Devon Energy

Last updated
Devon Energy Corporation
Public company
Traded as NYSE:  DVN
S&P 500 Index component
Industry Petroleum industry
Founded1971;48 years ago (1971)
FounderJohn Nichols
J. Larry Nichols
Headquarters Devon Energy Center
Oklahoma City, Oklahoma, United States
Key people
David A. Hager, CEO & President
Jeffrey L. Ritenour, CFO
Products Petroleum
Natural Gas
Natural Gas Liquids
Production output
500 thousand barrels of oil equivalent (3,100,000 GJ) per day (2018)
RevenueIncrease2.svg $10.734 billion (2018)
Increase2.svg $3.224 billion (2018)
Total assets Decrease2.svg $19.566 billion (2018)
Total equity Decrease2.svg $9.186 billion (2018)
Number of employees
2,900 (2018)
Website www.devonenergy.com
Footnotes /references
[1]

Devon Energy Corporation is a company engaged in hydrocarbon exploration in North America. It is organized in Delaware and headquartered in the 50-story Devon Energy Center in Oklahoma City, Oklahoma.

Hydrocarbon exploration search for hydrocarbons

Hydrocarbon exploration is the search by petroleum geologists and geophysicists for deposits of hydrocarbons, particularly petroleum and natural gas, in the Earth using petroleum geology.

North America Continent entirely within the Northern Hemisphere and almost all within the Western Hemisphere

North America is a continent entirely within the Northern Hemisphere and almost all within the Western Hemisphere; it is also considered by some to be a northern subcontinent of the Americas. It is bordered to the north by the Arctic Ocean, to the east by the Atlantic Ocean, to the west and south by the Pacific Ocean, and to the southeast by South America and the Caribbean Sea.

Delaware State of the United States of America

Delaware is one of the 50 states of the United States, in the South-Atlantic or Southern region. It is bordered to the south and west by Maryland, north by Pennsylvania, and east by New Jersey and the Atlantic Ocean. The state takes its name from Thomas West, 3rd Baron De La Warr, an English nobleman and Virginia's first colonial governor.

Contents

The company is ranked 213th on the Fortune 500. [2]

As of December 31, 2018, the company had proved reserves of 1.927  billion barrels of oil equivalent (1.179×1010 GJ). [1]

The barrel of oil equivalent (BOE) is a unit of energy based on the approximate energy released by burning one barrel of crude oil. The BOE is used by oil and gas companies in their financial statements as a way of combining oil and natural gas reserves and production into a single measure, although this energy equivalence does not take into account the lower financial value of energy in the form of gas.

FormationProved Reserves as of December 31, 2018
(% of total)
2018 Production
(thousand barrels of oil equivalent per day)
Barnett Shale 36%105
STACK Formation in Oklahoma 22%125
Jackfish Heavy crude oil in Alberta, Canada 21%117
Delaware Basin 13%75
Eagle Ford Group shale3%54
Rockies 5%17
Other formations1%7
Total100%500

History

Devon was founded in 1971 by John Nichols and his son, J. Larry Nichols. [3]

John Larry Nichols is the co-founder and former chairman, president, and chief executive officer of Devon Energy.

In 1988, the company became a public company via an initial public offering. [3]

Public company Company that offers its securities for sale to the general public

A public company, publicly traded company, publicly held company, publicly listed company, or public limited company is a corporation whose ownership is dispersed among the general public in many shares of stock which are freely traded on a stock exchange or in over the counter markets. In some jurisdictions, public companies over a certain size must be listed on an exchange. A public company can be listed or unlisted.

Initial public offering (IPO) or stock market launch is a type of public offering in which shares of a company are sold to institutional investors and usually also retail (individual) investors; an IPO is underwritten by one or more investment banks, who also arrange for the shares to be listed on one or more stock exchanges. Through this process, colloquially known as floating, or going public, a privately held company is transformed into a public company. Initial public offerings can be used: to raise new equity capital for the company concerned; to monetize the investments of private shareholders such as company founders or private equity investors; and to enable easy trading of existing holdings or future capital raising by becoming publicly traded enterprises.

In August 2000, the company was added to the S&P 500 Index. [4]

In August 2008, co-founder John Nichols died. [3]

In March 2010, the company sold assets in Brazil, Azerbaijan, and the Gulf of Mexico to BP for $7 billion. [5]

BP British multinational oil and gas company

BP plc is a British multinational oil and gas company headquartered in London, United Kingdom. It is one of the world's seven oil and gas "supermajors", whose performance in 2012 made it the world's sixth-largest oil and gas company, the sixth-largest energy company by market capitalization and the company with the world's 12th-largest revenue (turnover). It is a vertically integrated company operating in all areas of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading. It also has renewable energy interests in biofuels and wind power.

In October 2012, the company completed construction of its current headquarters, the 50-story Devon Energy Center in Oklahoma City, Oklahoma and closed its office in the Allen Center in Downtown Houston. [6]

In April 2014, the company sold its conventional assets in Canada to Canadian Natural Resources for C$3.125 billion. [7]

In June 2014, the company sold assets to Linn Energy for $2.3 billion. [8]

In August 2015, Dave Hager was named president and chief executive officer of the company. [9]

In February 2016, Devon announced plans to lay off 1,000 employees, including 700 in Oklahoma City, and cut its dividend as part of a cost-cutting effort due to low prices of its products. [10] [11]

In 2017, the company sold its Lavaca County assets in the Eagle Ford. [12]

