OKLAHOMA CITY—Devon Energy Corp. aims to use its Anadarko Basin position to fuel a robust cash return model and establish the company as an industry leader in promoting ESG.

“The Anadarko Basin is making a comeback,” said Aaron Ketter, a vice president at Devon Energy, during a keynote address at Hart Energy’s DUG Midcontinent conference and exhibition on March 2.

“Rig count’s up roughly 180%, productivity per rig is up,” continued Ketter, who oversees Devon’s Midcontinent and South Texas business unit. “It’s driven by technology improvements, longer laterals optimized completions. We're very excited about the Anadarko Basin. While others are getting reacquainted with this basin, we’ve been here, and we plan to continue to be here, and we plan to follow through on the 300,000 net acres that we have in this basis.”

Devon’s cash return model, which comprises five core components—moderate growth, reduced investment rates, low leverage, fixed-plus-variable dividends and ESG excellence—is being applied to its Anadarko Basin position, which generated $550 million free cash flow by itself in 2021.

In 2022, the Oklahoma City-based independent E&P company aims to spud 45 new wells in the Midcontinent, as well as produce a total of 600,000 boe/d across its five basins of operation that also include positions in the Eagle Ford Shale, Permian, Powder River and Williston basins.

Aaron Ketter, Devon Energy, DUG Midcontinent
Introduced by Nissa Darbonne, Hart Energy Editor-at-large, Devon Energy’s Aaron Ketter gave the keynote “Dial a Rock” at Hart Energy’s seventh annual DUG Midcontinent conference and exhibition. (Source: Madison Ratcliff/Hart Energy)

To apply technology in the Anadarko Basin, Ketter said Devon is implementing three strategies:

  1. Testing a wide range of technologies for “reliability, accuracy and frequency”;
  2. Factoring in how new information impacts decisions in the field and flow into the decision support center; and
  3. Integrating new technologies with existing analytics and apps.
Aaron Ketter, Devon Energy
Aaron Ketter, vice president of Midcontinent and South Texas business, Devon Energy (Source: Devon Energy)

“At Devon, we like to think about technology as a long-term game,” he said. “Consistent capital allocation has been a cornerstone of this. It’s not new, we've been doing in this for decades. It’s underpinned with standardization, trust and access to data. That takes years to get to that point. This allows different teams to make it actionable for their unique purposes.”

According to Ketter, both the company’s technology and field teams, as well as its vendors, are striving to make “continuous improvements” toward net-zero. At this point in time, that means a heavy emphasis on emissions monitoring, with three different sensors—a fixed camera monitor, long-range laser network and aerial laser survey—to continuously catch detrimental carbon and methane emissions.

“We need to recognize as technology advances, the transition to observed emissions reporting and associated accountability will increase,” he said. “That’s going to be a step-change. We’re eyes wide open that we will have agencies and NGO [non-governmental organization] oversight. They will continue to utilize similar technology to us, to hold us in compliance, to provide research and to provide external reporting. We want to know where our leaks are as quick as possible, correct them as soon as possible and move into a preventive phase, methane fees and carbon tax.”

“To Devon, emissions are emissions. The leniency intolerance doesn’t change if you’re in one basin versus the other,” he added. “That’s our expectations. And when you see our emission targets, it’s [reflective of the] total company. So we can’t be successful if only the Midcontinent gets to net-zero and our other basins has different standards.”