Devon Energy benefits from cost cutting efforts

Devon Energy Corp. (Devon) has announced that it has benefitted from its recent cost-cutting efforts, with its 2Q losses narrowing and a decline in asset write-downs and other items. The organisation has cut costs, shed non-core assets and reduced its dividend as part of the efforts to improve its balance sheet, amid a commodities downturn.

Last month, Devon signed a deal to sell its 50% ownership stake in Access Pipeline to Wolf Midstream Inc. This brought the company’s asset-sale tally to US$3.2 billion and allowed it to achieve its goal of divesting itself of US$2 billion to US$3 billion in assets.

Devon, which has been increasing its focus on North America in recent years, has raised its 2016 production guidance for its remaining operations by 3%.

Chief Executive Dave Hager has commented, saying that the company's production from US resource plays again topped expectations. He also added that with cost savings so far, Devon is on track to reduce its overhead costs by nearly US$1 billion this year.

Over all, Devon reported a loss of US$1.57 billion, US$3.04 a share, compared with a year-earlier loss of US$2.82 billion, US$6.94 a share.

Adapted from press release by Anna Nicklin

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