Devon Sells Gas Assets to Linn | Russell T. Rudy Energy LLC
“Rigzone” reports Devon Energy Corp. is selling non-core gas properties to Linn Energy LLC for $2.3 billion. The transaction seems to make sense for both parties. Devon is continuing both an industry and company trend of selling gas assets for higher margin oil and liquids properties. Encana, Canada’s largest gas producer recently sold its interest in the Bighorn field in Alberta and the Joshua field in Wyoming. Concurrently, Devon has raised more than $5 billion from assets sales, including natural gas properties in Canada, in order to invest in the oil prone Eagle Ford shale.
Linn, a master limited partnership, focuses on steady future income. To that end, it bought Berry last year and is buying Devon’s 900,000 net acres in Rockies, onshore Gulf Coast and mid-continent area. The latter produce 275 million cubic feet of gas equivalent per day, 80% of which is gas.
Devon will use the proceeds from the sale to buy oil properties and reduce debt. Linn will finance the purchase primarily through the sale of its Granite Wash assets in the Texas Panhandle and Western Oklahoma, as well as a loan.
To read the article in its entirety, please go to www.rigzone.com/news/article.asp?hpf=1&a_id=133804&utm .
