Devon Energy Corporation · NYSE:DVN

Devon Energy — Investor Presentation (December 2016)

30 slides from Devon Energy's investor presentation, December 2016

1. Slide 1: Investor Presentation

   Investor Presentation December 2016 NYSE: DVN devonenergy.com

2. Slide 2: Investor Contacts & Notices

   Investor Contacts & Notices Investor Relations Contacts Scott Coody, Vice President, Investor Relations (405) 552-4735 / scott.coody@dvn.com Chris Carr, Supervisor, Investor Relations (405) 228-2496 / chris.carr@dvn.com Forward-Looking Statements This presentation includes "forward-looking statement

3. Slide 3: Devon Today

   Devon Today A Leading North American E&P Heavy Oil Retained Asset Production Key Messages Q3 2016: 550 MBOED  Premier asset portfolio Gas  Focused in STACK and Delaware Basin 38% Oil Rockies Oil 45%  Delivering best-in-class results NGL 17%  Disciplined capital allocation driven by STACK value a

4. Slide 4: Approach To The Current Environment

   Approach To The Current Environment  Achieve additional operating cost savings  Further increase capital productivity  Focused on value and returns  Accelerate activity in STACK and Delaware Basin  Preserve continuity in other U.S. resource plays  Invest directionally within cash flow  Divest

5. Slide 5: Operating Strategy For Success

   Operating Strategy For Success  Maximize base production  Optimize capital program — Minimize controllable downtime — Disciplined project execution — Enhance well productivity — Perform premier technical work — Leverage midstream operations — Focus on development drilling — Reduce operating costs

6. Slide 6: Significant LOE Savings

   Significant LOE Savings  Achieving significant operating cost savings LOE Peak 2015 cost to Q3 2016 — Improved water and electrical infrastructure — Labor and supply chain expense declining LOE IMPROVEMENT $ Millions $562 $510 $480 $444 $416 $355 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 6

7. Slide 7: Consistent Productivity Gains

   Consistent Productivity Gains  D&C costs reduced by up to 40% D&C Costs Decline Peak cost to Q3 2016 ― Driven by efficiencies and supply chain costs UP TO ― More than offsetting larger completions  G&A savings to reach $400 million in 2016 SAVINGS ― 44% improvement from early 2015 Devon’s Avg. 90-

8. Slide 8: Delivering Best-In-Class Well Results

   Delivering Best-In-Class Well Results Avg. 90-Day Wellhead IPs BOED, 20:1 600 450 300 150 0 Top U.S. Producers Source: IHS/Devon. Operators with more than 100 wells in 2015.  Devon delivered best well results of any U.S. producer  Key drivers of success: — Enhanced completion designs and improved

9. Slide 9: Preliminary 2017 & 2018 Outlook

   Preliminary 2017 & 2018 Outlook Accelerating Activity Rig Activity – U.S. Resource Plays  Potential for 15-20 operated rigs in 2017 Operated Rigs — Focused in STACK and Delaware Basin 40 — Invest directionally within cash flow RIGS BY YEAR END 2017 30 RIGS BY YEAR END 2016 20  Preliminary 2017 pro

10. Slide 10: Significant Financial Strength

    Significant Financial Strength  Investment-grade balance sheet Adjusted Net Debt (1) 9/30/16 vs. 12/31/15  No significant debt maturities until mid-2021  Debt reduction program underway ― $1.2 billion tendered to date DECLINE ― Additional $1.0 billion tender offer outstanding ― Adjusted net debt

11. Slide 11: Advantaged Midstream Business

    Advantaged Midstream Business EnLink Overview  Devon’s equity ownership interest ― 24% of MLP (ENLK: 95 million units) ― 64% of GP (ENLC: 115 million units) BILLION  Eliminates midstream capital requirements DVN’S ENLINK OWNERSHIP MARKET VALUE DECEMBER 2016  Improves midstream growth potential 

12. Slide 12: STACK: Best-In-Class Position

    STACK Best-In-Class Position  World-class development opportunity Atoka Penn. Morrow — 430,000 net surface acres Springer Meramec – Core Area Kingfisher — Top targets: Meramec & Woodford Chester Dewey Mississippian Blaine — Q3 net production: 92 MBOED Meramec  Acreage concentrated in core of play

13. Slide 13: STACK: A Multi-Decade Growth Opportunity

    STACK A Multi-Decade Growth Opportunity Largest leasehold position of any operator Tremendous resource potential STACK Acreage Net Surface Acres STACK DRILLING INVENTORY 430,000 265,000 203,000 183,000 115,000 110,000 92,000 86,000 RISKED LOCATIONS Peers Source: Company and industry reports. Advanta

14. Slide 14: Meramec: Results Validate Core Position

    Meramec Results Validate Core Position Kingfisher  Favorable characteristics of Scheffler 1H-9X 30-Day IP: 2,000 BOED Pony Express 27-1H 30-Day IP: 2,100 BOED Born Free Staggered Pilot core oil window: Dewey Blurton 1-7-6XH Blaine 30-Day IP: 2,200 BOED 30-Day IP: 1,800 BOED Maybel 1H-13X 1. Attract

