Devon Energy sells gas properties to Linn for $2.3b

NEW YORK — Devon Energy Monday said it would sell assets in Texas and other sites to the smaller Linn Energy for $2.3 billion as US independents reshuffle properties amid the shale boom. 

Devon will sell Linn “non-core” oil- and gas-producing properties in the Rockies, onshore Gulf Coast and mid-continent regions. About 80 per cent of the production associated with the assets produces natural gas. 

Devon said the plan was consistent with efforts to tilt its portfolio towards a heavier share of oil, which some analysts believe has a better long-term price outlook than natural gas.

Devon previously sold other non-core properties in Canada and spent $6 billion to purchase assets in the Eagle Ford oil play in Texas. Both Devon and Linn are considered oil and gas “independents”, which means they produce oil and natural gas, but do not refine crude into gasoline.

“Devon is now concentrated in some of the most attractive North America resource plays, with liquids expected to approach 60 per cent of our production by year-end and multiyear oil production growth projected to be in excess of 20 per cent,” said Devon Chief Executive John Richels. 

Linn, meanwhile, said it identified more than 1,000 future drilling opportunities spread out over 900,000 acres from the Devon assets it will acquire. 

The deal is consistent with Linn’s efforts to build its presence in the Rockies and mid-continent, the company said. Linn plans to divest “non-core” properties in the Texas Panhandle and western Oklahoma.