Devon Energy acquires Eagle Ford assets from GeoSouthern for $6 billion

 

Devon Energy has agreed to acquire GeoSouthern Energy’s Eagle Ford assets for $6 billion in cash.
 
The deal includes 82,000 net Eagle Ford acres in DeWitt and Lavaca counties, with associated production of 53,000 boe/d.
 
Current production is 56% oil, 20% NGLs, and 24% natural gas.
 
The properties hold an estimated resource potential of 400 million boe.
 
Devon has an average 50% interest in the properties and a 38% net revenue interest.
 
“With this transaction, we have secured a premier acreage position in the very best part of the world-class Eagle Ford oil play. This acquisition enhances our already strong North American portfolio by adding another low-risk, light oil asset that provides outstanding well economics and self-funded growth,” said John Richels, CEO.
 
There is at least one producing well in each owned unit in DeWitt County and Devon expects EURs as high as 800,000 boe. The company estimates a drilling inventory of 1,200 locations and has a joint development agreement with BHP Billiton.
 
Devon expects annual growth of 25% from the assets for the next several years, with an ultimate peak of 140,000 boe/d.
 
The deal will be funded with cash on hand and borrowings.
 
By R.T. Dukes
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