Devon Energy Announces Final Step to Complete Transformation to U.S. Oil Growth Company - Seite 2

Additionally, the company’s board of directors approved a 13 percent increase in its quarterly common stock dividend beginning in the second quarter of 2019. The new quarterly dividend rate will be $0.09 per share, compared to the prior quarterly dividend of $0.08 per share.

Commitment to $780 Million in Annual Cost Reductions

With Devon’s new, narrowed focus as a U.S. oil business, the company is committed to aligning the cost structure by taking steps to deliver at least $780 million in sustainable annual cost savings by 2021. The cost-reduction plan includes a number of actions to achieve more efficient field-level operations and improvements in drilling and completion costs while better aligning personnel with the go-forward business. Approximately 70 percent of the estimated cost reductions are expected to be accomplished by year-end 2019, with the remaining savings realized in 2020 and 2021.

“Devon is taking aggressive, meaningful and decisive steps to improve our operational and corporate cost structure,” said Jeff Ritenour, executive vice president and chief financial officer. “The combination of selling higher-cost assets and bringing online new lower cost production, along with our commitment to at least $780 million in annual cost-reductions, is expected to drive down per-unit cash costs more than 20 percent by 2021.”

To underscore the commitment to achieving targeted results, the standing reserves committee of the board of directors will expand its scope of work to include oversight and measurement of progress toward the targets alongside management. The committee is composed of three independent board members, each with strong operational backgrounds.

Positioned for Significant Margin Expansion and Sustainable Long-Term Growth

New Devon’s business is characterized by core of the core positions with significant operating scale in four basins: the Delaware, STACK, Powder River and Eagle Ford. In the fourth-quarter of 2018, these assets delivered light-oil production growth of 20 percent year over year, with total production averaging 296,000 oil-equivalent barrels (Boe) per day. New Devon has operating margins that are 57 percent above the total company average in 2018 and has demonstrated well productivity that has exceeded the industry average by approximately 40 percent over the past three years.