Devon Energy Reports Fourth-Quarter and Full-Year 2012 Results

  Devon Energy Reports Fourth-Quarter and Full-Year 2012 Results

Business Wire

OKLAHOMA CITY -- February 20, 2013

Devon Energy Corporation (NYSE:DVN) today reported a net loss of $357 million
for the quarter ended December 31, 2012, or $0.89 per common share ($0.89 per
diluted share). The company’s fourth quarter financial results were impacted
by a non-cash asset impairment charge of $896 million. Excluding the asset
impairment charge and other items securities analysts typically exclude from
estimates, Devon earned $316 million or $0.78 per diluted share in the fourth
quarter of 2012.

Asset impairments also led to a loss of $206 million for the year ended
December 31, 2012, or $0.52 per common share ($0.52 per diluted share).
Excluding adjusting items, the company earned $1.3 billion or $3.26 per
diluted share in 2012.

“In spite of a challenging commodity price environment that impacted our
financial results, Devon delivered solid operating results in 2012. During the
year, we continued to make significant progress toward the conversion of our
asset portfolio to a higher oil weighting,” commented John Richels, Devon’s
president and chief executive officer. “This is evident through the strong oil
production growth we delivered during the year and the impressive growth in
oil reserves.”

Strong Oil Growth Drives Record Production

Total production of oil, natural gas, and natural gas liquids increased to 250
million oil-equivalent barrels (Boe) in 2012. This is the highest annual
production total in the company’s history from its North American property
base and represents a 10 million Boe increase compared to 2011. The increase
in 2012 production was driven almost entirely by growth in oil production.
Devon’s oil production increased 20 percent year-over-year, more than
offsetting declines in natural gas volumes due to reduced activity levels.

The company also delivered strong oil production growth in the fourth quarter
of 2012. Oil production averaged 151,000 barrels per day, a 13 percent
increase compared to the fourth quarter of 2011. The most significant growth
in oil production came from the U.S., where fourth-quarter year-over-year oil
production increased 30 percent.

Permian Basin Results Lead Fourth-Quarter Operating Highlights

  *Permian Basin oil production increased 31 percent over the fourth quarter
    of 2011. Oil accounted for 60 percent of the company’s 66,000 Boe per day
    produced in the Permian Basin during the quarter.
  *In the Bone Spring play in the Permian Basin, the company brought 10 new
    wells on production in the fourth quarter of 2012. Initial 30-day
    production from these wells averaged 790 Boe per day.
  *Also in the Permian Basin, Devon completed six wells in the
    Midland-Wolfcamp Shale during the fourth quarter. This activity was
    highlighted by the Cortes 1H well with initial 30-day production averaging
    795 Boe per day.
  *In the Mississippian Lime play in Oklahoma, the company brought seven
    wells online within its Sinopec joint venture acreage in the fourth
    quarter of 2012. Initial 30-day production from these wells averaged
    approximately 335 Boe per day, including 210 barrels of oil per day. Devon
    has a 57 percent working interest in these wells.
  *Net production from Devon’s Jackfish 1 and Jackfish 2 oil sands projects
    averaged a record 49,000 barrels of oil per day in the fourth quarter of
    2012. Compared to the fourth quarter of 2011, this represents a 15 percent
    increase in production.
  *Construction of Devon’s third Jackfish oil sands project is now
    approximately 50 percent complete, with startup expected by year-end 2014.
  *The company brought seven operated Granite Wash wells online, including
    three Hogshooter wells, in the fourth quarter of 2012. The average 30-day
    production rate from these seven wells was 1,625 Boe per day, including
    1,010 barrels of oil per day.
  *In the Cana-Woodford Shale play, Devon established production from 29
    operated wells in the fourth quarter. The average 30-day initial
    production rate was 6.5 million cubic feet of gas equivalent per day,
    including 135 barrels of oil per day and 420 barrels of natural gas
    liquids per day.
  *Fourth quarter production from the company’s Cana-Woodford Shale averaged
    326 million cubic feet of natural gas equivalent per day. Fourth-quarter
    liquids production increased 68 percent compared to the prior-year quarter
    to 18,000 barrels per day. Liquids now account for 32 percent of Devon’s
    net production from the play.
  *Net daily production in the Barnett Shale averaged 1.4 billion cubic feet
    of natural gas equivalent per day during the fourth quarter of 2012.
    Liquids production increased 3 percent year-over-year to 48,000 barrels
    per day.

Proved Oil Reserves Exhibit Robust Growth

At December 31, 2012, Devon’s estimated proved reserves totaled 3.0 billion
oil-equivalent barrels. During the year, oil reserves increased 13 percent
compared to 2011, mitigating declines in natural gas reserves.

