Investor Presentation December 2019 NYSE: DVN devonenergy.com - PowerPoint PPT Presentation

Investor Presentation December 2019 NYSE: DVN devonenergy.com

Devon’s Competitive Advantage  World-class U.S. oil portfolio New Devon Overview — Unrivaled acreage position in top basins — Multi-decade growth inventory Production: 325 MBOED (Q3 2019) Revenue: 74% oil — Top-tier well productivity across all assets Oil growth rate: 20%-21% in 2019  Disciplined returns-driven strategy Multi-decade growth inventory POWDER RIVER 25 MBOED (71% OIL) — Aggressively improving cost structure — Growing higher-margin oil production STACK 121 MBOED (26% OIL) — Positioned for FREE CASH FLOW above $48 WTI DELAWARE 127 MBOED (56% OIL)  Delivering value to shareholders EAGLE FORD — Committed to return of capital 45 MBOED (49% OIL) — Capital-efficient per-share growth — Building a fortress balance sheet 2 Investor Presentation

Unleashing Potential of World-Class Oil Assets U.S. well productivity showcases asset quality High-return inventory diversified across top U.S. basins Source: IHS/Devon. All wells drilled from 2015 through 2019 YTD. Includes operators with more than 150 wells. Gross operated inventory locations (non-operated locations not included) 950 6,500 operated >20 YEAR INVENTORY locations (AT CURRENT DRILLING PACE) RESULTS ~45% 850 SUPERIOR 6,000 WELL VS. PEER AVG. 750 Avg. 90-Day IPs BOED, 20:1 15 YEAR INVENTORY 4,200 operated (AT CURRENT DRILLING PACE) locations 650 4,000 PEER AVG. PRB 550 Eagle Ford STACK 2,000 450 Delaware Basin ~280 operated 350 wells online 0 2019 Program High-Return Inventory Risked Inventory 250 (@ $50 WTI) (@ $60 WTI) Top 50 U.S. Producers Note: High-return inventory represents locations estimated to generate >20% IRR. Returns based on all-in E&P capital investment, which includes drilling, completion and well-site facilities and flow back. 3 Investor Presentation

Executing on Our Strategic Objectives Efficiencies delivering improved capital outlook U.S. oil production exceeds guidance New Devon 2019e E&P capital New Devon (MBOD) U.S. OIL PRODUCTION 148 (Q3 Guide: 141-147) 4,000 DELAWARE POWDER RIVER 50% 20% E&P CAPITAL 124 $1.83-$1.87 BARRELS PER DAY BILLION ABOVE MIDPOINT Original Guidance ($1.8 - $2.0 billion) Q3 2018 Q3 2019 EAGLE Improving cost structure expands margins FORD STACK Per-unit cost (reported) ($/BOE) 14% 16% Interest G&A $14.18 LOE & GP&T  Operational efficiencies continue to ACCELERATE $11.86 16% Strong well productivity drives Q3 oil volumes above guidance DECLINE — Lowered 2019 capital outlook by $50 million — SINCE Q3 2018 $780 MM cost savings initiative ahead of plan (80% by YE19) — Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Old DVN DVN Today 4 Investor Presentation

Operational Success Driving Improved 2019 Outlook vs. Original Key Messages Updated Guidance Guidance RAISING OIL GROWTH outlook for 3 rd time in 2019  (1) U.S. oil growth 20% – 21% 550 Basis Point Delaware, Eagle Ford and PRB to drive strong Q4 growth  (vs. 2018) Improvement Scalable growth driving per-unit costs lower in Q4  LOE & GP&T $7.60 – $7.65 15% Higher-cost Canadian assets exit portfolio  (per BOE) Improvement Lowering G&A expense outlook for 3 rd time in 2019  G&A $460 – $470 17% Run-rate savings to REACH > $200 MILLION by year-end  ($ in millions) Improvement $1.7 billion debt redeemed YTD (annual interest savings: >$60 million)  Financing costs $245 – $255 22% Evaluating next steps for debt reduction program  Improvement ($ in millions) Q4 capital spending lower due to timing of completion activity  (1) Upstream capital $1.83 – $1.87 $50 Million Expect FREE CASH FLOW to accelerate in Q4 2019  ($ in billions) Improvement Improv oved o outloo ook (1) Represents New Devon performance target (excludes Barnett Shale). 5 Investor Presentation

Framework for the 2020 Planning Cycle CAPITAL ALLOCATION PRIORITIES  Maintain capital DISCIPLINE GREATER ER THAN AN Maintain base production $50 50 1  Free cash flow accelerates  Balance GROWTH & FREE CASH FLOW 2 Fund dividends  Fund dividends $50 50  Improve financial strength (Program funded @ $48 WTI) Pursue high-return growth projects 3  Protect financial strength $4 $45  Exercise capital FLEXIBILITY Return excess cash to shareholders 4  Maintain operational continuity WTI PRICE (ASSUMES $2.50 HENRY HUB) 6 Investor Presentation

Preliminary 2020 Outlook $ OPTIMIZED OIL SHARE FOR RETURNS GROWTH REDUCTION N E W D E V O N A S S E T S E & P C A P I TA L P R O G R A M S H A R E CO U N T VS . 2 0 1 9 $1.7-$1.9 Billion 7%-9% Growth 6%-8% Reduction D E S I G N E D F O R U LT R A - LO W DRIVEN BY LOW-RISK ENHANCING PER-SHARE B R E A K E V E N P R I C I N G DEVELOPMENT DRILLING CASH FLOW GROW TH Key Messages Program funded at $48 WTI & $2.50 Henry Hub  Low maintenance capital provides planning flexibility  Expect oil volumes to average up to 160 MBOD in 2020  Positioned for attractive FREE CASH FLOW  7 Investor Presentation

