Devon Energy Completes 50 Million Share Repurchase Program

Devon Energy Corporation (NYSE: DVN) announced, in conjunction with announcing record second quarter 2005 earnings per share, that it has completed the stock repurchase program announced on September 27, 2004. At that time the company said it planned to repurchase up to 10 percent of its common stock, or approximately 50 million shares, over an 18-month period. Under this program, Devon repurchased the shares at an aggregate cost of $2.3 billion. The company completed the repurchase program in approximately 10 months.

Second 50 Million Share Repurchase Program Announced

The company also announced today that its board of directors has authorized the repurchase of up to an additional 50 million shares of its common stock. This second stock repurchase program is planned to extend through 2007. Shares may be purchased from time to time depending upon market conditions. The company plans to repurchase shares in the open market and in privately negotiated transactions.

Devon to Redeem 6.75 Percent Notes due 2011

Furthermore, the company announced today that it intends to redeem all of its (U.S.) $400 million principal amount 6.75 percent notes due 2011 using cash on hand. These notes were assumed by Devon when it acquired Anderson Exploration Ltd. in 2001. Under the terms of these securities, Devon may redeem the notes at any time at the redemption price described in the prospectus.

"In September 2004, we outlined several initiatives intended to enhance Devon's value and investment appeal," said Brian J. Jennings, senior vice president and chief financial officer. "We split our stock and moved to the New York Stock Exchange, divested over $2 billion of non-core oil and gas properties and repurchased more than 10 percent of our common stock. We also pledged to retire $930 million of debt maturing in 2005. Today's announcements to initiate a second 50 million share repurchase program and to redeem $400 million of additional debt, further demonstrate our firm commitment to enhance shareholder value."

The redemption price of the 6.75 percent notes (CUSIP: 033901AA7) will equal the comparable Treasury Yield, as defined in the prospectus, plus 25 basis points. The ultimate redemption price will be dependent upon the comparable Treasury Yield on the third business day preceding the redemption date of September 8, 2005. Interest will cease to accrue on the redemption date.