In 2012, the company added 381 million Boe through successful drilling
(extensions, discoveries, and revisions other than price). Associated
drill-bit capital invested during the year totaled $7.5 billion. For reporting
purposes, $1.3 billion of cash proceeds received from the closing of two joint
ventures were not subtracted from the company’s 2012 drill-bit capital total.
However, these proceeds effectively reimbursed Devon for leasing and
exploration costs incurred.

“Devon’s capital program delivered excellent drill-bit results in 2012. Our
oil-focused drilling program replaced nearly 260 percent of our oil produced
during the year,” said Dave Hager, executive vice president, exploration and
production. “Even before the benefits of our joint venture agreements, these
reserve additions were added at very competitive finding costs.”

Reserve revisions related to lower prices resulted in a decrease in Devon’s
proved reserves of 171 million Boe at December 31, 2012. These price revisions
impacted only natural gas and natural gas liquids reserves. The company’s
reserve life index (proved reserves divided by annual production) remained at
approximately 12 years, and its proved developed reserves accounted for 72
percent of total proved reserves.

Oil and Gas Sales Total $7.2 Billion; Devon Adds Oil and Gas Hedges

Although total production increased, revenue from oil, natural gas, and
natural gas liquids sales declined 14 percent to $7.2 billion in 2012.
However, cash settlements related to the company’s oil and gas hedges
increased revenue by $870 million or $3.48 per Boe in 2012, partially
offsetting lower realized prices for all three products.

The strong oil price environment has provided Devon the opportunity to add oil
hedges for 2013. The company now has entered into contracts to hedge 115,000
barrels per day of oil production. Of this total, 55,000 barrels per day are
swapped at a weighted average price of $101 per barrel. The remaining 60,000
barrels per day utilize costless collars with a weighted average ceiling of
$113 per barrel and a floor of $90 per barrel.

The company also recently increased its natural gas hedging position. For the
full-year 2013, Devon now has approximately 1.3 billion cubic feet per day
protected at a weighted average floor price of $3.87. This position covers
approximately 60 percent of the company’s expected natural gas production in
2013.

Operating Costs Reflect Increased Oil Activity

In aggregate, the company’s pre-tax, cash costs totaled $14.36 per Boe in
2012, a 7 percent increase compared to 2011. Devon’s cost management efforts
and efficient operations partially offset the full impact of industry
inflation and a shift toward oil projects. In general, oil projects are more
expensive to develop and have higher operating costs than gas projects.

In the fourth quarter of 2012, expenses in most categories were generally in
line with expectations. However, general and administrative expenses of $198
million or $3.17 per Boe exceeded estimates. This was primarily due to $21
million of costs associated with the early settlement of pension obligations
during the fourth quarter.

Depreciation, depletion, and amortization expense (DD&A) increased to $11.73
per Boe in the fourth quarter. The DD&A rate was attributable to the impact of
price-related reserve revisions and an upward adjustment in future development
cost assumptions.

Joint Ventures Strengthen Balance Sheet and Liquidity

In 2012, Devon successfully entered into two exploration-based joint ventures,
delivering almost $4.0 billion in value to the company. The transactions
included $1.3 billion in cash payments along with $2.6 billion of drilling
carries that fund roughly 70 percent of the company’s capital requirements in
the joint ventures.

During the year, Devon generated cash flow from operations of $5.0 billion.
When combined with cash payments from the closing of two joint venture
agreements and other minor asset sales, Devon’s cash inflows totaled $6.5
billion in 2012.

The company exited 2012 with a very strong balance sheet. At December 31,
2012, the company’s cash and short-term investments totaled $7.0 billion, and
Devon’s net debt to adjusted capitalization was 18 percent.

Impairment Charge Methodology

On a quarterly basis, the carrying value of Devon’s oil and natural gas assets
are subject to a “ceiling test.” Under the full-cost method of accounting, the
net book value of the company’s oil and gas properties, less related deferred
income taxes, may not exceed a calculated ceiling. The ceiling is the
estimated future net cash flow from proved oil and gas properties, discounted
at 10 percent per year. Any excess is written off as a non-cash expense and
may not be reversed in future periods, even though higher oil and gas prices
may subsequently increase the ceiling. Future net cash flows are calculated
assuming continuation of prices and costs in effect at the time of the
calculation, except for changes that are fixed and determinable by existing
contracts. Trailing 12-month average prices at the end of each quarter are
used in the future net cash flow calculation. Impairment charges have no
impact on cash flow or cash balances and are not reflective of the fair value
of oil and gas assets.

