UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 1, 2016

DEVON ENERGY CORPORATION
(Exact Name of Registrant as Specified in its Charter)

 
					
DELAWARE	 	001-32318	 	73-1567067	
(State or Other Jurisdiction
of Incorporation or Organization)	 	(Commission
File Number)	 	(IRS Employer
Identification Number)	
		
333 W. SHERIDAN AVE., OKLAHOMA CITY, OK	 	73102	
(Address of Principal Executive Offices)	 	(Zip Code)	
Registrant’s telephone number, including area code: (405) 235-3611

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
 	☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)	
 
 	☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)	
 
 	☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))	
 
 	☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))	

 

Item 2.02	Results of Operations and Financial Condition	
Devon Energy Corporation hereby furnishes the information set forth in its news release dated November 1, 2016 announcing third quarter 2016 financial results, a copy of which is attached as Exhibit 99.1.
 
Item 9.01	Financial Statements and Exhibits	
(d) Exhibits

99.1	  	Devon Energy Corporation news release dated November 1, 2016.	
 
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereto duly authorized.

DEVON ENERGY CORPORATION	
		
By:	 	       /s/ Thomas L. Mitchell	
	 	Thomas L. Mitchell	
	 	Executive Vice President and	
	 	Chief Financial Officer	
Date: November 1, 2016
 
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Exhibit 99.1

	 		  	Devon Energy Corporation
333 West Sheridan Avenue
Oklahoma City, OK 73102-5015	
NEWS RELEASE
Devon Energy Reports Third-Quarter 2016 Results
OKLAHOMA CITY – Nov. 1, 2016 – Devon Energy Corp. (NYSE: DVN) today reported operational and financial results for the third quarter of 2016 and provided guidance for the fourth quarter of 2016.
Highlights
 
 	•	 	Achieved record-setting well results in U.S. resource plays	
 
 	•	 	Increased STACK production 38 percent year over year	
 
 	•	 	Decreased lease operating expenses 37 percent from peak rates	
 
 	•	 	Expected cost savings to reach $1 billion in 2016	
 
 	•	 	Completed $3.2 billion asset divestiture program	
 
 	•	 	Repurchased $1.2 billion of debt	
“Devon delivered an outstanding operational performance in the third quarter,” said Dave Hager, president and CEO. “Our development programs generated the best quarterly drill-bit results in Devon’s 45 year history. These prolific well results were centered in the STACK play, where production increased by 38 percent. We also continued to achieve significant cost savings in the quarter and we are on pace to reduce operating and G&A expenses by $1 billion in 2016.”
“In addition to our strong operating performance, we were able to successfully complete our $3.2 billion divestiture program,” Hager said. “These accretive transactions strengthened our investment-grade position and significantly reduced our leverage from earlier this year. This improved financial strength allows us to further accelerate investment in our best-in-class U.S. resource plays, led by the STACK and Delaware Basin.”
Record-Setting Well Results in U.S. Resource Plays
Total production averaged 577,000 oil-equivalent barrels (Boe) per day in the third quarter of 2016. Excluding divestiture properties, production from Devon’s retained asset base amounted to 550,000 Boe per day. With the shift to higher-margin production, oil is now the largest component of the company’s product mix at 45 percent of total volumes. To further enhance the profitability of production, Devon rejected approximately 6,000 barrels per day of ethane during the third quarter.
The majority of Devon’s retained asset production was attributable to its U.S. resource plays, which averaged 410,000 Boe per day. Production in the third quarter benefited from new well activity that achieved record-setting productivity. In aggregate, Devon commenced production on 20 development wells, with initial 30-day rates averaging an all-time quarterly high of 2,000 Boe per day. These prolific results were concentrated in the company’s STACK play, where production increased 38 percent year over year.
In Canada, Devon’s heavy-oil operations also delivered impressive results with net oil production reaching 137,000 barrels per day in the third quarter. Driven by the industry-leading performance of the Jackfish complex, Canadian oil production increased 13 percent compared to the third quarter of 2015.
 
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In the upcoming fourth quarter, oil production from retained assets is expected to be relatively stable compared to the third quarter, ranging between 238,000 and 248,000 barrels per day. Key drivers of the stabilized oil production are high activity levels in the STACK and accelerated completion activity in the Eagle Ford. Top-line production from retained assets is projected to range between 524,000 and 546,000 Boe per day in the fourth quarter.
Operating and G&A Cost Savings to Reach $1 Billion in 2016
Devon’s successful cost-reduction initiatives resulted in lease operating expenses (LOE) of $355 million in the third quarter, which was 7 percent below the low end of guidance. This strong cost result represents a decline of 37 percent from peak costs in mid-2015. The decrease in LOE was primarily driven by improved power and water-handling infrastructure, declining labor expense and lower supply chain costs.
The company also realized significant general and administrative (G&A) cost savings. Net G&A expenditures declined to $141 million in the third quarter. Including capitalized costs, total G&A expense declined to $195 million, a 44 percent improvement compared to peak rates in early 2015. The decrease was driven by reduced personnel costs.
Due to the strong cost performance achieved year to date, the company is lowering its full-year 2016 LOE outlook by $55 million to a midpoint of $1.6 billion. With this improved outlook, Devon is on track to reduce LOE, production taxes and G&A costs by $1 billion compared to 2015.
Upstream Revenue Rises; EnLink Profitability Expands
Improving commodity prices advanced the company’s upstream revenue to $1.1 billion in the third quarter, with per-unit realizations increasing 13 percent compared to the previous quarter. Oil revenue increased to 67 percent of total upstream sales in the third quarter.
Devon’s midstream results also improved, with operating profits totaling $210 million in the third quarter, bringing the year-to-date total to $619 million. This steady source of profitability was driven by the company’s investment in EnLink Midstream. Year-to-date, EnLink-related operating profit has expanded 7 percent compared to the same period in 2015.
EnLink’s growing profitability is derived from an asset base that is positioned in some of the most attractive markets in North America, including the STACK, Midland Basin, Delaware Basin and an NGL business that services end-user demand along the Gulf Coast. In aggregate, the company’s ownership in EnLink is valued at approximately $3.5 billion and will generate cash distributions of $270 million in 2016.
Third-Quarter 2016 Operations Report
For additional details on Devon’s E&P operations, please refer to the company’s third-quarter 2016 operations report at www.devonenergy.com . Highlights from the report include:
 
 	•	 	Record-setting well results in the STACK	
 
 	•	 	Raising Meramec and Woodford type curves	
 
 	•	 	Accelerating Delaware Basin rig activity	
 
 	•	 	Wolfcamp drilling to ramp up in 2017	
 
 	•	 	Eagle Ford resumes completion activity	
 
 	•	 	Jackfish complex production exceeds nameplate capacity	
Divestiture Program Complete: Proceeds Reach $3.2 Billion
Devon’s divestiture program is now complete with total proceeds reaching $3.2 billion. During the quarter, the company closed on the sale of non-core assets in the Midland Basin, East Texas and Granite Wash for $1.8 billion. With the closing of these transactions, the company’s upstream divestiture proceeds have reached $2.1 billion.
 
