation for $1.05 billion, or approximately $840 million after tax. The agreement covers Devon's 158 blocks (including 51 producing blocks) located offshore Texas, Louisiana and Alabama.
During 2009, Devon's production from the Gulf of Mexico shelf was approximately 62 million cubic feet of natural gas and 9 thousand barrels of liquids per day. As of December 31, 2009, Devon's reported estimated proved reserves included 144 billion cubic feet of natural gas and 15 million barrels of liquids associated with the assets being purchased by Apache.
"When we first announced our plans to reposition Devon, we expected total after-tax proceeds of between $4.5 and $7.5 billion," said Larry Nichols, Devon's chairman and chief executive officer. "This sale of the remaining Gulf of Mexico assets, combined with our previously announced divestitures of $8.3 billion, ensures that we will exceed the upper end of that range. Furthermore, we are pleased to have a single purchaser for the shelf assets with the financial strength and experience of Apache."
Completion of the transaction is subject to preferential rights to purchase held by the other working interest owners in the properties as well as customary closing conditions and regulatory approvals. Devon plans to provide updates to guidance for 2010 production, expenses and capital expenditures as the transactions are closed.
On November 16, 2009, Devon announced plans to divest its Gulf of Mexico and international assets to allow the company to focus on its world-class North American onshore assets. The divestiture proceeds will be allocated between the acceleration of development of Devon's North American onshore properties, debt reduction and share repurchases. Upon completion of the repositioning, Devon will emerge with even more liquidity and with one of the strongest balance sheets in its peer group.
The company has now announced the sale of the majority of the divestiture assets. Data rooms for the remaining international assets are currently open. Devon expects the closings of all divestitures to be completed prior to year-end.
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. 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. Statements regarding future drilling and production 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 the volatility of oil, natural gas and NGL prices; uncertainties inherent in estimating oil, natural gas and NGL reserves; drilling risks; environmental risks; and political or 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. 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