Devon has no current production or proved reserves associated with these projects. The sale of these properties reduces Devon’s 2010 capital budget for the Gulf of Mexico by approximately $400m. 

John Richels, president of Devon, said: “This is an important first step in executing our plan to divest all of our Gulf of Mexico and international assets and to reposition Devon as a purely North American onshore company. We intend to apply the sales proceeds to debt reduction and to accelerate investment in our world-class North American onshore assets.”

Devon estimates its after-tax proceeds from this transaction at approximately $1.1bn. The effective date of the sale is January 1, 2010 and closing is expected to occur on or before February 1, 2010. The completion of the transaction is subject to preferential rights to purchase held by the other working interest owners in the properties, and additional closing conditions and regulatory approvals.

Devon has planned to divest its Gulf of Mexico and international assets in November 2009. Data rooms for all of the remaining divestiture assets will be open in the first quarter of 2010. The company has estimated the aggregate after-tax proceeds from the planned divestitures, including this transaction, at $4.5bn to $7.5bn.