FILED BY DEVON ENERGY CORPORATION
PURSUANT TO RULE 425 UNDER THE SECURITIES ACT OF 1933
AND DEEMED FILED PURSUANT TO RULE 14a-12
OF THE SECURITIES EXCHANGE ACT OF 1934
SUBJECT COMPANY: MITCHELL ENERGY & DEVELOPMENT CORP.
COMMISSION FILE NO. 333-68694
[DEVON ENERGY LETTERHEAD]
NEWS RELEASE
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FOR IMMEDIATE RELEASE
INVESTOR CONTACTS: ZACK HAGER
MANAGER, INVESTOR RELATIONS
(405) 552-4526
MEDIA CONTACTS: MICHAEL BARRETT
MANAGER, CORPORATE COMMUNICATIONS
(405) 228-4252
DEVON ENERGY HEDGES ADDITIONAL OIL AND GAS PRODUCTION
OKLAHOMA CITY, OKLAHOMA, OCTOBER 31, 2001 -- Devon Energy Corporation (AMEX:
DVN; TSE:NSX) announced today that it has entered into additional financial
transactions covering portions of its 2001, 2002 and 2003 oil and natural gas
production. Devon provided an update of its 2001 and 2002 hedge positions in a
news release dated September 25, 2001. The following information describes
transactions entered into subsequent to that previous disclosure, including
transactions recently entered into by Devon as a result of the October 15, 2001
acquisition of Anderson Exploration Ltd. In addition, the following also
describes the aggregate effects of all transactions now in place.
FIXED PRICES - OIL PRODUCTION
For the fourth quarter of 2001, Devon recently entered into price swaps
covering 7,000 barrels of oil per day at an average price of $20.32 per barrel.
The price swaps will be settled utilizing the monthly average of the closing
prices of the New York Mercantile Exchange's (NYMEX) light sweet crude contract.
In aggregate, including previously disclosed transactions, Devon has downside
price protection in place for approximately 32,000 barrels per day in the fourth
quarter of 2001 at an average price of $22.39 per barrel. For comparison,
Devon's second quarter 2001 oil production, pro forma for the acquisition of
Anderson, was approximately 150,000 barrels of oil per day.
For 2002, Devon recently entered into price swaps covering approximately 18,000
barrels per day at an average price of $22.29 per barrel. In aggregate,
including previously disclosed transactions,
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Devon has downside price protection in place for approximately 53,000 barrels of
oil per day in 2002. This downside protection is at an average price of $22.31
per barrel.
FIXED PRICES - NATURAL GAS PRODUCTION
For the fourth quarter of 2001, Devon recently entered into price swaps
and fixed price contracts covering approximately 147,000 million British thermal
units (mmbtu) of natural gas per day at an average price of $2.70 per mmbtu. The
price swaps and fixed price contracts will be settled using the first of the
month published index prices in the regions in which the gas is produced.
Devon also entered into costless collars for the fourth quarter of 2001 covering
approximately 40,000 mmbtu per day. The average floor and ceiling prices for the
costless collars are $3.00 and $3.38 per mmbtu, respectively.
In aggregate, including previously disclosed transactions, Devon has downside
price protection in place for approximately 513,000 mmbtu per day in the fourth
quarter of 2001 at an average price of $3.06 per mmbtu. For comparison, Devon's
second quarter 2001 gas production, pro forma for the acquisition of Anderson,
was approximately 1.8 billion cubic feet per day.
For 2002, Devon recently entered into price swaps and fixed price contracts
covering approximately 220,000 mmbtu per day at an average price of $2.79 per
mmbtu. The price swaps and fixed price contracts will be settled using the first
of the month published index prices in the regions in which the gas is produced.
In aggregate, including previously disclosed transactions, Devon has downside
price protection in place for approximately 685,000 mmbtu of gas per day in
2002. This downside price protection is at an average price of $3.02 per mmbtu.
For 2003, Devon recently entered into price swaps and fixed price contracts
covering approximately 118,000 mmbtu per day at an average price of $3.17 per
mmbtu. The price swaps and fixed price contracts will be settled using the first
of the month published index prices in the regions in which the gas is produced.
Devon also recently entered into costless collars for 2003 covering
approximately 300,000 mmbtu per day. The average floor and ceiling prices for
the costless collars are $2.91 and $3.85 per mmbtu, respectively.
In aggregate, Devon has downside price protection in place for approximately
439,000 mmbtu of gas per day in 2003. This downside price protection is at an
average price of $3.03 per mmbtu.
Devon Energy Corporation is an independent energy company engaged in oil and gas
exploration, production and property acquisitions. Devon ranks among the top
five U.S.-based independent oil and gas producers and is included in the S&P 500
Index. Approximately 83 percent of the company's proved reserves are located in
North America. Also, Devon has international
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operations in Azerbaijan, Southeast Asia, South America and West Africa. Shares
of Devon Energy Corporation trade on the American Stock Exchange under the
symbol DVN. In addition, Devon's exchangeable shares trade on the Toronto Stock
Exchange under the symbol NSX.
NOTICE TO INVESTORS CONCERNING DEVON'S PLANS TO ACQUIRE
MITCHELL ENERGY
Investors and security holders are advised to read the definitive joint proxy
statement/prospectus that will be included in the Registration Statement on Form
S-4 filed with the Securities and Exchange Commission in connection with the
proposed transaction because it will contain important information. A
preliminary joint proxy statement/prospectus has been filed with the SEC by
Devon and Mitchell. Investors and security holders may obtain a free copy of the
joint proxy statement/prospectus and other documents filed by Devon and Mitchell
with the SEC at the SEC's web site at www.sec.gov. The definitive joint proxy
statement/prospectus and such other documents (relating to Devon) may also be
obtained for free from Devon when they become available by directing such
request to: Devon Energy Corporation, 20 North Broadway, Suite 1500, Oklahoma
City, Oklahoma 73102-8260, Attention: Investor Relations, telephone: (405)
552-4570, e-mail: judy.roberts@dvn.com. The definitive joint proxy
statement/prospectus and such other documents (relating to Mitchell) may also be
obtained for free from Mitchell when they become available by directing such
request to: Mitchell Energy & Development Corp., 2001 Timberloch Place, The
Woodlands, Texas 77380, Attention: Investor Relations, telephone: (713)
377-6625, e-mail: mndpr@mitchellenergy.com.
Devon, its directors, executive officers and certain members of management and
employees may be considered "participants in the solicitation" of proxies from
Devon's shareholders in connection with the transaction. Information regarding
such persons and a description of their interests in the transaction is
contained in Devon's Proxy Statements and Annual Reports on Form 10-K filed with
the SEC. Additional information regarding the interests of those persons may be
obtained by reading the definitive proxy statement/prospectus when it becomes
available.
Mitchell, its directors, executive officers and certain members of management
and employees may be considered "participants in the solicitation" of proxies
from Mitchell's shareholders in connection with the transaction. Information
regarding such persons and a description of their interests in the transaction
is contained in Mitchell's Proxy Statements and Annual Reports on Form 10-K
filed with the SEC. Additional information regarding the interests of those
persons may be obtained by reading the definitive proxy statement/prospectus
when it becomes available.
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