Devon Energy (DVN) 8-K Devon Energy Reports First-Quarter 2016 Results

EXHIBIT 99.1

	Devon Energy Corporation
	333 West Sheridan Avenue
	Oklahoma City, OK 73102-5015

NEWS RELEASE

Devon Energy Reports First-Quarter 2016 Results

OKLAHOMA CITY – May 3, 2016– Devon Energy Corp. (NYSE: DVN) today reported operational and financial results for the first quarter of 2016 and provided guidance for the second quarter and full-year 2016.

Highlights

• Exceeded midpoint expectations for all production products

• Raised full-year production guidance by 3 percent

• Reduced LOE costs by 21 percent year over year

• Lowered 2016 operating cost outlook by $50 million

• Improved balance sheet strength with liquidity increasing to $4.6 billion

“In spite of the challenging industry conditions, Devon achieved another high-quality operating performance in the first quarter as we continued to take the appropriate steps to deliver significant cost reductions and accelerate efficiency gains across our portfolio,” said Dave Hager, president and CEO. “These successful efforts resulted in production exceeding the midpoint of guidance for all products and operating costs declining by more than 20 percent year over year. Additionally, G&A costs savings remain on track to reduce overhead by up to $500 million on an annual basis.”

“Looking ahead, our top priority is to maintain a strong balance sheet,” said Hager. “We are balancing capital requirements with cash flow and enhancing our financial strength by utilizing asset sale proceeds to reduce debt. This disciplined financial strategy positions us to take advantage of our world-class resource plays when prices incentivize higher activity levels.”

Raising 2016 Production Guidance

Devon’s reported oil production averaged 285,000 barrels per day in the first quarter of 2016. Of this amount, 255,000 barrels per day were from the Company’s core assets, where investment will be focused going forward. Oil production from these assets increased 10 percent year over year, exceeding the midpoint of guidance by 5,000 barrels per day.

Overall, net production from Devon’s core assets averaged 581,000 oil-equivalent barrels (Boe) per day during the first quarter, surpassing the midpoint of guidance by 6,000 Boe per day. With the strong growth in higher-margin production, oil is now the largest component of Devon’s product mix at 44 percent of total production.

Given the strong year-to-date production performance, Devon has raised the midpoint of its 2016 guidance by 15,000 Boe per day, or 3 percent. This incremental production is expected to be delivered without additional capital spending.

Strong Operating Costs Performance in Q1; Additional Savings Expected

The Company has several cost-reduction initiatives underway that positively impacted first-quarter results. The most significant operating cost savings came from lease operating expenses (LOE), which is Devon’s largest field-level cost. LOE declined 21 percent compared to the first quarter of 2015 to $7.13 per Boe, and LOE was $6 million below the bottom-end of guidance. The decrease in LOE was primarily driven by improved power and water-handling infrastructure, declining labor expense and lower supply chain costs.

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With these outstanding results in the first quarter and additional cost savings expected throughout 2016, the Company is lowering its full-year LOE outlook by $50 million to a range of $1.75 billion to $1.85 billion. Due to these additional savings, the Company expects field-level costs, which include both LOE and production taxes, to decline by up to $400 million for the full-year 2016.

G&A Cost Savings Initiatives Ahead of Schedule

Devon also realized significant general and administrative (G&A) cost savings in the first quarter. G&A expenses totaled $194 million, a 23 percent improvement compared to the first quarter of 2015. This decrease was driven by lower employee-related costs.

In the first quarter of 2016, the Company reduced its employee count by approximately 20 percent, bringing the total workforce reduction to more than 25 percent over the past 12 months. This reorganization effort resulted in $234 million of non-recurring charges, with minimal cash payments occurring in the first quarter. Overall, approximately 75 percent of the reorganization charges will result in cash payments, with the vast majority in subsequent quarters.

As a result of the G&A cost-reduction initiatives, overhead costs are projected to decline to approximately $160 million in the second quarter, and the Company is on track to reduce G&A costs by up to $500 million on an annual basis.

Disciplined Capital Program Yields Strong Results

Devon’s accrued E&P capital spending, which accounts for activity that was incurred during the reporting period, amounted to $363 million in the first quarter. This strong cost performance was 9 percent below the Company’s guidance midpoint.

