You are given a text that consists of multiple sentences. Your task is to perform abstractive summarization on this text. Use your understanding of the content to express the main ideas and crucial details in a shorter, coherent, and natural sounding text. 
Text: Also joining me on the call today are Rick Muncrief, our president, and CEO; Clay Gaspar, our chief operating officer; Jeff Ritenour, our chief financial officer; and a few other members of our senior management team.
We appreciate everyone taking the time to join us on the call today.
For Devon Energy, 2021, as a transformational year that can best be defined by our willingness to be a first mover and pursue bold strategic consolidation.
Our operational excellence and unyielding commitment to capital discipline, and the groundbreaking deployment of our industry-leading cash return business model, underpinned by our fixed plus variable dividend.
This transaction was perfectly timed at the very bottom of the cycle and set the groundwork for Devon's significant value creation during the year.
With this Advantage platform, we executed on her Delaware focused operating plan and captured cost synergies that resulted in $600 million of annual cash flow improvements.
These margin expansion efforts, combined with a disciplined capital allocation framework that prioritize value over volumes, resulted in Devon generating the highest level of free cash flow in our prestigious 50-year history.
With this powerful stream of free cash flow, we delivered on exactly what our shareholder-friendly business model was designed for, and that is to leave the industry in cash returns.
As you can see on the graphic, we rewarded shareholders with outsized dividends, opportunistic share buybacks, and we took meaningful steps to strengthen our investment-grade balance sheet.
This disciplined execution was rewarded by the market, with our share price achieving the highest return of any stock in the entire S&P 500 index during 2021.
I am so very proud of what we accomplished, and I want to extend my sincerest gratitude to everyone involved.
Our team comprehensively executed on the tenets of our strategy while responsibly providing our nation with a low-cost and reliable energy source, that is the lifeblood of our a modern economy.
Now turning to slide six, while 2021 was a record-setting year for Devon, the setup for 2022 is even better.
With the operational momentum we've established, we have designed a capital program to efficiently sustain production at a ultra-low WTI breakeven funding level of around $30 a barrel.
Combined with the full benefit of merger-related costs synergies and a vastly improved hedge book, we're positioned to deliver free cash flow growth of more than 70% compared to 2021.
As you can see on the graph, the strong outlook translates into a free cash flow yield of 14%, assuming an $85 WTI price.
Play will run through the details of our operating plan later but simply put, we expect 2022 to be another great year for Devon.
Turning your attention to slide seven, with this significant stream of free cash flow, the top priority for our free cash flow is the funding of our fixed plus variable dividend.
This cash return strategy is a staple of our capital allocation process, allowing us to return meaningful and appropriate amounts of cash to shareholders across a variety of market conditions.
With this differentiated framework, we've increased Devon's dividend payout for five consecutive quarters, and in aggregate, we paid out $1.3 billion of dividends in 2021, which is a per share increase of roughly two times that of 2020.
Importantly, we expect our dividend growth story to only strengthen in 2022.
As you can see on the bar chart, we're on pace to essentially double our dividend again in the upcoming year, which equates to around 8%.
I would like to highlight that this attractive yield includes a substantial increase to our fixed dividend that we announced last night.
There's 45% increase in the fixed dividend reflects the confidence we have in our underlying business and financial performance as we head into 2022.
Now Slide nine, I want to briefly showcase how our unique dividend policy offers a quite compelling alternative for yield-seeking investors.
To demonstrate this point, we've included a simple comparison of our estimated dividend yield in 2022 compared to other commonly referenced yields in financial markets.
As you can see, Devon's yield of 8% is approximately six times higher than the S&P 500 index, and well in excess of the prevailing interest rate you can get from a 10-year treasury.
On Slide 10, in addition to our market-leading dividend payout, we're also excited to announce that we are increasing our share repurchase authorization by 60% to $1.6 billion.
At a multiple of less than five times cash flow, we believe our business trades at a substantial discount to the intrinsic value, especially given the structural improvements we've made to expand margins and returns.
Given this favorable setup, we put our money where our mouth is by aggressively repurchasing $589 million of shares just in the fourth quarter alone.