Non-GAAP Reconciliations

Pursuant to regulatory disclosure requirements, Devon is required to reconcile
non-GAAP financial measures to the related GAAP information (GAAP refers to
generally accepted accounting principles). Adjusted earnings, drill-bit
capital, net debt, and adjusted capitalization are non-GAAP financial measures
referenced within this release. Reconciliations of these non-GAAP measures are
provided beginning on page 13.

Conference Call to be Webcast Today

Devon will discuss its 2012 financial and operating results in a conference
call webcast today. The webcast will begin at 10 a.m. Central Time (11 a.m.
Eastern Time) and may be accessed from Devon’s home page at
www.devonenergy.com.

This press release includes "forward-looking statements" as defined by the
Securities and Exchange Commission. Such statements are those concerning
strategic plans, expectations and objectives for future operations. All
statements, other than statements of historical facts, included in this press
release that address activities, events or developments that the company
expects, believes or anticipates will or may occur in the future are
forward-looking statements. Such statements are subject to a number of
assumptions, risks and uncertainties, many of which are beyond the control of
the company. Statements regarding future drilling and production are subject
to all of the risks and uncertainties normally incident to the exploration for
and development and production of oil and gas. These risks include, but are
not limited to, the volatility of oil, natural gas and NGL prices;
uncertainties inherent in estimating oil, natural gas and NGL reserves; the
extent to which we are successful in acquiring and discovering additional
reserves; unforeseen changes in the rate of production from our oil and gas
properties; uncertainties in future exploration and drilling results;
uncertainties inherent in estimating the cost of drilling and completing
wells; drilling risks; competition for leases, materials, people and capital;
midstream capacity constraints and potential interruptions in production; risk
related to our hedging activities; environmental risks; political or
regulatory changes; and our limited control over third parties who operate our
oil and gas properties. Investors are cautioned that any such statements are
not guarantees of future performance and that actual results or developments
may differ materially from those projected in the forward-looking statements.
The forward-looking statements in this press release are made as of the date
of this press release, even if subsequently made available by Devon on its
website or otherwise. Devon does not undertake any obligation to update the
forward-looking statements as a result of new information, future events or
otherwise.

The United States Securities and Exchange Commission permits oil and gas
companies, in their filings with the SEC, to disclose only proved, probable
and possible reserves that meet the SEC's definitions for such terms, and
price and cost sensitivities for such reserves, and prohibits disclosure of
resources that do not constitute such reserves.This release may contain
certain terms, such as resource potential andexploration target size.These
estimates are by their nature more speculative than estimates of proved,
probable and possible reserves and accordingly are subject to substantially
greater risk of being actually realized. The SEC guidelines strictly prohibit
us from including these estimates in filings with the SEC. U.S. investors are
urged to consider closely the disclosure in our Form 10-K, available from us
at Devon Energy Corporation, Attn. Investor Relations, 333 West Sheridan
Avenue, Oklahoma City, OK 73102-5015. You can also obtain this form from the
SEC by calling 1-800-SEC-0330 or from the SEC’s website at www.sec.gov.

Devon Energy Corporation is an Oklahoma City-based independent energy company
engaged in oil and gas exploration and production. Devon is a leading
U.S.-based independent oil and gas producer and is included in the S&P 500
Index. For more information about Devon, please visit our website at
www.devonenergy.com.



DEVON ENERGY CORPORATION
FINANCIAL AND OPERATIONAL INFORMATION


PRODUCTION (net of        Quarter Ended            Year Ended
royalties)
                            December 31,                December 31,
Total Period                 2012       2011          2012       2011
Production:
Natural Gas (Bcf)
   United States             186.7         191.8         751.9         739.7
   Canada                    43.3          52.5          186.1         212.8
   Total Natural Gas         230.0         244.3         938.0         952.5
Oil / Bitumen (MMBbls)
  United States             6.0           4.6           21.5          16.8
  Canada                    7.9           7.7           32.0          27.9
   Total Oil / Bitumen       13.9          12.3          53.5          44.7
Natural Gas Liquids
(MMBbls)
  United States             9.3           8.7           36.1          33.0
  Canada                    0.9           0.9           3.8           3.6
   Total Natural Gas         10.2          9.6           39.9          36.6
   Liquids
Oil Equivalent (MMBoe)
  United States             46.4          45.2          182.9         173.1
  Canada                    16.0          17.4          66.8          67.0
   Total Oil                 62.4          62.6          249.7         240.1
   Equivalent
                                                                       