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Subsequent to quarter end, on Oct. 6, 2016, the company closed on the sale of its 50 percent interest in the Access Pipeline for USD $1.1 billion. In addition to these initial proceeds, Devon also has the right to receive an incremental USD $120 million payment with the sanctioning and development of a new thermal-oil project on Devon’s Pike lease in Alberta, Canada. The sale agreement further allows for Access Pipeline tolls to be reduced by as much as 30 percent with the future development of multiple projects at Pike.
Significant Liquidity and Financial Strength
Devon’s financial position remains exceptionally strong, with investment-grade credit ratings and excellent liquidity. The company exited the third quarter with $2.4 billion of cash on hand. Adjusted for the Access Pipeline sale, cash balances reached $3.5 billion.
In August, the company successfully tendered for $1.2 billion of debt, which is expected to reduce interest expense by $54 million annually. With the tendering activity focused on near-term maturities, Devon has no significant long-term debt maturities until mid-2021.
At the end of September, the company’s consolidated debt totaled $11.4 billion. Excluding non-recourse EnLink obligations and adjusting for Access Pipeline proceeds, adjusted net debt has declined to $4.7 billion.
Devon Increases Hedging Position in 2017
In recent months, Devon has had the opportunity to materially increase its hedging position in 2017. For oil volumes, Devon has utilized a combination of swaps and collars to hedge 83,000 barrels per day of production. For gas volumes, Devon now has 390 million cubic feet per day of production. These hedging positions represent more than 30 percent of current oil and natural gas production.
The company expects to continue to add to its hedging position and is targeting to have approximately 50 percent of its estimated revenues protected in 2017. This risk-management program will be a combination of systematic hedges added on a quarterly basis and discretionary hedges that take advantage of favorable market conditions.
Operating Cash Flow Grows 117 Percent; Earnings Beat Wall Street Consensus
Operating cash flow reached $726 million in the third quarter, a 117 percent increase compared to the second quarter of 2016. Combined with proceeds received from the sale of non-core assets, Devon’s total cash inflows for the quarter reached $2.4 billion.
Devon’s reported net earnings totaled $993 million or $1.89 per diluted share in the third quarter. These earnings results were impacted by certain items securities analysts typically exclude from their published estimates, with the most significant of these items being $1.4 billion in gains related to U.S. asset sales. Excluding these gains and other adjusting items, Devon’s core earnings were $47 million or $0.09 per diluted share, exceeding consensus analyst estimates.
Devon’s core earnings calculation in the third quarter was negatively impacted by an $85 million, non-cash tax charge. Excluding this charge, the company’s core earnings would have been $0.16 per share higher, further widening the margin of outperformance versus analyst expectations.
 
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Updated 2016 Outlook
Detailed forward-looking guidance for the fourth quarter of 2016 is provided later in the release. Based on year-to-date results and Devon’s fourth-quarter outlook, most operating and financial metrics remain relatively unchanged compared to previous guidance disclosures.
Of note, in the fourth quarter, the company expects to increase its rig activity in the U.S. from five operated rigs running in the third quarter to as many as 10 operated rigs by year end. This activity is expected to result in approximately $400 million to $425 million of E&P capital expenditures in the fourth quarter.
Non-GAAP Reconciliations
Pursuant to regulatory disclosure requirements, Devon is required to reconcile non-GAAP (generally accepted accounting principles) financial measures to the related GAAP information. Net debt, adjusted net debt, core earnings, and core earnings per share referenced within the commentary of this release are non-GAAP financial measures. Reconciliations and other important information regarding these non-GAAP measures are provided within the tables of this release.
Conference Call Webcast and Supplemental Earnings Materials
Please note that as soon as practicable today, Devon will post an operations report to its website at www.devonenergy.com . The company’s third-quarter conference call will be held at 10 a.m. Central (11 a.m. Eastern) on Wednesday, Nov. 2, 2016, and will serve primarily as a forum for analyst and investor questions and answers.
Forward-Looking Statements
This press release includes “forward-looking statements” as defined by the Securities and Exchange Commission (SEC). Such statements include those concerning strategic plans, expectations and objectives for future operations, and are often identified by use of the words “expects,” “believes,” “will,” “would,” “could,” “forecasts,” “projections,” “estimates,” “plans,” “expectations,” “targets,” “opportunities,” “potential,” “anticipates,” “outlook” and other similar terminology. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the company expects, believes or anticipates will or may occur in the future are forward-looking statements. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the company. Statements regarding our business and operations are subject to all of the risks and uncertainties normally incident to the exploration for and development and production of oil and gas. These risks include, but are not limited to: the volatility of oil, gas and NGL prices, including the currently depressed commodity price environment; uncertainties inherent in estimating oil, gas and NGL reserves; the extent to which we are successful in acquiring and discovering additional reserves; the uncertainties, costs and risks involved in exploration and development activities; risks related to our hedging activities; counterparty credit risks; regulatory restrictions, compliance costs and other risks relating to governmental regulation, including with respect to environmental matters; risks relating to our indebtedness; our ability to successfully complete mergers, acquisitions and divestitures; the extent to which insurance covers any losses we may experience; our limited control over third parties who operate our oil and gas properties; midstream capacity constraints and potential interruptions in production; competition for leases, materials, people and capital; cyberattacks targeting our systems and infrastructure; and any of the other risks and uncertainties identified in our Form 10-K and our other filings with the SEC. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in the forward-looking statements. The forward-looking statements in this press release are made as of the date of this press release, even if subsequently made available by Devon on its website or otherwise. Devon does not undertake any obligation to update the forward-looking statements as a result of new information, future events or otherwise.
 