The $363 million of accrued upstream capital activity in the first quarter compares to $749 million reported on Devon’s consolidated statement of cash flows. The difference primarily relates to EnLink capital incurred and the timing of payables from higher activity levels in late 2015.

First-Quarter 2016 Operations Report

For additional details on Devon’s E&P operations, please refer to the Company’s first-quarter 2016 operations report atwww.devonenergy.com. Highlights from the report include:

• STACK delivering top-tier results

• Leonard Shale potential expands in the Delaware Basin

• Eagle Ford generating substantial free cash flow

• Powder River Basin delivers best-in-class well results

• Jackfish 2 exceeds nameplate capacity

EnLink Midstream Delivers Steady Cash Flow

Devon’s midstream business generated $202 million of operating profit in the first quarter, driven entirely by Devon’s strategic investment in EnLink Midstream. The Company has a 64 percent ownership in the general partner (ENLC) and a 25 percent interest in the limited partnership (ENLK). In aggregate, Devon’s ownership in EnLink is valued at approximately $3 billion and is expected to generate cash distributions of $270 million in 2016.

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Balance Sheet and Liquidity Bolstered

Devon exited the first quarter with $4.6 billion of liquidity, consisting of $1.6 billion of cash on hand and $3.0 billion of capacity on its senior credit facility. Liquidity was bolstered during the first quarter by a secondary stock offering.

Devon exited the quarter with net debt, excluding non-recourse EnLink obligations, totaling $7.7 billion. The Company has managed its debt-maturity schedule to provide maximum flexibility with near-term liquidity and has no significant debt maturities until December 2018. The weighted-average cost of Devon’s outstanding debt is only 5 percent.

Asset Divestiture Programs Advance

To further enhance its financial strength, the Company is targeting total divestiture proceeds of $2 billion to $3 billion. In April, Devon took an important step toward that divestiture goal by announcing the sale of its non-core Mississippian assets in northern Oklahoma for $200 million, which is expected to close in the second quarter.

The divestiture process for the Company’s remaining non-core assets is ongoing. Devon is marketing its 50 percent interest in the Access Pipeline in Canada and anticipates an announcement in the first half of 2016. Efforts to monetize remaining non-core upstream assets in the U.S. are also progressing. Data rooms have been open since early March and bids are expected by the end of the second quarter.

Core Earnings Results and Non-GAAP Reconciliations

Adjusting for items that securities analysts typically exclude from their published estimates, Devon had a core loss of $249 million, or $0.53 per share in the first quarter of 2016. On a reported basis, Devon had a net loss of $3.1 billion for the first-quarter 2016.

For the quarter ended the Company had $149 million in net cash from operating activities. This included a positive working capital adjustment of $224 million and negative adjustments of $167 million and $130 million for restructuring and foreign exchange derivative settlements, respectively. These items are typically excluded from analyst estimates of cash flow from operations.

Pursuant to regulatory disclosure requirements, Devon is required to reconcile non-GAAP (generally accepted accounting principles) financial measures to the related GAAP information. Core earnings and net debt are non-GAAP financial measures referenced within this release. Reconciliations of these non-GAAP measures are provided later in this release.

Conference Call Webcast and Supplemental Earnings Materials

Please note that as soon as practicable today, Devon will post an operations report to its website atwww.devonenergy.com. The Company’s first-quarter conference call will be held at 10 a.m. Central (11 a.m. Eastern) on Wednesday, May 4, 2016, and will serve primarily as a forum for analyst and investor questions and answers.

Forward-Looking Statements

This press release includes “forward-looking statements” as defined by the Securities and Exchange Commission (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,” “could,” “forecasts,” “projections,” “estimates,” “plans,” “expectations,” “targets,” “opportunities,” “potential,” “anticipates,” “outlook” and other similar terminology. 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 our business and operations 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, gas and NGL prices, including the currently depressed commodity price environment; uncertainties inherent in estimating oil, gas and NGL reserves; the extent to which we are successful in acquiring and discovering additional reserves; the uncertainties, costs