                                                                       
                             Quarter Ended               Year Ended
                             December 31,                December 31,
Average Daily                2012          2011          2012          2011
Production:
Natural Gas (MMcf)
   United States             2,029.0       2,084.5       2,054.5       2,026.6
   Canada                    471.2         571.1         508.3         583.1
   Total Natural Gas         2,500.2       2,655.6       2,562.8       2,609.7
Oil / Bitumen (MBbls)
   United States             64.8          49.7          58.7          46.0
   Canada                    86.2          83.8          87.4          76.5
   Total Oil / Bitumen       151.0         133.5         146.1         122.5
Natural Gas Liquids
(MBbls)
   United States             101.4         94.5          98.6          90.4
   Canada                    9.5           9.8           10.5          9.9
   Total Natural Gas         110.9         104.3         109.1         100.3
   Liquids
Oil Equivalent (MBoe)
   United States             504.4         491.7         499.7         474.1
   Canada                    174.2         188.7         182.6         183.6
   Total Oil                 678.6         680.4         682.3         657.7
   Equivalent



DEVON ENERGY CORPORATION
FINANCIAL AND OPERATIONAL INFORMATION


BENCHMARK        Quarter Ended                   Year Ended
PRICES
(average            December 31,                       December 31,
prices)
                    2012            2011            2012         2011
Natural Gas
($/Mcf) –           $  3.41            $  3.54         $  2.79         $ 4.04
Henry Hub
Oil ($/Bbl) –
West Texas          $  88.16           $  93.96        $  94.21        $ 95.06
Intermediate
(Cushing)
                                                                       
                                                                       
REALIZED            Quarter Ended December 31, 2012
PRICES
                    Oil /              Gas             NGLs            Total
                    Bitumen
                    (Per Bbl)          (Per Mcf)       (Per Bbl)       (Per
                                                                       Boe)
United States       $  83.18           $  2.93         $  26.12        $ 27.72
Canada              $  52.31          $  3.26         $  47.64        $ 37.28
Realized
price without       $  65.56           $  2.99         $  27.96        $ 30.17
hedges
Cash                $  8.76           $  0.34         $  0.07         $ 3.24
settlements
Realized
price,
including           $  74.32          $  3.33         $  28.03        $ 33.41
cash
settlements
                                                                       
                                                                       
                    Quarter Ended December 31, 2011
                    Oil /              Gas             NGLs            Total
                    Bitumen
                    (Per Bbl)          (Per Mcf)       (Per Bbl)       (Per
                                                                       Boe)
United States       $  91.19           $  3.08         $  40.66        $ 30.10
Canada              $  71.36          $  3.45         $  56.19        $ 45.02
Realized
price without       $  78.75           $  3.16         $  42.11        $ 34.24
hedges
Cash                $  (0.28  )        $  0.63         $  0.05         $ 2.42
settlements
Realized
price,
including           $  78.47          $  3.79         $  42.16        $ 36.66
cash
settlements
                                                                       
                                                                       
                    Year Ended December 31, 2012
                    Oil /              Gas             NGLs            Total
                    Bitumen
                    (Per Bbl)          (Per Mcf)       (Per Bbl)       (Per
                                                                       Boe)
United States       $  88.68           $  2.32         $  28.49        $ 25.59
Canada              $  57.01          $  2.49         $  48.63        $ 37.01
Realized
price without       $  69.73           $  2.36         $  30.42        $ 28.65
hedges
Cash                $  4.84           $  0.65         $  0.04         $ 3.48
settlements
Realized
price,
including           $  74.57          $  3.01         $  30.46        $ 32.13
cash
settlements
                                                                       
                                                                       
                    Year Ended December 31, 2011
                    Oil /              Gas             NGLs            Total
                    Bitumen
                    (Per Bbl)          (Per Mcf)       (Per Bbl)       (Per
                                                                       Boe)
United States       $  91.19           $  3.50         $  39.47        $ 31.31
Canada              $  66.97          $  3.87         $  55.99        $ 43.23
Realized
price without       $  76.06           $  3.58         $  41.10        $ 34.64
hedges
Cash                $  (0.58  )        $  0.44         $  0.07         $ 1.63
settlements
Realized
price,
including           $  75.48          $  4.02         $  41.17        $ 36.27
cash
settlements