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The SEC permits oil and gas companies, in their filings with the SEC, to disclose only proved, probable and possible reserves that meet the SEC’s definitions for such terms, and price and cost sensitivities for such reserves, and prohibits disclosure of resources that do not constitute such reserves. This release may contain certain terms, such as resource potential, potential locations, risk and unrisked locations, estimated ultimate recovery (or EUR), exploration target size and other similar terms. These estimates are by their nature more speculative than estimates of proved, probable and possible reserves and accordingly are subject to substantially greater risk of being actually realized. The SEC guidelines strictly prohibit us from including these estimates in filings with the SEC. Investors are urged to consider closely the disclosure in our Form 10-K, available at www.devonenergy.com . You can also obtain this form from the SEC by calling 1-800-SEC-0330 or from the SEC’s website at www.sec.gov .
About Devon Energy
Devon Energy is a leading independent energy company engaged in finding and producing oil and natural gas. Based in Oklahoma City and included in the S&P 500, Devon operates in several of the most prolific oil and natural gas plays in the U.S. and Canada with an emphasis on a balanced portfolio. The company is the second-largest oil producer among North American onshore independents. For more information, please visit www.devonenergy.com .
Investor Contacts
Scott Coody, 405-552-4735
Chris Carr, 405-228-2496
Media Contact
John Porretto, 405-228-7506
 
Page 5 of 18

DEVON ENERGY CORPORATION
FINANCIAL AND OPERATIONAL INFORMATION

 	  	Quarter Ended	 	  	Nine Months Ended	 	
PRODUCTION NET OF ROYALTIES	  	September 30,	 	  	September 30,	 	
 	  	2016	 	  	2015	 	  	2016	 	  	2015	 	
	  				  				  				  				
Oil and bitumen (MBbls/d)	  				  				  				  				
U. S. - Core	  	 	108	  	  	 	140	  	  	 	124	  	  	 	143	  	
Heavy Oil	  	 	137	  	  	 	121	  	  	 	128	  	  	 	107	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Retained assets	  	 	245	  	  	 	261	  	  	 	252	  	  	 	250	  	
Divested assets	  	 	6	  	  	 	21	  	  	 	13	  	  	 	24	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	251	  	  	 	282	  	  	 	265	  	  	 	274	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Natural gas liquids (MBbls/d)	  				  				  				  				
U. S. - Core	  	 	96	  	  	 	108	  	  	 	107	  	  	 	109	  	
Divested assets	  	 	8	  	  	 	26	  	  	 	17	  	  	 	27	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	104	  	  	 	134	  	  	 	124	  	  	 	136	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Gas (MMcf/d)	  				  				  				  				
U. S. - Core	  	 	1,231	  	  	 	1,319	  	  	 	1,292	  	  	 	1,336	  	
Heavy Oil	  	 	18	  	  	 	16	  	  	 	20	  	  	 	21	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Retained assets	  	 	1,249	  	  	 	1,335	  	  	 	1,312	  	  	 	1,357	  	
Divested assets	  	 	75	  	  	 	251	  	  	 	165	  	  	 	262	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	1,324	  	  	 	1,586	  	  	 	1,477	  	  	 	1,619	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Oil equivalent (MBoe/d)	  				  				  				  				
U. S. - Core	  	 	410	  	  	 	467	  	  	 	446	  	  	 	474	  	
Heavy Oil	  	 	140	  	  	 	124	  	  	 	132	  	  	 	111	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Retained assets	  	 	550	  	  	 	591	  	  	 	578	  	  	 	585	  	
Divested assets	  	 	27	  	  	 	89	  	  	 	57	  	  	 	95	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	577	  	  	 	680	  	  	 	635	  	  	 	680	  	

													
KEY OPERATING STATISTICS BY REGION	  	Quarter Ended September 30, 2016	 	
 	  	Avg. Production	 	  	Gross Wells	 	  	Operated Rigs at	 	
 	  	(MBoe/d)	 	  	Drilled	 	  	September 30, 2016	 	
STACK	  	 	92	  	  	 	37	  	  	 	4	  	
Delaware Basin	  	 	59	  	  	 	8	  	  	 	1	  	
Eagle Ford	  	 	61	  	  	 	4	  	  	 	—  	  	
Heavy Oil	  	 	140	  	  	 	3	  	  	 	1	  	
Barnett Shale	  	 	166	  	  	 	—  	  	  	 	—  	  	
Rockies Oil	  	 	16	  	  	 	—  	  	  	 	—  	  	
Other assets	  	 	16	  	  	 	—  	  	  	 	—  	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Retained assets	  	 	550	  	  	 	52	  	  	 	6	  	
Divested assets	  	 	27	  	  	 	—  	  	  	 	—  	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	577	  	  	 	52	  	  	 	6	  	

Page 6 of 18

DEVON ENERGY CORPORATION
FINANCIAL AND OPERATIONAL INFORMATION

PRODUCTION TREND	  	2015	 	  	2016	 	
 	  	Quarter 3	 	  	Quarter 4	 	  	Quarter 1	 	  	Quarter 2	 	  	Quarter 3	 	
Oil and bitumen (MBbls/d)	  				  				  				  				  				
STACK	  	 	7	  	  	 	9	  	  	 	15	  	  	 	19	  	  	 	21	  	
Delaware Basin	  	 	41	  	  	 	42	  	  	 	38	  	  	 	36	  	  	 	31	  	
Eagle Ford	  	 	62	  	  	 	60	  	  	 	59	  	  	 	41	  	  	 	33	  	
Heavy Oil	  	 	121	  	  	 	121	  	  	 	126	  	  	 	121	  	  	 	137	  	
Barnett Shale	  	 	1	  	  	 	1	  	  	 	1	  	  	 	1	  	  	 	1	  	
Rockies Oil	  	 	16	  	  	 	15	  	  	 	17	  	  	 	15	  	  	 	11	  	
Other assets	  	 	13	  	  	 	12	  	  	 	12	  	  	 	11	  	  	 	11	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Retained assets	  	 	261	  	  	 	260	  	  	 	268	  	  	 	244	  	  	 	245	  	
Divested assets	  	 	21	  	  	 	18	  	  	 	17	  	  	 	15	  	  	 	6	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	282	  	  	 	278	  	  	 	285	  	  	 	259	  	  	 	251	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Natural gas liquids (MBbls/d)	  				  				  				  				  				
STACK	  	 	22	  	  	 	24	  	  	 	30	  	  	 	30	  	  	 	23	  	
Delaware Basin	  	 	8	  	  	 	11	  	  	 	12	  	  	 	13	  	  	 	12	  	
Eagle Ford	  	 	26	  	  	 	27	  	  	 	24	  	  	 	17	  	  	 	13	  	
Barnett Shale	  	 	47	  	  	 	49	  	  	 	46	  	  	 	46	  	  	 	44	  	
Rockies Oil	  	 	2	  	  	 	1	  	  	 	1	  	  	 	1	  	  	 	1	  	
Other assets	  	 	3	  	  	 	3	  	  	 	2	  	  	 	3	  	  	 	3	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Retained assets	  	 	108	  	  	 	115	  	  	 	115	  	  	 	110	  	  	 	96	  	
Divested assets	  	 	26	  	  	 	24	  	  	 	22	  	  	 	21	  	  	 	8	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	134	  	  	 	139	  	  	 	137	  	  	 	131	  	  	 	104	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Gas (MMcf/d)	  				  				  				  				  				
STACK	  	 	229	  	  	 	253	  	  	 	306	  	  	 	289	  	  	 	292	  	
Delaware Basin	  	 	70	  	  	 	82	  	  	 	84	  	  	 	99	  	  	 	92	  	
Eagle Ford	  	 	155	  	  	 	152	  	  	 	144	  	  	 	103	  	  	 	85	  	
Heavy Oil	  	 	16	  	  	 	24	  	  	 	15	  	  	 	28	  	  	 	18	  	
Barnett Shale	  	 	807	  	  	 	786	  	  	 	768	  	  	 	757	  	  	 	730	  	
Rockies Oil	  	 	41	  	  	 	38	  	  	 	32	  	  	 	31	  	  	 	19	  	
Other assets	  	 	17	  	  	 	16	  	  	 	17	  	  	 	14	  	  	 	13	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Retained assets	  	 	1,335	  	  	 	1,351	  	  	 	1,366	  	  	 	1,321	  	  	 	1,249	  	
Divested assets	  	 	251	  	  	 	232	  	  	 	215	  	  	 	206	  	  	 	75	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	1,586	  	  	 	1,583	  	  	 	1,581	  	  	 	1,527	  	  	 	1,324	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Oil equivalent (MBoe/d)	  				  				  				  				  				
STACK	  	 	67	  	  	 	75	  	  	 	96	  	  	 	97	  	  	 	92	  	
Delaware Basin	  	 	61	  	  	 	66	  	  	 	63	  	  	 	65	  	  	 	59	  	
Eagle Ford	  	 	113	  	  	 	113	  	  	 	107	  	  	 	76	  	  	 	61	  	
Heavy Oil	  	 	124	  	  	 	125	  	  	 	129	  	  	 	126	  	  	 	140	  	
Barnett Shale	  	 	183	  	  	 	181	  	  	 	175	  	  	 	173	  	  	 	166	  	
Rockies Oil	  	 	25	  	  	 	23	  	  	 	23	  	  	 	21	  	  	 	16	  	
Other assets	  	 	18	  	  	 	18	  	  	 	18	  	  	 	16	  	  	 	16	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Retained assets	  	 	591	  	  	 	601	  	  	 	611	  	  	 	574	  	  	 	550	  	
Divested assets	  	 	89	  	  	 	80	  	  	 	74	  	  	 	70	  	  	 	27	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	680	  	  	 	681	  	  	 	685	  	  	 	644	  	  	 	577	  	