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and risks involved in exploration and development activities; risks related to our hedging activities; counterparty credit risks; regulatory restrictions, compliance costs and other risks relating to governmental regulation, including with respect to environmental matters; risks relating to our indebtedness; our ability to successfully complete mergers, acquisitions and divestitures; the extent to which insurance covers any losses we may experience; our limited control over third parties who operate our oil and gas properties; midstream capacity constraints and potential interruptions in production; competition for leases, materials, people and capital; cyberattacks targeting our systems and infrastructure; and any of the other risks and uncertainties identified in our Form 10-K and our other filings with the SEC. 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 SEC 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 and exploration 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. Investors are urged to consider closely the disclosure in our Form 10-K, available atwww.devonenergy.com. You can also obtain this form from the SEC by calling 1-800-SEC-0330 or from the SEC’s website atwww.sec.gov.

About Devon Energy

Devon Energy is a leading independent energy company engaged in finding and producing oil and natural gas. Based in Oklahoma City and included in the S&P 500, Devon operates in several of the most prolific oil and natural gas plays in the U.S. and Canada with an emphasis on a balanced portfolio. The Company is the second-largest oil producer among North American onshore independents. For more information, please visitwww.devonenergy.com.

Investor Contacts

Howard Thill, 405-552-3693

Scott Coody, 405-552-4735

Chris Carr, 405-228-2496

Media Contact

John Porretto, 405-228-7506

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DEVON ENERGY CORPORATION

FINANCIAL AND OPERATIONAL INFORMATION

PRODUCTION NET OF ROYALTIES

	Quarter Ended
	March 31,
	2016		2015
Oil and bitumen (MBbls/d)
U. S. - Core		129		127
Heavy Oil		126		104
Core assets		255		231
Other		30		41
Total		285		272
Natural gas liquids (MBbls/d)
U. S. - Core		108		105
Other		29		34
Total		137		139
Gas (MMcf/d)
U. S. - Core		1,295		1,304
Heavy Oil		15		28
Core assets		1,310		1,332
Other		271		313
Total		1,581		1,645
Oil equivalent (MBoe/d)
U. S. - Core		452		449
Heavy Oil		129		109
Core assets		581		558
Other		104		127
Total		685		685

KEY OPERATING STATISTICS BY REGION

	Quarter Ended March 31, 2016
	Avg. Production (MBoe/d)		Gross Wells Drilled		Rigs at March 31, 2016 (including partner rigs)
STACK		91		17		4
Delaware Basin		63		21		—
Eagle Ford		107		24		2
Rockies		23		8		—
Heavy Oil		129		9		—
Barnett Shale		168		—		—
Core assets		581		79		6

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DEVON ENERGY CORPORATION

FINANCIAL AND OPERATIONAL INFORMATION

PRODUCTION TREND

	2015								2016
	Quarter 1		Quarter 2		Quarter 3		Quarter 4		Quarter 1
Oil and bitumen (MBbls/d)
STACK		6		6		6		7		14
Delaware Basin		33		41		41		42		38
Eagle Ford		75		67		62		60		59
Rockies		12		16		16		16		17
Heavy Oil		104		98		121		121		126
Barnett Shale		1		1		1		1		1
Core assets		231		229		247		247		255
Other		41		41		35		31		30
Total		272		270		282		278		285
Natural gas liquids (MBbls/d)
STACK		22		16		22		23		29
Delaware Basin		8		10		8		11		12
Eagle Ford		23		24		26		27		24
Rockies		1		1		2		1		1
Barnett Shale		51		49		44		46		42
Core assets		105		100		102		108		108
Other		34		34		32		31		29
Total		139		134		134		139		137
Gas (MMcf/d)
STACK		230		221		216		235		286
Delaware Basin		66		75		70		82		84
Eagle Ford		143		146		154		151		144
Rockies		38		41		41		38		32
Heavy Oil		28		20		16		24		15
Barnett Shale		827		805		788		768		749
Core assets		1,332		1,308		1,285		1,298		1,310
Other		313		319		301		285		271
Total		1,645		1,627		1,586		1,583		1,581
Oil equivalent (MBoe/d)
STACK		65		59		64		70		91
Delaware Basin		52		64		61		66		63
Eagle Ford		122		114		113		111		107
Rockies		19		24		25		23		23
Heavy Oil		109		101		124		126		129
Barnett Shale		191		185		176		175		168
Core assets		558		547		563		571		581
Other		127		127		117		110		104
Total		685		674		680		681		685

