UPDATE 1-Devon restructures to cut costs, trimming jobs

* Cutting 1 pct of workforce

* Vaughn to head up new unit

HOUSTON, May 28 (Reuters) - Oil and gas company Devon Energy Corp (DVN.N: Quote, Profile, Research) said on Thursday it will eliminate 75 jobs as it consolidates its international and Gulf of Mexico divisions to reduce costs.

The new unit, located in Houston, will be renamed the offshore division.

"The decision to combine these two divisions will allow us to better pool our knowledge and resources in offshore exploration and development," said Dave Hager, executive vice president of exploration and production. "We continue to view our deepwater strategy as a means to enhance Devon's long-term growth opportunities."

Devon, the largest U.S. exploration and production company by market capitalization, has 5,500 workers and offshore operations in the Gulf and offshore Brazil and China.

Tony Vaughn, who was previously senior vice president of Devon's Gulf Division, will head up the new unit.

Shares of Devon climbed 3.4 percent, or $2.07, to to $62.36 on the New York Stock Exchange. That gain was in line with a 3.5 percent rise in the American Stock Exchange index of natural gas companies. (Reporting by Anna Driver, editing by Gerald E. McCormick)