Page 7 of 18

DEVON ENERGY CORPORATION
FINANCIAL AND OPERATIONAL INFORMATION

BENCHMARK PRICES	  	Quarter 3	 	  	September YTD	 	
(average prices)	  	2016	 	  	2015	 	  	2016	 	  	2015	 	
Oil ($/Bbl) - West Texas Intermediate (Cushing)	  	$	45.02	  	  	$	46.69	  	  	$	41.41	  	  	$	51.11	  	
Natural Gas ($/Mcf) - Henry Hub	  	$	2.81	  	  	$	2.77	  	  	$	2.28	  	  	$	2.80	  	
		
REALIZED PRICES	  	Quarter Ended September 30, 2016	 	
 	  	Oil /Bitumen	 	  	NGL	 	  	Gas	 	  	Total	 	
 	  	(Per Bbl)	 	  	(Per Bbl)	 	  	(Per Mcf)	 	  	(Per Boe)	 	
United States	  	$	42.51	  	  	$	9.80	  	  	$	2.24	  	  	$	20.26	  	
Canada	  	$	23.71	  	  	 	N/M	  	  	 	N/M	  	  	$	23.23	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Realized price without hedges	  	$	32.27	  	  	$	9.80	  	  	$	2.24	  	  	$	20.98	  	
Cash settlements	  	$	0.84	  	  	$	0.10	  	  	$	(0.04	) 	  	$	0.32	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Realized price, including cash settlements	  	$	33.11	  	  	$	9.90	  	  	$	2.20	  	  	$	21.30	  	

 	  	Quarter Ended September 30, 2015	 	
 	  	Oil /Bitumen	 	  	NGL	 	  	Gas	 	  	Total	 	
 	  	(Per Bbl)	 	  	(Per Bbl)	 	  	(Per Mcf)	 	  	(Per Boe)	 	
United States	  	$	42.09	  	  	$	8.80	  	  	$	2.24	  	  	$	20.66	  	
Canada	  	$	25.10	  	  	 	N/M	  	  	 	N/M	  	  	$	24.55	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Realized price without hedges	  	$	34.78	  	  	$	8.80	  	  	$	2.24	  	  	$	21.37	  	
Cash settlements	  	$	21.16	  	  	$	—  	  	  	$	0.47	  	  	$	9.86	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Realized price, including cash settlements	  	$	55.94	  	  	$	8.80	  	  	$	2.71	  	  	$	31.23	  	

 	  	Nine Months Ended September 30, 2016	 	
 	  	Oil /Bitumen	 	  	NGL	 	  	Gas	 	  	Total	 	
 	  	(Per Bbl)	 	  	(Per Bbl)	 	  	(Per Mcf)	 	  	(Per Boe)	 	
United States	  	$	36.89	  	  	$	8.84	  	  	$	1.70	  	  	$	17.16	  	
Canada	  	$	18.58	  	  	 	N/M	  	  	 	N/M	  	  	$	18.15	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Realized price without hedges	  	$	28.03	  	  	$	8.84	  	  	$	1.70	  	  	$	17.37	  	
Cash settlements	  	$	(0.57	) 	  	$	(0.06	) 	  	$	0.12	  	  	$	0.02	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Realized price, including cash settlements	  	$	27.46	  	  	$	8.78	  	  	$	1.82	  	  	$	17.39	  	

 	  	Nine Months Ended September 30, 2015	 	
 	  	Oil /Bitumen	 	  	NGL	 	  	Gas	 	  	Total	 	
 	  	(Per Bbl)	 	  	(Per Bbl)	 	  	(Per Mcf)	 	  	(Per Boe)	 	
United States	  	$	45.91	  	  	$	9.50	  	  	$	2.27	  	  	$	22.18	  	
Canada	  	$	27.84	  	  	 	N/M	  	  	 	N/M	  	  	$	27.06	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Realized price without hedges	  	$	38.81	  	  	$	9.50	  	  	$	2.27	  	  	$	22.98	  	
Cash settlements	  	$	19.48	  	  	$	—  	  	  	$	0.53	  	  	$	9.11	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Realized price, including cash settlements	  	$	58.29	  	  	$	9.50	  	  	$	2.80	  	  	$	32.09	  	

