Devon closes on $1.4B venture
Devon Energy Corp. on Thursday announced the closing of its $1.4 billion joint venture with Japan's Sumitomo Corp. Devon and Sumitomo are teaming up to develop Devon's 650,000 net acres in the Cline Shale and the Midland-Wolfcamp Shale in west Texas. Sumitomo will invest $1.4 billion in exchange for 30 percent of Devon's acreage. Devon received $410 million in cash when the deal closed. The rest of Sumitomo's investment will come in the form of a drilling carry that is expected to cover nearly 80 percent of Devon's drilling costs in the area through the middle of 2014. “With the close of the Sumitomo transaction, we have now successfully entered two exploration joint ventures during 2012, approaching $4 billion in value to our company,” CEO John Richels said. “These arrangements significantly improve the capital efficiency of our exploration programs which preserves cash flow for our deep inventory of development projects.”
Osage takes stake in well
Osage Exploration and Development Inc. on Thursday announced its involvement in a Horizontal Mississippian well being drilled in Logan County by Devon Energy Corp. The Hopfer well is the second one this month Osage has been involved in. The California-based company's stake in the well is almost 15 percent. “We are hitting the milestones for our two well-per-month drilling program, and are delighted to be participating in a well operated by Devon Energy, who we believe is one of the best in the business, as well as drilling alongside them,” CEO Kim Bradford said.