DEVON ENERGY CORP.

Devon Energy Corp. turned 40 this year, and is eyeing growth at its Devon Energy Center Downtown, in the Cana Woodford shale in western Oklahoma, and through its operations in Texas, Louisiana, New Mexico, Colorado, Wyoming and Canada. The first quarter of 2011, nevertheless, did provide challenges. While the company reported net income of $416 million, first-quarter earnings were down 65% from the same quarter last year.

In the past two years, the company has sold its offshore and international interests to focus its exploration efforts in North America. For 2011, Devon’s production is about 68% natural gas and 32% oil and natural gas liquids. At the end of 2010, the company had more than 100 operating wells in the Cana and 23 rigs running there, with plans to drill 200 wells in 2011. Devon co-founder and Executive Chairman J. Larry Nichols says the company plans to spend more than $1 billion in the natural-gas liquids rich Cana this year.

Along with other companies, Devon is using horizontal drilling and hydraulic fracturing to re-drill and open shale in conventional reservoirs that had thought to be depleted before the use of the new technologies.

“Innovation and new technology have opened vast new opportunities for oil and natural gas production across the country, including Oklahoma,” says John Richels, Devon president and chief executive officer. “This is great news for consumers, for our economy and for Devon as we continue to expand our activities in the Cana- Woodford field.”

CHESAPEAKE ENERGY CORP.

Chesapeake Energy Corp. is looking to the future with plans to reduce long-term debt and to shift from focusing solely on natural gas to an approach to produce natural gas, natural gas liquids and oil. For the first quarter of 2011, however, it reported a net loss of $205 million and a net income of $732 million. Hedging losses totaled $725 million.

Looking ahead to the second quarter, Chairman and CEO Aubrey K. McClendon predicts the company will make $200 million due to a disclosed planned recapitalization of Frac Tech Services LLC. Chesapeake will increase its equity ownership stake in Frac Tech from 26% to 30%. That transaction is expected to close in the second quarter. By the end of 2011, company officials say they expect the value in its equity in Frac Tech to be worth upward of $1.5 billion.

In January, the company announced its 25/25 Plan meant to reduce long-term debt by 25% while also growing production by 25% by the end of 2012. The company reports it is already close to accomplishing the 25% longterm debt reduction and is now focused on the growth element of the plan.

The company has 160 rigs nationwide and 26 in Oklahoma. It plans to complete an estimated 270 wells in Oklahoma in 2011.

“With continued low natural gas prices, Chesapeake has transitioned to a more balanced revenue model that focuses on oil and natural gas liquids as much as natural gas.” McClendon says. “It is exciting that Oklahoma is home to some of the industry’s most productive oil and natural gas liquids plays, and that Chesapeake’s and the industry’s investment will benefit our state economy for decades to come.”

SANDRIDGE ENERGY

As SandRidge Energy CEO Tom Ward looked ahead to 2011, he saw the company’s immediate future in oil. While SandRidge began as primarily a natural gas exploration and production company, he says in today’s volatile market, it just made sense for the company to shift its primary focus to oil. SandRidge’s move away from natural gas began in 2009.

First-quarter earnings, however, showed a net loss of $316.6 million, compared to a gain of more than $18 million in the same quarter last year. Adjusted net income for the quarter was $2.3 million.

In a letter to shareholders attached to the 2010 annual report, Ward says in 2011, the company would derive about 80% of its revenues from oil, and dedicate all of its 2011 drilling budget to oil. With natural gas prices hovering around $4 per Mcf, and oil at around $100 a barrel, he says the valuation between the ratio of natural gas and oil is about 25-1.

But SandRidge is not done with natural gas by any means. The company reports it has 8,000 natural gas drilling opportunities in East Texas, the Gulf Coast, the Gulf of Mexico and in West Texas.

“At a time when oil is in high demand worldwide and is progressively becoming more difficult to find and produce, SandRidge increased oil production last year by 155% over 2009. In 2011, we expect to further increase our oil production by another 66% over 2010,” Ward says. “Our successful transformation to oil has put SandRidge in an extremely positive position for the future.”

CONTINENTAL RESOURCES

The big news for Enid-based Continental Resources in 2011 was the announcement that the company would move its headquarters to Oklahoma City in 2012.

“We’ve enjoyed extraordinary growth in Enid, but we are accelerating so quickly now that the move to Oklahoma City was the natural next step,” CEO Harold Hamm wrote in the company’s first-quarter earnings report.

But for the first quarter, it reported a net loss of $137.2 million. In the same quarter last year, it posted a net income of $72.5 million.

The company focuses on oil and natural gas exploration and production, and in the first quarter, crude oil accounted for 74% of the company’s production. Crude oil and natural gas sales for the quarter was $326.5 million, which was a 50% increase over the $217.1 million in the first quarter of 2010. The first quarter average for realized crude price was $85.34 per barrel, and the average realized natural gas price was $5.09 Mcf.

The company reports it is on track for 30% production growth this year, with a goal of tripling production and reserves in the next five years.

With plans to head to Oklahoma City, the company quietly bought the current headquarters of Devon Energy Downtown, 20 N Broadway Ave., for $22.5 million.

Hamm says the company is positioned for stronger growth in 2011, with its capital expenditure budget of $1.75 billion. More than 90% of the budget will be focused on the Bakken and Anadarko Woodford plays.

“Continental’s strategy is clear,” Hamm says. “We are focused on oil and liquids-rich unconventional plays in the U.S., where our experience, technology and low operating costs should deliver superior returns for our shareholders. We are on track to triple our production and proved reserves from 2009 to 2014, and we have the inventory in hand to complete the task.”