Devon Energy: The Company's Delaware Basin Revenues Will Remain High

Oct. 29, 2022 2:32 AM ETDevon Energy Corporation (DVN)6 Comments
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  • Due to increased energy prices and hiked natural gas and oil production levels in the United States, Devon is on the path of reporting strong quarterly results.
  • The company’s total upstream capital expenditures increased from $501 million in 1Q 2022 to $513 million in 2Q 2022.
  • In November 2022, oil and gas productions in the Permian region are expected to increase by 50 MBbl/s and 127 Mcf/d, respectively.
  • Improved Devon’s leverage and coverage ratios imply that the company can cover its obligations.

Permian Basin In West Texas In The Spotlight As Oil Prices Soar

Joe Raedle

Devon Energy's (NYSE:DVN) total oil equivalent production increased from 575 MBoe/d in 1Q 2022 to 616 MBoe/d in 2Q 2022, driven by increased production in the Delaware Basin. Also, DVN's total oil equivalent realized price (including cash settlements) increased from $54.75 per

Figure 1 - International petroleum and other liquids production and consumption


Figure 2 - U.S. crude oil and natural gas production


Figure 3 - Energy pieces in the United States


According to Figure 4, oil production in the Permian region (the Delaware Basin lies within the Permian region) is estimated to be 5403 MBbl/d in October 2022 and is expected to increase by 50 MBbl/s in November 2022. Gas production in the Permian region is estimated to be 20930 Mcf/d in October 2022 and is expected to increase by 127 Mcf/d in November 2022. Moreover, oil and natural gas production levels In Anadarko, Eagle Ford, Bakken, and Niobrara are expected to increase in November 2022.

eia and DVN's 2Q 2022 presentation

Figure 5 - DVT's leverage ratios

Author (based on SA data)

Figure 6 - DVT's coverage ratios

Author (based on SA data)

This article was written by

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As a fundamental stock market analyst, I mostly use real-market data to estimate stocks' intrinsic value. I evaluate dividend stocks using Comparative Company Analysis and Dividend Discount Model methods. I also use statistical analysis to make projections on variables related to the market to turn my observations into numbers.

Disclosure: I/we have a beneficial long position in the shares of DVN either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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