Page 8 of 18

DEVON ENERGY CORPORATION
FINANCIAL AND OPERATIONAL INFORMATION

CONSOLIDATED STATEMENTS OF EARNINGS	  	Quarter Ended	 	 	Nine Months Ended	 	
(in millions, except per share amounts)	  	September 30,	 	 	September 30,	 	
 	  	2016	 	 	2015	 	 	2016	 	 	2015	 	
Oil, gas and NGL sales	  	$	1,113	  	 	$	1,338	  	 	$	3,023	  	 	$	4,264	  	
Oil, gas and NGL derivatives	  	 	79	  	 	 	414	  	 	 	(30	) 	 	 	426	  	
Marketing and midstream revenues	  	 	1,690	  	 	 	1,849	  	 	 	4,503	  	 	 	5,569	  	
Gains on asset sales	  	 	1,351	  	 	 	—  	  	 	 	1,351	  	 	 	—  	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total revenues and other	  	 	4,233	  	 	 	3,601	  	 	 	8,847	  	 	 	10,259	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Lease operating expenses	  	 	355	  	 	 	510	  	 	 	1,215	  	 	 	1,625	  	
Marketing and midstream operating expenses	  	 	1,480	  	 	 	1,637	  	 	 	3,884	  	 	 	4,939	  	
General and administrative expenses	  	 	141	  	 	 	198	  	 	 	482	  	 	 	661	  	
Production and property taxes	  	 	67	  	 	 	91	  	 	 	220	  	 	 	315	  	
Depreciation, depletion and amortization	  	 	394	  	 	 	744	  	 	 	1,420	  	 	 	2,488	  	
Asset impairments	  	 	319	  	 	 	5,851	  	 	 	4,851	  	 	 	15,479	  	
Restructuring and transaction costs	  	 	(5	) 	 	 	—  	  	 	 	266	  	 	 	—  	  	
Other operating items	  	 	17	  	 	 	14	  	 	 	41	  	 	 	54	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total operating expenses	  	 	2,768	  	 	 	9,045	  	 	 	12,379	  	 	 	25,561	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Operating income (loss)	  	 	1,465	  	 	 	(5,444	) 	 	 	(3,532	) 	 	 	(15,302	) 	
Net financing costs	  	 	243	  	 	 	136	  	 	 	570	  	 	 	378	  	
Other nonoperating items	  	 	44	  	 	 	43	  	 	 	150	  	 	 	46	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Earnings (loss) before income taxes	  	 	1,178	  	 	 	(5,623	) 	 	 	(4,252	) 	 	 	(15,726	) 	
Income tax expense (benefit)	  	 	171	  	 	 	(1,714	) 	 	 	(228	) 	 	 	(5,435	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net earnings (loss)	  	 	1,007	  	 	 	(3,909	) 	 	 	(4,024	) 	 	 	(10,291	) 	
Net earnings (loss) attributable to noncontrolling interests	  	 	14	  	 	 	(402	) 	 	 	(391	) 	 	 	(369	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net earnings (loss) attributable to Devon	  	$	993	  	 	$	(3,507	) 	 	$	(3,633	) 	 	$	(9,922	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net earnings (loss) per share attributable to Devon:	  				 				 				 				
Basic	  	$	1.90	  	 	$	(8.64	) 	 	$	(7.22	) 	 	$	(24.45	) 	
Diluted	  	$	1.89	  	 	$	(8.64	) 	 	$	(7.22	) 	 	$	(24.45	) 	
Weighted average common shares outstanding:	  				 				 				 				
Basic	  	 	524	  	 	 	411	  	 	 	509	  	 	 	411	  	
Diluted	  	 	527	  	 	 	411	  	 	 	509	  	 	 	411	  	
 
Page 9 of 18

DEVON ENERGY CORPORATION
FINANCIAL AND OPERATIONAL INFORMATION

CONSOLIDATED STATEMENTS OF CASH FLOWS	  	Quarter Ended	 	 	Nine Months Ended	 	
(in millions)	  	September 30,	 	 	September 30,	 	
 	  	2016	 	 	2015	 	 	2016	 	 	2015	 	
Cash flows from operating activities:	  				 				 				 				
Net earnings (loss)	  	$	1,007	  	 	$	(3,909	) 	 	$	(4,024	) 	 	$	(10,291	) 	
Adjustments to reconcile net earnings (loss) to net cash from operating activities:	  				 				 				 				
Depreciation, depletion and amortization	  	 	394	  	 	 	744	  	 	 	1,420	  	 	 	2,488	  	
Asset impairments	  	 	319	  	 	 	5,851	  	 	 	4,851	  	 	 	15,479	  	
Gains on asset sales	  	 	(1,351	) 	 	 	—  	  	 	 	(1,351	) 	 	 	—  	  	
Deferred income tax expense (benefit)	  	 	86	  	 	 	(1,708	) 	 	 	(300	) 	 	 	(5,348	) 	
Derivatives and other financial instruments	  	 	(58	) 	 	 	(481	) 	 	 	359	  	 	 	(606	) 	
Cash settlements on derivatives and financial instruments	  	 	15	  	 	 	730	  	 	 	(133	) 	 	 	1,913	  	
Other	  	 	169	  	 	 	171	  	 	 	190	  	 	 	437	  	
Net change in working capital	  	 	136	  	 	 	67	  	 	 	181	  	 	 	93	  	
Change in long-term other assets	  	 	(3	) 	 	 	52	  	 	 	10	  	 	 	211	  	
Change in long-term other liabilities	  	 	12	  	 	 	36	  	 	 	7	  	 	 	(74	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net cash from operating activities	  	 	726	  	 	 	1,553	  	 	 	1,210	  	 	 	4,302	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash flows from investing activities:	  				 				 				 				
Capital expenditures	  	 	(421	) 	 	 	(1,080	) 	 	 	(1,659	) 	 	 	(4,229	) 	
Acquisitions of property, equipment and businesses	  	 	(3	) 	 	 	(113	) 	 	 	(1,641	) 	 	 	(530	) 	
Divestitures of property and equipment	  	 	1,680	  	 	 	27	  	 	 	1,889	  	 	 	35	  	
Other	  	 	34	  	 	 	(3	) 	 	 	7	  	 	 	(8	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net cash from investing activities	  	 	1,290	  	 	 	(1,169	) 	 	 	(1,404	) 	 	 	(4,732	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash flows from financing activities:	  				 				 				 				
Borrowings of long-term debt, net of issuance costs	  	 	816	  	 	 	277	  	 	 	1,662	  	 	 	3,328	  	
Repayments of long-term debt	  	 	(2,173	) 	 	 	(252	) 	 	 	(2,722	) 	 	 	(1,773	) 	
Net short-term debt repayments	  	 	—  	  	 	 	(169	) 	 	 	(626	) 	 	 	(932	) 	
Early retirement of debt	  	 	(82	) 	 	 	—  	  	 	 	(82	) 	 	 	—  	  	
Issuance of common stock	  	 	—  	  	 	 	—  	  	 	 	1,469	  	 	 	—  	  	
Sale of subsidiary units	  	 	—  	  	 	 	—  	  	 	 	—  	  	 	 	654	  	
Issuance of subsidiary units	  	 	59	  	 	 	9	  	 	 	835	  	 	 	13	  	
Dividends paid on common stock	  	 	(32	) 	 	 	(99	) 	 	 	(190	) 	 	 	(296	) 	
Contributions from noncontrolling interests	  	 	146	  	 	 	5	  	 	 	151	  	 	 	12	  	
Distributions to noncontrolling interests	  	 	(77	) 	 	 	(68	) 	 	 	(224	) 	 	 	(186	) 	
Other	  	 	(2	) 	 	 	(3	) 	 	 	(9	) 	 	 	(18	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net cash from financing activities	  	 	(1,345	) 	 	 	(300	) 	 	 	264	  	 	 	802	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Effect of exchange rate changes on cash	  	 	(9	) 	 	 	(22	) 	 	 	5	  	 	 	(65	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net change in cash and cash equivalents	  	 	662	  	 	 	62	  	 	 	75	  	 	 	307	  	
Cash and cash equivalents at beginning of period	  	 	1,723	  	 	 	1,725	  	 	 	2,310	  	 	 	1,480	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash and cash equivalents at end of period	  	$	2,385	  	 	$	1,787	  	 	$	2,385	  	 	$	1,787	  	

