Devon Energy Corp (NYSE:DVN, ETR:DY6) has agreed to pay $5 billion to acquire assets in the Williston Basin spanning parts of Montana, North Dakota and Saskatchewan.
The deal, with private equity backed Grayson Mill Energy, comprises $3.25 billion of cash proceeds plus $1.75 billion paid in stock.
Devon said the deal will enhance the scale and scope of its operations, adding a high-margin production mix – with the acquired assets adding around 100,000 boepd.
“The acquisition of Grayson Mill is an excellent strategic fit for Devon that allows us to efficiently expand our oil production and operating scale while capturing a meaningful runway of highly economic drilling inventory,” Devon Energy chief executive Rick Muncrief said in a statement.
“This transaction also creates immediate value within our financial framework by delivering sustainable accretion to earnings and free cash flow that will result in higher distributions to shareholders over time.”
The deal is expected to close by the end of the third quarter of 2024.
Alongside the announcement, Devon Energy also revealed it will expand its share buyback program, by 67% up to $5 billion.