Devon and Coterra merger creates shale major

Devon Energy has signed a definitive merger agreement with Coterra Energy. The companies say that the combination will create a leading shale operator with a high-quality asset base anchored by a premier position in the economic core of the Delaware Basin. The combined company will be named Devon Energy and will be headquartered in Houston while maintaining a significant presence in Oklahoma City. The companies say that they have identified $1 billion in annual pre-tax synergies which, together with technology-driven capital efficiency gains and optimised capital allocation, will drive near and long-term per share growth.

Under the terms of the agreement, Coterra shareholders will receive a fixed exchange ratio of 0.70 share of Devon common stock for each share of Coterra common stock. Based on Devon’s closing price on January 30, 2026, the transaction implies a combined enterprise value of approximately $58 billion. Upon completion, Devon shareholders will own approximately 54% of the company and Coterra shareholders will own 46%. The transaction, unanimously approved by the boards of both companies, is expected to close in the second quarter of 2026, subject to regulatory approvals and customary closing conditions.

“This transformative merger combines two companies with proud histories and cultures of operational excellence, creating a premier shale operator,” said Clay Gaspar, Devon’s President and CEO. “We’ve now built a diverse asset base of high-quality, long duration inventory to drive resilient value creation and returns for shareholders through cycles. Underpinned by our leading position in the best part of the Delaware Basin, and a deep set of complementary assets, we expect to capture annual pre-tax synergies of $1 billion. This will drive higher free cash flow and greater shareholder returns beyond what either company could achieve alone.”

The merger will create one of the world’s leading shale producers, with pro forma third quarter 2025 production exceeding 1.6 million barrels of oil equivalent per day, including over 550 thousand barrels of oil per day and 4.3 billion cubic feet of gas per day.