Page 10 of 18

DEVON ENERGY CORPORATION
FINANCIAL AND OPERATIONAL INFORMATION

	  				 				
CONSOLIDATED BALANCE SHEETS
(in millions)	  	September 30,
2016	 	 	December 31,
2015	 	
Current assets:	  				 				
Cash and cash equivalents	  	$	2,385	  	 	$	2,310	  	
Accounts receivable	  	 	1,092	  	 	 	1,105	  	
Assets held for sale	  	 	717	  	 	 	—  	  	
Other current assets	  	 	257	  	 	 	606	  	
	  	 	 	 	 	 	 	 	
Total current assets	  	 	4,451	  	 	 	4,021	  	
	  	 	 	 	 	 	 	 	
Property and equipment, at cost:	  				 				
Oil and gas, based on full cost accounting:	  				 				
Subject to amortization	  	 	75,431	  	 	 	78,190	  	
Not subject to amortization	  	 	3,637	  	 	 	2,584	  	
	  	 	 	 	 	 	 	 	
Total oil and gas	  	 	79,068	  	 	 	80,774	  	
Midstream and other	  	 	10,320	  	 	 	10,380	  	
	  	 	 	 	 	 	 	 	
Total property and equipment, at cost	  	 	89,388	  	 	 	91,154	  	
Less accumulated depreciation, depletion and amortization	  	 	(73,219	) 	 	 	(72,086	) 	
	  	 	 	 	 	 	 	 	
Property and equipment, net	  	 	16,169	  	 	 	19,068	  	
	  	 	 	 	 	 	 	 	
Goodwill	  	 	3,963	  	 	 	5,032	  	
Other long-term assets	  	 	2,230	  	 	 	1,330	  	
	  	 	 	 	 	 	 	 	
Total assets	  	$	26,813	  	 	$	29,451	  	
	  	 	 	 	 	 	 	 	
Current liabilities:	  				 				
Accounts payable	  	$	529	  	 	$	906	  	
Revenues and royalties payable	  	 	860	  	 	 	763	  	
Short-term debt	  	 	350	  	 	 	976	  	
Liabilities held for sale	  	 	202	  	 	 	—  	  	
Other current liabilities	  	 	910	  	 	 	650	  	
	  	 	 	 	 	 	 	 	
Total current liabilities	  	 	2,851	  	 	 	3,295	  	
	  	 	 	 	 	 	 	 	
Long-term debt	  	 	11,004	  	 	 	12,056	  	
Asset retirement obligations	  	 	1,230	  	 	 	1,370	  	
Other long-term liabilities	  	 	1,036	  	 	 	853	  	
Deferred income taxes	  	 	631	  	 	 	888	  	
Stockholders’ equity:	  				 				
Common stock	  	 	52	  	 	 	42	  	
Additional paid-in capital	  	 	7,487	  	 	 	4,996	  	
Retained earnings (accumulated deficit)	  	 	(1,977	) 	 	 	1,781	  	
Accumulated other comprehensive earnings	  	 	278	  	 	 	230	  	
	  	 	 	 	 	 	 	 	
Total stockholders’ equity attributable to Devon	  	 	5,840	  	 	 	7,049	  	
Noncontrolling interests	  	 	4,221	  	 	 	3,940	  	
	  	 	 	 	 	 	 	 	
Total stockholders’ equity	  	 	10,061	  	 	 	10,989	  	
	  	 	 	 	 	 	 	 	
Total liabilities and stockholders’ equity	  	$	26,813	  	 	$	29,451	  	
	  	 	 	 	 	 	 	 	
Common shares outstanding	  	 	524	  	 	 	418	  	
 
Page 11 of 18

DEVON ENERGY CORPORATION
FINANCIAL AND OPERATIONAL INFORMATION

CONSOLIDATING STATEMENTS OF OPERATIONS	  				 				 				 				
(in millions)	  	Quarter Ended September 30, 2016	 	
 	  	Devon U.S.
& Canada	 	 	EnLink	 	 	Eliminations	 	 	Total	 	
Oil, gas and NGL sales	  	$	1,113	  	 	$	—  	  	 	$	—  	  	 	$	1,113	  	
Oil, gas and NGL derivatives	  	 	79	  	 	 	—  	  	 	 	—  	  	 	 	79	  	
Marketing and midstream revenues	  	 	766	  	 	 	1,104	  	 	 	(180	) 	 	 	1,690	  	
Gains on asset sales	  	 	1,351	  	 	 	—  	  	 	 	—  	  	 	 	1,351	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total revenues and other	  	 	3,309	  	 	 	1,104	  	 	 	(180	) 	 	 	4,233	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Lease operating expenses	  	 	355	  	 	 	—  	  	 	 	—  	  	 	 	355	  	
Marketing and midstream operating expenses	  	 	784	  	 	 	876	  	 	 	(180	) 	 	 	1,480	  	
General and administrative expenses	  	 	111	  	 	 	30	  	 	 	—  	  	 	 	141	  	
Production and property taxes	  	 	57	  	 	 	10	  	 	 	—  	  	 	 	67	  	
Depreciation, depletion and amortization	  	 	268	  	 	 	126	  	 	 	—  	  	 	 	394	  	
Asset impairments	  	 	319	  	 	 	—  	  	 	 	—  	  	 	 	319	  	
Restructuring and transaction costs	  	 	(5	) 	 	 	—  	  	 	 	—  	  	 	 	(5	) 	
Other operating items	  	 	20	  	 	 	(3	) 	 	 	—  	  	 	 	17	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total operating expenses	  	 	1,909	  	 	 	1,039	  	 	 	(180	) 	 	 	2,768	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Operating income	  	 	1,400	  	 	 	65	  	 	 	—  	  	 	 	1,465	  	
Net financing costs	  	 	195	  	 	 	48	  	 	 	—  	  	 	 	243	  	
Other nonoperating items	  	 	46	  	 	 	(2	) 	 	 	—  	  	 	 	44	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Earnings before income taxes	  	 	1,159	  	 	 	19	  	 	 	—  	  	 	 	1,178	  	
Income tax expense	  	 	164	  	 	 	7	  	 	 	—  	  	 	 	171	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net earnings	  	 	995	  	 	 	12	  	 	 	—  	  	 	 	1,007	  	
Net earnings attributable to noncontrolling interests	  	 	—  	  	 	 	14	  	 	 	—  	  	 	 	14	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net earnings (loss) attributable to Devon	  	$	995	  	 	$	(2	) 	 	$	—  	  	 	$	993	  	

