Devon Posts Lower Profit; CEO Says No Contact From ExxonMobil

Devon Energy, an independent oil and gas producer, reported a 7% drop in first-quarter profit due to rising costs and lower natural gas prices.

The company said earnings fell to $651 million, or $1.44 a share, from $700 million, or $1.58 a share, for the same period a year ago. Still, the company beat the Wall Street consensus estimate of $1.26 a share.

“As long as we keep growing production, as we did last year and I think we will this year, we think we can continue to grow and that will drive long-term shareholder value,” Larry Nichols, Devon Energy’s chairman and chief executive officer, told CNBC’s “Squawk Box.”

Analysts have speculated that Devon is a takeover target and have said that ExxonMobil might be interested.

“We haven’t heard from Exxon yet,” Nichols said Wednesday. “That is flattering to hear those rumors. There are a variety of analysts that, as they look at the troubled times throughout the world, the Middle East (and) Venezuela where it’s just challenging to do businesses, they speculate that the majors might be redeploying their capital in North America and then they look around at who might have the most interesting assets. We’re very flattered that Devon’s name often appears at the very top of that list.”

Devon Energy, based in Oklahoma City, Okla., is active in the Gulf of Mexico and western Canada. It recently acquired PennzEnergy, Northstar Energy, Santa Fe Snyder, Anderson Exploration, Mitchell Energy & Development and Ocean Energy.