Devon Energy commences production in Brazil

Production has commenced by Devon Energy from its Polvo oil field in Brazil. Polvo was discovered in 2004 and is situated on block BM-C-8 in the Campos Basin offshore Rio de Janeiro in roughly 300 feet of water. Gross production is expected to peak at the end of 2008 at around 50,000 barrels of oil per day.

Polvo has an estimated resource potential in the region of 50 million barrels. Devon is the operator of the BM-C-8 development with a 60% interest. SK Corporation of Korea holds the remaining 40%.

A fixed production and drilling platform connected to a floating production are included. First sales are expected to commence in October when the first shipment of oil will be offloaded from the FPSO and transported to market.

Stephen J. Hadden, senior vice president of exploration and production, commented that the development of the Polvo discovery was a major engineering project carried out professionally within a rapid 3-year discovery-to-production cycle time. The project is expected to contribute about 26,000 barrels per day in 2008 to Devon’s continuing production growth forecast.

Mr Hadden concluded that with Polvo and 9 additional offshore leases, they have a strong future in Brazil with the likelihood of additional discoveries.