																	
OTHER KEY STATISTICS	  				 				 				  				
(in millions)	  	Quarter Ended September 30, 2016	 	
 	  	Devon U.S.
& Canada	 	 	EnLink	 	 	Eliminations	 	  	Total	 	
Cash flow statement related items:	  				 				 				  				
Operating cash flow	  	$	517	  	 	$	209	  	 	$	—  	  	  	$	726	  	
Capital expenditures	  	$	(285	) 	 	$	(136	) 	 	$	—  	  	  	$	(421	) 	
Divestitures of property and equipment	  	$	1,676	  	 	$	4	  	 	$	—  	  	  	$	1,680	  	
EnLink distributions received (paid)	  	$	66	  	 	$	(143	) 	 	$	—  	  	  	$	(77	) 	
Issuance of subsidiary units	  	$	—  	  	 	$	59	  	 	$	—  	  	  	$	59	  	
Balance sheet statement items:	  				 				 				  				
Net debt (1)	  	$	5,784	  	 	$	3,185	  	 	$	—  	  	  	$	8,969	  	
 
(1)	Net debt is a non-GAAP measure. For a reconciliation of the comparable GAAP measure, see “Non-GAAP Financial Measures” later in this release.	
 
Page 12 of 18

DEVON ENERGY CORPORATION
FINANCIAL AND OPERATIONAL INFORMATION

CAPITAL EXPENDITURES	  				  				
(in millions)	  	Quarter Ended September 30, 2016	 	  	Nine Months Ended September 30, 2016	 	
Exploration and development capital	  	$	231	  	  	$	816	  	
Capitalized G&A and interest	  	 	71	  	  	 	230	  	
Acquisitions	  	 	16	  	  	 	1,547	  	
Other	  	 	7	  	  	 	19	  	
	  	 	 	 	  	 	 	 	
Devon capital expenditures (1)	  	$	325	  	  	$	2,612	  	

(1)	Excludes $132 million and $816 million attributable to EnLink for the third quarter and first nine months of 2016, respectively.	
 
Page 13 of 18

DEVON ENERGY CORPORATION
FINANCIAL AND OPERATIONAL INFORMATION
 
NON-GAAP FINANCIAL MEASURES
This press release includes non-GAAP financial measures. These non-GAAP measures are not alternatives to GAAP measures, and you should not consider these non-GAAP measures in isolation or as a substitute for analysis of our results as reported under GAAP. Below is additional disclosure regarding each of the non-GAAP measures used in this press release, including reconciliations to their most directly comparable GAAP measure.
CORE EARNINGS
Devon’s reported net earnings include items of income and expense that are typically excluded by securities analysts in their published estimates of the company’s financial results. Accordingly, the company also uses the measures of core earnings and core earnings per share attributable to Devon. Devon believes these non-GAAP measures facilitate comparisons of its performance to earnings estimates published by securities analysts. Devon also believes these non-GAAP measures can facilitate comparisons of its performance between periods and to the performance of its peers. The following table summarizes the effects of these items on third-quarter 2016 earnings.

 	  	Quarter Ended September 30, 2016	 	
(in millions, except per share amounts)	  	Before-tax	 	 	After-tax	 	 	After
Noncontrolling
Interests	 	 	Per Share	 	
 	  	(Millions)	 	
Earnings attributable to Devon (GAAP)	  	$	1,178	  	 	$	1,007	  	 	$	993	  	 	$	1.89	  	
Adjustments:	  				 				 				 				
Gains on asset sales	  	 	(1,351	) 	 	 	(787	) 	 	 	(787	) 	 	 	(1.48	) 	
Deferred tax asset valuation allowance	  	 	—  	  	 	 	(408	) 	 	 	(408	) 	 	 	(0.78	) 	
Fair value changes in financial instruments and foreign currency	  	 	(16	) 	 	 	(3	) 	 	 	(3	) 	 	 	(0.01	) 	
Restructuring and transaction costs	  	 	(5	) 	 	 	(3	) 	 	 	(3	) 	 	 	(0.01	) 	
Early retirement of debt	  	 	84	  	 	 	53	  	 	 	53	  	 	 	0.10	  	
Asset impairments	  	 	319	  	 	 	202	  	 	 	202	  	 	 	0.38	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Core earnings attributable to Devon (Non-GAAP) (1)	  	$	209	  	 	$	61	  	 	$	47	  	 	$	0.09	  	

(1)	Devon’s core earning calculation was negatively impacted by an $85 million, non-cash tax charge or $0.16 per share.	
NET DEBT AND ADJUSTED NET DEBT
Devon defines net debt as debt less cash and cash equivalents and net debt attributable to the consolidation of EnLink Midstream as presented in the following table. Adjusted net debt is net debt further adjusted for the proceeds Devon received from the Access Pipeline divestiture transaction that closed in October of 2016 or the cash consideration for the Felix acquisition. Devon believes that adjusting for these items, including the asset sale proceeds and the Felix cash consideration, against debt and adjusting for EnLink net debt provides a clearer picture of the future demands on cash from Devon to repay debt.

(in millions)	  	September 30, 2016	 	
 	  	Devon U.S. & Canada	 	  	EnLink	 	  	Devon Consolidated	 	
Total debt (GAAP)	  	$	8,109	  	  	$	3,245	  	  	$	11,354	  	
Less cash and cash equivalents	  	 	(2,325	) 	  	 	(60	) 	  	 	(2,385	) 	
	  	 	 	 	  	 	 	 	  	 	 	 	
Net debt (Non-GAAP)	  	 	5,784	  	  	 	3,185	  	  	 	8,969	  	
Proceeds from asset sales	  	 	(1,100	) 	  	 	—  	  	  	 	(1,100	) 	
	  	 	 	 	  	 	 	 	  	 	 	 	
Adjusted net debt (Non-GAAP)	  	$	4,684	  	  	$	3,185	  	  	$	7,869	  	

Page 14 of 18

DEVON ENERGY CORPORATION
FINANCIAL AND OPERATIONAL INFORMATION

(in millions)	  	December 31, 2015	 	
 	  	Devon U.S. & Canada	 	 	EnLink	 	 	Devon Consolidated	 	
Total debt (GAAP)	  	$	10,023	  	 	$	3,090	  	 	$	13,113	  	
Less cash and cash equivalents	  	 	(2,292	) 	 	 	(18	) 	 	 	(2,310	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	
Net debt (Non-GAAP)	  	 	7,731	  	 	 	3,072	  	 	 	10,803	  	
Cash consideration for Felix acquisition	  	 	850	  	 	 	—  	  	 	 	850	  	
	  	 	 	 	 	 	 	 	 	 	 	 	
