Shale Developments Elevate Devon's E&P Success Rate

Devon drilled 1,135 wells in 2009 applicable to its continuing operations with a 99 percent success rate. Following are operational highlights and updates for selected exploration and development projects:

The company drilled 336 wells in the Barnett Shale field in north Texas in 2009, bringing its total producing wells in the field to almost 4,200 at year end. Devon exited 2009 with net Barnett Shale production at just over 1 billion cubic feet of natural gas equivalent per day. The company drilled its 2,000th horizontal well in the field in early 2010 and is currently running 16 operated drilling rigs. Devon expects to drill 370 total Barnett Shale wells during the year.

Devon drilled 47 successful wells in the Cana-Woodford Shale in western Oklahoma in 2009. During 2009 the company increased its net production from this important new shale-gas resource to an average of 39 million cubic feet of gas equivalent per day. Devon has increased its lease position in the Cana-Woodford Shale to 118,000 net acres and expects to drill approximately 85 wells in the field in 2010.

The company drilled eight Haynesville Shale wells in the greater Carthage area of east Texas in 2009. These wells have significantly de-risked Devon's 110,000 net Haynesville Shale acres in the Carthage area. The company expects to recover up to four trillion cubic feet equivalent of natural gas from its Carthage area Haynesville acreage.

In Canada, Devon's 100-percent owned Jackfish oil sands project in Alberta was operational throughout 2009. As measured by production per well and steam-oil ratio, Jackfish is one of Canada's most commercially successful steam-assisted gravity drainage (SAGD) projects. In late 2009, Jackfish production reached 33,700 barrels of oil per day. The addition of four more producing wells is expected to push production to the facility's capacity of 35,000 barrels per day in early 2010.

Construction continued throughout 2009 on a second phase of the Jackfish SAGD project. Jackfish 2 is also sized to produce 35,000 barrels of oil per day and will commence operations in 2011. Devon expects to file a regulatory application for a third phase of the project in the third quarter of 2010.

Offshore Brazil, Devon participated in two significant deepwater discoveries in 2009. The Devon-operated Itaipu exploratory discovery followed a successful appraisal of the 2008 Wahoo discovery. Both Itaipu and Wahoo are pre-salt prospects located in the Campos Basin. Devon plans to divest its Brazilian assets along with all of its other international properties in 2010. The Itaipu and Wahoo discoveries significantly enhance the value of the company's international assets to prospective buyers.


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