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DEVON ENERGY CORPORATION

FINANCIAL AND OPERATIONAL INFORMATION

BENCHMARK PRICES

(average prices)

	Quarter 1
	2016		2015
Oil ($/Bbl) - West Texas Intermediate (Cushing)	$	33.66	$	48.87
Natural Gas ($/Mcf) - Henry Hub	$	2.09	$	2.99

REALIZED PRICES

	Quarter Ended March 31, 2016
	Oil /Bitumen (Per Bbl)		NGL (Per Bbl)		Gas (Per Mcf)		Total (Per Boe)
United States	$	28.74	$	6.84	$	1.53	$	14.22
Canada(1)	$	9.18	$	N/M	$	N/M	$	8.95
Realized price without hedges	$	20.06	$	6.84	$	1.53	$	13.23
Cash settlements	$	—	$	—	$	0.13	$	0.30
Realized price, including cash settlements	$	20.06	$	6.84	$	1.66	$	13.53
	Quarter Ended March 31, 2015
	Oil /Bitumen (Per Bbl)		NGL (Per Bbl)		Gas (Per Mcf)		Total (Per Boe)
United States	$	42.80	$	9.40	$	2.45	$	21.66
Canada(1)	$	22.87	$	N/M	$	N/M	$	22.16
Realized price without hedges	$	35.17	$	9.40	$	2.45	$	21.74
Cash settlements	$	21.12	$	—	$	0.51	$	9.62
Realized price, including cash settlements	$	56.29	$	9.40	$	2.96	$	31.36

(1) The reported Canadian gas volumes include volumes that are produced from certain of our leases and then transported to our Jackfish operations where the gas is used as fuel. However, the revenues and expenses related to this consumed gas are eliminated in our consolidated financials.

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DEVON ENERGY CORPORATION

FINANCIAL AND OPERATIONAL INFORMATION

CONSOLIDATED STATEMENTS OF EARNINGS

(in millions, except per share amounts)	Quarter Ended
	March 31,
	2016			2015
Oil, gas and NGL sales	$	825		$	1,339
Oil, gas and NGL derivatives		33			294
Marketing and midstream revenues		1,268			1,632
Total operating revenues		2,126			3,265
Lease operating expenses		444			553
Marketing and midstream operating expenses		1,066			1,439
General and administrative expenses		194			251
Production and property taxes		78			108
Depreciation, depletion and amortization		542			930
Asset impairments		3,035			5,460
Restructuring and transaction costs		247			—
Other operating items		20			19
Total operating expenses		5,626			8,760
Operating loss		(3,500	)		(5,495	)
Net financing costs		164			117
Other nonoperating items		21			12
Loss before income taxes		(3,685	)		(5,624	)
Income tax benefit		(217	)		(2,035	)
Net loss		(3,468	)		(3,589	)
Net earnings (loss) attributable to noncontrolling interests		(412	)		10
Net loss attributable to Devon	$	(3,056	)	$	(3,599	)
Net loss per share attributable to Devon:
Basic	$	(6.44	)	$	(8.88	)
Diluted	$	(6.44	)	$	(8.88	)
Weighted average common shares outstanding:
Basic		479			410
Diluted		479			410

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DEVON ENERGY CORPORATION

FINANCIAL AND OPERATIONAL INFORMATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)	Quarter
	Ended March 31,
	2016			2015
Cash flows from operating activities:
Net loss	$	(3,468	)	$	(3,589	)
Adjustments to reconcile net loss to net cash from operating activities:
Depreciation, depletion and amortization		542			930
Asset impairments		3,035			5,460
Deferred income tax benefit		(207	)		(2,047	)
Derivatives and other financial instruments		194			(430	)
Cash settlements on derivatives and financial instruments		(104	)		719
Other noncash charges		(67	)		225
Net change in working capital		198			215
Change in long-term other assets		53			141
Change in long-term other liabilities		(27	)		24
Net cash from operating activities		149			1,648
Cash flows from investing activities:
Capital expenditures		(749	)		(1,717	)
Acquisitions of property, equipment and businesses		(1,627	)		(404	)
Divestitures of property and equipment		18			2
Other		(1	)		3
Net cash from investing activities		(2,359	)		(2,116	)
Cash flows from financing activities:
Borrowings of long-term debt, net of issuance costs		396			957
Repayments of long-term debt		(259	)		(487	)
Net short-term debt borrowings (repayments)		(626	)		15
Issuance of common stock		1,469			—
Sale of subsidiary units		—			569
Issuance of subsidiary units		727			2
Dividends paid on common stock		(125	)		(99	)
Distributions to noncontrolling interests		(73	)		(53	)
Other		—			(12	)
Net cash from financing activities		1,509			892
Effect of exchange rate changes on cash		26			(46	)
Net change in cash and cash equivalents		(675	)		378
Cash and cash equivalents at beginning of period		2,310			1,480
Cash and cash equivalents at end of period	$	1,635		$	1,858

