Investor Presentation November 2016 NYSE: DVN devonenergy.com
Devon Today A Leading North American E&P Heavy Oil Retained Asset Production Key Messages Q3 2016: 550 MBOED Premier asset portfolio Gas Focused in STACK and Delaware Basin 38% Oil Rockies Oil 45% Delivering best-in-class…
Approach To The Current Environment Achieve additional operating cost savings Further increase capital productivity Focused on value and returns Accelerate activity in STACK and Delaware Basin Preserve continuity in other U.S.…
Operating Strategy For Success Maximize base production Optimize capital program Minimize controllable downtime Disciplined project execution Enhance well productivity Perform premier technical work Leverage midstream operations…
Significant LOE Savings Achieving significant operating cost savings LOE Peak 2015 cost to Q3 2016 Improved water and electrical infrastructure Labor and supply chain expense declining LOE IMPROVEMENT Millions 562 510 480…
Consistent Productivity Gains D&C costs reduced by up to 40% D&C Costs Decline Peak cost to Q3 2016 Driven by efficiencies and supply chain costs UP TO More than offsetting larger completions G&A savings to reach 400 million in…
Delivering Best-In-Class Well Results Avg. 90-Day Wellhead IPs BOED, 20:1 600 450 300 150 0 Top U.S. Producers Source: IHS/Devon. Operators with more than 100 wells in 2015. Devon delivered best well results of any U.S.…
Preliminary 2017 & 2018 Outlook Accelerating Activity Rig Activity U.S. Resource Plays Potential for 15-20 operated rigs in 2017 Operated Rigs Focused in STACK and Delaware Basin 40 Invest directionally within cash flow RIGS BY…
Significant Financial Strength Investment-grade balance sheet Adjusted Net Debt (1) 9/30/16 vs. 12/31/15 No significant debt maturities until mid-2021 Debt reduction program underway 1.2 billion tendered to date DECLINE Adjusted…
Advantaged Midstream Business EnLink Overview Devons equity ownership interest 24% of MLP (ENLK: 95 million units) 64% of GP (ENLC: 115 million units) BILLION Eliminates midstream capital requirements DVNS ENLINK OWNERSHIP MARKET…
STACK Best-In-Class Position World-class development opportunity Atoka Penn. Morrow 430,000 net surface acres Springer Meramec Core Area Kingfisher Top targets: Meramec & Woodford Chester Dewey Mississippian Blaine Q3…
STACK A Multi-Decade Growth Opportunity Largest leasehold position of any operator Tremendous resource potential STACK Acreage Net Surface Acres STACK DRILLING INVENTORY 430,000 265,000 203,000 183,000 115,000 110,000 92,000 86,000…
Meramec Results Validate Core Position Kingfisher Favorable characteristics of Scheffler 1H-9X 30-Day IP: 2,000 BOED Pony Express 27-1H 30-Day IP: 2,100 BOED Born Free Staggered Pilot core oil window: Dewey Blurton 1-7-6XH Blaine…
Meramec Extended-Reach Laterals To Enhance Productivity Delivering industry-leading STACK results Meramec Over-Pressured Oil - 10,000 Lateral Type Well Meramec 30-day rates 50% above peers(1) IP 1,900 - 2,300 EXTENDED-REACH…
Meramec Tremendous Resource Opportunity Meramec inventory conservatively risked (4 wells per surface section) 10 spacing tests underway to drive risked location count higher First three Devon operated spacing pilots successful (Born…
Woodford Shale A Top-Tier Liquids-Rich Development Hobson Row completion activity underway Woodford Eastern Core Activity Kingfisher Blaine 5-section development with 40 wells Hobson Row Peak rates expected in early 2017 40 Wells…
Delaware Basin A World-Class Oil Play Industry leader in basin Bone Spring Net risked acres by formation: 670,000 SLOPE 285,000 net acres Lea Eddy Wolfcamp 60% Q3 net production: 59 MBOED 225,000 net acres Leonard Shale 60,000…
Delaware Basin Accelerating Activity On track to operate 3 rigs by end Delaware Basin Rig Activity Operated Rigs of 2016 15 Stabilize production by early 2017 RIGS BY YEAR END 2017 Ramping up to as many as 10 10 rigs by end of…
Delaware Basin Growing Resource Opportunity Basin Slope 1 Section 1 Section DELAWARE Identified 5,700 risked locations Madera SANDS Lower Bone Spring 60% of risked inventory Brushy A LEONARD Massive upside with…
Delaware Basin Master Development Plan Total Reservoir Access Concept (TRAC) A disciplined development approach to drive returns higher More efficient permitting process Minimizes surface disturbance Utilizes integrated surface…
Premier Asset Portfolio Platform For Value Creation Asset Risked Opportunity Upside Potential Heavy Oil STACK 5,300 undrilled 10 spacing tests locations underway Delaware 5,700 undrilled Wolfcamp and Basin locations Leonard appraisal…
Devon Energy A Leading North American E&P 23
Canadian Heavy Oil Thermal Heavy Oil Projects Top-tier thermal oil position Operational Projects High reservoir…
Eagle Ford Top-tier acreage position 66,000 net acres focused in DeWitt Co. Q3 net production: 61 MBOED (77% liquids) MILLION Expect 350 million of free cash flow in 2016 2016e FREE CASH FLOW Best-in-class well productivity…
Rockies Premier Powder River position Initial Powder River Focus Areas 470,000 net surface acres Parkman Campbell Turner Q3 net production: 16 MBOED (73% oil) Teapot Weston Johnson 50% decline in LOE from early 2016 Drilling…
Barnett Shale Significant gas optionality Future Development Net acres: 610,000 DENTON Q3 net production: 166 MBOED (27% liquids) Wise Denton Future development activity to unlock significant value Identified 1,000 horizontal…
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