Devon Energy Confirmed Tuesday It Is Cutting About 200 Jobs
March 6, 2019
Devon Energy Corp. is cutting loose about 200 of its employees in February and March as it works on plans to either sell or spin off its Canadian and north Texas assets, the company confirmed Tuesday.
Additional layoffs are expected later this year.
“While most job reductions will be associated with the separation of assets in North Texas and Canada, there will be additional reductions at our headquarters in Oklahoma City and at some field locations,” spokesman John Porretto stated in an email to The Oklahoman on Tuesday. "The full extent of those reductions has not been finalized for all departments, but layoffs during February and March are expected to total approximately 200 employees.
“We expect the majority of companywide job reductions to take place in 2019. Devon is providing impacted employees with a separation package that includes severance."
Currently, Devon employs about 2,850 companywide. About 1,360 employees work at its corporate headquarters in Oklahoma City.
Devon officials last month announced plans to sell the Canadian and Barnett Shale assets as final steps to complete a transformation into an oil and gas exploration company focused primarily on oil growth from wells it drills in U.S. shale fields.
Dave Hager, Devon’s president and CEO, last month said the firm’s aim is to “accelerate value creation for our shareholders by further simplifying our resource-rich asset portfolio.”
In an interview with The Oklahoman, Hager said the firm planned to realign its cost structure to expand its margins.
On Tuesday, Porretto's statement confirmed layoffs are part of that realignment, but stopped short of detailing exactly how many jobs ultimately may be cut or where they are being eliminated.
Devon has been active in Canada since it acquired Northstar Energy Corp. in 1998, which owned an oil sands operation called Dover that Devon used to experiment with steam-assisted gravity drainage, a type of extraction that produces a thick oil known as bitumen from reservoirs too deep for traditional mining.
Devon entered the Barnett Shale field in 2002, when it acquired Mitchell Energy, a Texas-based firm that had pioneered the use of hydraulic fracturing to produce natural gas from shale.
Devon took Mitchell’s technology a step further by combining the fracturing technology with the concept of drilling horizontal wells into shale formations to significantly boost production volumes from those wells.
In February, Hager told The Oklahoman that Devon already was working with advisers to assemble data potential buyers will be able to review as they evaluate each of those assets once they are offered for sale.
He said the company’s decision to sell those assets comes at the end of a deliberative strategic planning process underway inside Devon for years, and that officials hope to complete the sales before the end of this year (although spin-offs could take some additional time because of regulatory filing requirements).
In the future, Devon’s focus will remain on developing oil-producing assets it holds in the Delaware Basin, the STACK in northwest Oklahoma, the Powder River Basin in Wyoming and the Eagle Ford Shale field in south Texas, he said.