DEVON ENERGY CORPORATION
FINANCIAL AND OPERATIONAL INFORMATION


CONSOLIDATED
STATEMENTS OF       Quarter Ended                Year Ended
OPERATIONS
(in millions,
except per share       December 31,                    December 31,
amounts)
                      2012         2011            2012         2011
Revenues:
  Oil, gas and         $ 1,883         $ 2,144         $ 7,153         $ 8,315
  NGL sales
  Oil, gas and
  NGL                    178             (105  )         693             881
  derivatives
  Marketing and
  midstream             520           546           1,656         2,258  
  revenues
  Total revenues        2,581         2,585         9,502         11,454 
Expenses and
other, net:
  Lease
  operating              534             499             2,074           1,851
  expenses
  Marketing and
  midstream
  operating              399             412             1,246           1,716
  costs and
  expenses
  Depreciation,
  depletion and          731             626             2,811           2,248
  amortization
  General and
  administrative         198             182             692             585
  expenses
  Taxes other
  than income            108             88              414             424
  taxes
  Interest               110             82              406             352
  expense
  Restructuring          74              -               74              (2     )
  costs
  Asset                  896             -               2,024           -
  impairments
  Other, net            32            (98   )        78            (10    )
  Total expenses        3,082         1,791         9,819         7,164  
  and other, net
Earnings (loss)
from continuing
operations               (501  )         794             (317  )         4,290
before income
taxes
  Current income
  tax expense            44              158             52              (143   )
  (benefit)
  Deferred
  income tax            (188  )        115           (184  )        2,299  
  expense
  (benefit)
Earnings (loss)
from continuing          (357  )         521             (185  )         2,134
operations
Earnings (loss)
from
discontinued            -             (14   )        (21   )        2,570  
operations, net
of tax
Net earnings           $ (357  )       $ 507          $ (206  )       $ 4,704  
(loss)
                                                                       
Basic net
earnings (loss)
per share:
  Basic earnings
  (loss) from
  continuing           $ (0.89 )       $ 1.29          $ (0.47 )       $ 5.12
  operations per
  share
  Basic earnings
  (loss) from
  discontinued          -             (0.04 )        (0.05 )        6.17   
  operations per
  share
  Basic net
  earnings             $ (0.89 )       $ 1.25         $ (0.52 )       $ 11.29  
  (loss) per
  share
                                                                       
Diluted net
earnings (loss)
per share:
  Diluted
  earnings
  (loss) from          $ (0.89 )       $ 1.29          $ (0.47 )       $ 5.10
  continuing
  operations per
  share
  Diluted
  earnings
  (loss) from           -             (0.04 )        (0.05 )        6.15   
  discontinued
  operations per
  share
  Diluted net
  earnings             $ (0.89 )       $ 1.25         $ (0.52 )       $ 11.25  
  (loss) per
  share
                                                                       
Weighted average
common shares
outstanding:
  Basic                  405             404             404             417
  Diluted                405             405             404             418



DEVON ENERGY CORPORATION
FINANCIAL AND OPERATIONAL INFORMATION


CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions)      Quarter Ended                  Year Ended
                     December 31,                      December 31,
                      2012          2011             2012          2011
Cash flows from
operating
activities:
  Net earnings        $ (357   )       $ 507            $ (206   )       $ 4,704
  (loss)
  (Earnings)
  loss from
  discontinued          -                14               21               (2,570 )
  operations,
  net of tax
  Adjustments
  to reconcile
  earnings from
  continuing
  operations to
  net cash from
  operating
  activities:
  Depreciation,
  depletion and         731              626              2,811            2,248
  amortization
  Asset                 896              -                2,024            -
  impairments
  Deferred
  income tax            (188   )         115              (184   )         2,299
  expense
  (benefit)
  Unrealized
  change in
  fair value of         32               260              205              (401   )
  financial
  instruments
  Other noncash        104            56             240            241    
  charges
  Net cash from
  operating
  activities            1,218            1,578            4,911            6,521
  before
  balance sheet
  changes
  Net decrease
  (increase) in         (98    )         493              (50    )         185
  working
  capital
  Decrease
  (increase) in         (14    )         (18    )         (36    )         33
  long-term
  other assets
  Increase
  (decrease) in
  long-term            37             (34    )        105            (493   )
  other
  liabilities
  Cash from
  operating
  activities -          1,143            2,019            4,930            6,246
  continuing
  operations
  Cash from
  operating
  activities -         -              (9     )        26             (22    )
  discontinued
  operations
  Net cash from
  operating            1,143          2,010          4,956          6,224  
  activities
                                                                         
Cash flows from
investing
activities:
  Capital               (1,997 )         (2,019 )         (8,225 )         (7,534 )
  expenditures
  Proceeds from
  property and          71               116              1,468            129
  equipment
  divestitures
  Purchases of
  short-term            (1,137 )         (940   )         (4,106 )         (6,691 )
  investments
  Redemptions
  of short-term         958              668              3,266            5,333
  investments
  Other                (4     )        (6     )        14             (29    )
  Cash from
  investing
  activities -          (2,109 )         (2,181 )         (7,583 )         (8,792 )
  continuing
  operations
  Cash from
  investing
  activities -         (1     )        (16    )        57             3,146  
  discontinued
  operations
  Net cash from
  investing            (2,110 )        (2,197 )        (7,526 )        (5,646 )
  activities
                                                                         