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DEVON ENERGY CORPORATION

FINANCIAL AND OPERATIONAL INFORMATION

CONSOLIDATED BALANCE SHEETS

(in millions)
	March 31,			December 31,
	2016			2015
Current assets:
Cash and cash equivalents	$	1,635		$	2,310
Accounts receivable		1,023			1,105
Derivatives, at fair value		54			43
Income taxes receivable		24			147
Other current assets		214			416
Total current assets		2,950			4,021
Property and equipment, at cost:
Oil and gas, based on full cost accounting:
Subject to amortization		79,907			78,190
Not subject to amortization		3,901			2,584
Total oil and gas		83,808			80,774
Midstream and other		10,979			10,380
Total property and equipment, at cost		94,787			91,154
Less accumulated depreciation, depletion and amortization		(75,523	)		(72,086	)
Property and equipment, net		19,264			19,068
Goodwill		4,159			5,032
Other long-term assets		2,264			1,330
Total assets	$	28,637		$	29,451
Current liabilities:
Accounts payable	$	640		$	906
Revenues and royalties payable		705			763
Short-term debt		350			976
Other current liabilities		905			650
Total current liabilities		2,600			3,295
Long-term debt		12,195			12,056
Asset retirement obligations		1,491			1,370
Other long-term liabilities		1,112			853
Deferred income taxes		731			888
Stockholders’ equity:
Common stock		52			42
Additional paid-in capital		7,501			4,996
Retained earnings (accumulated deficit)		(1,400	)		1,781
Accumulated other comprehensive earnings		257			230
Total stockholders’ equity attributable to Devon		6,410			7,049
Noncontrolling interests		4,098			3,940
Total stockholders’ equity		10,508			10,989	��
Total liabilities and stockholders’ equity	$	28,637		$	29,451
Common shares outstanding		524			418

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DEVON ENERGY CORPORATION

FINANCIAL AND OPERATIONAL INFORMATION

CONSOLIDATING STATEMENTS OF OPERATIONS

(in millions)
	Quarter Ended March 31, 2016
	Devon U.S. & Canada			EnLink			Eliminations			Total
Oil, gas and NGL sales	$	825		$	—		$	—		$	825
Oil, gas and NGL derivatives		33			—			—			33
Marketing and midstream revenues		561			890			(183	)		1,268
Total operating revenues		1,419			890			(183	)		2,126
Lease operating expenses		444			—			—			444
Marketing and midstream operating expenses		576			673			(183	)		1,066
General and administrative expenses		164			30			—			194
Production and property taxes		67			11			—			78
Depreciation, depletion and amortization		420			122			—			542
Asset impairments		2,162			873			—			3,035
Restructuring and transaction costs		242			5			—			247
Other operating items		19			1			—			20
Total operating expenses		4,094			1,715			(183	)		5,626
Operating loss		(2,675	)		(825	)		—			(3,500	)
Net financing costs		120			44			—			164
Other nonoperating items		19			2			—			21
Loss before income taxes		(2,814	)		(871	)		—			(3,685	)
Income tax benefit		(213	)		(4	)		—			(217	)
Net loss		(2,601	)		(867	)		—			(3,468	)
Net loss attributable to noncontrolling interests		—			(412	)		—			(412	)
Net loss attributable to Devon	$	(2,601	)	$	(455	)	$	—		$	(3,056	)