With the board expanding the capacity of our repurchase program, we will continue to be opportunistic buyers of our stock throughout the upcoming year.
And lastly, the diagram on Slide 12, I believe, does a great job of summarizing what we've created here at Devon.
We've assembled a high-quality asset portfolio, and a team that has worked incredibly hard to deliver on our commitment to expand margins, and deliver growth, and free cash flow, accelerate our cash returns with our market leading dividend payout, enhance per share growth with opportunistic buybacks, and take consistent and meaningful steps to further enhance our financial strength.
While 2021 was a record year, we're only getting started.
At Devon, we have the right mix of assets, proven management, the right team, and a shareholder-friendly business model designed to continue to lead the energy industry and capital discipline, and cash returns.
And with that, I'll now turn it to Clay for the call to continue and provide an overview of our recent operational results and upcoming capital plan.
As Rick touched on, 2021 was a pivotal year for Devon, that demonstrated the power of our asset portfolio and the capabilities of our talented organization.
Across the portfolio, our team delivered results that exceeded production and capital efficiency targets, while continuing to drive down per-unit operating costs and improving margins.
Results matter, and while I don't take any of these accomplishments lightly, I'm equally proud of the way that we were able to accomplish these financial metrics.
Overcoming the challenges of the merger, pandemic, and supply chain issues we built a unified culture took many best practices from both legacy companies, and we're now poised for further leverage of those collective wins.
The first key point that is there is no change to the upstream capital budget of $1.9 to $2.2 billion as we disclosed last quarter.
While inflation is an absolute reality, our teams have done a good job of working with our service companies, mitigating escalations where we can, and quantifying the remaining impact or forecast.
The great thing about a cyclical business is that if you're paying attention, you should have a pretty good idea of what the most critical thing is to focus on in anticipation of the next phase.
At this point in the cycle, we're focused on listening to our service company partners and helping them help us be successful.
In this very tight supply chain market, the key phrase we hear is predictable and reliable.
You'll notice that our 22 program looks quite a bit like our 21 program.
This is what has allowed us to telegraph to our service companies, midstream partners, and other key stakeholders to expect more of the same.
That predictability allows them to plan their own supply chain work, and the reliability allows them to know that we're going to do what we say we're going to do.
Relationships are one of our core values at Devon, and this listening and working with our critical partners is an example of that value in action.
The relatively steady level of activity in 22 is projected to sustain our production throughout the year, ranging from 570,000 to 600,000 Boe per day.
During 2021, we had great success with our capital program that resulted in production growth rate of 34% compared to our first quarter 21.
It's high margin growth was driven by consistent execution and outstanding well productivity that was headlined by several memorable projects such as Danger Noodle, Boundary Raider, and Fiscal Cobra, to name a few.
Each of these prolific projects eclipse 30-day rates of more than 5,000 Boe per day on a plural basis, exhibiting the world class reservoir potential that resides in the Delaware Basin.
It's important to note, the strong volume performance in 2021 was paired with excellent capital efficiency and substantial additions to our approved reserves.
While I would never point to a single year of reserves booking as the measure of success with consistent and reasonable conservative booking processes, which we have, it can provide insight into the quality of the underlying assets.
At year-end, our proved reserves in the Delaware increased 18% on a Pro Forma basis, and these reserve additions replaced more than 200% of what we produce during the year.
I find it especially impressive that our team added these reserves and an ultra-low F&D cost of only $5 per Boe.
This result is just another example how advantaged and sustainable our resources in the Delaware Basin.
Turning your attention to the map on the right, you can expect more of the same for us in 2022.
You have a great slate of projects lined up to execute on, and once again, most of our program will consist of the high impact opportunities focused on developing Upper Wolfcamp and Bone Spring Zones, and to a lesser degree, the wolf is going to be Avalon targets as well.
To execute on this plan, we expect to run 14 rigs in 4 [inaudible] during the year.
This capital activity will be diversified across our acreage footprint with sweet spots in Southern Lea and Eddy County, and state line receiving most of the funding.
Not only with this level of activity continuing to grow Delaware production in 22, but the benefits of our operating scale and best practices from the merger integration, we are well-positioned to continue to improve our execution capabilities.