Cash flows from
financing
activities:
  Proceeds from
  borrowings of
  long-term             (7     )         -                2,458            2,221
  debt, net of
  issuance
  costs
  Net
  short-term            361              530              (537   )         3,726
  borrowings
  (repayments)
  Debt                  -                -                -                (1,760 )
  repayments
  Credit
  facility              -                -                750              -
  borrowings
  Credit
  facility              -                -                (750   )         -
  repayments
  Proceeds from
  stock option          2                -                27               101
  exercises
  Repurchases
  of common             -                (345   )         -                (2,332 )
  stock
  Dividends
  paid on               (82    )         (69    )         (324   )         (278   )
  common stock
  Excess tax
  benefits
  related to           -              2              5              13     
  share-based
  compensation
  Net cash from
  financing            274            118            1,629          1,691  
  activities
Effect of
exchange rate          (8     )        6              23             (4     )
changes on cash
Net change in
cash and cash           (701   )         (63    )         (918   )         2,265
equivalents
                                                                         
Cash and cash
equivalents at         5,338          5,618          5,555          3,290  
beginning of
period
Cash and cash
equivalents at        $ 4,637         $ 5,555         $ 4,637         $ 5,555  
end of period



DEVON ENERGY CORPORATION
FINANCIAL AND OPERATIONAL INFORMATION


CONSOLIDATED BALANCE SHEETS
(in millions)                               December 31,    December 31,
                                             2012               2011
Current assets:
      Cash and cash equivalents                $  4,637           $  5,555
      Short-term investments                      2,343              1,503
      Accounts receivable                         1,245              1,379
      Other current assets                       746              868     
      Total current assets                       8,971            9,305   
Property and equipment, at cost:
      Oil and gas, based on full cost
      accounting:
             Subject to amortization              69,410             61,696
             Not subject to amortization         3,308            3,982   
             Total oil and gas                    72,718             65,678
      Other                                      5,630            5,098   
Total property and equipment, at cost             78,348             70,776
Less accumulated depreciation, depletion         (51,032 )         (46,002 )
and amortization
             Property and equipment, net         27,316           24,774  
Goodwill                                          6,079              6,013
Other long-term assets                           960              1,025   
Total assets                                   $  43,326         $  41,117  
                                                                  
Current liabilities:
      Accounts payable                         $  1,451           $  1,471
      Revenues and royalties payable              750                678
      Short-term debt                             3,189              3,811
      Other current liabilities                  613              778     
      Total current liabilities                  6,003            6,738   
Long-term debt                                    8,455              5,969
Asset retirement obligations                      1,996              1,496
Other long-term liabilities                       901                721
Deferred income taxes                             4,693              4,763
Stockholders' equity:
      Common stock                                41                 40
      Additional paid-in capital                  3,688              3,507
      Retained earnings                           15,778             16,308
      Accumulated other comprehensive            1,771            1,575   
      earnings
Total stockholders' equity                       21,278           21,430  
Total liabilities and stockholders'            $  43,326         $  41,117  
equity
Common shares outstanding                         406                404



DEVON ENERGY CORPORATION
FINANCIAL AND OPERATIONAL INFORMATION


RESERVES RECONCILIATION
                     Total
                         Oil /        Gas         NGLs        Total
                         Bitumen
                         (MMBbls)        (Bcf)          (MMBbls)       (MMBoe)
As of December 31,                                                  
2011:
     Proved              309             8,908          428            2,223
     developed
     Proved              396            1,578         124           782   
     undeveloped
Total Proved             705            10,486        552           3,005 
Revisions due to         8               (930   )       (24   )        (171  )
prices
Revisions other          (1     )        (320   )       (13   )        (68   )
than price
Extensions and           139             1,158          116            449
discoveries
Purchase of              -               2              -              -
reserves
Production               (53    )        (938   )       (40   )        (250  )
Sale of reserves         -               (12    )       -              (2    )
As of December 31,                                                  
2012:
     Proved              327             8,070          451            2,123
     developed
     Proved              471            1,376         140           840   
     undeveloped
Total Proved             798            9,446         591           2,963 
                                                                       
                         United States
                         Oil /           Gas            NGLs           Total
                         Bitumen
                         (MMBbls)        (Bcf)          (MMBbls)       (MMBoe)
As of December 31,                                                  
2011:
     Proved              146             7,957          402            1,875
     developed
     Proved              22             1,550         123           403   
     undeveloped
Total Proved             168            9,507         525           2,278 
Revisions due to         (1     )        (831   )       (19   )        (159  )
prices
Revisions other          (6     )        (287   )       (13   )        (67   )
than price
Extensions and           65              1,124          114            367
discoveries
Purchase of              -               2              -              -
reserves
Production               (21    )        (752   )       (36   )        (183  )
Sale of reserves         -               (1     )       -              -
As of December 31,                                                  
2012:
     Proved              166             7,391          431            1,829
     developed
     Proved              39             1,371         140           407   
     undeveloped
Total Proved             205            8,762         571           2,236 
                                                                       
