Devon Energy Corp. is no longer considering spinning its gas gathering and processing holdings into an MLP, according to Larry Nichols, chairman and chief executive.

The company had planned to take the MLP public in third-quarter 2007 to pay off debt, but put the IPO on hiatus in November 2007. The company reported at the time that the IPO might be brought back, should market conditions improve. However, a company spokesperson says that the IPO is now off the table.

“We’re not considering forming an MLP anytime in the foreseeable future,” Nichols said at a Reuters program recently.

This withdrawal further underlines the dearth of MLP IPOs in 2008 following a banner 2007. Last month, two MLPs went public, which seemed to indicate an upswing in the soft market, but the two MLPs have delivered a mixed message as to how the market stands.

The midstream Western Gas Partners, which was spun off from Anadarko Petroleum Corp., priced its 18.8 million units between $17 and $19 each, but the MLP opened soft at $16.50 per unit and is currently trading at $16.37 each. As it was, the MLP was originally set to price at $20 to $22 per unit.

On the E&P side, Pioneer Natural Resources’ Pioneer Southwest Energy Partners MLP IPO has fared better. The MLP closed its first day trading at $19.65 per unit and was recently trading at $20.31.

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