Adjusted net debt (Non-GAAP)	  	$	8,581	  	 	$	3,072	  	 	$	11,653	  	

Page 15 of 18

DEVON ENERGY CORPORATION
FORWARD LOOKING GUIDANCE

PRODUCTION GUIDANCE	  	Quarter 4	 	
 	  	Low	 	  	High	 	
Oil and bitumen (MBbls/d)	  				  				
U.S.	  	 	103	  	  	 	108	  	
Heavy Oil	  	 	135	  	  	 	140	  	
	  	 	 	 	  	 	 	 	
Total	  	 	238	  	  	 	248	  	
	  	 	 	 	  	 	 	 	
Natural gas liquids (MBbls/d)	  				  				
Total	  	 	85	  	  	 	90	  	
Gas (MMcf/d)	  				  				
U.S.	  	 	1,190	  	  	 	1,230	  	
Heavy Oil	  	 	14	  	  	 	16	  	
	  	 	 	 	  	 	 	 	
Total	  	 	1,204	  	  	 	1,246	  	
	  	 	 	 	  	 	 	 	
Oil equivalent (MBoe/d)	  				  				
U.S.	  	 	387	  	  	 	403	  	
Heavy Oil	  	 	137	  	  	 	143	  	
	  	 	 	 	  	 	 	 	
Total	  	 	524	  	  	 	546	  	

									
PRICE REALIZATIONS GUIDANCE	  	Quarter 4	 	
 	  	Low	 	 	High	 	
Oil and bitumen - % of WTI	  				 				
U.S.	  	 	86	% 	 	 	96	% 	
Canada	  	 	50	% 	 	 	60	% 	
NGL - realized price	  	$	8	  	 	$	13	  	
Natural gas - % of Henry Hub	  	 	78	% 	 	 	88	% 	
 
Page 16 of 18

DEVON ENERGY CORPORATION
FORWARD LOOKING GUIDANCE

OTHER GUIDANCE ITEMS	  	Quarter 4	 	
($ millions, except %)	  	Low	 	 	High	 	
Marketing & midstream operating profit	  	$	205	  	 	$	225	  	
Lease operating expenses	  	$	360	  	 	$	400	  	
General & administrative expenses	  	$	140	  	 	$	160	  	
Production and property taxes	  	$	55	  	 	$	65	  	
Depreciation, depletion and amortization	  	$	400	  	 	$	450	  	
Other operating items	  	$	20	  	 	$	30	  	
Net financing costs (1)	  	$	140	  	 	$	160	  	
Current income tax rate	  	 	0.0	% 	 	 	0.0	% 	
Deferred income tax rate	  	 	35.0	% 	 	 	45.0	% 	
	  	 	 	 	 	 	 	 	
Total income tax rate	  	 	35.0	% 	 	 	45.0	% 	
	  	 	 	 	 	 	 	 	
Net earnings attributable to noncontrolling interests	  	$	—  	  	 	$	—  	  	
 
(1)	Fourth quarter includes $13 million of non-cash accretion on EnLink’s installment purchase obligations.	

CAPITAL EXPENDITURES GUIDANCE	  	Quarter 4	 	
(in millions)	  	Low	 	  	High	 	
Exploration and development	  	$	400	  	  	$	425	  	
Capitalized G&A	  	 	50	  	  	 	60	  	
Capitalized interest	  	 	15	  	  	 	20	  	
Other	  	 	5	  	  	 	15	  	
	  	 	 	 	  	 	 	 	
Devon capital expenditures (2)	  	$	470	  	  	$	520	  	

(2)	Excludes capital expenditures related to EnLink.	
 
Page 17 of 18

DEVON ENERGY CORPORATION
FORWARD LOOKING GUIDANCE

	  				  				  				  				  				  				  				
 	  	Oil Commodity Hedges	 	
COMMODITY HEDGES	  	Price Swaps	 	  	Price Collars	 	  	Call Options Sold	 	
Period	  	Volume
(Bbls/d)	 	  	Weighted
Average
Price
($/Bbl)	 	  	Volume
(Bbls/d)	 	  	Weighted
Average
Floor Price
($/Bbl)	 	  	Weighted
Average
Ceiling Price
($/Bbl)	 	  	Volume
(Bbls/d)	 	  	Weighted
Average Price
($/Bbl)	 	
Q4-2016	  	 	40,848	  	  	$	49.02	  	  	 	20,000	  	  	$	40.85	  	  	$	50.85	  	  	 	18,500	  	  	$	55.00	  	
Q1-Q4 2017	  	 	31,075	  	  	$	52.48	  	  	 	51,744	  	  	$	45.06	  	  	$	57.96	  	  	 	—  	  	  	$	—  	  	
Q1-Q4 2018	  	 	740	  	  	$	51.26	  	  	 	1,973	  	  	$	45.96	  	  	$	55.96	  	  	 	—  	  	  	$	—  	  	

 	  	Oil Basis Swaps	 	
Period	  	Index	  	Volume (Bbls/d)	 	  	Weighted Average Differential to
WTI ($/Bbl)	 	
Q4-2016	  	Western Canadian Select	  	 	33,000	  	  	 	(13.40	) 	

 	  	Natural Gas Commodity Hedges	 	
 	  	Price Swaps	 	  	Price Collars	 	  	Call Options Sold	 	
Period	  	Volume
(MMBtu/d)	 	  	Weighted
Average
Price
($/MMBtu)	 	  	Volume
(MMBtu/d)	 	  	Weighted
Average
Floor Price
($/MMBtu)	 	  	Weighted
Average
Ceiling Price
($/MMBtu)	 	  	Volume
(MMBtu/d)	 	  	Weighted
Average
Price
($/MMBtu)	 	
Q4 2016	  	 	155,000	  	  	$	2.83	  	  	 	385,000	  	  	$	2.74	  	  	$	2.97	  	  	 	400,000	  	  	$	2.80	  	
Q1-Q4 2017	  	 	159,151	  	  	$	3.08	  	  	 	230,904	  	  	$	2.91	  	  	$	3.31	  	  	 	—  	  	  	$	—  	  	
Q1-Q4 2018	  	 	11,096	  	  	$	3.35	  	  	 	8,630	  	  	$	3.18	  	  	$	3.48	  	  	 	—  	  	  	$	—  	  	
Devon’s oil derivatives settle against the average of the prompt month NYMEX West Texas Intermediate futures price. Devon’s natural gas derivatives settle against the Inside FERC first of the month Henry Hub index. Commodity hedge positions are shown as of October 28, 2016.
 
Page 18 of 18