                         Canada
                         Oil /           Gas            NGLs           Total
                         Bitumen
                         (MMBbls)        (Bcf)          (MMBbls)       (MMBoe)
As of December 31,                                                  
2011:
     Proved              163             951            26             348
     developed
     Proved              374            28            1             379   
     undeveloped
Total Proved             537            979           27            727   
Revisions due to         9               (99    )       (5    )        (12   )
prices
Revisions other          5               (33    )       -              (1    )
than price
Extensions and           74              34             2              82
discoveries
Production               (32    )        (186   )       (4    )        (67   )
Sale of reserves         -               (11    )       -              (2    )
As of December 31,                                                  
2012:
     Proved              161             679            20             294
     developed
     Proved              432            5             -             433   
     undeveloped
Total Proved             593            684           20            727   



DEVON ENERGY CORPORATION
FINANCIAL AND OPERATIONAL INFORMATION


COSTS INCURRED
(in millions)                  Total
                                 Year Ended December 31,
                                  2012         2011
Property acquisition costs:
     Proved properties            $  73           $ 48
     Unproved properties             1,178          939
Exploration costs                    655            538
Development costs                   6,099         5,418
Costs Incurred                    $  8,005        $ 6,943
                                                  
                                  United States
                                  Year Ended December 31,
                                  2012            2011
Property acquisition costs:
     Proved properties            $  2            $ 34
     Unproved properties             1,135          851
Exploration costs                    351            272
Development costs                   4,408         4,130
Costs Incurred                    $  5,896        $ 5,287
                                                  
                                  Canada
                                  Year Ended December 31,
                                  2012            2011
Property acquisition costs:
     Proved properties            $  71           $ 14
     Unproved properties             43             88
Exploration costs                    304            266
Development costs                   1,691         1,288
Costs Incurred                    $  2,109        $ 1,656


COMPANY OPERATED RIGS
                                           As of December 31,
                                               2012       2011
Number of Company Operated Rigs Running:
               United States                   74            53
               Canada                          8             7
               Total                           82            60



DEVON ENERGY CORPORATION
FINANCIAL AND OPERATIONAL INFORMATION


KEY OPERATING STATISTICS BY REGION
                                Quarter Ended December 31, 2012
                                    Avg.           Operated     Gross
                                    Production        Rigs at         Wells
                                    (MBOED)           December        Drilled
                                                      31, 2012
Barnett Shale                       227.4             10              73
Canadian Oilsands - Jackfish        48.9              -               -
/ Pike
Cana-Woodford Shale                 54.3              11              44
Granite Wash                        18.8              4               8
Gulf Coast / East Texas             57.3              4               21
Lloydminster                        33.6              -               69
Mississippian                       1.8               14              29
Permian Basin                       66.3              26              65
Rocky Mountains                     56.2              5               11
Other                               114.0             8               35
          Total                     678.6             82              355



CAPITAL EXPENDITURES
(in millions)                      Quarter Ended December 31, 2012
                                     United States    Canada    Total
  Exploration                         $    246            71           $ 317
  Development                             994            543           1,537
  Exploration and development         $    1,240          614          $ 1,854
  capital
  Capitalized G&A                                                        77
  Capitalized interest                                                   10
  Midstream capital                                                      166
  Other capital                                                         84
Total Continuing Operations                                            $ 2,191
  Discontinued operations                                               -
Total Operations                                                       $ 2,191
                                                                       
                                                                       
CAPITAL EXPENDITURES
(in millions)                         Year Ended December 31, 2012
                                      United States       Canada       Total
  Exploration                         $    1,463          292          $ 1,755
  Development                             4,009          1,431         5,440
  Exploration and development         $    5,472          1,723        $ 7,195
  capital
  Capitalized G&A                                                        359
  Capitalized interest                                                   36
  Midstream capital                                                      530
  Other capital                                                         354
Total Continuing Operations                                            $ 8,474
  Discontinued operations                                               13
Total Operations                                                       $ 8,487
                                                                         
                                                                         

                           DEVON ENERGY CORPORATION
                    FINANCIAL AND OPERATIONAL INFORMATION

NON-GAAP FINANCIAL MEASURES

The United States Securities and Exchange Commission has adopted disclosure
requirements for public companies such as Devon concerning Non-GAAP financial
measures. (GAAP refers to generally accepted accounting principles). The
company must reconcile the Non-GAAP financial measure to related GAAP
information. Devon's reported net earnings include items of income and expense
that are typically excluded by securities analysts in their published
estimates of the company's financial results. The following tables summarize
the effects of these items on fourth-quarter and full-year 2012 earnings.


