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Market Chatter: Stone Ridge Bids $8 Billion for Devon Energy Marcellus Assets

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Stone Ridge Asset Management has offered around $8 billion to acquire Devon Energy's (DVN) Marcellus shale assets, Reuters reported Friday, citing people familiar with the matter.

This followed last month's closing of the $58 billion merger between Devon and Coterra Energy (CTRA) to form a large-cap shale operator in the US, with a focus on the Delaware Basin.

Sources told the news agency that Stone Ridge made the move to initiate conversations about a possible deal, although Devon may or may not consider the proposal.

Stone Ridge will use an asset-backed securitization to fund its proposal. If accepted, the deal will have the largest ABS funding in the history of US oil and gas industry, the sources reportedly said, although the actual size of financing was not immediately known.

The investment firm, an active buyer of oil and gas assets using ABS, could also partner with another party on a possible Marcellus acquisition. It has previously partnered with Flywheel Energy to acquire Ovintiv's (OVV) Oklahoma assets for $3 billion, according to sources cited by Reuters.

Devon had not made any decisions about the Marcellus assets, previously belonging to Coterra and spanning 190,000 net acres in Pennsylvania, according to the report.

Asset manager Kimmeridge, a Devon shareholder, earlier urged the company's board to "initiate an accelerated program of non-core asset divestitures," to streamline its portfolio following the merger with Coterra.

Devon and Stone Ridge did not immediately respond to' requests for comment.

The Marcellus assets were reportedly projected to account for about 20% of Devon's 2026 production outlook of 1.6 million barrels of oil equivalent per day. The Delaware assets, meanwhile, will contribute about 53% of output.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

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