OTHER KEY STATISTICS

(in millions)	Quarter Ended March 31, 2016
	Devon U.S. & Canada			EnLink			Eliminations		Total
Cash flow statement related items:
Operating cash flow	$	(45	)	$	194		$	—	$	149
Capital expenditures	$	(614	)	$	(135	)	$	—	$	(749	)
Acquisitions of property, equipment and businesses	$	(830	)	$	(797	)	$	—	$	(1,627	)
EnLink distributions received (paid)	$	66		$	(139	)	$	—	$	(73	)
Issuance of subsidiary units	$	—		$	727		$	—	$	727
Balance sheet statement items:
Net debt(1)	$	7,712		$	3,198		$	—	$	10,910

(1) Net debt is a non-GAAP measure. For a reconciliation of the comparable GAAP measure, see “Non-GAAP Financial Measures” later in this release.

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DEVON ENERGY CORPORATION

FINANCIAL AND OPERATIONAL INFORMATION

CAPITAL EXPENDITURES

(in millions)
	Quarter Ended March 31, 2016
Exploration and development capital	$	363
Capitalized G&A		73
Capitalized interest		14
Acquisitions		1,518
Midstream		2
Corporate and other		4
Devon capital expenditures(1)	$	1,974

(1) Excludes $545 million attributable to EnLink.

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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.

CORE EARNINGS

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. Accordingly, the Company also uses the measures of core earnings and core earnings per diluted share. Devon believes these non-GAAP measures facilitate comparisons of its performance to earnings estimates published by securities analysts. Devon also believes these non-GAAP measures can facilitate comparisons of its performance between periods and to the performance of its peers. The following table summarizes the effects of these items on first-quarter 2016 earnings.

(in millions, except per share amounts)	Quarter Ended March 31, 2016
	Before-Tax		After-Tax
Net loss attributable to Devon (GAAP)			$	(3,056	)
Asset impairments		3,035		2,299
Deferred tax asset valuation allowance				808
Restructuring and transaction costs (1) SEE CASH FLOW FOOTNOTE BELOW		247		159
Changes in financial instruments and FX (2) SEE CASH FLOW FOOTNOTE BELOW		12		(39	)
Core earnings before noncontrolling interest (non-GAAP)				171
Noncontrolling interest				420
Core loss attributable to Devon (non-GAAP)			$	(249	)
Share count				479
Core loss per share attributable to Devon (non-GAAP)			$	(0.53	)

CASH FLOW FOOTNOTES

(1) Includes a negative $167 million impact to cash flow before balance sheet changes that is typically excluded from analyst estimates.

(2) Includes a negative $130 million impact to cash flow before balance sheet changes and operating cash flow that is typically excluded from analyst estimates.

NET DEBT

Devon defines net debt as debt less cash and cash equivalents and net debt attributable to the consolidation of EnLink Midstream as presented in the following table. Devon believes that netting these sources of cash against debt and adjusting for EnLink net debt provides a clearer picture of the future demands on cash from Devon to repay debt.

(in millions)	March 31, 2016
	Devon U.S. & Canada			EnLink			Devon Consolidated
Total debt (GAAP)	$	9,341		$	3,204		$	12,545
Less cash and cash equivalents		(1,629	)		(6	)		(1,635	)
Net debt (non-GAAP)	$	7,712		$	3,198		$	10,910

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DEVON ENERGY CORPORATION

FORWARD LOOKING GUIDANCE

PRODUCTION GUIDANCE

	Quarter 2				Full Year
	Low		High		Low		High
Oil and bitumen (MBbls/d)
U. S. - core		103		108		105		110
Heavy Oil		122		127		128		133
Core assets		225		235		233		243
Other		24		29		20		25
Total		249		264		253		268
Natural gas liquids (MBbls/d)
U. S. - core		100		105		98		103
Other		25		30		22		27
Total		125		135		120		130
Gas (MMcf/d)
U. S. - core		1,200		1,250		1,185		1,235
Heavy Oil		14		17		14		17
Core assets		1,214		1,267		1,199		1,252
Other		240		260		228		248
Total		1,454		1,527		1,427		1,500
Oil equivalent (MBoe/d)
U. S. - core		403		421		401		419
Heavy Oil		124		130		130		136
Core assets		527		551		531		555
Other		89		102		80		93
Total		616		653		611		648

