Devon Energy Corp. reported that net earnings during 2003 climbed more than 1,500%, making 2003 the most profitable year in the company's history.
Devon reported net earnings of $1.7 billion, or $8.32 per common share ($8.07 per diluted common share) for the year ended Dec. 31, 2003. Devon's 2002 net earnings were $104 million, or 61 cents per diluted common share. A 21% increase in oil and natural gas production and sharply higher oil and gas prices drove the earnings increase.
For the fourth quarter of 2003, the company reported net earnings of $543 million, or $2.32 per common share ($2.25 per diluted common share). The most significant event for the company in 2003 was the merger with Ocean Energy in April. The integration of the two companies was substantially accomplished by year-end.
Devon also reported several notable operational accomplishments in 2003:
• The company drilled 2,116 successful wells in 2003, a 32% increase over 2002.
• In the deepwater Gulf of Mexico, the company drilled two exploratory discoveries at Sturgis and St. Malo. The St. Malo discovery and Devon's 2002 Cascade discovery are located in the emerging lower Tertiary trend. The lower Tertiary trend may prove to hold significant reserve growth potential for the industry. Devon has a substantial acreage position in the trend and has identified many additional prospects with characteristics similar to St. Malo and Cascade.
• Offshore China, the Devon-operated Panyu field began production into a floating production, storage and offloading vessel. Devon's share of field production is expected to reach 16,000 b/d in 2004. Devon brought Panyu to production in less than two years following the Chinese government's approval of the project.
Combined sales of oil, gas and natural gas liquids increased 78% in the year ended Dec. 31, 2003, to $5.9 billion. The increase was attributable to rising production and higher product prices.