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Devon Energy sells 50% in Alberta pipeline to CPPIB-backed company

Staff Writer |
Devon Energy will sell its 50 percent stake in a pipeline in Western Canada for $1.1 billion to a midstream oil and gas company backed by the Canada Pension Plan Investment Board (CPPIB).

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"Devon's divestiture program is now complete with proceeds totaling $3.2 billion, surpassing the top end of our $2 billion to $3 billion guidance range," CEO Dave Hager said.

Oil prices are yet to fully recover from the slump last year, forcing companies in the sector to sell non-core assets to lower debt and finance new projects.

This has given investment companies, including CPPIB, a chance to buy assets at attractive valuations.

In the past month, CPPIB, which invests on behalf of Canada's national pension plan, has acquired assets from Canadian producers Penn West Petroleum and Paramount Resources through companies it holds stake in.

Devon will use the proceeds of the sale of stake in the Access pipeline to Wolf Midstream Inc to finance drilling activity in the U.S. shale fields, including the Stack basin in Oklahoma and the Delaware basin.

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