Acquisitions

#YearCompanyPriceDescription of AssetsRef(s).
11992Hondo Oil and Gas$122 millionOil and gas reserves and seven natural gas processing plants [13]
21996 Kerr-McGee $250 millionNorth American onshore oil and gas properties, 370,000 net acres of undeveloped drilling rights [14]
31998Northstar Energy$750 millionOil and gas properties in Canada [15]
41999PennzEnergy$2.2 billionOil and gas properties in the Gulf Of Mexico [16]
52000Santa Fe Snyder$2.35 billion [4]
62001Anderson Exploration$4.6 billionCanadian properties [17]
72002Mitchell Energy$3.5 billionProperties in the Barnett Shale of Texas [18]
82003Ocean Energy$5.3 billionDeepwater sites in the Gulf of Mexico [19]
92006 Chief Oil and Gas $2.2 billionBarnett Shale leasehold [20]
102014 GeoSouthern Energy $6.1 billionEagle Ford assets [21]
112014Crosstex EnergyMerger of midstream assets to form EnLink Midstream, LLC [22]
122015Felix Energy$2.5 billionAssets in the Powder River Basin & Anadarko Basin [23]

Controversies

Environmental record

Shareholders have introduced several resolutions that would require the company to monitor its effect on climate change [24] and to disclose its lobbying activity against regulations to prevent climate change. [25]

In 2014, an investigation by The New York Times uncovered that a three-page letter from Oklahoma's Attorney General Scott Pruitt to the United States Environmental Protection Agency, bluntly accusing regulators of grossly overestimating the amount of air pollution caused by drilling of new natural gas wells, was actually written by an attorney for Devon. The investigation found that "attorneys general in at least a dozen states are working with energy companies and other corporate interests, which in turn are providing them with record amounts of money for their political campaigns, including at least $16 million this year." [26]

Political contributions

Devon is a major contributor to political campaigns and organizations, almost entirely to organizations and individuals affiliated with the Republican Party. [27]

In 2016, the company contributed $750,000 to the Senate Leadership Fund, whose goal is to protect the Republican majority in the United States Senate. It also gave $500,000 to the Congressional Leadership Fund, whose goal is to protect the Republican majority in the United States House of Representatives. [28]

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References

  1. 1 2 "Devon Energy Corporation 2018 Form 10-K Annual Report". U.S. Securities and Exchange Commission.
  2. "Fortune 500: Devon Energy". Fortune.
  3. 1 2 3 Miller, Stephen (August 9, 2008). "Former Accountant Worked to Build Devon Energy Into Industry Giant" . The Wall Street Journal .
  4. 1 2 "Devon Energy and Santa Fe Snyder Complete Merger" (Press release). U.S. Securities and Exchange Commission. August 29, 2000.
  5. "BP pays Devon Energy $7bn for Brazilian, Azeri, and Gulf of Mexico assets". The Daily Telegraph. Reuters. March 11, 2010.
  6. Pulsinelli, Olivia (October 11, 2012). "Devon Energy cutting 1,000 jobs, slashing dividend". American City Business Journals .
  7. "Devon Energy Completes Sale of Canadian Conventional Assets" (Press release). Business Wire. April 2, 2014.
  8. "LINN Energy Announces $2.3 Billion Acquisition of Assets from Devon Energy" (Press release). GlobeNewswire. June 30, 2014.
  9. "Devon Energy Completes Leadership Transition as Board of Directors Elects Dave Hager New President and CEO, Succeeding Retiring John Richels" (Press release). Business Wire. August 3, 2015.
  10. Wilmoth, Adam (February 16, 2016). "Devon Energy to lay off 700 in Oklahoma City". The Oklahoman .
  11. Baker, Max B. (February 17, 2016). "Devon Energy cutting 1,000 jobs, slashing dividend". Fort Worth Star Telegram .
  12. "Devon Energy Announces $340 Million of Non-Core Asset Sales" (Press release). Business Wire. July 31, 2017.
  13. "Hondo Oil Offer". The New York Times . February 29, 1992.
  14. Vandewater, Bob (January 1, 1997). "Devon Obtains Kerr-McGee Oil, Gas Properties". The Oklahoman .
  15. "Devon Energy and Northstar Energy to Combine: US$2 Billion Oil and Gas Company Would be Created" (Press release). U.S. Securities and Exchange Commission. June 29, 1998.
  16. "Devon Energy and PennzEnergy Announce Completion of Merger" (Press release). U.S. Securities and Exchange Commission. August 17, 1999.
  17. "Devon Energy to Acquire Anderson Exploration and Become North America's Largest Independent Producer of Oil and Natural Gas" (Press release). U.S. Securities and Exchange Commission. September 4, 2001.
  18. "Mitchell Energy & Development Corp acquired by Devon Energy Corp". TechCrunch.
  19. WILMOTH, ADAM (April 26, 2003). "Devon completes $5.3 billion merger with Ocean Energy; More than 98 percent approve companies' deal". The Oklahoman .
  20. "Devon acquiring Barnett shale acreage from Chief" . Oil & Gas Journal . May 8, 2006.
  21. "Devon Energy Completes Acquisition of Eagle Ford Assets from GeoSouthern Energy" (Press release). Business Wire. February 28, 2014.
  22. "Devon Energy and Crosstex Energy to Create New Midstream Business" (Press release). Business Wire. October 21, 2013.
  23. "Devon Energy Sharpens Focus on Core Assets" (Press release). Business Wire. December 7, 2015.
  24. Feder, Barnaby J. (February 27, 2004). "Funds Want Oil Companies To Report On Climate" . The New York Times .
  25. Bogoslaw, David (January 11, 2016). "Shareholders ask oil producers for climate lobbying disclosure". Corporate Secretary .
  26. Lipton, Eric (December 6, 2014). "Energy Firms in Secretive Alliance With Attorneys General" . The New York Times .
  27. "Devon Energy: Total Contributions by Party of Recipient". Center for Responsive Politics.
  28. "Devon Energy: Profile for 2016 Election Cycle". Center for Responsive Politics.