RECONCILIATION TO GAAP INFORMATION
(in millions)                                               
                                              Quarter Ended December 31, 2012
                                               Before-Tax           After-Tax
Net earnings (GAAP)                                                 $  (357  )
  Asset impairments                            896                     589
  Restructuring costs                          74                      49
  Income tax accrual adjustments               -                       17
  Oil, gas and NGL derivatives                 24                      13
  Interest rate and other financial            10                     5     
  instruments
Adjusted earnings (Non-GAAP)                                        $  316   
Diluted share count                                                    405
Adjusted diluted earnings per share                                 $  0.78  
(Non-GAAP)
                                                                    
                                                                     
                                               Year Ended December 31, 2012
                                               Before-Tax           After-Tax
Net earnings (GAAP)                                                 $  (185  )
  Asset impairments                            2,024                   1,308
  Restructuring costs                          74                      49
  Income tax accrual adjustments               -                       17
  Oil, gas and NGL derivatives                 177                     112
  Interest rate and other financial            32                     21    
  instruments
Adjusted earnings (Non-GAAP)                                        $  1,322 
Diluted share count                                                    404
Adjusted diluted earnings per share                                 $  3.26  
(Non-GAAP)
                                                                             
                                                                             

                           DEVON ENERGY CORPORATION
                    FINANCIAL AND OPERATIONAL INFORMATION

NON-GAAP FINANCIAL MEASURES

Devon believes that using net debt for the calculation of “net debt to
adjusted capitalization” provides a better measure than using debt. Devon
defines net debt as debt less cash, cash equivalents and short-term
investments. Devon believes that netting these sources of cash against debt
provides a clearer picture of the future demands on cash to repay debt.


RECONCILIATION TO GAAP INFORMATION
(in millions)                                      
                                          December 31,
                                           2012           2011
Total debt (GAAP)                          $ 11,644       $ 9,780
Adjustments:
  Cash and short-term investments           6,980         7,058
  Net debt (Non-GAAP)                      $ 4,664        $ 2,722
                                                          
Total debt                                 $ 11,644       $ 9,780
Stockholders' equity                        21,278        21,430
  Total capitalization (GAAP)              $ 32,922       $ 31,210
                                                          
Net debt                                   $ 4,664        $ 2,722
Stockholders' equity                        21,278        21,430
  Adjusted capitalization (Non-GAAP)       $ 25,942       $ 24,152
                                                            
                                                            

                           DEVON ENERGY CORPORATION
                    FINANCIAL AND OPERATIONAL INFORMATION

NON-GAAP FINANCIAL MEASURES

Drill-bit capital is defined as costs incurred less asset retirement costs and
proved acquisition costs. Drill-bit capital is a Non-GAAP measure. Devon
believes drill-bit capital is relevant because it provides additional insight
into costs associated with current year exploration and development
activities. Certain securities analysts also use this methodology to measure
Devon’s performance. It should be noted that the actual costs of reserves
added through Devon’s drilling program will differ, sometimes significantly,
from the direct comparison of capital spent and reserves added in any given
period due to the timing of capital expenditures and reserve bookings.


RECONCILIATION TO GAAP INFORMATION
(in millions)                               
                                    Total
                                     Year Ended December 31,
                                     2012          2011
Costs Incurred (GAAP)                $ 8,005       $ 6,943 
Less:
  Asset retirement costs               415           (4    )
  Proved acquisition costs            73           48    
  Drill-bit capital (Non-GAAP)       $ 7,517       $ 6,899 
                                                   
                                     United States
                                     Year Ended December 31,
                                     2012          2011
Costs Incurred (GAAP)                $ 5,896       $ 5,287 
Less:
  Asset retirement costs               146           (6    )
  Proved acquisition costs            2            34    
  Drill-bit capital (Non-GAAP)       $ 5,748       $ 5,259 
                                                   
                                     Canada
                                     Year Ended December 31,
                                     2012          2011
Costs Incurred (GAAP)                $ 2,109       $ 1,656 
Less:
  Asset retirement costs               269           2
  Proved acquisition costs            71           14    
  Drill-bit capital (Non-GAAP)       $ 1,769       $ 1,640 

Contact:

Devon Energy Corporation
Investor Contacts
Scott Coody, 405-552-4735
or
Shea Snyder, 405-552-4782
or
Media Contact
Chip Minty, 405-228-8647