As you can see on the slide, with the efficiencies captured in the Delaware, the team has essentially doubled the productivity of our rig and frac equipment compared to just a few years ago.
The operational improvements have also meaningfully reduced our cost over time to about $550 per lateral foot in 2021, which competes very well with anyone out there.
As I look ahead to 22, I expect our operational performance to continue to improve.
Our team consistently is identifying new ways to leverage technology, operational breakthroughs, and industry best practices.
Inflationary pressure and supply chain disruptions are reality.
Based on today's industry activity and commodity price projections, we've baked in around 15% higher costs than we saw in 2021.
We have been, and continue to be focused on consistency, planning, and staying out in front ahead of these in reacting to any unforeseen issues.
This work will be even more critical as the market continues to tighten.
On Slide 17, the next area I want to showcase is the momentum we're building in the Anadarko Basin, where we have a concentrated 300,000 net acre position in the liquids rig window of the play.
With the benefits of our $100 billion Dow JV Kerry, we drilled over 30 wells in 2021 and commenced the first production on 16 of those wells during the year.
As you can see on the charts, on the right, the initial capital efficiency is excellent.
With the benefit of state-of-the-art completion designs, and appropriately up spaced developments, per well capital cost of decrease by 25% versus legacy activity and well productivity to date has exceeded the type curve expectations by 35%.
With the strong execution, the carried returns we're seeing from this activity will compete for capital with any asset in our portfolio.
Given the success, we've elected to step up activity in the Anadarko Basin to 3 rigs and 22.
This program will result in around 40 new wells coming online in 2022, allowing us to maintain steady production profile throughout the year and harvest significant amounts of free cash flow.
Collectively, these assets generated more than a billion dollars of free cash flow in 2021, and we're on pace to produce a similar amount of free cash flow in 22.
We also remain some of the best returns in our portfolio.
The team has continued to unlock additional locations and has leveraged company best practices to significantly improve our ESG footprint.
Our Eagle Ford Asset continues to deliver solid returns.
The team is doing some very exciting work to unlock additional locations and a very significant refract potential.
The Powder, is a basin with the most upside yet to unlock.
Our team is making great progress in that regard by driving laterals longer to three miles and rebooting the stimulation design, we're seeing very encouraging results.
I'm proud of what these assets are delivering, and I appreciate the team's hard work and effort that goes into fulfilling this important role within our portfolio.
As many of you are aware, we set aggressive emissions reductions targets last year that covered a myriad of near, mid, and long-term priorities.
In addition, to ensure our organizational alignment, we directly tied progress on these targets to our annual compensation program.
We've also dedicated a board committee to engage in our ESG goal-setting process, performance, and reporting.
Since the announcement of these environmental targets, we've taken immediate action and delivered results.
We do not have finalized figures yet for this past year, but I can tell you our scope 1 & 2 GHG emissions will improve roughly by 20% in 2021 versus our 19 baseline, well ahead of that, stated the stated goals from this past summer.
Two of the key successes on reducing overall emissions is reducing methane emissions, and reducing flaring.
In 2020, we reduced methane emissions by 47% and we reduce flaring by 33%.
I expect this positive rate of change to continue.
Looking specifically at 22, we have many visible catalysts that will drive important results, such as advancing advancements and leak detection technologies, improved facility design, facility retrofits, wide-scale deployment of air-driven pneumatic controllers, and electrification of select field operations.
I believe that it's also important to point out that these efforts are focused on changes that will not only improve our ESG metrics, but will also improve our overall operations.
By focusing on these operational wins, we further align our organizational focus and excitement around ESG improvement.
My comments today will be focused on the key drivers of our financial results in 2021, and also provide some insights into our 2022 outlook.
Beginning with production, our total volumes in the fourth quarter averaged 611,000 Boe per day, exceeding the midpoint of our guidance by 3%.
This production B was across all products, with the most significant outperformance coming from NGLs, where processing and economics were exceptionally strong during the quarter.
In the upcoming quarter, we expect production to approximate 570,000 Boes' per day.
