Devon Energy Corp., Oklahoma City, has reduced its planned capital spending by $100 million for the second consecutive quarter, with executives joining several of their peers in saying that their teams are working ever more efficiently.
Devon’s assets in the Delaware, Rockies, Eagle Ford and Anadarko basins required $932 million in capital during second-quarter 2025, which was 7% less than president and chief executive Clay Gaspar and his team had planned for. Over the past 2 years, executives pointed out, Devon’s average drilling cost in the Delaware has fallen 12% and its average completion spending is down 15%.
“We are optimizing well performance, reducing cycle times, and streamlining field operations all while delivering production performance,” Gaspar said on an Aug. 6 conference call. “These are sustainable, structural gains.”
For the year, Devon’s leaders now expect the company’s capital spending to be between $3.6 billion and $3.8 billion. When they first laid out their 2025 plans last November, the midpoint of their range was $4.1 billion.
The capex reduction—which is of the same magnitude as recent moves by both Diamondback Energy Corp. and Expand Energy Corp.—comes after a second quarter in which Devon averaged 387,000 b/d of oil production and 841,000 boe/d of total production while averaging 21 rigs and six completion crews. The oil output was up 15% from last year’s spring quarter and oil-equivalent production was up 19% thanks in part to sizable natural gas and natural gas liquids increases from the company’s Permian operations.
Looking ahead to upcoming quarters, Gaspar told analysts that a production level around 385,000 b/d is “the right oil rate for us” and that spending will focus more on maintaining that rate than on growth.
“What we’re trying to do is make sure that we balance […] moderating […] activity so we’re not running away on production,” he said. “We’re being very thoughtful about trying to be ratable and smooth.”
In the 3 months that ended June 30, Devon rang up net income of $917 million on total revenues of nearly $4.3 billion. In the same period of last year, those numbers were $509 million and more than $4.4 billion, respectively, which included a $254 million asset impairment loss. This year’s quarter also benefited from a $307 million gain on the sale of the Matterhorn Pipeline.
Devon’s average price for its oil in the second quarter was $63.95, down from more than $71 in the first quarter and nearly $81 in Q2 2024. Its realized natural gas prices, however, popped to $3.44/Mcf from $1.89 a year earlier.
Shares of Devon (Ticker: DVN) were up about 1% to $32.65 after its leaders reported results. Over the past 6 months, they are down slightly, trimming the company’s market capitalization to about $21 billion.
About the Author
Geert De Lombaerde
Senior Editor
A native of Belgium, Geert De Lombaerde has more than two decades of business journalism experience and writes about markets and economic trends for Endeavor Business Media publications Healthcare Innovation, IndustryWeek, FleetOwner, Oil & Gas Journal and T&D World. With a degree in journalism from the University of Missouri, he began his reporting career at the Business Courier in Cincinnati and later was managing editor and editor of the Nashville Business Journal. Most recently, he oversaw the online and print products of the Nashville Post and reported primarily on Middle Tennessee’s finance sector as well as many of its publicly traded companies.