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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Investor contact: Zack Hager
(405) 552-4526
Media contact: Michael Barrett
(405) 228-4252
DEVON ENERGY UPDATES 2002 OIL AND GAS HEDGING POSITION
OKLAHOMA CITY (Dec. 20, 2001) -- Devon Energy Corporation (AMEX: DVN,
TSE: NSX) announced today that it has entered into additional hedging
transactions covering its first quarter 2002 natural gas production. In
addition, the company summarized the aggregate effects of all of its 2002 oil
and gas hedges in place. Devon's 2002 hedges include oil and gas price swaps,
costless collars and fixed-price agreements.
Gas production
For the first quarter of 2002, Devon recently entered into fixed-price
physical delivery contracts for natural gas production in the United States and
Canada. In the U. S., the company entered into fixed-price physical delivery
contracts covering an additional 116,400 million British thermal units (mmbtu)
of natural gas per day at an average price of $2.65 per mmbtu. In Canada, the
company entered into fixed-price physical delivery contracts covering an
additional 118,400 mmbtu of natural gas per day at an average price of $2.46 per
mmbtu.
In aggregate, including the recent contracts, Devon has downside price
protection in place for about one-half of its expected first quarter 2002 gas
production at an average price of $2.94 per mmbtu. For the full year 2002, Devon
has downside price protection in place for approximately 39 percent of its
expected gas production at an average price of $3.02 per mmbtu.
Oil production
In aggregate, Devon has downside price protection in place for
approximately 53,200 barrels of oil per day in 2002 at an average price of
$22.34 per barrel. This represents approximately 55 percent of Devon's expected
2002 oil production.
The recent transactions described above update hedges disclosed in
Devon's SEC Form 8-K dated Dec. 11, 2001. The expected levels of 2002 oil and
gas production referenced above are
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based upon annual production estimates included in Devon's Form 8-K dated Dec.
11, 2001. These production estimates exclude production attributable to oil and
gas properties Devon has designated for disposition in 2002.
This press release includes "forward-looking statements" as defined by
the Securities and Exchange Commission. Such statements are those concerning the
contemplated transaction and strategic plans, expectations and objectives for
future operations. All statements, other than statements of historical facts,
included in this press release that address activities, events or developments
that the company expects, believes or anticipates will or may occur in the
future are forward-looking statements. These statements are based on certain
assumptions made by the company based on its experience and perception of
historical trends, current conditions, expected future developments and other
factors it believes are appropriate in the circumstances. Such statements are
subject to a number of assumptions, risks and uncertainties, many of which are
beyond the control of the company. Statements regarding future production are
subject to all of the risks and uncertainties normally incident to the
exploration for and development and production of oil and gas. These risks
include, but are not limited to, inflation or lack of availability of goods and
services, environmental risks, drilling risks and regulatory changes. Investors
are cautioned that any such statements are not guarantees of future performance
and that actual results or developments may differ materially from those
projected in the forward-looking statements.
Devon Energy Corporation is an Oklahoma City-based 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.
NOTICE TO INVESTORS CONCERNING DEVON'S PROPOSED ACQUISITION
OF MITCHELL ENERGY
Investors and security holders are advised to read the definitive joint
proxy statement/prospectus included in the Registration Statement on Form S-4
filed with the Securities and Exchange Commission in connection with the
proposed transaction because it contains important information. A 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 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 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
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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.
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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