$5 Billion Grayson Mill Deal Expands Devon Energy's

Williston Operations
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Based in Oklahoma City, Devon Energy is expanding its operations in the Williston Basin
with a major $5 billion acquisition of Grayson Mill Energy, a company supported by the
Houston-based EnCap Investments LP. This deal includes $3.25 billion in cash and
$1.75 billion in Devon stock. Announced before the markets opened on July 8, this
strategic move aims to boost Devon's oil production and operational scale significantly.

With this acquisition, Devon will add an impressive 307,000 net acres to its Williston
Basin holdings, where it already has a 70% working interest. This expansion is expected
to bring Grayson Mill's production to an estimated 100,000 barrels of oil equivalent per
day (boe/d) by 2025, with oil making up 55% of this production.

This deal not only increases Devon’s oil production to an average of 375,000 barrels per
day but boosts its total production to about 765,000 boe/d. Additionally, owning Grayson
Mill's extensive midstream infrastructure, which includes 950 miles of gathering systems
and various storage and disposal facilities, is projected to add over $125 million to
Devon's annual EBITDAX. This infrastructure ownership also enhances Devon's market
access and pricing capabilities.

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In response to the acquisition, Devon's board has also increased the company’s share
repurchase authorization by 67%, extending it to $5 billion through mid-2026, reinforcing
the company's commitment to shareholder value.

This acquisition comes at a time when the U.S. upstream oil and gas sector is seeing
significant merger and acquisition activity. Devon had previously explored expansion
opportunities in the Permian Basin with Endeavor Energy Resources and CrownRock
LP, though these companies were later acquired by other major players for substantial
sums.

The Williston Basin itself has been a hotbed for energy deals, demonstrated by Chord
Energy’s recent $4 billion acquisition of Enerplus Corp., which positioned it as a leading
producer in the region. Additionally, TXO Partners LP has entered the Williston scene
with two new acquisitions.

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