Positioned for Attractive Free Cash Flow in 2020 FY2020 OUTLOOK $675 $750 10% OIL GROWTH: 7%-9% MILLION BREAKEVEN: $48 WTI 8% (Assumes $2.50 Henry Hub) 2020e Free Cash Flow ($MM) 2020e Free Cash Flow Yield EXCLUDES BARNETT SHALE $500 $400 (before dividends) 6% MILLION 4% $250 $125 MILLION 2% $- 0% $50 WTI $55 WTI $60 WTI $2.50 HH $2.50 HH $2.50 HH Free Cash Flow Free Cash Flow Yield Note: Free cash flow yield assumes market capitalization based on share price as of 11/01/19 multiplied by expected shares outstanding at year-end 2019 (~375 mm shares). Free cash flow represents operating cash flow less total capital requirements before dividends. 8 Investor Presentation

2019 & 2020 Outlook = Improved Capital Efficiency Oil production remains on track Efficiencies driving lower capital requirements New Devon 2019-2020 cumulative upstream capital ($B) New Devon 2019-2020 cumulative oil production (MMBO) $4.2 120 Current Plan Original Plan Original Plan ~$400 MILLION (11/05/19 Guide) (2/19/19 Guide) (2/19/19 Guide) LESS CAPITAL $4.0 105 New Devon Cumulative Oil Production (MMBO) New Devon Cumulative Upstream Capital ($B) (VS. ORIGINAL PLAN) $3.8 90 Current Plan (11/05/19 Guide) $3.6 75 $3.4 60 $3.2 45 $3.0 30 2019e - 2020e 2019e - 2020e 2019e - 2020e 2019e - 2020e ( Cumulative Capital) ( Cumulative Capital) ( Cumulative Oil) ( Cumulative Oil) 9 Investor Presentation

Committed to Return of Capital to Shareholders Dedicated to disciplined allocation of capital Repurchase program accelerates per-share growth Outstanding basic shares (MM) $11.0 Billion 527 521 70 % ~ 30 % ~ 491 ALLOCATED TO SHARE COUNT SHAREHOLDER REDUCTION 459 RETURNS & DEBT 434 REDUCTION 415 Dividends 397 Debt reduction 383 ~375 (1) Share buyback New Devon capital Uses of Cash Since 2018 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 10/31/19 YE 2019e (1) Assumes remaining authorization is completed by year-end and incremental shares are repurchased at current share price. 10 Investor Presentation

Building a Fortress Balance Sheet Significant liquidity with no near-term debt maturities Aggressive debt reduction improves financial strength Net debt (1) ($B) Debt maturities ($MM) $4,700 $10.7 SIGNIFICANT FINANCIAL FLEXIBILITY NO DEBT MATURITIES Cash >75% UNTIL 2025 $2.6 Credit REDUCTION $1,250 Facility $750 $750 $675 $485 SINCE 2015 $366 $73 Liquidity Liquidity 2025 2027 2031 2032 2041 2042 2045 12/31/2015 12/31/2016 12/31/2017 12/31/2018 9/30/2019 Low leverage provides competitive advantage  Debt redemption program: targeting up to $3 billion NET DEBT ($ in billions) — $1.7 billion of debt retired YTD 1.0x Total debt (GAAP) $4.3 — Evaluating next steps for debt reduction program Less cash $1.7 — Potential INTEREST SAVINGS of ~$130 million annually Net debt (Non-GAAP) (1) $2.6 TO EBITDAX EBITDAX (Non-GAAP) (1)(2) $2.6  Hedging program further protects financial strength AS OF 9/30/2019 Net debt to EBITDAX ratio 1.0x — Majority of oil and gas volumes protected in Q4 2019 — Targeting ~50% oil & gas production in 2020 (1) Net debt and EBITDAX are non-GAAP measures. Non-GAAP reconciliations are provided in Q3 earnings release materials. (2) Based on last 12 months results from continuing operations. 11 Investor Presentation

Divestiture Program Accelerates Value Creation  Resource depth allows for portfolio high-grading SALES PRICE: ACCRETIVE MULTIPLE: CAD $3.8 BILLION ~10x CASH FLOW CANADIAN CLOSED:  Cotton Draw midstream partnership formed HEAVY OIL Q2 2019 — Contributing gathering & compression assets — Devon to remain operator of the assets POWDER RIVER — Receive $100 MILLION cash distribution in Q4 ROCKIES CO 2 — Partner to fund $40 million of expansion capital Q3 Production: 3 MBOED Sales process: Ongoing COTTON DRAW  Barnett Shale divestiture process progressing (MIDSTREAM PARTNERSHIP) — Data rooms opened in early Q3 Proceeds: $100 million STACK Gathering: 90 miles — Initial bids RECEIVED in September Compression: 4 stations — Ongoing negotiations with advantaged bidders DELAWARE BARNETT SHALE Q3 Production: 100 MBOED  Exited Canada for CAD $3.8 billion (USD $2.8B) Sales process: Ongoing DEVON ASSETS — Transaction closed in Q2 2019 EAGLE FORD DIVESTITURE ASSETS 12 Investor Presentation