Devon Energy (DVN) / Coterra Energy (CTRA) Merger Highlights
All-stock merger creating a scaled, Delaware basin driven E&P. Devon is issuing 0.70 shares per CTRA share, resulting in pro-forma ownership of ~54% DVN/~46% CTRA
Pro-forma production of ~1.6MMboepd, establishing one of the largest independent E&Ps in North America
Targeting ~$1B in annual pre-tax synergies by year-end 2027. Synergies drawn across operating efficiencies, capital optimization and corporate cost reductions
Improved capital flexibility and multi-basin optionality. Merger sets to drive capital efficiency in the Delaware basin, while growing balanced three-stream production with lower reinvestment intensity across the Marcellus, Anadarko, Rockies and Eagle Ford basins.
The transaction is expected to be closed by the end of 2Q26
DVN’s agreement to acquire CTRA in an all-stock transaction marks the latest step in the ongoing consolidation of US shale, creating a scaled independent producer built for steady growth. The merger combines complementary portfolios of multi-basin production totaling ~1.6MMboepd with greater geographic and commodity diversification. Financially, the merger is designed to focus on efficiency over expansion. Leadership is targeting approximately $1B in in annual pre-tax synergies by the end of 2027, driven largely through capital optimization, operating efficiencies and reduced corporate overhead. Synergy-based savings are expected to lower reinvestment intensity, strengthen free cash generation and deliver capital allocation flexibility through enhanced dividends, continued buybacks and balance-sheet flexibility.
The merger announcement did not, however, provide operational guidance for the consolidated company. Year-end earnings calls are scheduled for later this month, and in turn, 2026 guidance is expected to provide further clarity for drilling activity and Capex allocations. Nonetheless, our first-pass estimate for 2026 Capex and drilling activity includes the following:
Basin | Rigs / Wells Drilled & TIL’ed | Capex |
|---|---|---|
Delaware | ~14 rigs / ~260 wells | ~$2.6B |
Marcellus | ~2 rigs / ~36-40 wells | ~$350MM |
Eagle Ford | ~3 rigs / ~40 wells | ~$250MM |
Rockies | ~4-5 rigs / ~55-60 wells | ~$1.1B |
Anadarko | ~ 1-3 rigs / ~30-40 wells | ~$500MM |
DVN/CTRA 2026 Capital Budget Forecast | ~24-27 rigs/~420-440 wells | ~$4.8B |
4Q25 Earnings Call
Devon Energy Corporation (DVN), February 18, 9:00AM MT (link)
Financial Statement Model Forecast
Companies Mentioned
Coterra Energy Inc. (CTRA)
Devon Energy Corporation (DVN)
Disclaimer: All information contained in this publication has been researched and compiled from sources believed to be accurate and reliable at the time of publishing. However, in view of the natural scope for human and/or mechanical error, either at source or during production, Patrick Enwright accepts no liability whatsoever for any loss or damage resulting from errors, inaccuracies or omissions affecting any part of the publication. All information is provided without warranty, and Patrick Enwright makes no representation of warranty of any kind as to the accuracy or completeness of any information hereto contained.
