Devon Energy Acquires 16,300 Delaware Basin Acres at $161,500 per Acre
Devon Energy acquired 16,300 undeveloped acres in the Delaware Basin for $2.6 billion, or $161,500 per acre, adding 400 2-mile lateral locations with an 87.5% NRI and 10-year lease terms. The contiguous acreage leverages existing infrastructure, extends inventory life and is accretive to NAV while maintaining its strong credit profile.
1. Lease Acquisition Details
Devon Energy acquired 16,300 undeveloped acres in Lea and Eddy Counties, New Mexico, for $2.6 billion, equating to $161,500 per net acre. The deal adds 400 2-mile lateral drilling locations under 10-year federal leases with an 87.5% net revenue interest.
2. Strategic Positioning
The contiguous acreage in the core Delaware Basin bolsters inventory life and allows for longer laterals and multi-well pad development, leveraging existing pipelines and processing facilities adjacent to Devon’s current operations.
3. Funding and Financial Impact
The $2.6 billion transaction will be funded with cash on hand, preserving Devon’s strong credit profile and supporting its disciplined $8 billion share repurchase program without increasing leverage.
4. Integration and Outlook
Following its recent merger with Coterra, Devon’s expanded federal inventory enhances its top-tier well economics and is expected to be immediately accretive to net asset value per share.