I don't know what to say. Leading independent Devon Energy's
I know that number may not sound like a lot, compared to the $24.2 billion charge at Time Warner, the $37.2 billion writedown of Wachovia's loan book at Wells Fargo
The Wall Street Journal noted that "[m]ost analysts pay little attention to such charges." Well, include me out, as Samuel Goldwyn would say. I'm well aware that this charge doesn't impact Devon's cash flows, which hit a record at $9.6 billion for the year. It still reflects poorly on the firm's reserve booking practices, in my opinion.
One would think this gigantic impairment charge would invite a dose of humility. However, Devon is going ahead with a 2009 capital program that will overshoot cash flow by about $1 billion. Granted, exploration and development spending will drop about 50% from last year, but it's still a fairly aggressive move in this environment.
Even Chesapeake Energy
Maybe I'm getting all worked up over nothing here, but I find myself in Tudor Pickering's camp. That energy-focused research outfit recommended swapping E&P dollars out of Devon and into Anadarko Petroleum