PRICE REALIZATIONS GUIDANCE

	Quarter 2						Full Year
	Low			High			Low			High
Oil and bitumen -     % of WTI
U. S.		83	%		93	%		83	%		93	%
Canada		38	%		48	%		34	%		44	%
NGL - realized price	$	6		$	10		$	7		$	11
Natural gas -     % of Henry Hub		73	%		83	%		75	%		85	%

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DEVON ENERGY CORPORATION

FORWARD LOOKING GUIDANCE

OTHER GUIDANCE ITEMS

	Quarter 2						Full Year
($ millions, except %)	Low			High			Low			High
Marketing & midstream operating profit	$	200		$	225		$	875		$	925
Lease operating expenses	$	440		$	470		$	1,750		$	1,850
General & administrative expenses	$	150		$	170		$	625		$	675
Production and property taxes	$	70		$	80		$	285		$	315
Depreciation, depletion and amortization	$	510		$	560		$	2,100		$	2,300
Other operating items	$	15		$	20		$	50		$	75
Net financing costs(1)	$	160		$	170		$	650		$	700
Current income tax rate		0.0	%		0.0	%		0.0	%		0.0	%
Deferred income tax rate		35.0	%		45.0	%		35.0	%		45.0	%
Total income tax rate		35.0	%		45.0	%		35.0	%		45.0	%
Net earnings attributable to noncontrolling interests	$	—		$	—		$	—		$	—

(1) Full year 2016 includes $50 million of non-cash accretion on EnLink’s installment purchase obligations.

CAPITAL EXPENDITURES GUIDANCE

	Quarter 2				Full Year
(in millions)	Low		High		Low		High
Exploration and development	$	250	$	300	$	900	$	1,100
Capitalized G&A		55		65		200		250
Capitalized interest		10		20		40		50
Midstream		—		5		—		10
Corporate and other		10		15		30		35
Devon capital expenditures(2)	$	325	$	405	$	1,170	$	1,445

(2) Excludes capital expenditures related to EnLink.

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DEVON ENERGY CORPORATION

FORWARD LOOKING GUIDANCE

COMMODITY HEDGES

	Oil Commodity Hedges
	Price Swaps				Price Collars						Oil Call Options Sold
Period	Volume (Bbls/d)		Weighted Average Price ($/Bbl)		Volume (Bbls/d)		Weighted Average Floor Price ($/Bbl)		Weighted Average Ceiling Price ($/Bbl)		Volume (Bbls/d)		Weighted Average Price ($/Bbl)
Q2-2016		30,000	$	39.24		73,000	$	33.85	$	41.59		18,500	$	60.99
Q3-2016		15,000	$	45.63		65,000	$	40.37	$	46.91		18,500	$	55.00
Q4-2016		15,000	$	46.16		20,000	$	40.85	$	50.85		18,500	$	55.00

	Oil Basis Swaps
Period	Index	Volume (Bbls/d)		Weighted Average Differential to WTI ($/Bbl)
Q2-2016	Western Canadian Select		42,000	$	(13.31	)
Q3-2016	Western Canadian Select		39,000	$	(13.38	)
Q4-2016	Western Canadian Select		33,000	$	(13.40	)

	Natural Gas Commodity Hedges
	Price Swaps				Price Collars						Call Options Sold
Period	Volume (MMBtu/d)		Weighted Average Price ($/MMBtu)		Volume (MMBtu/d)		Weighted Average Floor Price ($/MMBtu)		Weighted Average Ceiling Price ($/MMBtu)		Volume (MMBtu/d)		Weighted Average Price ($/MMBtu)
Q2-2016		481,400	$	2.73		24,725	$	1.97	$	2.30		400,000	$	2.80
Q3-2016		100,000	$	2.84		—	$	—	$	—		400,000	$	2.80
Q4-2016		—	$	—		70,000	$	2.56	$	2.76		400,000	$	2.80

Devon’s oil derivatives settle against the average of the prompt month NYMEX West Texas Intermediate futures price. Devon’s natural gas derivatives settle against the Inside FERC first of the month Henry Hub index. Commodity hedge positions are shown as of April 29, 2016.

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