Devon Energy’s 2026 drilling activity highlights the Permian Basin’s central role in its development strategy. The supplied U.S. dataset contains 581 wells spudded through November 2 across six states, including 414 in the Permian, where Eddy and Lea counties account for 305 records. Additional activity spans the Williston, Anadarko, Eagle Ford, Powder River and Marcellus regions, while H&P and Cactus lead drilling contractor participation with 233 and 172 well records, respectively.
That footprint aligns with Devon’s Q3 earnings call strategy: direct approximately 75% of its preliminary $5.3 billion 2027 capital budget to the Permian, complete the planned Eagle Ford divestiture and improve capital efficiency through Coterra integration, longer laterals and AI-supported operations. Following $2 billion in Q3 free cash flow, management outlined a path toward low single-digit oil growth, increased share repurchases and further debt reduction.
Devon Energy — Q3 2026 earnings call highlights
- Strong cash generation: Generated $3.5 billion in discretionary cash flow and $2 billion in free cash flow, with $1.5 billion in capital investment and a 43% reinvestment rate.
- Record production: Oil and total production reached company records and remained within guidance. Q4 guidance is 550,000–560,000 barrels of oil per day and 1.66–1.70 million BOE/day.
- Permian remains the cornerstone: Approximately 75% of the preliminary 2027 capital budget will go to the Permian. Anadarko, Marcellus and Rockies assets will provide complementary investment opportunities and cash flow.
- Eagle Ford exit: The sale is expected to close in early 2027 and generate approximately $3.5 billion in net proceeds. Management said it improves inventory life, lowers breakevens and reduces the company’s base production decline.
- 2027 outlook: Preliminary guidance calls for $5.3 billion in capital spending, approximately 525,000 barrels of oil per day and 1.6 million BOE/day, assuming the Eagle Ford sale closes. On the retained assets, Devon expects low single-digit production growth with lower capital spending.
- Additional investments: The $5.3 billion budget excludes land acquisitions and the Solitude Pipeline investment. Devon anticipates approximately $500 million for acreage acquisitions and trades and $400 million for Solitude in 2027.
- Disciplined growth strategy: Targets low single-digit annual oil growth, reinvestment of 45%–60% of cash flow, and 5%–10% annual growth in free cash flow per share.
- Coterra integration progressing: Management reported faster-than-planned synergy capture. Devon was operating 34 drilling rigs and nine completion crews, while simultaneous fracturing increased from 68% to 75% of wells.
- Longer laterals improve economics: Average lateral length is expected to increase by more than 10% in 2027, including 53 four-mile wells across four basins. Expected companywide drilling, completion, facilities and flowback costs are approximately $750 per lateral foot.
- AI supports field performance: Devon uses AI to identify and spread operating best practices, guide subsurface and completion designs, support real-time monitoring and optimize gas lift. Management also highlighted larger fracture treatments and surfactant use.
- New federal acreage: First wells on the recently acquired New Mexico acreage are expected to spud around mid-2027, with meaningful production in early 2028.
- Gas transportation investment: Devon holds a 25% equity stake in Solitude Pipeline, intended to move Permian gas to Gulf Coast markets and improve realized prices. Its total project investment is expected to be approximately $500 million.
- Inventory depth: Management cited more than 12 years of delineated drilling inventory, potentially exceeding 15 years when additional subsurface opportunities are included.
- Accelerating buybacks: Q3 repurchases totaled $414 million, alongside a $0.32-per-share dividend. Devon expects more than $1 billion in Q4 buybacks, with further emphasis on repurchases in 2027.
- Debt reduction: Repaid $750 million in Q3, bringing debt reduction since the merger to $1.25 billion. Plans include another $1.5 billion repayment in 2027, targeting approximately $9 billion in gross debt.
- Further portfolio changes remain possible: The formal portfolio review is complete, but management remains open to acquisitions, divestitures and other transactions that improve shareholder value.
Devon’s Wells Drilled YTD 581 U.S. well records, with activity dates from January 1 through November 2, 2026. All 581 licence numbers are unique.
Records by Province/State
State Record count Share New Mexico 305 52.5% Texas 147 25.3% North Dakota 52 9.0% Oklahoma 45 7.7% Wyoming 18 3.1% Pennsylvania 14 2.4% Total 581 100.0%
Counties grouped by play/basin
The basin groupings below are assigned from county geography; the file does not contain a basin field.
Play/basin Counties and record counts Total Permian Eddy, NM: 163; Lea, NM: 142; Culberson, TX: 67; Loving, TX: 14; Upton, TX: 11; Andrews, TX: 9; Reeves, TX: 8 414 Williston / Bakken McKenzie, ND: 32; Williams, ND: 16; Mountrail, ND: 3; Dunn, ND: 1 52 Anadarko Canadian, OK: 28; Blaine, OK: 9; Custer, OK: 5; Caddo, OK: 3 45 Eagle Ford DeWitt, TX: 37; Karnes, TX: 1 38 Powder River Converse, WY: 15; Campbell, WY: 3 18 Appalachian / Marcellus Susquehanna, PA: 14 14 Total 581
The Permian accounts for 71.3% of the supplied records, led by Eddy and Lea counties.
Top contractor–rig combinations
Rank Contractor and rig Record count 1 H&P 470 24 2= H&P 269 23 2= H&P 314 23 2= H&P 646 23 5= Cactus 408 21 5= H&P 393 21 5= H&P 600 21 8 Nabors B13 20 9= Cactus 403 19 9= H&P 384 19 9= Nabors 1203 19
Eleven combinations are shown to include the tie at the cutoff. These are well-record counts, not current active-rig counts. The file contains 45 named contractor–rig combinations and seven records without a rig assignment.
Records by drilling contractor
Contractor Record count H&P 233 Cactus 172 Nabors 87 Precision 31 Cyclone 28 Ensign 11 NorAm 7 Latshaw 4 Patterson 1 Not specified 7 Total 581
Devon Energy’s supplied 2026 U.S. drilling dataset contains 581 wells across six states, with the Permian accounting for 414 records, or 71%, and H&P leading contractor participation with 233. After generating $2 billion in Q3 free cash flow, Devon plans to direct approximately 75% of its preliminary 2027 capital budget to the Permian while pursuing its Eagle Ford exit, operating efficiencies and increased shareholder returns.
Author: phinds