We expect this to be our lowest production quarter of the year due to winter weather downtime that reduced volumes by about 15,000 Boe per day.
All winter-related curtailments are back online, and we expect no impact to our full-year production estimates.
Moving to expenses, our lease operating GP&T costs exceeded 2021 at a rate of $7.25 per barrel.
This result represents a 1%t decline compared to where we started the year, but with slightly elevated compared to our forecast.
As you might expect, we experienced moderate pricing pressures across several service and supply cost categories in the quarter, and we are also incurred a non-recurring charge to GP&T expense in the Eagle Ford.
Another key variance was higher work-over activity, which contributed to our strong production results in the quarter.
Overall, our exposure to higher-value production, coupled with the low-cost structure, expanded Devon's field level cash margin to $42.37 per barrel, a 14% increase from last quarter.
Jumping to corporate cost, we did a great job of improving this expense category in 2021.
In aggregate, G&A and financing costs declined 31% year over year on a pro forma basis due to lower personnel cost and the company's ongoing debt reduction program.
These structural improvements will carry over into 2022 and act as an ongoing annuity for years to come.
Cutting to the bottom line, Devon's core earnings increase for the sixth quarter in a row to a $1.39 per share.
This level of earnings momentum translated into operating cash flow of $1.6 billion in the fourth quarter.
after funding our disciplined maintenance capital program, we generated $1.1 billion of free cash flow in the quarter.
This represents growth in free cash flow of more than 400% compared to where we started the year after closing the WPX merger.
The top priority of our free cash flow is the funding of our dividend.
As Rick covered earlier, in conjunction with our earnings report, we announced a fixed plus variable dividend of $1 per share that is payable in March and includes the benefit of our 45% raise to the fixed dividend.
This payout represents the highest quarterly payout in Devon's history.
Another avenue that we're returning cash to shareholders through is the execution of our share repurchase program.
Since we initiated the program in November, we're off to a great start by repurchasing $14 million shares at a total cost of $589 million.
This equates to an average price of $42 per share, which is around a 25% discount to our current trading levels.
With the board expanding our share repurchase program to $1.6 billion, we now have roughly $1 billion remaining on this authorization, and we expect to continue to opportunistically buy back stock in 2022.
We also have returned value to shareholders through our efforts to reduce debt and improve the balance sheet.
In 2021, we made significant progress strengthening Devon's financial position by retiring more than $1.2 billion of outstanding notes, and we achieved our net debt to EBITDA target ahead of plan, exiting the year at less than a turn of leverage.
At today's pricing, we expect our leverage to trend even lower in 2022 pushing toward a zero net debt balance by year-end.
And lastly, I do want to highlight that our disciplined strategy is also resulting in excellent returns on capital employed.
In 2021, we achieved a 20% return on capital employed, and we are positioned for this measure to substantially increase in 2022.
The strong rate of change we are delivering with ROCE, combined with our cash return framework, further differentiates Devon versus other opportunities in the market today.
In summary, 2021 was a banner year for Devon.
We delivered on exactly everything we promised and then some.
Now, as we shift our focus to the upcoming year, I want to be clear that there is no change to our cash return playbook.
It will be more of the same.
We will be relentlessly focused on delivering high returns with capital employed, margin expansion, accelerating free cash flow growth, and returning excess cash to shareholders.
Our talented team here at Devon take great pride in leading the industry in this discipline operating framework, and when coupled with the development and deployment of two net of new technologies.
Simply put, we are very energized and ready to roll in 2022.
I sincerely hope you can now appreciate how we've delivered on the vision that Dave Hager and I, along with our respective teams, had when we announced our merger in September of 2020.
We wanted to create something truly special and we feel that we've done just that.
We'll now open the call to Q&A.
Please limit yourself to one question and a follow-up.
With that operator, we'll take our first question.

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qtrly adjusted core earnings per share $1.39.
devon’s total production averaged 611,000 oil-equivalent barrels (boe) per day in the fourth quarter.
production in q1 of 2022 is estimated to be reduced by 3 percent or 15,000 boe per day due to the impact of severe winter weather.
expects production to approximate 570,000 boe per day in the first quarter.

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