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Devon selling Barnett Shale assets for $553 million to undisclosed buyer

New York (Platts)--8 Mar 2018 440 pm EST/2140 GMT


Devon Energy on Thursday announced plans to sell the southern portion of its North Texas Barnett Shale position for $553 million to an undisclosed buyer.

Net production from the assets, located primarily in Johnson County, currently average 200 MMcfe/d. The Oklahoma City-based producer estimated field-level cash flow from these assets, excluding overhead costs, to be about $100 million in 2018.

"Combined with other recent asset sales, divestiture proceeds associated with our "2020 Vision" have now reached $1 billion," President and CEO Dave Hager said in a statement.

The company's remaining assets in the Barnett Shale, primarily located in Denton, Wise and Tarrant counties, have an estimated current production of 680 MMcfe/d and include an inventory of about 1,500 potential locations, consisting of undrilled inventory and horizontal refracturing opportunities, Devon said.

In its Q4 2017 earnings call last month, executives said Devon, the 10th-largest US gas producer, would seek to sell off its non-core assets, such as the Barnett Shale, in order to focus more attention on the Permian Basin's Delaware sub-territory and Oklahoma 's STACK play.

Devon said it expects the deal to close in the second quarter.

In a separate statement, Devon said its board had authorized a $1 billion share repurchase program and a 33% increase in its quarterly cash dividend.

"We are very confident about Devon's future and, as market conditions permit, we will continue to pursue opportunities to further increase cash returns to our shareholders," Hager said.

-- Jim Magill, jim.magill@spglobal.com

-- Edited by Gail Roberts, newsdesk@spglobal.com




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