15. Slide 15: Meramec: Extended-Reach Laterals To Enhance Productivity

    Meramec Extended-Reach Laterals To Enhance Productivity  Delivering industry-leading STACK results Meramec Over-Pressured Oil - 10,000’ Lateral Type Well — Meramec 30-day rates 50% above peers(1) IP 1,900 - 2,300 EXTENDED-REACH 30-Day, BOED LATERALS — Driven by legacy 5,000’ lateral design EUR 1,60

16. Slide 16: Meramec: Tremendous Resource Opportunity

    Meramec Tremendous Resource Opportunity  Meramec inventory conservatively risked (4 wells per surface section)  >10 spacing tests underway to drive risked location count higher ― First three Devon operated spacing pilots successful (Born Free, Alma and Pump House tests) ― Testing up to 8 wells per

17. Slide 17: Woodford Shale: A Top-Tier Liquids-Rich Development

    Woodford Shale A Top-Tier Liquids-Rich Development  Hobson Row completion activity underway Woodford Eastern Core Activity Kingfisher Blaine — 5-section development with ≈40 wells Hobson Row — Peak rates expected in early 2017 ≈40 Wells drilled (5-sections) 30-Day IPs: Expected early 2017 Canadian

18. Slide 18: Delaware Basin: A World-Class Oil Play

    Delaware Basin A World-Class Oil Play  Industry leader in basin Bone Spring — Net risked acres by formation: 670,000 SLOPE 285,000 net acres Lea Eddy Wolfcamp 60% — Q3 net production: 59 MBOED 225,000 net acres Leonard Shale 60,000 net acres  LOE reduced 54% from peak 2015 rates Delaware Sands BAS

19. Slide 19: Delaware Basin: Accelerating Activity

    Delaware Basin Accelerating Activity  On track to operate 3 rigs by end Delaware Basin Rig Activity Operated Rigs of 2016 15 — Stabilize production by early 2017 RIGS BY YEAR END 2017  Ramping up to as many as 10 10 rigs by end of 2017 — Position to resume strong production growth 5 RIGS BY YEAR E

20. Slide 20: Delaware Basin: Growing Resource Opportunity

    Delaware Basin Growing Resource Opportunity Basin Slope 1 Section 1 Section DELAWARE  Identified >5,800 risked locations Madera SANDS Lower — Bone Spring ≈60% of risked inventory Brushy A LEONARD — Massive upside with >20,000 unrisked locations B C  Appraisal work evaluating resource upside 1st BO

21. Slide 21: Delaware Basin Master Development Plan

    Delaware Basin Master Development Plan Total Reservoir Access Concept (TRAC)  A disciplined development approach to drive returns higher — More efficient permitting process — Minimizes surface disturbance — Utilizes integrated surface facilities — Flexibility to add/defer development zones — Allows

22. Slide 22: Premier Asset Portfolio

    Premier Asset Portfolio Platform For Value Creation Asset Risked Opportunity Upside Potential Heavy Oil STACK 5,300 undrilled >10 spacing tests locations underway Delaware >5,800 undrilled Wolfcamp and Basin locations Leonard appraisal work ongoing Heavy Oil 1.4 billion barrels Technology to Rockies

23. Slide 23: Devon Energy

    Devon Energy A Leading North American E&P 23

24. Slide 24: Thank you.

    Thank you. devon

25. Slide 25: Forward-Looking Statements

    Forward-Looking Statements This presentation includes "forward-looking statements" as defined by the SEC. Such statements include those concerning strategic plans, expectations and objectives for future operations, and are often identified by use of the words “expects,” “believes,” “will,” “would,”

26. Slide 26: Appendix

    Appendix NYSE: DVN devonenergy.com

27. Slide 27: Canadian Heavy Oil

    Canadian Heavy Oil Thermal Heavy Oil Projects  Top-tier thermal oil position Operational Projects — High reservoir quality: <2.5 SOR(1) — Massive risked resource: 1.4 BBO  Significant leverage to higher prices — $1 increase in WTI ≈$40 MM of annual cash flow  Jackfish complex oil production up 23

28. Slide 28: Eagle Ford

    Eagle Ford  Top-tier acreage position — 66,000 net acres focused in DeWitt Co. — Q3 net production: 61 MBOED (77% liquids) MILLION  Expect ≈$350 million of free cash flow in 2016 2016e FREE CASH FLOW — Best-in-class well productivity — Low-cost asset: LOE <$5 per BOE AUSTIN CHALK Staggered Lateral

29. Slide 29: Rockies

    Rockies  Premier Powder River position Initial Powder River Focus Areas — ≈470,000 net surface acres Parkman Campbell Turner — Q3 net production: 16 MBOED (73% oil) Teapot Weston Johnson  ≈50% decline in LOE from early 2016  Drilling activity resumed in the Power River Natrona — Targeting Parkman

30. Slide 30: Barnett Shale

    Barnett Shale  Significant gas optionality Future Development — Net acres: 610,000 DENTON — Q3 net production: 166 MBOED (27% liquids) Wise Denton  Future development activity to unlock significant value — Identified 1,000 horizontal refrac locations FT. WORTH Tarrant — Improved rig economics for

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